RCE 2013 Print Report

Page 1

Responsible Canadian Energy 2 0 1 3

P r o g r e s s

R e p o r t

View the full report online at www.capp.ca/rce

S u m m a ry


Table

of

contents

President's Message.............................................3 Program, Vision, Principles............................... 4-5 Governance....................................................... 6-7 Advisory Group Statement................................ 8-9 Performance Overview.................................. 10-11 People........................................................... 12-15 Air.................................................................. 16-17 Canadian Upstream Oil and Gas Map ......... 18-19 Air (continued)............................................... 20-21 Water............................................................. 22-25 Land.............................................................. 26-29 Hydraulic Fracturing...................................... 30-31 Transportation............................................... 32-33 National Data Table....................................... 34-35 About CAPP.........................................Back cover

Online Links

2

Cover Photo Credits L to R: 1 and 3 Cenovus Energy Inc.

Photo Credit: Sean F. Walsh, Connacher Oil and Gas Limited


Responsible development of Canada’s oil and gas resources contributes to the prosperity of all Canadians. Canada’s upstream oil and gas sector operates in a diverse and rapidly changing external context influenced by: technology breakthroughs such as hydraulic fracturing that have fundamentally recast North American natural gas supply and demand, differing views as to the economic, social and environmental performance of the industry, changing public expectations about how the industry engages communities along the value chain, and, increasingly, a global market for our products. As Canada’s oil and gas industry seeks to diversify markets and grow production of crude oil and natural gas, broader “social licence” for our activities becomes increasingly important. The RCE Program, of which this report is a part, both reports on industry performance in key areas and is intended to promote and enable industry performance improvement over time. The objective of CAPP’s Responsible Canadian Energy progress report is to ensure our performance reporting is credible and transparent, with the view that this will allow us collectively to assess how we are doing and to identify and act on opportunities for improvement.

President’s

Message

On behalf of the Canadian Association of Petroleum Producers (CAPP) and all of our member companies, I am pleased to present the 2013 Responsible Canadian Energy (RCE) progress report. The RCE report consists of two components: • The print report, which provides highlights of our industry’s performance from a national perspective in the areas of people, air, water and land, and an overview of the underlying data for 2012. • The companion website, www.capp.ca/rce, which provides greater in-depth data, analyses and commentary regarding our performance by region and resource type, including Western Canada, Oil Sands and Atlantic Canada Offshore.

Each year we gather and analyze data for this report, with the aim to quantify the areas where we are improving our performance, and to identify areas where we require more focus. The overall industry performance outlined in the report largely speaks for itself. The report identifies areas where upstream oil and gas sector performance continues to improve, as well as areas where our industry must focus our efforts to deliver performance improvements. This RCE report marks CAPP’s fourth year with the RCE Program, an unprecedented industry-wide effort to assess and report performance. The RCE Program and this report will continue to evolve, and the RCE Advisory Group has made a number of suggestions in this regard. These will be reviewed and considered, along with other potential enhancements, for future reports. As we move forward as an industry, our task is to use the commitment of Canada’s industry to RCE to take steps that will up our collective performance and at the same time consider better ways we can articulate to Canadians the performance and value we deliver. In a global context, Canada is pretty good at what we do in oil and gas development. This report provides us an opportunity to demonstrate our progress, to be candid about our challenges and to open the door for a collaborative approach to solutions. We welcome your feedback. Dave Collyer www.capp.ca/rce

3


Photo Credit: Husky Energy Inc.

Responsible

Canadian

Energy

Photo Credit: Shell Canada Ltd.

Program

The Responsible Canadian Energy Program represents a collective commitment by CAPP’s member companies to measure and report on and continuously improve performance in the areas of people, air, water and land. The measurement, reporting and analysis of information enables industry to show both where it is making progress in improving performance and where more focus is needed to reduce industry’s environmental footprint, to ensure every worker returns home safely each day and to improve the ways in which it engages stakeholders.

4


Vision

and

Principles

CAPP’s Board of Governors has endorsed the following Vision and Principles for the Responsible Canadian Energy Program. Our Vision is: • We will conduct our business activities in a safe and sustainable manner, balancing social, economic and environmental considerations. The Principles which we will hold each other accountable for and measure ourselves against are: • Provide a safe and healthy workplace for our employees, contractors and for

The RCE Progress R e p o rt The Responsible Canadian Energy progress report provides data, information, trends and performance analysis, including descriptions of the significance and relevance of the program’s key performance areas. The goal of the publication is to put performance information into context to support an understanding of what the data is telling us, where progress is being made in achieving performance objectives and where industry needs to improve its performance. The 2013 report presents full year 2012 industry data and analysis.

the communities in which we work, with a goal to do no harm; • Conduct our activities in an environmentally responsible manner; • Engage our stakeholders in open and responsive communications; • Create opportunities for economic and social benefits in the communities in which we operate, at a local and national level; and, • Conduct our business activities with integrity, ensuring all people are treated with dignity, fairness and respect.

Measuring

Performance

The Responsible Canadian Energy Program focuses on four key performance areas: people, air, water and land. Objectives have been developed for each of the focus areas and are stated at the beginning of each section of the report. CAPP has standard metrics to assess industry’s performance in each of these areas and to evaluate performance against the objectives. Based on performance, this report outlines how the industry is progressing towards meeting its Responsible Canadian Energy Vision and Principles. Data on key metrics is gathered on an annual basis from CAPP members, as well as from government and regulators, and reported to illustrate industry’s performance. Examples of leading practices and case studies are also presented in this report to show the types of projects, technologies and innovation that are driving forward performance of the industry. This print report provides highlights of industry's performance; for detailed data and regional analysis, view the full report online. Photo Credit: Shell Canada Ltd.

5


Governance

LDERS/SOCIAL LICEN KEHO CE STA

The Responsible Canadian Energy progress report is an important annual deliverable for CAPP and the upstream oil and gas industry. It is a key

RD OF GOVERNO P BOA RS CAP

element of the broader Responsible Canadian Energy Program. The program is overseen by the manager, corporate responsibility, and is supported by both CAPP staff and members.

CAPP EXECUTIVE

The report provides a vehicle by which to communicate industry performance, while the broader program also provides members with CAPP MEMBER COMMITTEES

P

R

O

G

R

A

M

RCE ADVISORY GROUP

guidelines and tools to support performance improvement. Progress regarding enhancements to the Responsible Canadian Energy Program is regularly communicated to member companies and to the CAPP Board of Governors.

RCE PROGRAM MANAGEMENT

To ensure consistent performance reporting on behalf of its members, CAPP has developed a reporting and data submission guideline. CAPP’s reporting guideline aligns in principle with company, national and international reporting practices. The guideline outlines how data and information for key metrics are to be submitted to CAPP on a regular basis. CAPP and member companies have also developed guidelines for the management of specific and important areas of operations and engagement. The purpose is to establish a point of reference for companies when developing their internal systems. The guidelines developed to date include: • Air and energy management; • Safety and well-being;

G

6

CAPP’s Board of Governors is composed of senior executives from 30 members representing small, medium and large companies. It sets strategic direction O V E R N A N C E and priorities for CAPP and regularly reviews progress against strategies and plans.

• Community impacts and benefits;

• Stakeholder engagement;

• Aboriginal engagement; and,

• Water management;

• Hydraulic fracturing operating

• Land management;

practices.

Right Photo: Steam generators at an in situ steam assisted gravity drainage (SAGD) operation.


Photo Credit: Cenovus Energy

7


Responsible

Canadian

Energy

Advisory

Ken Ogilvie

Stewart Elgie

JP Gladu

John Lounds

Cameron MacGillivray

Anne McLellan

Dr. Robert (Bob) Page

Environmental Policy Consultant

Director, Institute of the Environment, University of Ottawa

President and Chief Executive Officer, Canadian Council for Aboriginal Business

President and Chief Executive Officer, The Nature Conservancy of Canada

President and Chief Executive Officer, Enform

LLP, Bennett Jones

Director, Enbridge Centre for Corporate Sustainability, University of Calgary

Ruth Ramsden-Wood

Greta Raymond

Gary Redmond

Chris Smillie

Robert Walker

Dr. Dan Wicklum

Community Member

Independent Consultant

Executive Director, Synergy Alberta

Senior Advisor, Government Relations and Public Affairs, Canadian Building Trades

Vice President, ESG Services, NEI Investments

Chief Executive, Canada's Oil Sands Innovation Alliance

RCEAG Chair

The Responsible Canadian Energy Advisory Group (RCEAG) is composed of leaders

The RCEAG has reviewed the 2013 Responsible Canadian Energy progress report

representing the safety, environment, labour, Aboriginal, academic, private, finance

and their statement reflects the group’s perspective on the progress CAPP members

and investment communities. The RCEAG is an independent body whose role is

have made over the past year toward achieving the Responsible Canadian Energy

to advise and challenge industry to effectively manage its risks and continuously

vision and principles.

improve its performance.

8

Group

For some key performance metrics, data provided by CAPP members has been

They review and provide feedback on the Responsible Canadian Energy progress

supplemented by publicly available data from federal and provincial governments

report process, the program and the progress industry is making as demonstrated in

and regulators. CAPP will continue to take this approach to provide as complete a

the annual Responsible Canadian Energy progress report.

picture of industry performance as possible.


Advisory

Group

St a t e m e n t

Photo Credit: Keyera Corporation

The RCE Advisory Group is pleased to provide the following comments on the 2013

We call for CAPP member companies to be aggressive and specific about

progress report. As with previous statements, our goal is to help and challenge

performance ambitions, and to report progress towards those ambitions in a

CAPP members to improve reporting and performance in ways that are transparent,

credible manner to the public. RCE reports should be used by the public to

credible and meaningful to the public. Our comments should be read in the context

assess the Canadian oil and gas industry’s performance and significance at all

of previous years’ statements as we wish to avoid unnecessary repetition.

scales — regional, national and global. A broad perspective is required, recognizing

The three main comments we make for the 2013 and future reports are as follows:

the industry’s contribution to Canada and the world, as well as the impacts of its

• Future reports should be written using clear, non-technical language, so they will be more easily understood by the public. • CAPP members should pay greater attention to the transportation of their products by various modes, such as rail, pipelines and marine tankers, and within their sphere of influence work closely with carriers to assure the safe and environmentally sustainable movement of these products. • Metrics included in the 2013 RCE report do not always line up well with the program’s objectives, which make it difficult to understand whether all of the

operations and products throughout their full supply chain and lifecycle. CAPP members have responded well to a number of our past comments and recommendations. We look forward to future RCE reports that include clearly stated measures of performance ambition that drive continuous improvement, and more comprehensive metrics at relevant sectoral levels to track performance improvements. We respectfully submit these comments to CAPP. To obtain our statement to the report issued in 2012, and the changes CAPP has made in response over the past year, refer to www.capp.ca/rce.

objectives are being achieved. For example, further work is needed in areas such as Aboriginal and community engagement. www.capp.ca/rce

9


P EO P LE

AIR Performance

Ov e r v i e w

Performance trends for key focus areas are variable for 2012, with ongoing performance improvement being demonstrated in some areas such as safety and the reduction of NOx and SO2, and performance challenges becoming more evident in other areas such as greenhouse gases. Safety performance for both employees and the contractor workforce improved in 2012. Overall safety performance as measured by Total Recordable Injury Frequency (TRIF) has shown moderate improvement, with a 29 per cent decline in TRIF since 2008. The number of fatalities has continued to decline. Industry recognizes a safe work environment means no one gets injured, and so will continue to drive toward our goal of zero incidents. Industry will continue to focus on reducing hazards, increasing emphasis on a safety culture and enhancing focus on process safety management in operations. Continuing a multi-year positive trend, CAPP member companies’ national NOx and SO2 emissions performance (both absolute emissions and emissions per barrel of production) continued to improve in 2012, primarily due to shifts in production mix and implementation of new technologies over the last five years. An absolute reduction in these air contaminants helps to maintain air quality and reduce acid rain and smog. The total volume of fresh water consumed by our industry continues to increase, driven largely by the growth of in situ oil sands production. The overall intensity (the amount of fresh water withdrawn per barrel of production) of water use by the upstream oil and gas industry has shown a slow and steady decline over the past decade. In situ oil sands production is an important contributor to this trend, with fresh water withdrawal falling from more than 0.6 barrels per barrel of bitumen production in 2003 to less than 0.4 barrels in 2012. Most of this performance improvement has been achieved through recycling and the use of saline groundwater sources. Total greenhouse gas (GHG) emissions from Canadian oil and gas continue to increase as a result of increased oil sands production. GHG emissions intensity

10

Photo Credit: Enform

Photo Credit: Husky Energy Inc.


WA T ER

LAND

has also increased (from 0.28 tonnes CO2e in 2008 to 0.34 tonnes CO2e in 2012), reflecting the industry’s shift toward more energy intensive production processes. While there are significant improvements in GHG emissions for some new projects as compared to similar existing projects, the pace at which new technologies to mitigate GHG emissions can be developed and implemented must accelerate in order to achieve industry's longer term GHG emissions intensity reduction objective. With the continued oil and gas industry growth, land disturbance is increasing. Numerous reclamation initiatives are underway, but overall reclamation is not keeping pace with disturbance. Working collaboratively through organizations like Canada’s Oil Sands Innovation Alliance (COSIA) and with key stakeholders, innovation and technology are expected to play a key role in meeting these key environmental performance challenges over time. Through CAPP's annual RCE data collection process, all member companies indicating that they use hydraulic fracturing in their development programs were surveyed in 2013 to assess adoption of the hydraulic fracturing operating practices introduced in 2012. A high degree of implementation exists, demonstrating the rapid application of voluntary practices by the Canadian industry and alignment with regulatory requirements in some jurisdictions. Finally, as described in the People section of this report, the upstream oil and gas industry and the products we produce continue to have a very positive impact on the Canadian economy, on jobs (both direct and indirect employment), and on Canadians' quality of life. Following is a summary of recent performance trends in each of CAPP’s key performance areas — People, Air, Water and Land. In this report, industry performance is discussed from a national perspective, combining Western Canada, oil sands and Atlantic Canada offshore, and regionally in more detail in the full version of the report, available on the web at www.capp.ca/rce .

Photo Credit: Suncor Energy Incorporated

11


P EO P LE

Safety Workforce and Respectful Engagement

o bj e ct i v e s : P EO P L E We will provide a safe environment for our employees, contractors and the communities where we operate. We will provide employment and business opportunities for regional communities, including Aboriginal peoples. We will respectfully engage with directly affected stakeholders through all stages of our operations.

Safety is integral to Canada’s upstream oil and gas industry and the communities in which we work. Employee, contractor and community safety is industry’s first priority. Industry also recognizes the importance of investing in communities where it operates, and in supporting employment and business opportunities for local and Aboriginal peoples. Oil and gas companies engage directly with affected stakeholders, ensuring they understand the positive and negative impacts (and associated mitigation options) associated with oil and gas activity.

- 29% The reduction in total recordable injury frequency (TRIF) from 2008 to 2012.

12

Photo Credit: Fisheries and Marine Institute of Memorial University

- 8% The reduction in number of recordable injuries from 2008 to 2012.

FACTOID: Every year, almost 200,000 oil and gas workers are touched by Enform’s leading health and safety training, programs and services.


P EO P LE

Imp r o v i n g

Safety

O u r P e rf o rma n c e

The TRIF has plateaued at around 0.80 worker injuries per 200,000 hours across all operations (Western Canada, oil sands, Atlantic Canada offshore).

National – Fatalities

National – Total Fatalities

National – Total Recordable Injury Frequency

National – Total Recordable Injury Frequency (TRIF) 30 2.00

Employee TRIF

1.80

Contractor TRIF

1.60

20 Injuries/200,000hrs

Number of Fatalities

25

15 10

Combined Worker TRIF

1.40 1.20 1.00 0.80 0.60

5

0.40

0 2008

2009 *

0.20

2010

2011

2012

0.00

2008

The number of fatalities at operations continues to decline year over year. In 2012, there were a total of four fatalities. Industry’s safety performance goal is zero injuries and zero fatalities; any other number is unacceptable. Our safety record shows that the industry is making progress, but must continue to be relentless in the pursuit of keeping people safe. Continued focus is needed on industry’s safety practices and creating the safety culture to maintain a consistent disciplined focus on risk management, particularly those risks associated with new activities. *In 2009, there was a tragic helicopter incident offshore Newfoundland resulting in 17 fatalities. Significant work on safety, specifically improving the safety of travel to and from offshore facilities, has been undertaken in response to this incident. Oil sands producers experienced one fatality in each of 2011 and 2012. Fatalities at conventional oil and gas operations in Western Canada have also decreased, from seven fatalities in 2008 to three in 2012. The national Total Recordable Injury Frequency (TRIF) data shows the total worker (employee and contractor) recordable injury rate has declined by 29 per cent since 2008.

2009

2010

2011

2012

The data demonstrates the benefits of continued application of robust health and safety management systems. However, the statistical plateau in performance highlights a need to seek further innovative solutions to reduce injuries. Continual focus on and improvement in systems enable organizations to manage health and safety risks through a framework of processes and procedures that ensure, for example, standardized safety training and equipment, and the application of leading safety practices. The data also suggests that health and safety management systems are helping the industry maintain and improve safety performance in remote or harsh environments, and among new workers. For example, TRIF rates have historically increased in years in which industry has taken in large numbers of new, inexperienced workers. However, despite a 40 per cent increase in worker exposure hours from 2008 to 2012, TRIF has not increased. Working with Enform, the oil and gas industry’s safety association, as well as with the Atlantic Canada Offshore Training and Qualifications Committee, industry follows strong safety standards and guidelines, shares leading health and safety practices

Left Photo: A study of dive masks used in the Helicopter Underwater Escape Trainer (HUET) will help improve safety outcomes in the offshore industry.

and utilizes comprehensive integrated training resources. www.capp.ca/rce

13


P EO P LE

W H A T ’ S NE X T: O P P OR T UNI T IES AND C H ALLENGES

Creating

Given that the pace of industry safety performance improvement has

Social

slowed, it is important that industry broadens the scope of its efforts. This will include increased focus on process safety management in operations

Economic

and

Benefits

O u r P e rf o rma n c e

(e.g., unplanned or hazardous release of hydrocarbons, such as a loss of

Canada’s oil and gas industry works with communities in all areas of operations. A

containment — well blowout, spill, fire, explosion, etc.). As well, continued

key benefit of oil and gas activity is royalties and taxes for governments, and jobs

focus on leadership and safety culture will continue to strengthen industry’s

and business opportunities in local communities.

safety performance. Evolution of performance measures to include process safety and safety culture will enable industry to take safety to the next level. For more information on what CAPP and industry are doing in these areas, view our full report online.

Upstream oil and gas payments to all levels of government in the form of royalties, income taxes and lease sales average $18 billion per year. In 2012, the industry employed more than 550,000 Canadians and provided $67 billion in annual investment. As Canada’s largest private sector investor, the economic contributions from Canada’s oil and gas industry benefit Canadians coast to coast. Employment extends from rig hands in the oil field to technology experts developing new water management tools. The industry also supports a variety of businesses across Canada. One example is Vancouver-based glove manufacturer Watson Gloves. The company revived its failing business fortunes when it partnered with oil sands companies to create specialty work gloves designed for oil sands workers. Safe, skilled and well-paying jobs are a primary benefit of upstream oil and gas activity. In 2012, CAPP signed agreements with the Building Trade Unions and Merit Contractors Association to advance initiatives to improve labour availability, including workforce mobility, skilled trades training and apprenticeship opportunities, and immigration. The oil sands industry is the largest employer of skilled trades workers in Canada, providing more than 200 million work hours annually for 14 unions with locals from coast to coast. According to the federal government’s Construction Sector Council latest forecast, by 2018 construction employment will rise by 180,000 jobs and about 200,000

14

Photo Credit: Imperial Oil Limited

Left Photo: The Aboriginal Awareness Training Program for Imperial Oil employees working at the Kearl Oil Sands project promotes greater awareness, understanding and respect for Aboriginal peoples and their culture.


P EO P LE

skilled trades workers will retire. While about 170,000 new entrants are expected, a 200,000-worker gap is forecast. These workforce challenges have inflationary implications, including cost increases for construction projects and increased project execution risk, and could impact the industry’s ability to attract investment. CAPP is working with the federal and provincial governments to identify actions to address this issue in both the near and medium term. Canada’s oil and gas industry continues to be a major customer for Aboriginal companies and to invest in training and education for Aboriginal people to ensure they are well-positioned to benefit from the economic opportunities associated with resource development. With oil and gas production technology changing and exploration moving into new areas such as New Brunswick, the focus on effective individual company engagement and broader industry-stakeholder discussions about issues such as market access and cumulative effects has increased. In 2012, CAPP held its Natural Gas Dialogues in Vancouver, Fort St. John, Red Deer, Ottawa, Moncton, Montreal, Toronto and Halifax, releasing in early 2013 the Natural Gas Dialogues Report which summarizes the views expressed from customers, landowners, academics, NGOs and other stakeholder groups, along with the industry’s response to these views.

The oil and gas industry also continued its landowner and community

There is a current and continued projected shortage of skilled workers to meet the oil and gas industry’s labour demands. Through CAPP, industry is

engagement via independent third parties such as Synergy Alberta, and its individual

facilitating the development of a workforce strategy for the upstream oil and

synergy groups. Synergy groups provide the opportunity for communities to have

gas industry and working with other stakeholders to address training needs.

more meaningful, ongoing participation in decisions that directly affect them, and embodies the principle of working together to resolve issues, lessen impacts, and encourage the use of best practices in the areas of health, safety and the environment. This initiative is based on collaboration and principles which CAPP and its members strongly support.

Canada’s oil and gas industry recognizes there are additional opportunities for CAPP members to engage with Aboriginal communities to develop local skills and services through training, education, employment and other capacity development initiatives. For more information on these issues and initiatives,

W H A T ’ S NE X T: O P P OR T UNI T IES AND C H ALLENGES Right Photo: Michelle Liebau, Workforce Supervisor at Suncor says: “I’ve been given opportunities that I would never have experienced anywhere else in Canada. I tell people that they have no idea just how amazing the potential is here.” View video online.

view our full report online.

15


Air

Reducing emissions i n t e n s i t y th r o u g h technology and ENERGY e f f i c i e n c y

o bj e ct i v e s : A I R We will design and operate our facilities to be better than provincial air quality objectives. We will continue to reduce greenhouse gas emissions per barrel equivalent of production by improving our energy efficiency and by developing new technologies. Air quality matters to Canadians—both in terms of the potential for air contaminants such as NOx and SO2 to affect regional air quality, as well as the global impact of greenhouse gas emissions. Canada’s oil and gas industry is working to continuously improve air emissions performance for both contaminants and greenhouse gases. Air emissions data is typically presented in two distinct ways, volume and intensity. Volume is important as it provides information regarding overall trends in total emissions. It is impacted by many factors and does not provide a perspective on efficiency of operations. Intensity measures are important in understanding how efficient an

SO2

SO2

operation is in terms of the emissions associated with delivering each unit of production. Industry’s objective is to have continuous improvement in emissions intensity.

CO

CO

While both absolute and intensity measures2provide important information2to the oil and gas industry, intensity is the more relevant measure of operational performance. It normalizes, or accounts for, changes in product, production volumes and mix, and it allows oil and gas companies to evaluate own operations and NO against their NOtheir X X competitors — both domestic and international.

SO2

GHG

GHG

-19% CO

+21%

0.14%

2

The reduction in SO2 intensity from 2008 to 2012 (an 18% reduction has been realized for NOx intensity). NO

The increase in GHG intensity from 2008 to 2012 for the overall oil and gas industry.

X

16

Photo Credit: ARC Resources Ltd

CO

The percentage of overall global GHG emissions represented by Canada’s oil sands industry. The industry accounts for 7.8% of Canada’s GHG emissions.

CO

Left Photo: ARC Resources Dawson gas plant incorporates a number of emissions practices2 that have 2 reduced the plant’s overall carbon footprint by approximately 60,000 tonnes per year.


AIR

GHG

National – GHG Emissions Intensities

Em i s s i o n s

0.6

O u r P e rf o rma n c e

Atlantic Canada Offshore

80

Tonnes CO2e /m3 OE

Oil Sands

100 Total CO2e tonnes/yr Millions

Western Canada

For example, over the past five years, oil sands in

Oil Sands Atlantic Canada Offshore

National – Absolute GHG Emissions Western Canada

National

0.5

National – GHG Emissions 120

aging reservoirs and shifts in the mix of production.

National – GHG Emissions Intensity

situ production volume, which has a more energy intensive (and therefore GHG intensive) production profile than mining, has increased almost 150 per cent.

0.4

Additionally, as conventional oil and gas reservoirs

0.3

become depleted, more energy intensive technologies are applied to maximize extraction of depleting

0.2

reservoirs, and to extract more difficult hydrocarbons,

0.1

largely those entrapped in deep deposits of sand or

60

0

2008

40

2009

2010

2011

2012

shale. New technologies are being deployed which have significantly lower GHG emissions intensity than

20 0

2008

2009

2010

2011

2012

As production, specifically oil sands production, increases in Canada, the absolute amount of GHGs emitted from oil and gas production is expected to

National GHG emissions intensity from oil and gas

is the case for similar projects currently producing. The

production is trending up over time from 0.28 tonnes

challenge for the industry is to accelerate the pace of

CO2e/m3 in 2008 to 0.34 tonnes CO2e/m3 in 2012. This

development and implementation of new technologies

is as a result of the increasing production coming from

that reduce the intensity of GHG emissions from oil and

more GHG-intensive extraction methods, including oil

gas production despite the shift in production mix, and

sands.

over time diminish the upward trend in absolute GHG emissions.

continue to increase in the near and medium term.

The oil and gas industry's objective is to decrease the

We anticipate that the progressive application of new

overall intensity of GHG emissions per unit of energy

Technology and innovation are critical tools for reducing

technologies will over time reduce GHG emissions

produced over time, largely through the development

emissions intensity as production of oil sands resources

intensity and ultimately absolute GHG emissions.

and implementation of new technologies. There is

continues to grow. One example of an innovative

increasing focus, through COSIA and other initiatives,

technology is solvent-cyclic steam-assisted gravity

on accelerating the pace of innovation to improve

drainage (SC-SAGD). This technology reduces the

environmental performance, including GHG emissions

amount of steam required for in situ extraction, and

intensity.

in the future is expected to decrease GHG emissions

In Western Canada, reductions in absolute GHG emissions result from declining gas production. Other reductions in Western Canada GHG emissions result from CAPP's reclassification of cold flow bitumen in situ oil sands category in an effort to better align

Wh a t ’ s N e xt: O P P OR T UNI T IES AND C H ALLENGES

with government methodology. Meanwhile, absolute

Overall emissions intensity is increasing for a number

GHG emissions from oil sands continue to increase

of reasons, primarily because more energy is needed to

as production increases in both mining and in situ

extract and process oil and natural gas resources from

from Western Canada conventional production to the

intensity in mature in situ reservoirs. Additional technologies are being developed through Canada’s Oil Sands Innovation Alliance (COSIA).

operations. www.capp.ca/rce

17


CANADIAN

U P S T REA M

Canada is the world’s

OIL

AND

GAS

MAP

5th largest natural gas producer

1

YUKON TERRITORY

In 2012, Enform issued

NUNAVUT

240,000

safety and training certificates (a record number)6

NORTHWEST TERRITORIES

180 vessels of over 500 tonnes

On any given day, there are

BRITISH COLUMBIA ALBERTA

gross tonnage that operate within Canadian jurisdiction9

MANITOBA

SASKATCHEWAN

Oil sands production accounts for

7.8 per cent of Canada’s GHG emissions and just over 0.14 per cent of global GHG emissions 4

CRUDE OIL PRODUCTION

Fresh water withdrawal for 2012 was

244 million m3

as compared to

226 million m3 in 2009

7

18

Upstream payments to government in the form of royalties, income taxes and lease sales average

$18 billion per year

2

NATURAL GAS PRODUCTION


The natural gas sector is expected to provide

317,000 jobs

(indirect, direct and induced) across Canada by 20353

Canada has the

3rd largest

NEWFOUNDLAND & LABRADOR

oil reserves in the world2

For every direct job created in Alberta’s oil sands industry, approximately

PRINCE EDWARD ISLAND

one indirect and one induced job

QUEBEC

will be created in the rest of Canada8

ONTARIO

NEW BRUNSWICK POTENTIAL RESOURCES

NOVA SCOTIA

80 million tonnes

Annually of oil are safely shipped off Canada’s East and West coasts9

New oil sands development is expected to contribute over

$2.1 trillion

2010 dollars to the Canadian economy over the next 25 years – about $84 billion per year 5 Sources: 1 = BP Statistical Review 2013 2 = Oil and Gas Journal 2012 3 = CERI 2011 4 = Environment Canada 2012, United Nations Statistical Division and CAPP 5 = CERI 2011 6 = Enform 2012 Annual Report 7 = Government data 8 = CERI 2011 9 = Transport Canada

www.capp.ca/rce

19


Air

Air

Em i s s i o n s Across all Canadian oil and gas production, NOx intensity continues to decrease

O u r P e rf o rma n c e

as a result of focus on the efficiency of engines and boilers. An exception to the

National – Absolute NOx Emissions

National – NOx Emissions

Kilotonnes

350

downward trend is in Atlantic Canada where efficiency gains in offshore equipment

Western Canada

Oil Sands

Atlantic Canada Offshore

are offset by declining oil production and the increased need to power equipment

300

that pumps and treats increasing volumes of produced water.

250

In Western Canada (not including oil sands), the five-year trend shows a continuing

200

decline in NOx intensity — demonstrating the success of focusing on engine

150

efficiency, and because fewer engines and compressors are needed as natural gas production declines.

100

Oil sands NOx emissions continue to slowly increase with growing but less NOx

50

intense production, primarily from in situ. In situ production is less NOx intensive

0

2008

2009

2010

2011

2012

The overall five year trend in NOx emissions shows a continuing decline as natural gas production declines, oil production mix shifts to less NOx intensive sources,

than mining, so the production trend also means there continues to be a decrease in overall NOx emissions per barrel of oil sands production. National – Absolute SO2 Emissions

National – SO2 Emissions

and more efficient engines and boilers are put into use. NOx is a by-product of

250

Western Canada

Oil Sands

combustion and is released from engines and boilers used in oil and gas production. National – NOx Emissions Intensity Regional Comparison

200

1.2

National

Western Canada

Oil Sands Atlantic Canada Offshore

Tonnes/103m3 OE

1 0.8

Kilotonnes

National – NOx Emissions Intensity Regional Comparison

150

100

50

0.6

0

2008

0.4

2009

2010

2011

2012

Atlantic Canada offshore contributions (not shown) are negligible at one tonne with respect to the national total.

0.2

The overall trend nationally in SO2 emissions continues to improve, although the

0

2008

2009

2010

2011

2012

mix of crude oils is becoming more sour (i.e., higher in sulphur content). This improvement in SO2 emissions is primarily the result of more efficient sulphur recovery equipment at facilities that process sour crude oils.

20


AIR

W H A T ’ S NE X T: O P P OR T UNI T IES AND C H ALLENGES While over the last five years there is an overall decline in SO2 emissions in the oil sands, variability year over year is the result of operational issues primarily associated with upgraders. Additionally, a one-time change in product classification means some heavy crude production in Alberta is now classified as in situ bitumen. As such, there has been a slight increase in oil sands SO2 emissions compared to past years where the data has not been restated. In Western Canada, an absolute reduction in SO2 resulted from a decrease in sour natural gas production volumes, the high efficiency of sulphur recovery equipment at crude oil facilities, and because some sour crudes were reclassified as oil sands, as

are expected under the development of the federal Air Quality Management System (AQMS), which is a comprehensive approach for improving air quality in Canada that is supported by CAPP. AQMS is the product of unprecedented collaboration by the federal, provincial and territorial governments, industry and NGOs. Implementation of AQMS began in 2013. A key component of the system will be emissions requirements that set a base level of performance on an equipment-type basis, e.g., air emissions performance of engines. The growing contribution of mine vehicle fleets to NOx emissions is driving

noted above.

increased focus on NOx emissions reduction technologies. Additionally the

National – SO2 Emissions Intensity

National – SO2 Emissions Intensity Regional Comparison 1.8

Further improvements in the oil and gas industry’s air emissions intensity

National

Western Canada

AQMS will include a Base Level Industry Emissions Regulation for natural gas-fired reciprocating engines used at facilities and for gas compression.

Oil Sands Atlantic Canada Offshore

1.6

Tonnes/103m3 OE

1.4 1.2 1 0.8 0.6 0.4 0.2 0

2008

2009

2010

2011

2012

Nationally, in spite of the gradual shift to more sour crude and bitumen production, SO2 emissions intensities over the past years are improving. This is in part due to reduced production of sour gas, improvements in sulphur recovery, and regulations reducing the amount of flaring and venting in Canada. In the oil sands, in situ production continues to grow, representing over half of oil sands production though only a fraction of SO2 emissions. In situ bitumen contains far less sulphur than mined bitumen, so SO2 emissions per barrel of oil sands produced is down by 45 per cent since 2008. Right Photo: Imperial Oil is working on an alternative to thermal recovery processes to reduce direct greenhouse gas emissions from production by more than 90 per cent.

Photo Credit: Imperial Oil Limited

21


WA T ER

R e d u c i n g f r e s h w at e r w i th d r a w a l p e r barrel of production and safeguarding w at e r q u a l i t y.

o bj e ct i v e s : WAT E R We will continue to reduce the amount of fresh water required per barrel equivalent of production by improving water recycle rates, using low quality (e.g. saline) water sources where feasible, and by developing new technologies. We will safeguard the quality of regional surface and groundwater resources. Canadians place high value on their fresh water resources. They want to know the oil and gas industry is using water responsibly, without negative impact on water quality or availability to communities. Canada’s oil and gas industry is working to reduce the amount of fresh water withdrawn per barrel equivalent of production. One approach is to improve water 2 recycling rates. Using alternatives to fresh water, whereSO feasible, and developing

and implementing new technologies for the efficient use of water are other ways industry is working to manage water. Canada’s oil andCO gas industry is also working 2

with provincial and federal government agencies to increase data collection and

SO2

monitoring activities to improve knowledge and management of regional surface and groundwater resources.

NOX CO2

GHG NOX

80% The percentage of water used in oil sands mining production that is recycled. In situ rates are typically 90% to 95%.

- 28%

- 46%

The decrease in fresh water withdrawal per barrel of production for oil sands mining from 2003 to 2012.

TheGHG decrease in fresh water withdrawal per barrel of oil sands in situ production from 2003 to 2012.

CO2 22

Photo Credit: Cenovus Energy Inc.


WA T ER

Reducing

our

Fresh

Water

IN T ENSI T Y O u r P e rf o rma n c e National – Fresh Water Withdrawal per Barrel of Production

Oil Sands Mining and In Situ, and WCSB Crude Oil – Fresh Water Withdrawal Per Barrel of Production 5.0

Oil Sands Mining WCSB Crude Oil Oil Sands In Situ

4.0 Barrels per Barrel

Oil Sands Mining – Barrels of Fresh Water Per Barrel of Bitumen Production

2 0 1 2 : 3 . 1 B arr e l s

3.0

2.0

1.0

0.0

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

This graph shows fresh water withdrawal per barrel of production for oil sands

Oil sands mining operations' fresh water withdrawal varies significantly over time,

mining, oil sands in situ and Western Canada crude oil over the last decade.

driven by new mine startups and the need to initially store large quantities of water.

In 2012, oil sands mining accounted for 68 per cent of industry's total fresh water withdrawal, while crude oil and natural gas production (and associated usage types) in the Western Canada Sedimentary Basin accounted for 24 per cent. The remaining eight per cent were used for in situ bitumen production in Alberta. Fresh water withdrawal per barrel of crude oil production in the Western Canada Sedimentary Basin has remained relatively constant over the last four years for which we have quality government data. Over that period, an average of 0.5 barrels of fresh water was withdrawn per barrel of oil and gas production in Western Canada (excluding oil sands).

Variability is also seen if facilities experience operational shutdowns for a period of time. Fresh water withdrawal per barrel of oil sands bitumen production for in situ and mining operations shows a slight decline over the last decade. Most of this performance improvement was achieved by increasing recycling rates and replacing fresh water with saline groundwater sources. Over time as mines reach steady state operations, the need for make-up water declines and recycling rates increase. The last mine start-up was in 2008 and in that year, oil sands mining operations withdrew an average of 4.4 barrels of fresh water per barrel of bitumen. Subsequently, there were three years in a row of continual improvement. The 2012 withdrawal per barrel of production shows an increase from the previous year, primarily due to one facility returning to full production after incurring damage that had shut down production for seven months in 2011.

www.capp.ca/rce

23


WA T ER

National – Total Fresh Water Withdrawal

W H A T ’ S NE X T: O P P OR T UNI T IES AND C H ALLENGES

National – Fresh Water Withdrawal* 300 Western Canada

Oil Sands In Situ

Oil Sands Mining

to enhance in situ production without the use of additional water) is expected to

250

contribute to further performance improvements. While saline groundwater use is

200 Millions m3

The evolution and application of new technologies (e.g., the use of solvent injection

implemented where possible, availability of this alternative water source could be

150

limited in locations where such water is not found or cannot be feasibly retrieved.

100

Industry supports water conservation and continues to develop new methods for recycling of water and to source alternatives to fresh water where appropriate.

50

However, it is important to consider all potential environmental impacts. For

0

2009

2010

2011

2012

*Water data from last year’s report has been restated to include additonal water uses in the Western Canada volumes.

example, the use of saline groundwater to conserve fresh water resources may result in increased GHG emissions as a result of energy needed for water treatment, increased surface footprint for treatment facilities, and the generation of a waste stream (salt) that requires appropriate disposal. As such, industry supports the

Total fresh water withdrawn by industry in Western Canada, oil sands in situ and

principle that water management and allocation decisions made by government be

oil sands mining, was 244 million cubic metres in 2012, an increase from 226

based on an assessment of environmental net effects, and with consideration for

million cubic metres in 2009. The main reason for the overall increase in fresh water

land use objectives.

withdrawal in 2012 was an increase in water requirements for oil sands mining operations.

24

Photo Credit: Shell Canada Ltd.


WA T ER

Safeguarding

Water

Resources

O u r P e rf o rma n c e 66 Regulations in both British Columbia and Alberta require disclosure of hydraulic fracturing additives and chemicals. The public and stakeholders are concerned about industry’s operating practices affecting water quality, such as the potential effects of hydraulic fracturing on groundwater and drinking water wells, and potential spills and disposal of waste fluids. The oil and gas industry is highly regulated and takes strict measures to protect both surface water and groundwater quality. W H A T ’ S NE X T: O P P OR T UNI T IES AND C H ALLENGES To help address public concerns about the potential health and environmental effects of the chemicals used during hydraulic fracturing, CAPP sponsored the development of a Fracturing Fluid Additive Screening Tool in 2013. This tool categorizes the additives in fracturing fluids according to their toxicity and environmental

T h e Off s h o r e Environment Spill prevention and response is always a key focus area for the offshore industry. Although the focus is on prevention first, offshore operators also regularly assess their spill response capability. In industry's view, Canada has a world-class spill response system with global response equipment and personnel available on call 24/7/365. However, we recognize the need for ongoing improvement and to learn from other jurisdictions. Industry is conducting research on further enhancing its spill response capabilities through participation in the Subsea Well Response Project (a joint global initiative among oil and gas companies to develop advanced capping and dispersant equipment to be used in case of an underwater loss of containment of a well). To find out more, read our full report online.

persistence, enabling members to make appropriate decisions with regard to chemical use. Additional industry initiatives include a fracturing fluid reuse feasibility study and decision tool, among others. For more information, view our full report online. In addition, water quality is being carefully monitored through industry and government initiatives. In 2013, the governments of Canada and Alberta jointly announced access to federal and provincial environmental monitoring data on air, water, land and biodiversity in the oil sands. This data is available through an online data portal: www.jointoilsandsmonitoring.ca.

Left Photo: Shell has formed a dynamic relationship with the City of Dawson Creek by funding a water reclamation facility which supplies the majority of water Shell requires for its Groundbirch field completions. Right Photo: The Subsea Well Response Project is a global initiative to develop advanced capabilities for handling underwater loss of containment of a well.

Photo Credit: Subsea Well Response Project

25


LAND

Minimizing Land Imp a c t , M a i n t a i n i n g Biodiversity

o bj e ct i v e s : L A N D We will mitigate our impact on the land while maintaining regional ecosystems and biodiversity. We will progressively reclaim all lands affected by our operations, returning them to self-sustaining landscapes. Industry knows that the nature of oil and gas exploration and production has an impact on the land and therefore continually assesses the impact of its activities, and evaluates and addresses the effectiveness of its efforts to mitigate these impacts. Mitigation SO is achieved by ensuring that each phase of development, from site 2

preparation, through exploration and production, and finally reclamation, is designed and implemented in a manner that minimizes land disturbance and industry’s surface

CO2 works with numerous stakeholders including Aboriginal peoples, footprint. Industry biologists and environmental scientists to achieve this goal. Once oil and gas development has occurred, industry knows that it is not always possible toNO fullyX return an area back to its natural state. For example, lands which are predominantly low-lying wetlands before oil sands mining development are

often reclaimed to upland (forested) areas, due to hydrological, hydrogeological SO2 and geotechnical constraints. Industry is required to return the land to a productive self-

sustainingGHG landscape prior to receiving a reclamation certificate and handing the land

CO2

back to the government.

NOX

0.02% The proportion of Canada’s CO boreal forests that2has been disturbed by oil sands mining operations in the past 46 years.

NO

26

Photo Credit: Nexen Energy ULC

77% The percentage of abandoned wells in active reclamation/ remediation, being monitored to demonstrate successful reclamation, or awaiting reclamation certification/release.

+32% Increase in the number of GHG inactive wells since 2008.

X Left Photo: As part of COSIA’s Algar Restoration Project, restoration of woodland caribou habitat is being achieved using best practices such as winter planting.


LAND

P r o g r e s s i v e ly Affected

by

Reclaiming

Lands

Op e r a t i o n s Oil Sands In Situ – Status of Abandoned Wells in 2012

W E L L S - W ES T E R N C A N A D A A N D OI L S A N D S IN SI T U Wells

Number of Wells

Increase Since 2008

Active

228,006

10%

Inactive

108,283

Status of Abandoned Wells in 2012 – Western Canada and Oil Sands In Situ

23% 29%

32%

Abandoned Wells in Active Reclamation/Remediation

Source: Government data

Active wells are wells that reported production at some point during the reporting year, whereas inactive wells are capable of production but did not report production

Temporarily Deferred Abandoned Wells

48%

Abandoned Wells in Monitoring/Assessment or Application

in the reporting year. Since 2008, the number of inactive wells is growing at a faster rate than the number of active wells (32 per cent versus 10 per cent). Regulations require permanent abandonment (cut, cement and cap the well below the surface) once a well reaches the end of its productive life. The number of inactive wells depends primarily on the economic viability of the well. When, for instance, the price received for gas is lower than what it costs to extract the gas, the operator may shut in the well and manage it until such time as it again becomes economic.

For the 43,136 wells that have been abandoned in Western Canada and oil sands in situ developments as of 2012: 23 per cent are temporarily deferred; 48 per cent are in active remediation or reclamation; and 29 per cent are in the monitoring, assessment or application phase (the final phase before a reclamation certificate is issued). The proportion of abandoned wells in each stage of life-cycle well

Regulators are required to strike a balance between conservation of oil and gas

management is almost unchanged as compared to what was reported in 2011.

resource potential and environmental liability. Shutting in wells to conserve the

Source: Canadian Association of Petroleum Producers.

resource for the future can lead to an accumulation of inactive wells which is not necessarily desirable in the near term. Industry is evaluating how to meet resource conservation needs and the need to reduce the number of inactive wells.

This graph captures how industry’s inventory of abandoned wells is progressing through the stages of land reclamation, with the end goal of receiving a reclamation certification/release, so that the land can be returned to the Crown or private landowners. Seventy-seven per cent of industry’s abandoned wells are in the final two phases of reclamation: active reclamation/remediation and monitoring/ assessment or application. This demonstrates that industry is progressing abandoned wells toward eventual certification. It is important to note the reclamation process takes time to complete; typically, five to seven years.

www.capp.ca/rce

27


LAND

Mitigating

Land

Maintaining

Imp a c t s

and

Biodiversity

The provincial and federal governments continue to clarify the definition of footprint and biodiversity in the context of species-at-risk. For this reason, the selection of a metric has been challenging. Instead, the oil and gas industry has proactively been participating in on-the-ground initiatives throughout Canada. An example is Canadian Natural Resource Limited’s Bear Management Strategy—a program that dramatically reduced the number of incidents with bears. Visit our full report online for more information. As well, through CAPP, industry has begun to turn its attention to its role and responsibility in managing cumulative effects on a shared land base. CAPP has been providing input to a number of key initiatives including the British Columbia Cumulative Effects Management Framework, the Alberta Lower Athabasca Regional Plan, and the Saskatchewan South of the Divide Multi-Species Action Plan.

¨

28

Photo Credit: Canadian Natural Resources Limited

Left Photo: Through strategies including fencing, garbage bin management, bear awareness training and banning of outdoor cooking, Canadian Natural Resources Limited has dramatically reduced incidents involving bears. In 2012, there were 215 bear sightings near Canadian Natural Resources Limited facilities and zero bear incidents.


LAND

OI L S A N D S M INES

W H A T ’ S NE X T: O P P OR T UNI T IES AND C H ALLENGES

Since 2009, the total active footprint of oil sands mines increased by 17,064 hectares

Industry and regulators want to ensure the abandonment and reclamation liabilities

to 84,394; and the area of land ready for reclamation or in some stage of reclamation

are estimated appropriately to ensure that adequate funding is in place to manage

increased by 479 hectares to 8,088. In 2012, 90 per cent of the total active footprint

these liabilities. To address this, the Energy Resources Conservation Board (ERCB),

for oil sands mining operations was cleared or disturbed land while 10 per cent was

now the Alberta Energy Regulator (AER), implemented changes to the Licensee

ready for reclamation or being reclaimed. This is a slight change from 89 per cent

Liability Rating (LLR) Program in 2013. The LLR Program compares a producer

and 11 per cent respectively in 2009. Source: Alberta Environment and Sustainable

licensee’s assets with its liabilities, and requires companies to post security if

Resource Development. Maintaining the percentage of land in the reclamation stage

liabilities exceed assets. The changes to the program require a greater number

while increasing the total active footprint demonstrates that industry is keeping up with

of licensees to post financial security deposits, significantly increasing the total

reclamation despite increasing development.

deposits held in guarantee of land reclamation.

Through progressive reclamation, mature oil sands mining companies have been able

Canada’s Oil Sands Innovation Alliance (COSIA) is working to develop the Landscape

to reclaim a more significant portion of land even as the mine continues to produce. For

Ecological Assessment and Planning (LEAP) tool, which uses geospatial data and

example, 21 per cent of Syncrude’s Mildred Lake mining operation’s total active footprint

forest industry modeling techniques to create a multi-layered digital map of land

is ready for reclamation or is being reclaimed.

use in the southern Lower Athabasca region of Alberta. LEAP will allow industry to

With new projects coming online, industry’s total active footprint growth will temporarily

establish a baseline of land use in the region, as well as model how reclamation work

outpace progressive reclamation progress. As these new projects mature, the percentage of the total active footprint in some stage of reclamation will increase.

undertaken today will affect reforestation and caribou and other species habitat five, ten, even fifty years into the future. British Columbia

Two Island Lake

Geophysical, Geomatics, GIS Services

2013-06-12

M u lt i - pa d

c-63-K\94-O-8

14 Wells Total Disturbance = 5.4ha Reclaimed = 3.6ha Unreclaimed = 1.8ha

Land

Photo Credit: Encana

14 Wells:

Total Disturbance = 5.4ha

Reclaimed = 3.6ha

Unreclaimed = 1.8ha

Wells

to

Reduce

F o o tp r i n t

Horizontal drilling allows multiple wells to be consolidated onto one pad site. Not only does this reduce the average footprint per well, a significant portion of the lease area can be reclaimed right after drilling operations are completed to minimize surface disturbance. This is an example of Encana's 14-well pad in the Dawson Creek area. The initial surface disturbance was 5.4 ha and 3.6 ha was progressively reclaimed after the wells were drilled and tied in (i.e., only one-third of the surface lease is ultimately taken up by wells and facilities). 29


Hydraulic

30

Fracturing

Photo Credit: Devon Canada


Hydraulic

2013

Hydraulic

Practices

Fracturing

Fracturing

Up d a t e

In 2011, CAPP and its members developed a set of hydraulic fracturing principles

CAPP added to its yearly performance survey of members a series of questions

for tight gas that have since been adopted by members producing tight oil. In

regarding the state of implementation of the Operating Practices.

2012, a series of seven leading Operating Practices in support of the principles

Recognizing that not all aspects of all of the practices can be fully implemented

were introduced, and implementation was initiated by members. As part of the

in a single year, it is still important to report the implementation achieved with an

Responsible Canadian Energy Program, CAPP members who use hydraulic

expectation that companies will continue to progress toward full implementation.

fracturing in their shale and tight gas development programs made a commitment to report to CAPP on the uptake of the Operating Practices for Hydraulic Fracturing in their first year of implementation.

For this report, CAPP’s survey asked questions specifically regarding the implementation of the first six practices relating to hydraulic fracturing. The results are provided in the following graph.

The Operating Practices set out clear expectations of members, including the expectation that processes members use to manage critical aspects of their

HF Operating Implementation National - Hydraulic FracturingPractice Operating Practice Implementation

hydraulic fracturing programs are disclosed to the public. In support of this, 100 90 Percentage Implemented

80 70 60 50 40 30 20 10 0

OP #1

OP #2

OP #3

OP #4

OP #5

OP #6

C A P P H y dra u l i c F ract u r i n g Op e rat i n g P ract i c e s OP#1 Fracturing Fluid Additive Disclosure OP#2 Fracturing Fluid Additive Risk Assessment and Management OP#3 Baseline Groundwater Testing OP#4 Wellbore Construction and Quality Assurance OP#5 Water Sourcing, Measurement and Reuse OP#6 Fluid Transport, Handling, Storage and Disposal Illustration Credit: Statoil Left Photo: Pressure pumping units in operation for hydraulic fracturing in the Horn River Basin. Illustration: Diagram showing an example of hydraulic fracturing.

www.capp.ca/rce

31


Transportation

32

Photo Credit: HDMC


transportation

Safe

and

Responsible

Transport

to

Product

Market

The upstream oil and gas industry has a longstanding commitment to working with our transportation providers to ensure safe delivery of our products to markets. The growth in oil and gas production and the need to access new markets are driving new natural gas and oil pipeline proposals, potential for increased oil and LNG tanker

As producers, we are also working with rail operators to assure appropriate systems and processes are in place to address the rapid growth in oil transport by rail, and the impact on existing and new infrastructure. The tragic incident at Lac Mégantic in 2013 reinforced the importance of working with the railways to address the safety of

traffic along Canada’s West Coast and growth in the rail transport of crude oil.

rail transport of crude oil and other petroleum products.

With the oil and gas industry’s growth, Canada’s upstream producers continue to

In addition, we are working with the marine tanker industry to assure product

support both industry initiatives directed at safe transportation of our products, and efforts by governments to review safety standards and regulations. For example, our industry supports the Canadian Energy Pipeline Association’s Integrity First

®

Program, a program intended to improve performance throughout the pipeline industry. We are also broadly supportive of the independent pipeline review

continues to move in a safe and environmentally responsible manner along Canada’s coasts. Industry is providing input into the federal government’s panel on oil spill prevention and response, and working with the marine industry, governments and regulators to ensure that Canada has a world-class marine spill prevention and response system in place.

commissioned by the Alberta Energy Regulator, which resulted in a number of recommendations for regulatory enhancement, while affirming the pipeline industry’s strong record and world-class safety systems. CAPP is currently assessing opportunities to improve performance for those pipelines owned and operated by member companies.

Left Photo: Deployment of the Norlense 1200R oil containment boom during Exercise Synergy on August 28, 2013. Synergy is an annual on-water spill response exercise organized by offshore operators in N.L.

www.capp.ca/rce

33


NA T IONAL

DA T A

T ABLE

N A T ION A L Key Metric

Metric

Global Reporting Initiative (GRI) Reference

GRI Performance Indicators

N/A

Social 2 Social 2 Social 2 Social 2 N/A

LA7 3 LA7 3 LA7 3 LA7 3 N/A

N/A

N/A

N/A

Discussed in report Discussed in report

Economic Economic

EC1 4 EC1 4

Discussed in report

Social 2

EC1 4

2008

2009

2010

2011

2012

12 0.63 1.24 1.08

25 0.60 0.94 0.85

7 0.58 0.99 0.88

5 0.56 1.00 0.89

4 0.51 0.84 0.77

P EO P LE Fatalities

Worker fatalities (number/yr) Employee total recordable injury frequency (trif) Total recordable injury Contractor total recordable injury frequency trif) frequency (TRIF) Combined total recordable injury frequency (trif) Community engagement Qualitative indicator discussed in report Spending on Aboriginal Qualitative indicator discussed in report related projects Taxes and royalties Investment spending Payments to government Employment (direct and Employment (direct and indirect) indirect) WA T ER

M ANAGE M EN T

Fresh water withdrawal

Fresh water as a percentage of total water withdrawal

Fresh water withdrawal per barrel of production

Per cent water reuse

Water quality

34

Fresh water withdrawal for Western Canada Sedimentary Basin operations (millions m3/yr.)1 Fresh water withdrawal for in situ operations (millions m3/yr)1 Fresh water withdrawal for mining operations (millions m3/yr)1 Fresh water as a percentage of total water withdrawal for Western Canada Sedimentary Basin operations (%)1 Fresh water as a percentage of total water withdrawal for oil sands in situ operations (%) Fresh water withdrawal per barrel of production for Western Canada Sedimentary Basin operations (bbl/bbl)1 Fresh water withdrawal per barrel of production for oil sands in situ operations (bbl/bbl)1 Fresh water withdrawal per barrel of production for oil sands mining operations (bbl/bbl)1

First available in 2009

28.4

31.7

31.0

34.2

Environment

EN8 5

19.1 184.3

16.6 162.4

17.7 152.4

18.0 143.5

19.9 167.0

Environment Environment

EN8 5 EN8 5

First available in 2009

61%

66%

66%

68%

Environment

EN8 5

57%

50%

49%

52%

49%

Environment

EN8 5

First available in 2009

0.5

0.6

0.5

0.5

Environment

EN8 5

0.6

0.4

0.4

0.4

0.4

Environment

EN8 5

4.4

3.4

3.1

2.8

3.1

Environment

EN8 5

Per cent water reuse in hydraulic fracturing

First reported in 2012

33%

Environment

EN10 6

Flow back generated (m3/yr)

First reported in 2012

2,364,534*

Environment

EN8 5

Flow back reused (m3/yr)

First reported in 2012

740,529

Environment

EN10 6

N/A

N/A

Qualitative indicator discussed in report

N/A


N A T ION A L Key Metric Air

and

Metric Energy

Air emissions

Greenhouse gas (GHG) emissions

2008

2009

2010

2011

2012

Global Reporting Initiative (GRI) Reference

GRI Performance Indicators

214,047 0.68 286,555 0.97 90,607,676 0.28

228,448 0.72 299,852 0.93 98,826,706 0.31

197,334 0.63 283,407 0.90 102,399,512 0.32

178,618 0.56 265,948 0.84 102,442,702 0.32

173,059 0.55 255,144 0.80 109,815,779 0.34

Environment Environment Environment Environment Environment Environment

EN20 10 EN20 10 EN20 10 EN20 10 EN16 9 EN16 9

13,407 11,600

215,220 102,304 2,682 9,788 20,959 9,882

228,143 108,327 2,915 10,155 20,585 12,396

Environment Environment Environment Environment Environment Environment

EN12 7 EN12 7 EN12 7 EN12 7 EN12 7 EN12 7

1,505

1,709

2,018

1,636

Environment

EN13 8

67,419

71,451

76,164

84,424

Environment

EN12 7

59,810

63,820

68,383

76,336

Environment

EN12 7

7,609

7,631

7,781

8,088

Environment

EN13 8

Management

So2 emissions (tonnes/yr) So2 intensity (tonnes per thousand m3 OE of production) Nox emissions (tonnes/yr) Nox intensity (tonnes per thousand m3 OE of production) Total co2 equivalent emissions (tonnes/yr) Tonnes ghg emitted per m3 OE of production

LAND

M ANAGE M EN T Active wells Active wells and inactive wells Inactive wells Annual well abandonments Annual well abandonments Temporarily deferred abandoned wells Status of abandoned wells in Abandoned wells in active reclamation/remediation reclamation Abandoned wells in monitoring/assessment or application Annual certifications or Annual certifications or releases received releases received Total active footprint (oil Total active footprint (oil sands mining) (ha) sands mining) Total area cleared or Total area cleared or disturbed (oil sands mining) (ha) disturbed (oil sands mining) Total area in reclamation or Total area in reclamation or reclaimed not certified (oil reclaimed and not certified sands mining) (ha) (oil sands mining)

207,595 82,081 1,791

204,198 90,045 1,914 First reported in 2011 11,771 11,370 5,556 6,994 1,821

First reported in 2009 First reported in 2009 First reported in 2009

N/A - Not available "Combined" includes both employees and contractors in TRIF calculation 1 Methodology updated in 2012 and applied to all five years of data as a restatement 2 Social = Labour Practices and Decent Work 3 LA7 = Rates of injury, occupational diseases, lost days, and absenteeism, and total number of work -related fatalities, by region and by gender 4 EC1 = Direct economic value generated and distributed, including revenues, operating costs, employee compensation, donations and other community investments, retained earnings, and payments to capital providers and governments

213,991 94,748 3,126

EN8 = Total water withdrawal by source EN10 = Percentage and total volume of water recycled and reused 7 EN12 = Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas 8 EN13 = Habitat protected or restored 9 EN16 = Total direct and indirect greenhouse gas emissions by weight 10 EN20 = NOx, SO2, and other significant air emissions by type and weight 5 6

www.capp.ca/rce

35


About

th e

Petroleum

Canadian

Association

of

Producers

The Canadian Association of Petroleum Producers (CAPP) represents companies, large and small, that explore for, develop and produce natural gas and crude oil throughout Canada. CAPP’s member companies produce about 90 per cent of Canada’s natural gas and crude oil production. CAPP’s associate members provide a wide range of services that support the upstream crude oil and natural gas industry. Together, CAPP's members and associate members are an important part of a national industry with revenues of about $100 billion a year. CAPP's mission is to enhance the economic sustainability of the Canadian upstream petroleum industry in a safe and environmentally and socially responsible manner, through constructive engagement and communication with governments, the public and stakeholders in the communities in which we operate.

http://twitter.com/@OilGasCanada http://www.facebook.com/OilGasCanada

capp.ca/rce

2100, 350 - 7 Avenue SW, Calgary, Alberta Canada T2P 3N9 Phone: 403-267-1100 | Fax: 403-261-4622

Place FSC logo here

ENVIRONMENTAL BENEFITS STATEMENT The savings below are achieved when post-consumer recycled fiber is used in place of virgin fiber. This report uses 910 kilograms of paper which has a post-consumer recycled content of 100 per cent. By using the environmentally friendly paper, in a print run of 4,000 copies, CAPP contributing to saving the following resources: Trees Water-borne Waste Wastewater Solid Waste Greenhouse Gases Energy 19 preserved 25 kilograms not created 30,975 litres flow saved 411 kilograms not generated 809 kilograms prevented 13,644,540 BTUs not consumed Calculated based on data research by Environmental Defense Fund. Printed in Canada.

2013-0025


Issuu converts static files into: digital portfolios, online yearbooks, online catalogs, digital photo albums and more. Sign up and create your flipbook.