Useful resource Innovation Discussion board – Useful resource Works
In 2020, Useful resource Works delivered its first ever Useful resource Innovation Discussion board with the assist of Cenovus Power. Drawing audio system from Canada’s high thought-leaders and innovators within the useful resource, atmosphere, and funding industries, the 2020 collection has continued relevance for anybody excited by the way forward for Canadian assets. The collection has been recorded and made obtainable under, the place you may hearken to our six episodes that includes company together with Dr. Deborah Yedlin, John Stackhouse, Wes Jickling and extra.
Episode one: Institutional partnerships and views on oil sands innovation
“Science” and “math” had been recurring themes in our first on-line Useful resource Innovation Discussion board that includes Deborah Yedlin, Chancellor of the College of Calgary and John Stackhouse or the Royal Financial institution of Canada.
Our opening speaker, Deborah Yedlin, on Apollo 13 and the Canadian power trade: “If we might put a person on the moon, if we might save three astronauts from being misplaced in area and doubtlessly perishing, absolutely we will determine how you can handle the challenges (a) of local weather change, (b) of the challenges dealing with the power sector and significantly the oil sands by way of emissions and water use. . . .
“We will do that. We’ve finished far tougher issues with far much less computing energy than we have now at this time. . . . Science goes to supply the answer and the solutions to what we face as a worldwide group on the subject of power use and manufacturing,” she mentioned.
Our second speaker, John Stackhouse, Senior VP, Workplace of the CEO, on the Royal Financial institution of Canada, highlighted the hazards of ideology: “After we speak about local weather change, and the passionate views, and logical views, it is essential to recollect: This isn’t faith. It’s math. It’s an actual math downside, and it is a math downside that we will clear up.
“I used to be struck by the Institute for Sustainable Finance’s argument that oil and gasoline is among the most cost-efficient investments we will make; in all probability the very best carbon ROI for us to hit our emissions targets. . . . In whole, (funding of) about $26 billion over a decade, $2.6 billion a yr, in new expertise within the oil and gasoline sector, can get us to the place we have to be.”
Stackhouse went on to notice that since 2014 the variety of corporations within the Canadian power index has shrunk from 52 to 14. And half the index’s worth comes from simply two pipeline corporations. “So we have an actual math problem there.”
A part of that problem, he mentioned, is because of ESG funding points (environmental, social and governance.)
“That’s significantly true for European buyers. We will speak about all of the successes of Canada, however there was a New York banker on this name that I simply got here off who mentioned, ‘The remainder of the world has a view of Canadian oil and gasoline, and it isn’t essentially constructive.’”
And, Stackhouse mentioned: “Within the context of Canadian power there’s a better deal with the E than the S or G, rightly or wrongly, however proper now E is a capital E, and it towers over the S and the G. ESG is drawing extra consideration amongst buyers and institutional funding funds,” mentioned Stackhouse. A Royal Financial institution survey of 800 world funding professionals discovered 75 per cent of buyers used ESG of their funding method this yr, up from 70 per cent in 2019.
“So how will we be sure that ESG is nice for Canadian returns, significantly for oil sands funding? We see it as a chance. . . . ESG can contribute to the intangible worth of Canadian oil and gasoline corporations, if we expect long-term and strategically about it, and develop the arguments that we expect the world could also be keen, and wanting, to listen to. . . .
“There’s a complete new frontier of so-called inexperienced funding, effectively into the 2020s, that Canada may help pioneer”, he mentioned.
“We have to perceive that the expertise investments of oil and gasoline corporations are extra vital maybe than every other clean-tech spending happening at this time. Seventy-five per cent of Canada’s clean-tech spending, roughly, in analysis and improvement, in addition to commercialization, comes from the power trade.
“So how will we guarantee buyers, institutional buyers, are in a position to acknowledge that of their portfolios, and say to their very own members and stakeholders, ‘Look, that is the place your cash goes, and it’s resulting in materials decline in carbon emissions.’”
Episode two: Collaborative innovation in Canada’s oil sands
Due to assist from Cenovus Power, our second instalment of the Useful resource Innovation Discussion board featured Wes Jickling from COSIA. That’s a research-and-innovation partnership of 9 corporations, which produce 90 per cent of the oil from the oil sands.
Right here’s a few of what he needed to say, beginning with a reminder that Canada has the world’s third-largest reserves of oil —167 billion barrels, or 10 per cent of the world’s identified oil reserves. Some 96 per cent of that Canadian reserve is within the Alberta oil sands. And Canada is the world’s fourth largest producer of oil.
“Should you checked out a shiny brochure about what COSIA is, I’d characterize it because the place the place Canada’s oilsands corporations come to innovate collectively,” mentioned Jickling.
“It was created in 2012, primarily on the precept that, on the subject of environmental stewardship, on the subject of growing clear applied sciences and enhancing the environmental efficiency of this trade, oil sands can go quicker, additional, higher, collectively.
“If we pool our assets and we pool our experience, we will speed up the enhancements that we’re making in environmental efficiency.
“We’d name it ‘excessive collaboration’ between 9 rivals, 9 main competitor-companies. And what’s taking place right here is the 9 corporations are sharing, with each other, mental property, applied sciences, they’re giving entry to 1 one other’s, and sharing subject-matter specialists.”
Jickling added: “This can be a very Canadian factor, a really Canadian method of doing clear tech, or doing innovation and analysis and expertise improvement. It’s a degree of sharing and co-operation that we don’t see if every other trade or every other group of rivals wherever on the planet.
“That’s excessive sharing, excessive collaboration, and it’s all concerning the atmosphere.”
COSIA’s analysis and innovation deal with 4 areas: land, water, tailings, and greenhouse gases.
Every of these 4 areas, he mentioned, has its personal joint-venture agreements that every one the businesses have signed to. They share a analysis agenda. They develop and pursue expertise pathways, and work carefully collectively, exchanging technological info and applied sciences. He shared some large numbers: COSIA companions have developed and shared 1,076 applied sciences, at a value of about $1.6 billion. And the affect on operations can be “a lot a lot larger” than that $1.6 billion. There are 225 tasks underneath method at this time, at a value of $62.1 million.
Outcomes embrace the discount in greenhouse gases emitted, per barrel of oil sands oil, by 20 per cent from 2009-2018. “(That is) very vital. You do not see the opposite main producers on the planet with that sort of trend-line.” And an extra discount of 16-23 per cent is anticipated over the following decade.
As effectively, since 2012, COSIA members have lowered the depth of fresh-water use from the Athabasca River by 46 per cent at in situ operations, and by 18 per cent at oil sands mining operations.
And there’s extra: “Within the oil sands we have now some super CO2, carbon-capture-and-storage property. We’ve one of many world’s largest carbon-capture-and-storage services on the Quest facility on the Scotford refinery in Edmonton. We now have the world’s greatest CO2 pipeline, the Alberta Carbon Trunk Line.”
Episode three: Rising Potential of CCUS Expertise
Episode three of the Useful resource Innovation Discussion board hosted three main voices on innovation to debate the rising potential of carbon seize, utilization, and storage (CCUS) for Canada’s oil and gasoline sector.
Margareta Dovgal moderates a dialogue between Marla Orenstein (CWF), Jeff Pearson (Wolf Midstream), and Marcius Extavour (XPRIZE Basis), masking carbon seize innovation, coverage mechanisms, and extra.
“CCUS is one piece of the puzzle; it’s not the one piece of the puzzle. It’s not a magic bullet. However it does appear to have an awesome capability for truly serving to us get to the place we have to go. So very promising and really thrilling,” mentioned Orenstein.
Extavour agreed, highlighting the potential for Canada to develop into an early adopter and chief in CCUS expertise.
“There are only a few international locations which have the mix of the geology that we have now, the present oil and gasoline and engineering, deep bench of personnel, the regulatory regimes we have now, the management on the provincial and federal ranges which can be to do one thing right here. And that is an space that, frankly, our typical pals and rivals, just like the EU, and Japan, and China, and the USA, haven’t already dominated. So there may be, I believe, nonetheless a chance for Canada to – that’s a really large phrase – however to be a pacesetter right here, and an export chief.”
There’s rather a lot at stake. Regardless of the big financial profit offered by the oilsands, they’re nonetheless a significant supply of emissions.
“I have a look at the oilsands, and the oilsands, to me, is among the most attention-grabbing areas, due to the sheer magnitude of emissions that we see popping out of the oilsands,” mentioned Pearson.
“And to me, that’s the grand prize, I believe, from a decarbonization perspective.
I believe you’ll see much more corporations beginning to search for alternatives, and personal capital coming in to fund these. I believe, I imply, the good factor about this relative to quite a lot of the opposite stuff I’ve labored in oil and gasoline is, all people needs to do it. Everyone likes it. I don’t discuss to a single one who doesn’t wish to transfer this agenda ahead. I believe we’re all collectively in settlement.”
Episode 4: Federal Coverage Challenges and Alternatives within the Patch
With net-zero on the federal coverage horizon, what are the coverage alternatives and challenges now earlier than Canada’s oil sands? Episode 4 of the Useful resource Innovation Discussion board includes a dialog between our Director of Analysis, Margareta Dovgal, Dr. Monica Gattinger (College of Ottawa), and Aaron Henry (Canadian Chamber of Commerce).
Henry highlighted the problem of recent federal prices and taxes on oil and gasoline producers, with potential impacts on emissions discount innovation.
“The oil and gasoline sector will probably be impacted by this Clear Gas Normal. And each form of greenback that goes up in compliance for that comes out of probably CapEx. Which implies that you’re not going to have these tasks for innovation which can be going to actually ship long-term dividends.”
That is a theme Gattinger continued.
“I believe there’s an enormous query of the place will funding {dollars} come from for innovation? It’s going to take an incredible quantity of funding to rework the trade and within the present financial atmosphere that we’re in and that we might very effectively proceed to be in for a while with weak costs, demand despair resulting from COVID. I believe that raises actual questions on funding.”
Federal contributions to emission discount analysis and implementation have to be a part of the answer. But, false impressions abound on the subject of federal investments within the oilsands.
“Presently when the federal authorities makes an funding into the power sector, particularly, however different energy-intensive operations, and that funding reduces emissions, we nonetheless have people who find themselves calling that out as a subsidy to fossil fuels”, mentioned Henry. “And I believe that that’s ridiculous. We have to truly get to the purpose the place we acknowledge that emission discount is nice. It doesn’t matter what part it is available in. It’s essential to make that occur.”
Episode 5: Authorities Helps for Innovation within the Oil Sands
For our fifth Cenovus-sponsored Useful resource Innovation Discussion board occasion, we had been joined by David A. Dodge O.C., Particular Advisor to our occasion companion Bennett Jones LLP and former Governor of the Financial institution of Canada, and Patricia Mohr, Director of Emissions Discount Alberta and a former Vice-President and Economist at Scotiabank in Toronto.
Our dialogue of presidency helps for oil sands innovation additionally lined the state of funding within the oil sands, nationwide financial restoration efforts, how innovation within the oil sands may help emissions discount targets, and the way making a extra resilient and progressive trade is helpful to Canadian prosperity.
Dodge introduced the challenges: “I’d say there are three key points that the trade actually has to take note of. One is how we’re going to cut back the manufacturing emissions so as to meet rising ESG requirements world wide. Second, how we’re going to get the price of our manufacturing right down to compete within the world market, and eventually, what are we going to do to extend our capability to ship the product to the world market?”
It is not simply governments which can be excited by emissions discount, mentioned Mohr: “It is rather essential that patrons in Asia, additionally in Europe and the USA understand the super effort that Canadian oil producers are making to cut back their depth within the oilsands, and in reality, that we’re having some success at doing it.”
However it will take vital technological funding by the trade. It is also one thing governments ought to be supporting.
“We will’t transfer ahead in getting the GHG content material down or certainly getting our prices down with out additional investments in expertise on this trade,” added Doge. “And in order that’s the actual focus, I believe, if we consider the insurance policies of Ottawa or the insurance policies of Edmonton in that regard or Regina or Victoria for that matter.”
Talking of investments in low-carbon expertise, Mohr highlighted the problem forward of an actual hydrogen financial system.
“If you wish to actually transfer to an actual hydrogen financial system the place you’re not simply utilizing it to make fertilizers, for instance, or for refining, however if you wish to develop it into being a gas for heavy automobiles or the railway or for area heating, there may be some R&D that must be finished, and it’s going to price some actual cash within the type of capital to actually get this going,” she mentioned.
Till low-carbon applied sciences are prepared for widespread adoption, oil and gasoline stay important. It is essential to acknowledge the continued significance of the trade.
“This can be a very, essential trade for Canada. As David mentioned, it’s usually generates – it’s by far the most important export generator of something. You couldn’t dream up something to interchange it,” mentioned Mohr.
“However I’d say in about 10 to fifteen years, we have to shift a bit bit to decrease carbon merchandise.”
And with the experience developed via investments in emissions discount and low-carbon merchandise, Canada can achieve a brand new export: expertise.
“One of many issues that we must be doing isn’t just exporting the product however exporting the data and the expertise which our individuals are producing,” mentioned Dodge.
“That could be a worthwhile export in and of itself.”
Episode six: Hydrogen Potential – Past Blue, Grey or Inexperienced
Within the sixth and ultimate installment of the Useful resource Innovation Discussion board, sponsored by Cenovus Power, we had been joined by Marty Reed (Evok Improvements) and Chris Reid (Ekona Energy) for a dialogue on hydrogen potential in Canada. Useful resource Works’ Director of Analysis, Margareta Dovgal, moderated.
Evok Improvements is a Vancouver-based tech incubator that applies Silicon Valley pondering to spend money on power transformation alternatives. Certainly one of these is Ekona Energy, an organization creating new options to provide clear, industrial-scale hydrogen at low-cost.
Hydrogen is often sorted by manufacturing technique—leading to blue, inexperienced, and grey hydrogen. However because the panelists famous, this simplification might not totally convey every kind’s affordability and carbon depth. Inexperienced hydrogen has the bottom emissions however has excessive manufacturing prices, being made via electrolysis from renewables. In the meantime, gray and blue hydrogen are developed from fossil fuels, requiring much less power than the electrolysis course of. This enables them to be a extra inexpensive type of hydrogen power, and blue hydrogen has the added benefit of getting used together with carbon seize applied sciences, which dramatically lowers emissions.
Reed highlighted the potential to make use of all types of hydrogen power to attain a double backside line: “there’s this naïve view that we will merely electrify all the things, and whereas electrification is a vital path…the straightforward sheer quantum of power required is past our scale to deliver on new electrons that quick.”
Reid added: “We can not overlook concerning the buyer and the economics on this.” Blue hydrogen is a crucial a part of the street to growing inexpensive and cleaner power.
The message is obvious: whether or not blue or inexperienced, we want every kind of hydrogen power. As Reid mentioned, “we have now to watch out that good does not play the enemy of the nice right here. We have to throw all the things plus the kitchen sink at this downside.”
With improvement on industrial scales, Reid seems to be ahead to a way forward for hydrogen power offered for “a buck a kilogram.” Reed spoke of business alternatives to enhance, exchange, and produce on extra SMRs with scale and low carbon footprints, particularly in agriculture. He continued that medium and long-term alternatives exist in long-haul trucking, rail, and marine transportation fuels along with Asian export potential.
Each Reed and Reid envisioned a future of presidency, trade, and unions working collectively to assist the event of a clear and worthwhile hydrogen financial system. This future is on its method. After consultations with stakeholder teams, the federal authorities introduced a method on hydrogen power, which could be discovered here. As Canada works in direction of growing its hydrogen power financial system, the panellists highlighted the continued want to teach our political leaders concerning the potential makes use of of carbon seize and storage expertise.
With the conclusion of this webinar, Useful resource Works wrapped up its first-ever Useful resource Innovation Discussion board after six weeks of perception and knowledge from innovators and thought leaders in Canadian power.
