Canadian carbon tax impacts: carbon capture, utilization and storage (CCUS) & environmental, social and governance (ESG) reporting

August 17, 20216:30 AM BOE Report Staff

CANADA’S CLIMATE PLAN

As part of Canada’s plan to reduce emissions and combat climate change, the Pan-Canadian Framework on Clean Growth and Climate Change was developed to meet emission reduction targets, grow provincial economies, and adapt to climate challenges. According to the Government of Canada: “In 2018, the Greenhouse Gas Pollution Pricing Act came into effect, ensuring there is a price on carbon pollution across the country. A well-designed price on carbon pollution provides an incentive for climate action and clean innovation while protecting business competitiveness. It is efficient and cost effective because it allows businesses and households to decide for themselves how best to reduce the emissions that cause climate change.”

Canada has committed to reduce Greenhouse Gas (GHG) emissions by 30% from 2005 levels by 2030. GHG emissions from 1990 to 2019 by economic sector is summarized in Figure 1.

Figure 1: GHG emissions by economic sector, Canada, 1990 to 2019.

As it relates to the oil and gas sector, data from the Government of Canada suggests that GHG emissions from oil and gas production have gone up 23% between 2000 and 2019 (Figure 2), largely from increased oil sands production, particularly in-situ extraction.

Figure 2: Oil and gas sector GHG emissions, Canada, 1990 to 2019.

Over the last 4 years, there have been many changes and updates to the Canadian legislation at the federal and provincial levels, with Canada attempting to achieve emissions neutrality by 2050.

CANADIAN CARBON TAX IMPACT ON COMPLIANCE CREDIT GENERATION

Canada’s Climate Plan includes an Output-Based Pricing System (OBPS) on large industrial emitters and, more recently, the proposed Clean Fuel Regulation (CFR) on primary suppliers of fossil fuels.

Canada’s OBPS and proposed CFR will create an economic opportunity for developing technologies that reduce carbon intensity of liquid fossil fuels. In the oil and gas industry, CCUS is a considerable mitigation option that can be applied to reduce anthropogenic CO2 emissions that offsets other industries where emissions reductions are not cost-effectively achievable. Sequestered CO2 is compressed and transported to be used in enhanced oil recovery (EOR) projects, obtaining incremental oil recovery through an enhanced oil recovery scheme, or through direct injection into deep geological formations (saline aquifers or depleted oil and gas reservoirs). Revenue streams relate directly to CO2 emission reductions that are captured from the point source to the portion that is permanently stored within the geological formations.

These policies will establish and provide a financial incentive for companies to capture, utilize and/or store CO2 while aligning development with a reduction in Canada’s GHG emissions.

OUTPUT-BASED PRICING SYSTEM

According to the Government of Canada: “A price on carbon pollution is an essential part of Canada’s plan to fight climate change and grow the economy. It is one of the most efficient ways to reduce greenhouse gas emissions and stimulate investments in clean innovation. It creates incentives for individuals, households, and businesses to choose cleaner options.”

The Greenhouse Gas Pollution Pricing Act (GGPPA) establishes a carbon pollution pricing system — a regulatory trading system known as the Output-Based Pricing System (OBPS). It will allow for covered facilities who are below their emission limits to receive surplus credits. Those credits can be used as compliance units or sold to other facilities in the OBPS through a public registry. Under this legislation, permanently stored CO2 would be eligible to receive a credit market value of $50/tonne by 2022 and up to $170/tonne by 2030 under the recently proposed accelerated national OBPS.

MULTI-BILLION DOLLAR OBPS COMPLIANCE CREDIT OPPORTUNITY

Based on the details in Figure 2, even a marginal reduction in greenhouse gas (GHG) emissions from the oil and gas sector has a material compliance credit value potential that companies could achieve through CCUS strategies. This takes the form of reduced operating costs and/or additional revenue through the OBPS credit market. If companies can reduce the 2019 CO2 equivalent emissions of 191Mt by 10% (19.1Mt), a 2022 OBPS market price of $50/tonne equates to $955 million in compliance credits. At an accelerated 2030 OBPS market price of $170/tonne, the same 10% reduction equates to $3.2 billion in compliance credits.

In actuality, Canada has committed to reduce all GHGs by 30% from 2005 levels by 2030. Looking closely at the oil and gas sector in 2005, CO2 equivalent emission levels were approximately 160Mt. A 30% reduction in GHG from this level would lead to an emissions target of 112Mt for 2030, equating to a GHG reduction of 79Mt from 2019 levels. As shown in Figure 3 below, assuming the 79Mt will be reduced linearly over 10 years (7.9Mt/year) from 2021 to 2030, the potential compliance credit value generation could range from $3.9 billion to $8.2 billion under the current and proposed accelerated OBPS market prices, respectively.

Figure 3: Oil and gas sector greenhouse gas emission reductions from 2005 levels by 2030 and associated compliance credit generation.

PROPOSED CLEAN FUEL REGULATIONS

Another leg of Canada’s Climate Plan is the Clean Fuel Regulations (CFR). First proposed in late 2020, the CFR is complementary to the OBPS. According to the Government of Canada: “The goal of the Clean Fuel Standard is to significantly reduce pollution by making the fuels we use everyday cleaner over time. The Clean Fuel Standard will require liquid fuel suppliers to gradually reduce the carbon intensity of the fuels they produce and sell for use in Canada over time, leading to a decrease in the carbon intensity of our liquid fuels used in Canada by 2030.”

The proposed CFR is not yet resolved; however, regulations are expected to be finalized and published in the Canada Gazette, Part II by late 2021. This is another regulatory approach with the aim of reducing Canada’s greenhouse gas (GHG) emissions through increased use of lower-carbon fuel sources.

A new regulatory credit market for compliance credits will be established under the proposed CFR, where producers/importers who surpass the minimum clean fuel standard are rewarded with credits which may then be purchased by other producers/importers to achieve compliance. This regulation works by upping the carbon intensity reduction target every year between 2022 – 2030.29dk2902l

Canadian average lifecycle carbon intensity was defined by using a model developed by Environment and Climate Change Canada (ECCC). In 2016, the Canadian Government’s calculations indicated that GHG emission reductions will be achieved at a central estimated net societal cost of carbon (SCC) of $94/tonne. More recently published literature estimates the net SCC value in 2020 that ranges between $135 and $440/tonne.

Under the proposed CFR, primary suppliers of fossil fuels (including refineries, upgraders, and fuel importers) create or acquire compliance credits to satisfy their emissions reductions. Optionally, primary suppliers can pay into a compliance fund to acquire credits at a price of $350/tonne. Although, credits acquired from the compliance fund can only be used to satisfy a maximum of 10% of their annual reduction obligation. The CFR also considers a credit clearance mechanism (CCM) to assist the exchange of credits whereby a credit seller may pledge their available credits to be sold at or below a price ceiling of $300/tonne pursuant to the CCM.

Given that the CFR is not currently legislated and is not expected to be finalized until late 2021, the CFR compliance credit market value remains uncertain. However, the future market value will be directly correlated to the implementation of projects that generate or utilize these credits, CCUS included, and may mirror the OBPS value to some degree.

CANADIAN CARBON TAX IMPACTS TO RESERVES & ESG REPORTING

In practice, carbon taxes and compliance credits based on existing legislation ought to be included in all economic evaluations to understand the commercial impact on existing and future projects within the energy industry.

In a reserves evaluation report, carbon tax burdens are included as an operating cost ($/boe) within the economic cash flows and is quantified from the carbon taxes defined in the corporate and property lease operating statements. Carbon tax burdens will consider existing legislation surrounding the carbon market value through the OBPS scheme and incorporating the proposed accelerated OBPS and CRF compliance obligations when legislated. Carbon credits associated with approved CCUS projects are determined on a project phase basis, based on the emissions reductions from permanently storing CO2 within geological formations. This is summarized in a reserves report as a reduced operating cost or, in the case of excess compliance credits, as an “Other Income” stream within the economic cash flows related to a CCUS project.

In ESG reporting of emissions, both the Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB), the two most widely used frameworks for reporting, require reporting gross emissions before any offsets, credits, trades or any other mechanisms that have reduced or compensated for emissions.  A disclosure available in the GRI framework, 305-5, reduction of GHG emissions, requires GHG emissions reduced as a direct result of reduction initiatives, specifically calling for any reduction from carbon offsets to be reported separately.

Where carbon offsets and credits are often discussed in ESG reporting is in scenario analysis, as required for SASB reporting and as part of the recommendations from the Task Force on Climate-related Financial Disclosures (TCFD) reporting. SASB specifically requires reporting the sensitivity of hydrocarbon reserve levels to future price projection scenarios that account for a price on carbon emissions. The TCFD recommends undertaking scenario analysis as a method for developing strategic plans and positioning a company to address climate-related risks and opportunities. Companies, as part of their scenario analysis, may consider how they will address increases in carbon price through use of carbon credits and other programs.

For more information, visit our website: www.gljpc.com

GLJ Ltd. is a leading energy resource consulting firm. With comprehensive industry expertise and client-focused philosophy, GLJ provides technical excellence to a global client base. The company’s long-term record of success comes from an experienced team of professionals who have an absolute commitment to delivering high-quality results for their clients. For more information visit www.gljpc.com

WRITTEN BY SCOTT QUINELL, GLJ LTD.

Scott is a Senior Engineer at GLJ and has over fifteen years of experience in reserves evaluations and reservoir studies. He has extensive involvement in oil reservoirs and is one of the leading experts at GLJ in the evaluation of enhanced oil recovery (EOR) projects with a focus on Polymer and CO2 tertiary recovery schemes. More recently he has been involved in providing guidance to GLJ’s clients on the economic impact of carbon taxes and carbon market value surrounding carbon capture, utilization and storage (CCUS) projects in Canada.

FROM THE RIGHT
Opinion: Engine No. 1 is all talk, no strategy with Exxon Mobil

The tell: No specific recommendations on how Exxon should become a leader in profitable clean-energy production

GETTY IMAGES

Last Updated: Aug. 16, 2021 
By Henry N. Butler, and Bernard S. Sharfman

What does Engine No. 1’s recent proxy fight at Exxon Mobil have in common with the insane trading in GameStop and AMC common stock that occurred during the pandemic? The answer is that they all garnered lots of media attention but accomplished nothing.

Engine No. 1, a small hedge fund with less than $40 million worth of Exxon Mobil XOM, -1.17% common stock in hand, amazingly succeeded in getting three of its four nominated directors elected to Exxon’s board. Unfortunately, the hedge-fund activism of Engine No. 1, seeking to enhance shareholder value, reduce Exxon’s carbon emissions, and transition it into a global leader in profitable clean-energy production, was not able to provide specific recommendations on how Exxon Mobil was to accomplish these objectives.

For example, what precisely are the profitable clean-energy opportunities that Engine No. 1 would like to see Exxon Mobil invest in? Engine No. 1 did not provide an answer.

In sum, a lack of specificity indicated that it was not truly informed about the operations of Exxon Mobil or how to manage its long-term future.

Read: Here are the oil and gas companies whose methane emissions intensity is 6 times the national average (hint: it’s not the majors)

Confirmation that Engine No. 1’s activism was not expected to positively impact Exxon Mobil can be found in the lack of an associated upward movement in Exxon’s stock price. As observed by Hemang Desai, Shiva Rajgopal and Sorabh Tomar in June, whatever increase in the stock since Engine No. 1’s activism became public can be attributed to a rise in oil prices that have benefited all oil and gas companies.

However, even without specific recommendations or a positive market price reaction, Engine No. 1 was still able to win its proxy fight. How was it able to do this?

No doubt the timing was right. Exxon Mobil was floundering financially as a result of a high debt load, pandemic-reduced demand for its products, and low oil and gas prices. Yet at the time that Engine No. 1 began its proxy fight in earnest on March 15, Exxon was still a $250 billion company and recognized as one of those small number of top-performing companies, based on decades of capital appreciation and dividend payouts, that have allowed the stock market to significantly outperform U.S. Treasurys over time.

Exxon Mobil was floundering financially as a result of a high debt load, pandemic-reduced demand for its products, and low oil and gas prices

Engine No. 1 succeeded because it focused on gaining the support of the “Big 3” investment advisers to index and ESG funds — BlackRock BLK, -2.40%, Vanguard, and State Street Global Advisors. The Big 3 own approximately 21% of Exxon Mobil’s voting stock. However, that percentage significantly understates their voting power because they will likely vote all their shares while individual investors — those most likely to vote with management — won’t.

To garner the Big 3’s support, Engine No. 1 appealed to their desire to be perceived as investment advisers who are making a difference in mitigating climate change. Such a perception is necessary to attract “millennial” investors, the investor segment that will soon be the dominant investor type in mutual-fund and exchange-traded-fund investing.

So the Big 3 were under a lot of pressure to support Engine No. 1’s efforts or else they would be perceived as not walking the talk on climate change. Based on their voting, it appears that the marketing implications won out over the need to actually implement value-enhancing change at Exxon Mobil. BlackRock ended up supporting three Engine No. 1 director nominees, while Vanguard and State Street Global Investors each supported two.

An impediment to fighting climate change

Perhaps most importantly, Engine No. 1’s hedge-fund activism may be an impediment to the world’s ability to deal with climate change. As observed by Tariq Fancy, BlackRock’s former chief investment officer for sustainable investing, “one lesson COVID-19 has hammered home is that systemic problems—such as a global pandemic or climate change—require systemic solutions. Only governments have the wide-ranging powers, resources and responsibilities that need to be brought to bear on the problem.”

If so, then the Engine No. 1’s successful proxy fight may have caused significant harm to climate change mitigation efforts “by creating a societal placebo that delayed overdue government reforms,” he added. That is, the sustained focus on the proxy fight and the perception that Engine No. 1’s victory represents a victory in the fight against climate change may have reduced our sense of urgency to advocate for strong governmental actions that will have a real impact on mitigating climate change. Fancy, the former BlackRock executive, refers to this as a “deadly distraction.”

Engine No. 1’s activism resulted in Exxon needlessly spending significant resources on defending its director nominees and thereby distracting Exxon Mobil from engaging in its current strategy of focusing on the production of oil and gas, a strategy that Engine No. 1 could not adequately disprove as being the correct one.

Yes, Exxon’s current strategy may result in the company stranding oil and gas assets or the company eventually losing its independent existence if the road to decarbonization speeds up, but until proven otherwise, perhaps a different hedge-fund activist that is more informed will serve that role, its strategy cannot be discounted as the one that will maximize the value of the company’s stock.

Henry N. Butler is executive director of the Law & Economics Center at George Mason University’s Antonin Scalia Law School. Bernard Sharfman is a research fellow at the Law & Economics Center and a senior corporate governance fellow of RealClearFoundation.

 

Why Norwegians Love Both EVs and Oil

By Charles Kennedy - Aug 16, 2021, 

Most Norwegians support their country’s current commitment to continue to search for oil and gas, even though Norway has the highest electric vehicle (EV) penetration anywhere in the world.

Norway is set to hold a parliamentary election on September 13, a few months after the current government of a conservative-led coalition said in June that the Norwegian oil and gas sector will continue to play a major role in long-term job creation, economic growth prospects, and value for the country.

A recent poll of Norstat carried out for Norwegian Broadcasting (NRK) showed on Monday that 55 percent of respondents wanted Norway to continue oil exploration, while 32 percent were against it.

The survey was carried out after the Intergovernmental Panel on Climate Change (IPCC) published on August 9 a report warning that the goal of limiting global warming to 2 degrees Celsius above pre-industrial levels will be beyond reach unless the world makes immediate, rapid, and large-scale reductions in greenhouse gas emissions.

Related: Islamic State Attacks Iraqi Oil Field

According to the latest election polls, the current government coalition in Norway will not be re-elected, Bloomberg notes.

However, a leftist and climate-conscious coalition would face challenges to change the current pro-oil government policy, not least because Norway is one of Europe’s richest countries thanks to the decades of oil revenues amassed in the world’s largest sovereign wealth fund with US$1.3 trillion in assets and holdings of 1.4 percent of all of the world’s listed companies. 

Norway doesn’t have any second thoughts about oil exploration and investment in light of the International Energy Agency’s (IEA) report suggesting that no new fossil fuel exploration would be needed for a net-zero world.

Western Europe’s biggest oil and gas producer is doubling down on oil development and continues to consider oil exploration and production a critical part of its economy and income for the state.

Bu Charles Kennedy for Oilprice.com

IKEA is now selling clean energy to Swedish households (no Allen key needed)

Michelle Lewis
- Aug. 17th 2021 


STRÖMMA is a locality in Stockholm County, Sweden. And it’s also the name Swedish furniture and home goods giant IKEA has given to its new clean energy retail service from next month in its home country.

IKEA’s clean energy – STRÖMMA

IKEA shoppers in Sweden will be able to not only buy everything from lights to appliances in one gargantuan blue building, they can also, from September, buy the clean energy from IKEA to power those items.

IKEA calls STRÖMMA an “electricity subscription,” and says it’s good for the planet and customers’ wallets.

IKEA products are named after a Swedish word based on the type of product. So, for example, fabrics are given female names, and bed and bath products are given flower and plant names. Perhaps further clean energy offerings will also be named after locations in Sweden.

The company explains in an announcement today:

The electricity from fossil fuels used at home has an impact on both our health and our planet. One simple action we can all take is switching to more renewable energy at home. IKEA offers more sustainable solutions that can be integrated seamlessly into our everyday lives. In addition to STRÖMMA in Sweden, IKEA offers solar panels to customers in 11 markets, with the ambition to enable customers in all our Ingka Group markets to use and generate more renewable energy through our energy services by 2025.

Through the STRÖMMA offer in Sweden, customers can buy affordable, certified electricity from solar and wind, and use an app to track their own electricity usage. Customers who have already bought solar panels from IKEA can also track their own production in the app and sell back the electricity they don’t use themselves.

Bojan Stupar, sales manager at IKEA Sweden, says:

IKEA is a home furnishing company, and we want to make it easier for more people to live a more sustainable life at home. Today we offer smart and energy efficient products and services that contribute to prolonging the life of products, reducing waste, saving water, and eating more healthily, as well as reducing electricity usage. Providing solar and wind power at a low price to more people feels like the natural next step on our sustainability journey.

The company plans on rolling out the offering to all of its global markets, and intends to source energy from wind and solar farms that are less than five years old to encourage the building of more of them.
Electrek’s Take

Talk about a turn (Allen) key solution. Reuters reports that Svea Solar, which is a partner of IKEA’s parent company Ingka and produces solar panels for IKEA, will buy the electricity on the Nordic power exchange Nord Pool and resell it without a surcharge. Consumers will pay a fixed monthly fee plus a variable rate. Combine that with IKEA’s smart lighting, and voila!



As a fun aside, we also wonder whether the STRÖMMA app features the cartoon “IKEA man”? If it doesn’t, then the instructions to sign up surely must.

Thanks to Marcus Johannson in Sweden!

Read more:
IKEA’s NYC delivery trucks will be fully electric by May 2021
IKEA put 1 million solar panels on 370 of its buildings in 2019

UK can’t fight climate crisis with austerity, warns expert

Author of government study says Treasury resistance to green spending programmes could halt progress to net zero

Nicholas Stern: ‘We mustn’t make the mistake we made a dozen years ago with premature austerity.’ Photograph: David Levenson/Getty Images


Michael Savage
Sat 14 Aug 2021

Imposing “premature austerity” again will undermine the fight against climate change and stop poorer households going green, one of the world’s leading climate economists has warned the government, amid claims that the Treasury is resisting policies to tackle the crisis.

Nicholas Stern, the author of the seminal 2006 government study into the costs of climate change, said comprehensive programmes were needed to help poorer households make the switch to electric cars and away from gas heating, if the government hoped to bring all greenhouse gas emissions to net zero by 2050.

In an interview with the Observer, he joined other prominent figures in calling on Boris Johnson and chancellor Rishi Sunak to invest in the technology needed and adopt policies such as subsidised loans to help all households make the switch.

“It’s going to need determination, some resources and smart design to solve these problems,” he said. “These things have to be made easy for people. Growth has to be driven by innovative investment. And we mustn’t make the mistake that we made a dozen years ago with premature austerity.

“It’s about helping people make the change. You’ve got to have a credible plan to help people with the replacement of boilers, when there are real costs, particularly for the poorest.”

It comes after claims from inside and outside government that the Treasury is resisting expensive programmes to tackle climate change in the run-up to the Cop26 climate summit, such as so-called “green cheques” to help people switch from gas. A string of policies, from home insulation to new infrastructure spending, have been scrapped, watered down or delayed. No 10 is now said to be pushing a bigger scrappage scheme for gas boilers.

On Saturday night, Keir Starmer, the Labour leader, pledged to work with the government on matters of “national and international interest” and back an ambitious plan to tackle climate change. However, he warned that the government’s track record and current plans fell short and that Boris Johnson was failing to convince his party of the urgent need for action.

“The Labour party I lead will always engage with the prime minister on issues of national and international interest,” Starmer said. “We face a climate emergency and the prime minister needs to grasp the opportunity Cop26 presents – and convince his own MPs to do the same.

“The UK needs to lead at home to enable leadership abroad. So far the Tories are falling woefully short of meeting this moment. The government’s greenwashing and delay risks fatally undermining the UK’s credibility as hosts of Cop26 and our ability to build trust and turn up the pressure on major emitters.”

Johnson last week set out his plan to make “coal, cars, cash and trees” the focus of the Glasgow summit. But Labour criticised the government’s record on each count. It attacked the refusal to block the Cambo oil field project in the North Sea, its cut to electric car subsidies, the reduction of aid to help poorer nations deal with climate change and its failure to meet tree-planting targets.

Stern’s plea for investment was echoed by other senior figures including John Gummer, the former Tory cabinet minister who now chairs the climate change committee that advises the government. “We have so far been very bad at dealing with helping people with the transition,” he said. “What we need to have is an honest national conversation, based upon the principle that we’ve actually got to achieve this. There isn’t an alternative. The price is something that society as a whole can afford. The issue is, how do you protect the vulnerable?


Calls for G7 spending restraint misguided, warns Lord Stern


“One of the issues that the Treasury has to recognise is that the longer it leaves this gap, the longer it gives people who want to make mischief an opportunity to say how very expensive everything is all going to be, and how everybody’s going to be in a terrible state. You mustn’t leave a gap, you’ve actually got to go in and say, these are the possibilities that we could do. We’ve had that vacuum over the past three or four months.”

Sir John Armitt, chair of the National Infrastructure Commission, also called for investment. “We’ve got to find ways in which this can be made affordable,” he said. “This has got to be something which we all, as citizens, can actually live with and recognise we’re going to have to pay for because we pay for it one way or the other – whether we pay through a government subsidy, or whether we pay through the meter.”

The government said £12bn had already been allocated for the prime minister’s 10-point plan for a green industrial revolution, “including billions to decarbonise our homes and vehicles – and a commitment to ensuring that the costs of the transition to net zero are fair and affordable”.

“We are already investing £1.3bn into helping make the homes of low-income families more energy efficient and cheaper to heat, and affordability and fairness will be at the heart of our comprehensive Net Zero Strategy that we’ll publish ahead of Cop26,” they said.

Opinion: Western Canadians are ready for a new economic era

Merran Smith is the executive director and Trevor Melanson is the communications director of Clean Energy Canada, a program at Simon Fraser University’s Centre for

Dialogue.

Author of the article: Calgary Herald
Publishing date: Aug 16, 2021 • 

With an abundance of wind, solar and other power sources, Alberta is set to lead job creation in the energy transition economy, say columnists. The Associated Press file

You’ve probably already heard that the village of Lytton, B.C., broke Canada’s all-time temperature record not once but three days in a row earlier this summer, culminating to an unbelievable 49.6 C before tragically burning to the ground.

What you may have missed: the unprecedented heat dome, which subsequently drifted eastward through the Prairies, was 150 times more likely because of human-caused climate change. For comparison, the Fort McMurray fire of 2016 was up to six times more likely as a result of global warming.

This year’s heatwave could hardly have been more symbolic, and yet it’s joined by a number of other significant recent events that together are imploring Western Canadians to look in the mirror and reassess their climate resilience and, along with it, their economic future.

Climate change threatens many important industries. While a decline in fossil fuel use is well-documented, crops will increasingly be impacted as well, by droughts or unexpected snowstorms. Indeed, climate change is already driving up food prices.

In short, climate change is no longer a distant threat. It’s now our lived reality.

Reality is changing in other ways too.

In the wake of COVID-19, countries around the globe are rebuilding their economies with purpose and climate change top of mind. Likewise, automakers are electrifying their most popular models, including their most popular trucks (even Premier Jason Kenney’s Ram 1500 will soon have an electric version).

There’s no pretending that things aren’t changing, nor is there any denying that global demand for what we produce here in Canada must change with it.

Western Canada has often been oversimplified as cowboys on the Prairies and hippies on the Left Coast, much to the annoyance of the 12 million people who actually live there and know better.

What Western Canada actually has in common is its entrepreneurial spirit.

Looking forward, Canada’s clean energy sector will add 210,000 jobs by 2030, many of them on this side of the country. According to recent modelling from Clean Energy Canada and Navius Research, Alberta will experience the biggest jump of any province: a 164 per cent increase in clean energy jobs over the next decade. In second, third and fourth place for fastest expected job growth: Saskatchewan, B.C. and Manitoba, respectively.

Given the diverse nature of the clean energy sector, growth will take different forms in different provinces. As Alberta updates its fossil-fuel-heavy electricity grid, the province is on track to see a surge in wind power jobs. Clean hydrogen and geothermal also represent opportunities for Alberta. The recent announcement of a $1.3-billion hydrogen facility in Edmonton is but one example that opportunity is rapidly becoming reality.

Additionally, as Alberta’s electricity grid (which is phasing out coal power way ahead of schedule) grows cleaner, so too will the many industries powered by it, giving them a competitive low-carbon advantage as our largest trading partners — the U.S. and the EU — eye carbon tariffs on future imports.

Luckily, Alberta isn’t just rich in oil; the province is generously endowed with renewable energy, with perhaps the best wind and solar resources in the country. It was Alberta wind power that yielded the lowest-ever rate for electricity in Canada, while the province’s solar power potential is roughly on par with Florida’s.

Job seekers are taking note. In a recent poll, seven in 10 Canadian fossil fuel workers said they’re interested in careers in the clean economy.

Western Canadians are looking to the horizon and wanting change.

The alternative — towns burning, streets flooding, missing out on the economic opportunity of a generation — is hardly an appealing proposition.

That’s especially true for a region that already possesses the right skills, the renewable resources, and the good old-fashioned tenacity to push forward.

Foreign ship stranded without refuelling options due to Rio Tinto Kitimat strike


The cargo vessel Indiana is docked in Kitimat but can’t be refueled because of the ongoing Rio Tinto aluminum smelter strike. (Ameblo.jp photo)

As captain calls for kindness, fuel suppliers afraid to cross union picket lines

BINNY PAUL
Aug. 16, 2021 2:00 p.m.

As the Kitimat aluminum smelter strike enters its fourth week, the captain of a Norwegian cargo ship trapped at a dock since July is calling on the the union and Rio Tinto to let it be refuelled.

The master of MV Indiana, berthed at Rio Tinto’s Terminal B wharf since July 17 in anticipation of loading up with aluminum, says the ship will run out of Emission Control Area (ECA) compliant low sulphur marine fuel if not refuelled by the end of the month.

“We ask for your kindness to allow us to replenish fuel in this berth,” said Capt. Roman Vicente Fudolig in a statement sent to Rio Tinto and Unifor Local 2301 on Aug. 15

Federal regulations state that any vessel docked in Canadian waters can only be refuelled with low sulphur marine fuel. The vessel does have high sulphur fuel onboard but switching to it would be in violation of other federal and International Maritime Organization mandates. MV Indiana has requested 100- 170 metric tonnes of low sulphur fuel.

Arbutus Point Marine Ltd. – the sole supplier of low sulphur marine gas oil to foreign flag ships on Canada’s Pacific coast – said their subcontractor, Northwest Fuels, is refusing to cross picket lines fearing social media defamation.

“MV Indiana is the unwitting victim of the Rio Tinto strike in Kitimat,” said Marc Gawthrop, managing director of Arbutus Point Marine.

Contractors fear that people on the picket line will take photographs of the fuel trucks and post them on social media, causing local repercussions for Northwest Fuels employees.

In July after the strike commenced, videos of contractors being heckled by union workers outside the smelter surfaced on social media.

Contractors remarked that getting through the picket line without being heckled by the union workers outside of the smelter was difficult, as videos surfaced on Facebook of an integrated fire and security company Tyco being yelled at and called “scabs” by multiple Unifor members as they drove through the picket lines.

READ MORE: BC Labour Relations Board lay down the law during labour dispute

“Compromising the safety and security of the crew members on board MV Indiana is not advancing their cause,” said Gawthrop and added that his calls and emails to both Unifor Local 2301 and Rio Tinto remain unanswered.

The foreign crew can’t disembark because of ongoing COVID-19 restrictions and the ship cannot be taken out of its berth because tug boat operators won’t cross picket lines either.

Northwest Fuels declined to comment on the situation citing confidentiality reasons with regards to information on customer deliveries.

While most vessels that arrive at the docks in Kitimat usually have enough fuel to turn back after collecting cargo, MV Indiana encountered a delay as the cargo delivery from the aluminum smelter was affected by the strike which began on July 25.

The strike between Rio Tinto and its approximately 900 unionized employees represented by Unifor Local 2301 began after negotiations for a collective agreement fell through and the aluminum giant refused to come back to the table.

While top officials from Rio Tinto and Unifor 2301 president met last week (Aug. 12) in Kitimat to determine if negotiations can be renewed, there have been no updates as to whether negotiations will resume again.

According to Gawthrop there are only three truck-accessible places on the north coast of B.C. for foreign flag ships to refuel – Stewart World Port and two Rio Tinto wharves in Kitimat. Heading to Stewart World Port is not a cost efficient option at this point, said Gawthrop estimating anywhere above $30,000 to take that vessel off the berth to Stewart for fuel, and back.

“Denying fuel to the International Transport Federation (ITF) crew members on board a foreign flag ship in Canada does not advance any labour interests for Unifor and posting photographs of contractors on social media to smear them is also a direct threat to the comfort and security of the ITF workers on board the Motor Vessel Indiana,” said Gawthrop.

In an email statement MV Indiana’s owners – shipping company Saga Welco headquartered in Norway – said their vessel Indiana made a scheduled port call for cargo loading operations in Kitimat and is an “innocent party” to the negotiations.

“We look forward to a quick and amicable resolution so the vessel can complete cargo loading,” said Saga Welco.

BHP moving ahead with Jansen potash mine in Saskatchewan

By David Giles Global News
Posted August 17, 2021

The long-delayed Jansen potash project, located about 140 kilometres east of Saskatoon, is expected to produce about 4.35 million tonnes of potash per year. 

BHP Group is going ahead with its oft-delayed Jansen potash project in Saskatchewan.


The Australian mining giant announced Tuesday morning that it has approved $7.5 billion in capital expenditures for the project approximately 140 kilometres east of Saskatoon.

“This is an important milestone for BHP and an investment in a new commodity that we believe will create value for shareholders for generations,” BHP chief executive Mike Henry said in a statement.

“In addition to its merits as a stand-alone project, Jansen also brings with it a series of high returning growth options in an attractive investment jurisdiction.”


READ MORE: BHP sets 2021 timeline for Jansen, Sask. potash mine investment decision

Saskatchewan Premier Scott Moe said this is the single-largest economic investment a company has ever made in the province’s history.

“BHP’s decision highlights the strength of our potash resource and will undoubtedly help build a strong economy for Saskatchewan,” Moe said in a statement.

“We are thrilled to see this landmark potash mine move ahead. This project paves the way to create thousands of good-paying jobs for the people of this province.”

Construction is expected to take six years, with the first ore targeted for 2027.

BHP said the mine is expected to produce 4.35 million tonnes of potash yearly with the potential for future expansion.

Henry said Jansen is located in the world’s best potash basin and opens a new front for the company to grow.

He predicted operations at the mine will last for 100 years.

“Jansen will deliver healthy returns as a high-margin, expandable resource which can support a century or more of operations,” Henry said.

“Potash provides BHP with greater diversification by commodity, country, and customer. This is a new and exciting chapter in BHP’s history.”


READ MORE: BHP delays decision on Jansen potash mine

Economic spinoffs

BHP said the project will create 3,500 jobs at its peak construction and 600 jobs in ongoing operations.

The company said its workforce will be gender-balanced and Indigenous employees will make up 20 per cent of the labor force.

BHP said there will be economic opportunities for local and Indigenous companies.

It has signed opportunity agreements with six First Nations around the Jansen site.

Energy and Resources Minister Bronwyn Eyre said the news of the project shows the investment climate is strong in Saskatchewan.

“The positive economic impact of this decision for our province cannot be overstated,” she said.

“The Jansen Mine will generate tens of billions of dollars in taxes and royalties and create thousands of quality jobs for the people of Saskatchewan.”

BHP also said it has signed a deal with Westshore Terminals in Delta, B.C., to handle the potash that will be shipped to export markets.

   

Analyst says Jansen mine catalyst for ‘Saskaboom 2.0’

Saskatoon / 650 CKOM

Brent Bosker

Aug 17, 2021 | 12:57 PM

The BHP Jansen potash mine, located about 140 kilometres east of Saskatoon. (Supplied)

A Saskatchewan business analyst says the province will see the economic spinoffs of a new potash mine for years to come.

BHP announced Tuesday it will bring its long-delayed Jansen potash project into production. The $7.5 billion capital investment includes the construction of an underground mine, processing facility and rail infrastructure.

“It adds to the value or worth of the province,” said business commentator Paul Martin.

“Once you build a mine you can’t unbuild a mine. Saskatchewan will be forever changed by this.”

The ripple effects, Martin says will be felt for a long time with new jobs, investment at the community level and new royalty revenue for the provincial government.

BHP has spent billions already on the project that has been touted as the largest potash mine in the world, with annual production of 4.35 million tonnes.

Martin believes there’s room for another mine despite the potash industry just going through a major expansion.

“Global populations are growing; demand for food and fertilizer as a consequence is growing. By the time this (mine) comes on stream the demand should have caught up to all the growth (Saskatchewan) did in the last 10 years and it should not over-saturate the market. It should be just in time, is what (BHP) is betting on,” said Martin.

According to Martin, global commodity markets are in the early stages of a resurgence and the Jansen mine will help the province capitalize on that growth.

“Saskatchewan’s economy is taking off right now and it’s being pushed by investment capital,” he said.

“Saskatchewan is back into Sashays and Sashays 2.0.”

Global firm bets billions on Sask. potash mine

CTV News SaskatoonStaff
Published Tuesday, August 17, 2021


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WATCH: CTV Saskatoon’s Pat McKay gets reaction to the largest investment in Saskatchewan’s history.

SASKATOON -- BHP has announced it will pour billions of dollars into a potash mine southeast of Saskatoon.

On Tuesday, the Australian firm said it has approved $7.5 billion in spending for its Jansen potash mine.

The mine has been in the works for a decade but a sluggish potash market had stalled the project.

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"This is an important milestone for BHP and an investment in a new commodity that we believe will create value for shareholders for generations," the firm's CEO Mike Henry said in a news release.

The Jansen Stage 1 project is expected to produce 4.5 million tonnes of potash a year, according to the company.

The community of Jansen is located roughly 150 kilometres from Saskatoon.

Premier Scott Moe was beaming during a news conference held in Regina Tuesday morning.

"While we were all sleeping last night one of the largest mining companies in the world approved one of the largest projects in their history, " Moe said, desribing the project as the "largest private economic investment" in Saskatchewan history.

"It certainly isn't every day in Saskatchewan or anywhere else where we have the opportunity to announce a new mine in the province, certainly not one the size and scope of what we are announcing here today," Moe said.

The province estimates the project will create around 3,500 jobs annually during construction and and provide direct employment for 600 workers once it is up and running.

Construction is expected to take six years, followed by a two-year "ramp-up" period.

The mine could operate for up to a century, according to BHP.

According to the company, it has already epent over $5.6 billion on the project over the years, describing the cost as a "significant initial outlay."

The firm said its approach would be different if considering the project again today.

As it shared news of its multi-billion dollar bet on the Saskatchewan mine, the firm also announced it would spin off its petroleum business.

"Our petroleum and Jansen decisions will increase the weighting of BHP’s remaining portfolio towards the future facing commodities that are most positively leveraged towards population growth, rising living standards, electrification and decarbonisation," Henry said in a note to shareholders.

 

Fizzing sodium could explain asteroid Phaethon's cometlike activity

by Jet Propulsion Laboratory

This illustration depicts asteroid Phaethon being heated by the Sun. The asteroid’s 

surface gets so hot that sodium inside Phaethon’s rock may vaporize and vent into

 space, causing it to brighten like a comet and dislodge small pieces of rocky debris. 

Credit: NASA/JPL-Caltech/IPAC

Models and lab tests suggest the asteroid could be venting sodium vapor as it orbits close to the Sun, explaining its increase in brightness.

As a comet zooms through the inner solar system, the Sun heats it, causing ices below the surface to vaporize into space. The venting vapor dislodges dust and rock, and the gas creates a bright tail that can extend millions of miles from the nucleus like an ethereal veil.

Whereas comets contain lots of different ices, asteroids are mainly rock and not known for producing such majestic displays. But a new study examines how near-Earth asteroid Phaethon may in fact exhibit cometlike activity, despite lacking significant quantities of ice.

Known to be the source of the annual Geminid meteor shower, the 3.6-mile-wide (5.8 kilometer-wide) asteroid brightens as it gets close to the Sun. Comets typically behave like this: When they heat up, their icy surfaces vaporize, causing them to become more active and brighten as the venting gases and dust scatter more sunlight. But what is causing Phaethon to brighten if not vaporizing ices?

The culprit could be sodium. As the new study's authors explain, Phaethon's elongated, 524-day orbit takes the object well within the orbit of Mercury, during which time the Sun heats the asteroid's surface up to about 1,390 degrees Fahrenheit (750 degrees Celsius). With such a warm orbit, any water, carbon dioxide, or carbon monoxide ice near the asteroid's surface would have been baked off long ago. But at that temperature, sodium may be fizzing from the asteroid's rock and into space.

"Phaethon is a curious object that gets active as it approaches the Sun," said study lead Joseph Masiero, a scientist at IPAC, a research organization at Caltech. "We know it's an asteroid and the source of the Geminids. But it contains little to no ice, so we were intrigued by the possibility that sodium, which is relatively plentiful in asteroids, could be the element driving this activity."

Asteroid-meteor connection

Masiero and his team were inspired by observations of the Geminids. When meteoroids—small pieces of rocky debris from space—streak through Earth's atmosphere as meteors, they disintegrate. But before they do, friction with the atmosphere causes the air surrounding the meteoroids to reach thousands of degrees, generating light. The color of this light represents the elements they contain. Sodium, for example, creates an orange tinge. The Geminids are known to be low in sodium.

Until now, it was assumed that these small pieces of rock somehow lost their sodium after leaving the asteroid. This new study suggests that the sodium may actually play a key role in ejecting the Geminid meteoroids from Phaethon's surface.

The researchers think that as the asteroid approaches the Sun, its sodium heats up and vaporizes. This process would have depleted the surface of sodium long ago, but sodium within the asteroid still heats up, vaporizes, and fizzes into space through cracks and fissures in Phaethon's outermost crust. These jets would provide enough oomph to eject the rocky debris off its surface. So the fizzing sodium could explain not only the asteroid's cometlike brightening, but also how the Geminid meteoroids would be ejected from the asteroid and why they contain little sodium.

"Asteroids like Phaethon have very weak gravity, so it doesn't take a lot of force to kick debris from the surface or dislodge rock from a fracture," said Björn Davidsson, a scientist at NASA's Jet Propulsion Laboratory in Southern California and a co-author of the study. "Our models suggest that very small quantities of sodium are all that's needed to do this—nothing explosive, like the erupting vapor from an icy comet's surface; it's more of a steady fizz."

Lab tests required

To find out if sodium turns to vapor and vents from an asteroid's rock, the researchers tested samples of the Allende meteorite, which fell over Mexico in 1969, in a lab at JPL. The meteorite may have come from an asteroid comparable to Phaethon and belongs to a class of meteorites, called carbonaceous chondrites, that formed during the earliest days of the solar system. The researchers then heated chips of the meteorite to the highest temperature Phaethon would experience as it approaches the Sun.

"This temperature happens to be around the point that sodium escapes from its rocky components," said Yang Liu, a scientist at JPL and a study co-author. "So we simulated this heating effect over the course of a 'day' on Phaethon—its three-hour rotation period—and, on comparing the samples' minerals before and after our lab tests, the sodium was lost, while the other elements were left behind. This suggests that the same may be happening on Phaethon and seems to agree with the results of our models."

The new study supports a growing body of evidence that categorizing small objects in our solar system as "asteroids" and "comets" is oversimplified, depending not only on how much ice they contain, but also what elements vaporize at higher temperatures.

"Our latest finding is that if the conditions are right, sodium may explain the nature of some active asteroids, making the spectrum between asteroids and comets even more complex than we previously realized," said Masiero.

The study, titled "Volatility of Sodium in Carbonaceous Chondrites at Temperatures Consistent with Low-Perihelia Asteroids," was published in The Planetary Science Journal on Aug. 16, 2021.

Rare blue asteroid responsible for Geminid meteor shower reveals itself during fly-by

More information: Joseph R. Masiero et al, Volatility of Sodium in Carbonaceous Chondrites at Temperatures Consistent with Low-perihelion Asteroids, The Planetary Science Journal (2021). DOI: 10.3847/PSJ/ac0d02

Journal information: The Planetary Science Journal 

Provided by Jet Propulsion Laboratory 

 

Signed in secrecy off Newfoundland 80 years ago, the Atlantic Charter changed world history

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Charter was signed in secret off coast of Argentia

Alex Kennedy · CBC News · Posted: Aug 17, 2021 

Four months before the U.S. went to war, Franklin Delano Roosevelt and Sir Winston Churchill chat aboard HMS Prince of Wales on August 10, 1941, a rendezvous that gave the world the Atlantic Charter. To the extreme left behind FDR is Capt. Elliott Roosevelt, his son. (The Canadian Press/AP)

War historians in Newfoundland and Labrador are marking the 80th anniversary of the signing of the Atlantic Charter, a closed-doors deal between Britain and the United States that helped shape the course and aftermath of the Second World War.

The charter was signed near Argentia, on ships off the coast of Newfoundland, on August 14, 1941, by British Prime Minister Winston Churchill and U.S. President Franklin D. Roosevelt.

It included eight principles the world could follow at the end of the war, including an agreement between the two countries not to seek territorial expansion, free seas, and international labour and economic standards.

Gary Walsh, immediate past-president of the Crow's Nest Officers' Club, said the beginnings of the deal came at a time when the war wasn't going so well for the British — and Churchill knew he needed help from the Americans.

"They were afraid that Germany may invade and whatnot," Walsh told The St. John's Morning Show on Friday.

"They decided 'we have to meet,' and of course Churchill was very anxious to get the Americans to join in. So a very top secret set of meetings was arranged. And they decided to meet at a very secret location … and Newfoundland was selected of all places."

Walsh said Newfoundland was chosen for several reasons. It wasn't overly populated, which meant there was less chance of being caught by a spy. The island had also connected the British and Americans in the past through naval and air bases, which allowed for a safe meeting place.

"The year before in 1940 … the British allowed the Americans to set up some naval and air bases in their British territories, one of them, of course, being Newfoundland."

Roosevelt even had a family connection to the island, with his son, Franklin Roosevelt Jr., stationed in Gander in 1940.

The anniversary, which is commemorated every five years, was celebrated Saturday. Festivities included a dinner in Placentia, remarks from Premier Andrew Furey and federal Conservative Leader Erin O'Toole and a showing of a play that was created for the 75th anniversary called Mysterious Visitors.

Walsh said the signing of the charters highlights an important time during the Second World War that he hopes can be preserved for years to come.

"They wanted this eight principles that the world could follow once the war was over. That's what came out of the charter," he said. "This meeting really developed a joint, strong initiative to get together...and there's a lot of historians who think it's very much worth commemorating."