may 4, 2011 - canada's oil sands - the reality
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Canada's Oil Sands - The Reality Presentation by David Collyer, CAPP President to Building Trades - 2011 Canadian Legislative Conference, OttawaTRANSCRIPT
Canada’s Oil Sands – The Reality Building Trades – 2011 Canadian Legislative Conference
Ottawa - May 4, 2011
Dave Collyer, President
The Global Energy Context
• Significant energy demand growth: Population, standards of
living
• Need all forms of energy: Increasing role for
renewables Continuing reliance on
hydrocarbons Increasing role for non-
conventional crude oil & natural gas
• Technology is a key lever for sustainable growth Production Cost competitiveness Environmental
performanceCurrent Policies Scenario
Global Primary Energy Demand
Global Crude Oil Reserves by Country
Source: Oil & Gas Journal Dec. 2010
25 20 1930
374660
92102
115
137
175
211
260
0
50
100
150
200
250
300
billio
n ba
rrel
s
Includes 1
70 billion barre
ls
of oil s
ands rese
rves
State owned78%
Accessible
Canada’sOil Sands
World OilReserves
OtherAccessibleReserves
52%
48%
Accessible
Oil Reserves
Oil Sands Deposits & Projects
In Situ ProjectsMining ProjectsIn Situ ProjectsMining Projects
Fort
McMurray
Cold Lake
Fort Hills
Horizon
Joslyn Creek
Syncrude
Suncor
Muskeg River
Albian
Dover
MacKay River
Firebag
Hangingstone
Long Lake
Surmont
Christina Lake
(ECA)
Foster
Creek
Wolf Lake/Primrose
Hilda Lake
Cold Lake
Tucker Lake
Jackfish
Kearl
Lake
Jackpine
Peace River
Peace River
Seal
Peace River
Peace River
Seal
Northern
Lights
White Sands
Oil Sands Production MethodsP
hoto
: Con
ocoP
hilli
ps -
Sur
mon
t
Schematic: Devon - Jackfish
Drilling (80% Resource, 97% Land)Mining (20% Resource, 3% Land)
W. Canadian Oil Sands & Conventional Oil Production Outlook
May 2010
2011 Oil Sands
Capital ~ $15B
Access to Current and New Oil Markets
Canadian & U.S. Crude Oil Pipeline Proposals
Canada’s Share of U.S. Imports – Crude Oil & Petroleum Products
0%
10%
20%
30%
40%
50%
60%
70%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
% Saudi Arabia% Mexico% Venezuela% Canada
Source: EIA Jan-Dec 2010 8
Asian Market Potential for Canadian Oil Sands Production
Prince Rupert/Kitimat
Los Angeles
Jose/La Cruz
3,840
ChinaPersian
Gulf
Japan
Taiwan
~ 8,600 N Miles
~ 4,500 N Miles
Prince Rupert/Kitimat
Jose/La Cruz
Los Angeles
Japan
Taiwan
Target Markets
~ 5,400 N Miles
1,400 N
Miles
Far East U.S West Coast
• •••
Japan
Taiwan
Korea
•
•
SantaCruz
• •
1,790
Competitive travel distances for Canadian supply to both markets
Source: Enbridge Pipelines
Canadian & U.S. Jobs & Economic Benefits
• Construction & operations Upstream Pipelines Upgraders & refineries
• Employment Direct & indirect
• Supply of goods and services• Royalties & taxes • CERI economic benefits study (Canada only over 25
years) Economic impact generated $1.7 trillion Employment 11.4 million person-years Federal & provincial tax $300 billion
Alaska
Hawaii
16 - 30Over 40
10 - 15Under 10
Incremental U.S. Employment from Canadian Oil Sands by State 2011-2025
Thousand Person-Years
11Source: Canadian Energy Research Institute – April 2011 Preliminary
78%
58%
65%
79%
78%
74%
20%
38%
31%
12%
4%
2%
4%
4%
9%
18%
9%17%
0% 20% 40% 60% 80% 100%
BQ
Green
NDP
Liberal
Conservative
Total
To develop the oil sands with an effort to limit the environmental impacts
To stop the development of the oil sands altogether
To focus on maximizing the full economic benefits of the oil sands resource
Best Goal for Oil Sands
Which is the best goal when it comes to the oil sands?
Reputation / Social License & Oil Sands
Industry Reputation / Social License =
Performance + Communications
• “3E” policy framework
• Robust regional planning:
System-wide metrics
Effective monitoring
Transparent data
3rd party validation
• World class regulation
• Technology & innovation
• Collaboration
• Proactive
• Transparent
• Verifiable
• Visible leadership
• Broad portfolio:
mainstream
social media
directly & via 3rd parties
Canada, U.S., Europe, Asia
ADVERTISING
EDUCATION – ENERGY LITERACY
Environmental & Social Performance
• People• Air• Water• Land
Guiding Principles for Oil Sands Development
Oil Sands Water Use & Quality
Mining
Currently use 0.5 per cent of the annual flow of the Athabasca river (1/3 of City of Toronto water use).
80-90% recycle.
Withdrawals restricted during low flow periods (on-site water storage).
“No impact on Athabasca water quality/ecosystem and no evidence of impact on human health in downstream communities” (Royal Society, 2010 report).
• Drillable (Insitu) 90-95% recycle. No water from Athabasca River. Shift to using non-potable (saline)
from sub-surface aquifers. New projects are using 100% saline
for steam.
North American GHG Emissions (2009): Coal-Fired Power and Oil Sands
15 megatonnes50 megatonnes
100 megatonnes
FL
GA
TX
NC
MI
AL
MO KY
IN OH
NE
NM
ND
CO
SC
KS
IA
TN
WV
WY
VA
MN
UT
OK
WI
AZ
AR
AK
LA
IL
NV
OR
MT
SD
NJ
NY
NH
MS
Legend
U.S. Coal fired power generating plants
Canadian coal-fired power generating plants
Canadian oil sands
Sources: U.S. DOE/EIA & Environment Canada
Reducing Greenhouse Gas Emissions
• Energy Efficiency Using less energy input Reducing energy waste/losses Capturing waste heat Cogeneration power/steam
• Improved recovery processes Lower temperature extraction Additives to reduce use of
both water and energy (steam)
Use of electricity rather than steam
Underground combustion rather than steam
• Carbon capture & sequestration Most effective at upgraders
Oil Sands GHG Emissions/bbl
39%
g c
o2
eq./
mj
1990 2008
Royal Society of Canada ReportEnvironmental & Health Impacts of Canada’s Oil Sands Industry
• Science-based, independent analysis of the environmental aspects of Canada’s oil sands
• Addresses many of the issues and perceptions of oil sands development: Reclamation is not keeping pace, but
sustainable reclamation is achievable Water use does not threaten viability of
the Athabasca River No impact on Athabasca water
quality/ecosystem and no evidence of impact on human health in downstream communities
Tailings technologies are emerging, but tailings inventory is growing
GHG emissions per barrel are reducing but growing production creates a challenge in meeting international commitments
Minimal impacts on regional air quality December 2010
2010 CAPP OIL SANDS CAMPAIGN
Advertising - Getting the Word OutJoy Romero – Canadian Natural Resources Limited
http://www.youtube.com/v/ShqPwDWAuYM
Advertising - Getting the Word OutSteve Gaudet – Syncrude Canada
http://www.youtube.com/v/iXtHFPGXjlY
2010 Oil Sands Dialogues
• 13 OS CEOs, 8 cities, 160 participants
• Strong Building Trades representation in Canada & U.S.
• Input exceeded expectations
• Comprehensive report – “What We Heard”, “Our Response”
• Strong industry support for labour mobility and training
“The Ask”
• Enable oil sands related projects in Canada & U.S.
• Encourage a North American approach to energy strategy, addressing security & reliability
• Encourage & support balanced policy & regulation: Labor mobility & training Open borders for trade Non-discriminatory policy toward Canadian oil sands supply
sources Avoid unnecessary regulatory “creep” Equitable approach to climate policy Technology development & deployment
• Assist in communicating a balanced, pragmatic, fact-based message regarding Canada’s oil sands
• Rebut myths & misrepresentations about oil sands
Oil Sands - #1 Employer of Building Trades in Canada
Jobs, Economic Growth & Responsible Environmental Social / Performance