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Enbridge CEO hopes for more carbon capture support in upcoming federal budget

The Canadian Press

The CEO of energy infrastructure giant Enbridge Inc. says he hopes the federal government will unveil more incentives for carbon capture and storage in the upcoming federal budget.

Greg Ebel says the U.S. is currently a more attractive place for companies seeking to invest in carbon capture technology.

He says the Inflation Reduction Act in the U.S. offers incentives that reduce the capital costs as well as on ongoing operating costs for carbon capture.

Canada's energy industry has identified carbon capture and storage as key to its plan to reduce greenhouse gas emissions.

Companies have proposed approximately 25 different projects aiming to capture carbon from Alberta's oil and gas sector.

Among these is Enbridge's Open Access Wabamun Carbon Hub to be located northwest of Edmonton.

Enbridge earmarks $3.3 billion for Gulf Coast storage plant, other projects

Amanda Stephenson, The Canadian Press

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A U.S. Gulf Coast gas storage facility and a stake in a company developing fuel from waste food are among a string of new investments announced by Canadian energy giant Enbridge Inc. on Wednesday.

At its annual investor day event, the Calgary-based company announced $3.3 billion in new investments it says will help Enbridge grow to meet increasing global demand for energy.

The new investments include a deal to acquire Tres Palacios Holdings LLC from Brookfield Infrastructure Partners and Crestwood Equity Partners LP for US$335 million. Tres Palacios is a natural gas storage facility in the U.S. Gulf Coast region, which has been a focus for Enbridge in the last several years.

The deal is expected to close in the second quarter of 2023.

Enbridge will also acquire a 10 per cent stake in Divert Inc., a food waste management company expanding into renewable natural gas, for US$80 million.

That agreement includes further investment opportunities to develop RNG projects across the U.S., Enbridge said, providing potentially more than $1 billion in new capital growth. 

And the company said it will go ahead with plans to build the Enbridge Houston Oil Terminal for an initial capital cost of $240 million. The facility will focus on heavy crude and will have access to the Houston region's refining complex and export opportunities through the Seaway docks at Freeport and Texas City.

On Wednesday, Enbridge reaffirmed its 2023 earnings guidance of $15.9-$16.5 billion, and also said it expects its earnings per share to grow at a compounded annual rate of between four and six per cent through 2025.

In his remarks to investors, CEO Greg Ebel said 2022 was an "inflection" point for Canada's energy industry as years of underinvestment coupled with Russia's invasion of Ukraine to drive unprecedented commodity price spikes.

He said Enbridge is well positioned to help "rebalance" the global energy system.

"The bottom line is we see plenty of executable growth across our business units and the existing asset base," Ebel said.

"We are excited about our growth opportunities in the short and medium term."

Ebel said as the energy transition takes hold, renewable energy will continue to grow and Enbridge continues to explore opportunities in new, low-carbon forms of energy such as renewable natural gas.

But he said natural gas and oil will remain critical parts of the energy mix for the foreseeable future. Natural gas, in particular, will be needed as a reliable backup given the intermittent nature of wind and solar power, he said.

Enbridge also announced on Wednesday $2.4 billion of new gas transmission modernization and utility spending to its secured capital program.

The company also said it will build a 14-kilometre natural gas pipeline in Ontario to help ArcelorMittal Dofasco's plan to change the way it makes steel.

Enbridge's medium-term growth expectations "appear reasonable," said RBC Dominion Securities analyst Robert Kwan in a note, adding the investor day updates Wednesday were consistent with the market's expectations.

This report by The Canadian Press was first published March 1, 2023.

Oil and gas investment in Canada to 

hit $40 billion in 2023, industry group 

says

The Canadian Pres

The Canadian Association of Petroleum Producers says it expects investment in oil and natural gas production in this country to hit $40 billion this year. 

The industry group says that's 11 per cent higher than last year and also surpasses pre-COVID-19 pandemic levels.

Upstream oil and natural gas investment in Canada reached a low of $22 billion in 2020, as prices collapsed due to the pandemic.

CAPP says conventional oil and natural gas capital investment for 2023 is forecast at $28.5 billion, while oilsands investment is expected to reach $11.5 billion.

CAPP says much of this year's increased spending will go towards maintenance and incremental growth projects, as well as managing inflationary pressures.

The lobby group says spending is also expected to go towards emission reduction technologies such as advancing the development of carbon capture utilization and storage (CCUS).

This report by The Canadian Press was first published March 1, 2023.

Varcoe: As Trudeau trades jabs with province, clock ticks on carbon capture projects worth billions

Both sides should sit down and hash out a new regime that activates billions of dollars in proposed CCUS projects

Author of the article:Chris Varcoe • Calgary Herald

Publishing date:Oct 20, 2022 

Canada's Prime Minister Justin Trudeau takes part 

in a climate change conference in Ottawa, Ontario, 

Canada October 18, 2022. Blair Gable/Reuters


Mr. Prime Minister, Alberta has a new premier and she doesn’t like your climate policies, “so what specifically are you doing to work with her government to address the emissions problem?”

This was the question from a Bloomberg News journalist to Justin Trudeau at a climate conference in Ottawa this week.

His response was a classic example of partisan deflection.

“It’s interesting because you see a position in which Conservative politicians in Canada are actually distancing themselves from the positions of the industries they’re supposed to protect. The oil and gas industry in Canada has made very strong declarations about needing to get to net-zero by 2050,” Trudeau told a Canadian Climate Institute conference.

“Listen, Alberta politicians will continue to say what they say. What Albertans are actually saying, what industry leaders are actually saying, is how do we manage this together?

“How do we get the pace right so we can decarbonize quickly, while still being there to provide the very real short-term energy needs.”

But don’t worry about Premier Danielle Smith. She’s been getting a few practice swings in on the energy file in her first couple of weeks on the job.

Premier Danielle Smith speaks at an Edmonton 

Chamber of Commerce luncheon on Thursday. Greg Southam/Postmedia

In her victory speech after becoming UCP leader, Smith vowed Alberta “will not have our resources landlocked or our energy phased out of existence by virtue-signalling prime ministers.”

At a news conference, Smith blasted Environment Minister Steven Guilbeault, saying “he’s done nothing but attack our industry,” and said Alberta will send its own delegation to the COP27 climate meeting next month.

“I’m not sure why we haven’t attended those in the past, but . . . with such a hostile environment minister in Steven Guilbeault, they would keep getting hit after hit after hit,” Smith told an Edmonton Chamber of Commerce event on Thursday.

“We cannot have our message on the world stage with Steven Guilbeault being our emissary on that.”

If the two sides want to do something constructive, here’s a novel idea: quickly find some common ground.

Both sides should sit down and hash out a new regime that activates billions of dollars in proposed investments in carbon capture, utilization and storage (CCUS) projects in short order.

Part of it should look for ways to speed up the regulatory process; they should also look at the financial side of the equation.

After taking an entire year to put together an investment tax credit for CCUS projects, the Trudeau government this spring finally offered up a 50-per-cent credit for spending on equipment that’s required to capture CO2


It also called on the provinces to step up.


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Alberta pointed to royalty offsets available within its existing oilsands royalty structure that provide incentives for major capital costs tied to such projects.

Meanwhile, the U.S. has waltzed past Canada, adopting an even bolder program than what Ottawa announced by passing its new Inflation Reduction Act this summer. It boosts the existing U.S. government tax credit for such projects to $85 for each tonne of stored CO2, a jump from $50.

On Wednesday, the Business Council of Canada sent a letter to Finance Minister Chrystia Freeland, noting she recently indicated the federal government would fast-track energy projects to assist Canada’s allies.

“For major projects to go ahead, however, investors need regulatory predictability,” states the letter from council CEO Goldy Hyder.

“Such a declaration should spell out in detail the kinds of projects the government is prepared to fast-track and . . . outline any incentives — financial or otherwise — which the government will put in place in response to those contained in the United States’ Inflation Reduction Act.”

Steven Guilbeault, minister of the Environment and Climate Change, attends a climate change conference in Ottawa on Tuesday. Blair Gable/Reuters

The future of decarbonizing Alberta’s energy industry through CCUS is waiting for such clarity.

The Pathways Alliance, compromising large oilsands producers such as Cenovus Energy and Suncor Energy, estimates the cost of its foundational carbon capture and storage hub at $16.5 billion by 2030 as it strives to reach net-zero emissions by 2050.

FORMER FEDERAL LIBERAL CABINET MINISTER

Suncor Energy’s chief climate officer Martha Hall Findlay, who announced this week she will retire at the end of November, said the alliance welcomes the federal credit and this month’s decision by Alberta to allocate the group pore space necessary for its planned CCUS hub.

However, it has done analysis on the gap between Canada’s incentives and the U.S. plan — and Ottawa knows it must do more to be competitive, said Hall Findlay, a former Liberal MP and past CEO of the Canada West Foundation.

“Even with our carbon pricing in Canada, the difference now between the environment in the United States and in Canada is still very big,” she said in an interview.

A number of other proposed decarbonization projects in Alberta are also in the wings, including Enbridge’s Wabamun Carbon Hub initiative with Capital Power and Lehigh Cement, and the Alberta Carbon Grid development, led by Pembina Pipeline and TC Energy.

“It is a pretty pivotal point in the dialogue,” said Michael Gullo, the business council’s vice-president of policy.

“This is go time.”

On the provincial front, little progress was made while the leadership race to replace Jason Kenney unfolded.

The ball now rests squarely in the court of Smith and her new cabinet, which will be announced Friday.

Federally, there have been signals Ottawa may respond to the new measures south of the border.

On Wednesday, Freeland also suggested the fall economic update could offer more clarity to closing the gap with the U.S.

For Hall Findlay, collaboration is the way to get things moving, noting the group will need to see investment from both the provincial government and Ottawa.

“The world is going to need what we produce for the next number of decades. So our view is what we are doing is, in fact, incredibly important to the prosperity of Alberta,” she added.

“All I can do right now is encourage Alberta and the federal government to come and join us at the table all together and really figure out how we can do this — not only for Alberta, but for Canada.”

Chris Varcoe is a Calgary Herald columnist.

Oilsands group pledges to spend $16.5B on carbon capture project by 2030

Amanda Stephenson, The Canadian Press

Canada's biggest oilsands companies say they will spend $16.5 billion before 2030 on a massive proposed carbon capture and storage facility that is the centrepiece of their net-zero-by-2050 pledge.

The Pathways Alliance, a consortium of the country's six largest oilsands companies, said Friday it will also spend an additional $7.6 billion on other emissions reductions projects, for a total of around $24.1 billion.

The announcement comes as Canada's oil and gas industry has been under fire from environmental groups who say not enough of the record profits being reaped this year due to sky-high oil prices are being funneled into decarbonization.

Last month, a report from environmental think-tank the Pembina Institute said Canada's oil and gas sector is estimated to earn a profit of $152 billion in 2022 due to the war in Ukraine and the resulting commodity price boom. The report criticized the industry for not moving faster to meet its climate commitments in light of its windfall profits.

Federal Environment Minister Steven Guilbeault has also said he wants to see more details from industry on what it is doing with its profits to achieve its emissions-reduction targets. 

"If they don't make those investments while they're making record-level profits, then when would it be a good time for them to make those investments?" Guilbeault said in a September interview. "If not now, then I don't know when.''

The Pathways Alliance has not yet made a final investment decision on the project, which would capture CO2 emissions from more than 20 oilsands facilities in northern Alberta and store them safely underground, delivering an estimated 10 million tonnes of emissions reductions per year.

But it says it has already completed pre-engineering work and is consulting with Indigenous communities along the route of the proposed 400-km pipeline that would carry captured CO2 to the storage hub. The group says it has also completed nine carbon capture feasibility studies involving member companies at oil sands sites.

Earlier this year, the federal government announced an investment tax credit for carbon capture and storage (CCS) that will enable companies to claim a tax credit of up to 60 per cent for direct air capture projects and 50 per cent for all other eligible carbon capture projects. A 37.5 per cent tax credit is available for investment in equipment for carbon transportation, storage and use.

But oilsands CEOs have said more government support will be necessary to make the building and operating of such expensive, cutting-edge technology economical.

“A CCS project of this size is a huge undertaking that requires significant up-front work and a strong partnership between industry and government to proceed,” said Kendall Dilling, president of Pathways Alliance, in a news release.

The industry has also said the government's overall targets for the oil and gas sector are unrealistic. While the Pathways Alliance has said it believes it can reduce greenhouse gas emissions from production by 22 million tonnes by 2030 — an approximate 30 per cent reduction from current levels — the federal government wants Canada's oilpatch to reduce by 42 per cent below 2019 levels. 

That would bring total emissions from the sector to 110 million tonnes by 2030, down from 191 million tonnes in 2019. They haven't been that low in more than three decades.

“We continue to work with the federal and Alberta governments to ensure Canada’s co-funding programs and regulatory environment for CCS are globally competitive and that emissions reduction targets for our industry are realistic and achievable," Dilling said Friday.

“In parallel, we’re progressing work to make sure we’re ready to make an investment decision and start building as soon as the necessary financial and regulatory conditions are in place.”

The Pathways Alliance is made up of member companies Canadian Natural Resources Ltd., Cenovus Energy Inc., ConocoPhillips Canada, Imperial Oil Ltd., MEG Energy Corp., and Suncor Energy Inc.

The group says it plans to apply for regulatory approval for its CO2 transportation line and storage network in late 2023. It says it could begin injecting carbon as early as 2026

SEE LA REVUE GAUCHE - Left Comment: Search results for CCS 

Chief ‘really happy’ to be at the table with Alberta on carbon capture projects


Mon, May 9, 2022

Getting the nod to further develop two separate carbon capture project proposals in Alberta is not too much for the First Nation Capital Investment Partnership (FNCIP), which comprises the First Nations of Enoch Cree, Paul, Alexander and Alexis Nakota Sioux.

“We can take on more, if anything,” said Enoch Cree Nation Chief Billy Morin. “They’re two completely different, separate applications and we’re lucky we got them both in round one, which we were kind of happily surprised.”

At the end of March, the Alberta government announced six potential projects had been selected in the first round of submissions to look at safely storing carbon from industrial emissions in hubs deep underground.

FNCIP is involved in the Open Access Wabamun Carbon Hub west of Edmonton and the Wolf Midstream project east of Edmonton.

The Wabamun Carbon Hub sees FNCIP joining with the Lac St. Anne Métis to partner with Enbridge Inc.

“We do have to walk with some humility and say we do need partners like Enbridge. We do need emitters like Capital Power, which has already signed up with Enbridge and Lehigh (Hanson Materials Limited). We need those industry partners for their expertise, but also to come to the table in a fair and equitable way, and that’s what Enbridge has done,” said Morin.

FNCIP and Lac St. Anne Métis have 50 per cent ownership in the Wabamun project.

In the Wolf Midstream project, which also involves Heart Lake First Nation and Calgary-based energy company Whitecap Resources Inc., FNCIP has 30 per cent ownership.

The Wolf Midstream sequestration hub will serve large facilities in the industrial heartland of Fort Saskatchewan. Initial hub volumes are expected to be between two to three million tonnes per annum with significant expansion capability to support current and future requirements of area businesses. If given the go-ahead, it is expected to be operational by the end of 2024.

Engaging First Nations as these projects get underway is an indication that the province has learned from its mistakes with oil and gas development, said Morin.

“In one way, shape or form I would say they got ahead of the game this time and learned from some of their historic mistakes in not engaging with us developing oil and gas over the last 80 years,” he said.

“This one is a brand-new industry and from the start we’re at the table, having ownership … (and) upholding treaty rights below the depth of the plow…So the government was really proactive … and I'm really happy they did that.”

Companies will be invited to work with government to further evaluate the suitability of each location. If the evaluation demonstrates that the proposed projects can provide permanent storage, companies can work with the government on an agreement that provides them with the right to inject captured carbon dioxide. This agreement will also ensure they will provide open access to all emitters and affordable use of the hub, reads a statement from Alberta Energy.

“It's round two, so we're talking about more regulatory development with the provincial government,” said Morin. “Now it's getting down into the details of ‘let's get a shovel in the ground’ and that is going to take a lot more engineering, technical capacity, community engagements, internally and externally from First Nations. (It’s) another year planning roughly.”

Morin said he sees FNCIP engaging with the Alberta Indigenous Opportunities Corporation once they have “structured a deal” with the province.

“It's not the only way we can raise capital, but certainly in Alberta that was exactly what this was designed for. (It) is to engage First Nations in new initiatives with industry in the province itself. Absolutely, we will be at the table with them early,” he said.

The AIOC, created in 2019, was initially set up to provide loan guarantees to natural resource projects. This past February, the mandate expanded to include investments in major agriculture, telecommunications and transportation projects. The AIOC can provide up to $1 billion in loan guarantees. To date, it has backstopped more than $160 million in Indigenous investments in natural resource projects, according to Alberta Indigenous Relations.

Alberta has committed $1.24 billion through 2025 to two commercial-scale carbon capture and storage projects. Both projects will help reduce the carbon dioxide emissions from the oil sands and fertilizer sectors and reduce greenhouse gas emissions by 2.76 million tonnes each year. This is equivalent to the yearly emissions of 600,000 vehicles.

A second request for full project proposals to provide carbon storage services to regions across the rest of the province just closed.

By Shari Narine, Local Journalism Initiative Reporter, Windspeaker.com

SEE LA REVUE GAUCHE - Left Comment: Search results for CCS  

THE REALITY IS THAT CCS IS NOT GREEN NOR CLEAN IT IS GOING TO BE USED TO FRACK OLD DRY WELLS SUCH AS IN THE BAKAN SHIELD IN SASKATCHEWAN
https://plawiuk.blogspot.com/2014/10/the-myth-of-carbon-capture-and-storage.html

Residents raise stink over proposed industrial feedlot near popular Alberta lake

By Dan Grummett Global News
Posted April 10, 2022

People who live near Pigeon Lake in central Alberta are concerned about a cattle operation expansion they say is being rushed through the approval process. Dan Grummett reports residents want more time to fight the plan, which they say has the potential to devastate local water ways.


A proposed industrial-sized livestock operation southwest of Edmonton is being met with pushback from residents concerned the project could jeopardize their property values and the local ecosystem.

Last month, some were notified of an application by livestock producer G & S Cattle Ltd., to construct a new confined feeding operation (CFO) that would hold up to 4,000 cattle just a few kilometres west of Pigeon Lake.

On April 6, community members rented a hall to gather and share concerns over the proposal, ranging from odour nuisances to potential for ground and surface water contamination.

“It’s very emotional for everybody. That’s probably why we got such a big turnout,” said Ed Buczny, who organized the gathering.

Concerned citizens rented Yeoford Community Hall, west of Pigeon Lake, to discuss concerns related to an application for a feedlot expansion in the area. Dan Grummett

The project would be located adjacent to an existing commercial feedlot of 1,500 cattle operated by the same applicant

There was a belief amongst those in attendance that the current feedlot was the source of water pollutants in the area, though Global News could not independently verify these claims.

“The biggest concern, probably for everybody in there, is the lake,” Buczny said. “For myself, it’s groundwater (and) it’s what my place is gonna be worth if they put it in — and the smell.”
Testing shows troubling contaminant levels: watershed association

The Pigeon Lake Watershed Association (PLWA) has been conducting testing in the area for years. The group said contaminants from manure produced by cattle seep into the soil and run off in creeks and streams which ultimately end up in Pigeon Lake.

PLWA executive director Catherine Peirce said recent sampling suggests phosphorus levels are 10 times higher than they were in 2013, the last time a major government study on Pigeon Lake was conducted.

Peirce worries if the new CFO is approved and built, the land will not be able to filter the extra nutrients.

“If we add more nutrients in the watershed, we will end up with algal blooms and that will affect the economy,” she said.

A map outlines the boundaries of a proposed CFO in Wetaskiwin County. It was contained in a 19-page statement of complaint submitted to the Natural Resources Conservation Board, which will decide whether to approve the project. Pigeon Lake Watershed Association

Pinpointing source of contamination can be ‘tricky,’ says expert

Pigeon Lake, a popular summer beach destination for Albertans, has been the subject of many blue-green algae public health warnings over the last decade. In July 2021, Alberta Health Services issued a warning for Pigeon Lake about “fecal bacteria” at a local beach.

The biggest concern is phosphorus, according to the Alberta Lake Management Society, which can be both external and internal.

READ MORE: Fecal bacteria leads to advisories at multiple Alberta lakes, including Wabamun and Pigeon

Trying to answer the source of external phosphorus can be tricky, executive director Bradley Peter said. He noted that the data that exists right now isn’t specific enough to pinpoint one source for the problem.

“The reality is we need to be thinking of cumulative impacts when we allow or don’t allow development to occur with any lake watershed,” Peter said.

“I think, at the end of the day, we know these developments are not going to improve water quality, so I can certainly understand the frustration of residents.”
County supports application, understands resident concerns

The County of Wetaskiwin has no jurisdiction over CFOs but is certainly hearing about resident frustration.

“We’ve been receiving numerous emails,” Reeve Josh Bishop said. “They’re from many stakeholders, residents, and other (village and municipal) councils among the lake.”

The county is in favour of the application being approved. Bishop said having a CFO in the area will improve provincial oversight and scrutiny. For example, the application must include a proposal for a catch basin where surface water from the cattle pens can drain.

“Being a CFO, (the applicant) will be required to adhere to all the restrictions put in place. Right now, they wouldn’t have too many of those,” Bishop said.

G & S Cattle owner Greg Thelan declined an interview request but provided a statement to Global News.

“We are currently applying for an expansion on our ranch. There seems to be a lot of concern but not a lot of questions, only statements,” the statement reads in part.

“…Our goal is to stay environmentally sustainable. The concerns of water contamination, and depleting water supply, and manure application are all more than covered by the (Natural Resource Conservation Board) NRCB.”

The NRCB is a regulatory body that operates at arm’s length from the provincial government and reports to the Ministry of Environment.

In 2021, the group received 161 applications for CFOs in Alberta. The NRCB said 107 were approved, 44 were withdrawn, three were denied and two were approved following a board review.

People frustrated by process

Only residents considered to be “directly impacted” were notified of the application on March 10. According to provincial legislation, the NRCB is only required to notify residents who live within 1.5 kilometres of the proposed project boundaries. The deadline for those residents to submit statements of complaint was April 7.

“Three weeks to respond to something of this magnitude is not enough,” said Gloria Booth, who has lived in the county for 14 years.

“This is just not morally or ethically correct.”

Buczny thinks the notification range is too limited.

“It’s not just the people within 1.5 kilometres. It’s all the people around the lake,” he said. “Businesses, cottage owners — everything. They should all be part of this process.”

An NRCB spokesperson said affected parties can request a review of the decision, even after approval.

There’s no timeline for a decision, but the NRCB said officers “strive to process applications within 65 workings days” from application completion.

Enbridge teams up with Alberta First Nations on carbon capture project

Capital Power’s Genesee Generating Station, located west of Edmonton. (Supplied)

Kerry McAthey
CTV News Edmonton
Feb. 4, 2022 

Enbridge has partnered with four Treaty Six Nations and the Lac Ste. Anne Métis Community to expand a proposed carbon capture and transportation project west of Edmonton.

In a Thursday announcement, Enbridge said the Open Access Wabamun Carbon Hub is being developed to both transport and store carbon, in support of recently announced carbon capture projects by Capital Power, Lehigh Cement, and others.

The Alexander First Nation, Alexis Nakota Sioux Nation, Enoch Cree Nation, and Paul First Nation recently formed the First Nation Capital Investment Partnership (FNCIP) to pursue ownership in major infrastructure projects. The partnership with Enbridge on the Hub is the FNCIP’s first such project.

“This path creates an opportunity to generate wealth, but more importantly it allows sustainable economic sovereignty for our communities,” said Chief George Arcand Jr. of Alexander First Nation in a release. “We’re looking forward to working with industry leaders who share our values of environmental stewardship and to collaborate with Enbridge on world-scale carbon transportation and storage infrastructure investments.”

The hub would transport carbon emissions like those from the Lehigh Cement plant in Edmonton by pipeline, to be stored by Enbridge. According to Enbridge, that project alone could capture up to 780,000 tonnes of carbon dioxide annually.

Combined, the emissions from Capital Power and Lehigh’s projects could avoid nearly four million tonnes of atmospheric carbon dioxide emissions.

Enbridge has applied to develop the open access hub through the province’s Request for Full Project Proposals process.

Enbridge and its partners haven't publicly said what the project will cost, except that it expects to invest "hundreds of millions of dollars."

The company said pending regulatory approvals, it could be up and running by 2025.

Alberta's investment in carbon capture technology not worth bang for buck, environmental group argues

Alex Antoneshyn
CTVNewsEdmonton.ca Digital Producer
Updated Jan. 21, 2022 


A new report accuses the oil-and-gas industry of greenwashing the impact of carbon capture and storage – also known as CCS – technology, pointing to an oil-processing complex in Alberta that emits more carbon than it buries in the ground.

The report by Global Witness argues CCS is a poor substitute for phasing out fossil fuels and an expensive undertaking that the governments of Alberta and Canada partly funded.

"We think this really isn't sustainable, it's not climate friendly, and it shows that governments across the world, not just in Canada, mustn't support fossil hydrogen," report author Dominic Eagleton told CTV News Edmonton. "They should boost more genuinely sustainable alternatives to fossil hydrogen, such as renewables."


Global Witness, a non-government organization based in the U.K., says its goal is to create a "more sustainable, just and equal planet."

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Hundreds of academics ask Freeland to scrap carbon capture tax credit

Alberta prioritizes oil sands' carbon storage hub, energy minister says

Eagleton, a senior campaigner with the group, compared the amount of emissions produced at Shell's Scotford Complex in Fort Saskatchewan, northeast of Edmonton, with the amount of carbon dioxide its CCS system – called Quest – removes. He says the site was chosen because of the data publicly available on it.

Global Witness found that between 2014 and 2019, Quest stored five million tonnes of carbon dioxide, or CO2. During the same period, it says the Scotford Complex produced in total 7.5 million tonnes of greenhouse gases, including methane. The data was pulled from reports submitted by Shell to the Alberta government, as well as data crunched by the Pembina Institute.

Eagleton calls the 2.5-million tonne difference a "wake-up call for the world."

Shell believes Quest hints at what is possible in the future.

'A DEMONSTRATION PROJECT'

Shell operates Quest on behalf of its partners mining oil sands in northern Alberta and refutes Global Witness' assertion it overpromised Quest's potential.

In addition to the CCS system, Scotford Complex consists of an upgrader that turns bitumen from those oil sands into lighter crude products, a refinery that makes fuels and other products from synthetic crude oil, and a chemical plant.

In order to upgrade bitumen, Shell makes hydrogen, producing carbon dioxide in the process.

Quest's job is to capture and liquefy CO2 before trapping it two kilometres below ground.

Quest has stored about six million tonnes of carbon in its six-and-a-half years – faster and cheaper than expected, according to the company. However, the system was never meant to capture more than one third of the Scotford upgrader's emissions, Shell maintains.

When Quest was built, it was touted as the world's first commercial-scale CCS facility at an oil sands operation. And, as one of the first facilities of its kind, Quest isn't able to capture and store as much carbon as is now possible – around 90 per cent, the industry estimates.

"We were there working with the government to really demonstrate Quest as a proof point that CCS does work. Not only in the capture in a brownfield site, but also the storage complex," Shell's national CCS lead Tim Wiwchar told CTV News Edmonton.

"We called it a demonstration project."

Shell is currently planning a CCS project at Scotford that would have a storage capacity of 300 million tonnes of carbon dioxide, or the above-90 per cent capture levels industry says current technology now allows.

The company is expected to decide to move forward or not with Polaris in late 2023.

'A FRACTION OF THOSE EMISSIONS'

Quest cost $1.35 billion, $845 million of which came from the provincial and federal governments. Some of the provincial dollars, contingent Quest's performance, continue to flow in.

And more dollars will flow to similar projects in the future.

Alberta wants to increase its CCS capacity and has incentivized proposals as part of a plan to capitalize on what is expected to become a $2.5-trillion global hydrogen market by 2030. Hydrogen's potential is premised on its nature to burn cleanly. When it is made alongside a carbon capture system, like at Shell Scotford Complex, it's known as blue hydrogen – and considered dirtier only than green hydrogen made with renewable energy.
Alberta prioritizes oil sands' carbon storage hub, energy minister says
Plans for $1.3B net-zero hydrogen plant underway in Alberta's capital region
Alberta hopes hydrogen becomes the next oil sands and 'generational wealth' creator
Alberta funding $131M in new emission reduction projects

But Eagleton says it is misleading for the fossil fuel industry to present hydrogen production and carbon capture as favourably as it does when CCS can't transform the oil-and-gas sector into a zero-emitting industry.

The senior campaigner at Global Witness found Quest only captured 48 per cent of carbon emissions produced by the Scotford complex – which he called "a fossil hydrogen plant," which Shell disputed – and 39 per cent of all greenhouse gas emissions.

"Trying to apply carbon capture systems to the rest of the world's fossil hydrogen plants could be a disaster for the climate because it might only capture a fraction of those emissions," Eagleton told CTV News Edmonton.

He also believes investing more in carbon-capture infrastructure is a bet in technology that hasn't yet proven itself, when compared to things like wind and solar power.

"It's these options that will take us to a safer climate and not more investment in fossil-fuel infrastructure, which is what fossil hydrogen will entail," Eagleton added.

"Given…that CCS is required in other industries that go beyond fossil fuels -- fertilizer, cement, chemicals, those are all going to be required into the future -- that again, this is a proof point using an oil and gas facility that CCS does work," Wiwchar responded.

"[Quest] has captured over six million tonnes of CO2. That's six million tonnes that would have been emitted from the upgrader…had we not built Quest."

Alberta's energy minister did not respond to CTV News Edmonton's request for comment.

With files from CTV News Edmonton's Touria Izri


Quest carbon capture and storage facility in Fort Saskatchewan Alta., on Nov. 6, 2015. (Jason Franson / THE CANADIAN PRESS)