Waiting to Launch, Third Quarter 2022 UpdateThe gap between Canadian oilsands companies’ climate pledges and actions

Publication - Nov. 10, 2022 - By Jan Gorski, Eyab Al-Aini

This report serves as a brief update to our September 2022 publication, Waiting to Launch: The gap between Canadian oilsands companies’ climate pledges and actions

Broad trends remain the same. While profits in Q3 were not as exceptionally high as in Q2 (due to slightly diminished global oil prices), 2022 remains on track to be a historic year for the oilsands companies in terms of revenues, profits and free cashflow. The rate at which these windfall profits are being returned to shareholders in share buybacks and dividend payments also remains extremely high. Meanwhile, despite some announcements in recent weeks from Pathways on the “advancement” of their emissions reduction plans, it remains the case that most details of these plans — including project specifics, timelines for projects, capital allocations, or timelines for final investment decisions — remain undisclosed. Conversely, one Pathways member, Suncor, has recently announced it will invest $1 billion to increase its share in the Fort Hills mining project — demonstrating that companies remain willing to invest in assets.

While much of the focus surrounding the Pathways Alliance has been on multi-year carbon capture projects and investments, other measures could be implemented much more quickly and with less capital investment. For example, there remains a significant opportunity for Pathways members that also operate conventional (non-oilsands) oil and gas assets to invest in proven, affordable methane reduction technology and projects to reduce emissions over and above current methane regulatory requirements. In doing so, they can make real, measurable emissions reductions across their entire portfolios. This is work that could be started today.

In the coming months, individual companies are expected to outline capital spending plans for 2023. It remains to be seen if details on decarbonization investments, as well as timelines for the expected absolute emissions reductions associated with those investments, will be disclosed.

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