Canada’s oil sands industry has taken a major leap toward greening their operations and their image. The 12 largest producers – accounting for 80% of oil sands production – have come together to form Canada’s Oil Sands Innovation Alliance, which has committed to accelerating the pace of environmental improvement, COSIA CEO Dan Wicklum told Breaking Energy recently.
Numerous environmental oversight organizations sprung up organically over time to ensure oil companies were honoring their commitment to the environment. While these ad hoc sustainability initiatives made positive strides, the public wanted more. As a result, COSIA was formed and the chief executives of each member company signed a charter on March 1st committing them to specific activities and behavior.
COSIA differs from other industry-led sustainability efforts in four distinct ways. The first is that each member company’s chief executive is beholden to the publicly-signed charter, and alliance’s chief Wicklum is in turn accountable to the 12 CEOs. Second, goals and performance are directly linked within a transparent, “line of sight” framework in which the companies set environmental performance targets and publicly report their progress. The third distinction is an open commitment to share innovation – including patents and similar intellectual property – among member companies.
Finally, the alliance is committed to reaching beyond traditional partnerships that typically include academics, industry participants and governmental groups, in its search for innovative solutions to the environmental challenges posed by oil sands development. According to Wicklum, the alliance is open to working with all relevant stakeholders, both within Canada and internationally.
Four Main Focus Areas
COSIA’s environmental focus areas are water, land, greenhouse gas emissions and tailings.
Individual organizations – like the Oil Sands Leadership Initiative (OSLI) and the Oil Sands Tailings Consortium (OSTC) – had previously been devoted to each of these areas, but COSIA brings them all under one roof and provides overarching leadership.
One example of an area where COSIA is looking to accelerate technical innovation is water management associated with steam assisted gravity drainage – an in-situ process where steam injection is used to create heat and pressure that separates oil from sand. SAGD is a water-intensive process and companies currently recycle as much water as possible. COSIA’s goal is to advance and accelerate SAGD water recycling initiatives.
Transparency as a Buffer
As a member-funded organization, COSIA’s operational budget is at the discretion of the 12 oil sands producers. As a result, the alliance could face future resource constraints during periods of shifting commodity price dynamics that negatively impact individual members or the industry as a whole.
Oil sands developers have endured boom and bust cycles throughout their history. And since these projects often require a higher breakeven price per barrel than many conventional oil development projects, these higher cost operations are often the first to be postponed or canceled when oil prices decrease significantly. Nevertheless, Wicklum said the CEOs are likely to honor the transparent public commitment made to the organization and its goals.
COSIA consists of the following 12 oil sands producers: BP Canada Energy Company, Canadian Natural Resources, Cenovus Energy, ConocoPhillips Canada Resources, Devon Canada, Imperial Oil, Nexen, Shell Canada Energy, Statoil Canada, Suncor Energy, Teck Resources, Total E&P Canada.