Last November, two hundred countries–including Canada–came together and agreed to transition away from fossil fuels.
These countries committed to doing their part in trying to keep the Earth from overheating.
The Agreement signed at the latest World Climate Summit (COP28) signalled the “beginning of the end” of the fossil fuel era by laying the ground for a swift, just and equitable transition, underpinned by deep emissions cuts and scaled-up finance.”
Given that the oil sands are one of the most carbon pollution-intensive oil projects in the world, you’d think that production in the oil sands would begin slowing down.
But in Alberta, the opposite is happening.
Numerous companies involved in the oil sands sector are churning out more oil than ever.
Why?
That’s the billion-dollar question.
Who is Ramping Up Production?
Cenovus Energy Inc., a Calgary-based company with the majority of shareholders being Hong Kong and US-based, reported its second-highest quarterly production ever in the fourth quarter of 2023.
Cenovus’ increased output was primarily due to the creation of new well pads in its Foster Creek and Christina Lake oil sands well sites.
They expect a further increase in production as they bring on more new well pads in the next two to three years.
CEO Jon McKenzie expects total production in 2024 to exceed 2023 levels.
Imperial Oil Ltd, which is majority-owned by US Oil Giant ExxonMobil, and has a 69.6% ownership stake in the Canadian operation, also announced to its shareholders that its oil sands production surged. Their Kearl oil sands facility produced a record volume in the fourth quarter of 2023.
According to Oilsands Magazine, most oil sands operators saw increased production in 2023, with six facilities reporting record production.
Overall oil production in Alberta was up, with Oilsands Magazine reporting: “Including conventional oil, the province produced a record 4.19 million bbl/day in December, up 35,000 bbl/day from the previous month. This is the second consecutive monthly record high.”
Canada’s total predicted growth in oil production over the next two years is expected to exceed the total amount added over the last five years, according to a recent report by Deloitte Canada.
Why the Increase?
According to the National Observer, increased “output is part of an overall industry trend as Canadian oilsands producers ramp up output in preparation for the Trans Mountain pipeline expansion…”
We wonder if there is something else going on beyond Trans Mountain.
When the rest of the world slows oil production, Premier Smith hopes to double production in Alberta.
She’s been on the road promoting oil, particularly in the US, like a carnival barker selling ‘miracle elixirs’ – a lot of hype, but the so-called cure may actually be an addictive drug.
So far, her ‘miracle elixirs’ aren’t finding many buyers.
In contrast, the Premier has been treating the renewables industry like a mean old nun smacking the palms of fiesty youth with a ruler.
Potentially billions of dollars in investment have been forced into limbo, awaiting Smith’s decision on whether or not she will lift the ‘pause’ on approvals of renewables projects scheduled to end in February.
Is Smith doubling down on all of Alberta’s energy potential or just oil and gas?
Only time will tell whether Alberta joins the rest of the world in taking action to curb polluting fuels.
