IPC CEO urges Canada to offer more funding to create carbon sequestration | – #IPC #CEO #urges #Canada #offer #funding #create #carbon #sequestration
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March 19 (Reuters) – International Petroleum Corp ( IPCO.TO ), the first foreign oil company to sanction a project in Canada’s oil sands in more than a decade, may add carbon capture and storage (CCS) to the plant if the government provides more funding. incentives are becoming available, its CEO told Reuters.
Geneva-based IPC, part of Sweden’s Lundin Group, last month permitted the first phase of the 30,000 barrel per day (bpd) Blackrod thermal project in northern Alberta.
The company has joined Canada’s biggest oil producers in urging politicians to increase public funding for the expensive technology seen as key to reducing emissions from the carbon-intensive oil sands.
The industry says CCS projects need more government support to be financially viable, with Ottawa and oil-rich Alberta at odds over who should get the increased funding.
“There’s still an opportunity — if we can get serious government decisions to meet climate targets — if the right incentives come in, we’ll be in a very good position to look at carbon sequestration,” CEO Mike Nicholson said in an interview in late February.
Until then, the company will pay Canada’s carbon tax, which will rise to C$170 a tonne by 2030, Nicholson said.
Canada, France and IPC, which has assets in Malaysia, 850 million for the development of the first phase of Blackrod, which produces 50,000 barrels dollars will spend First oil is expected in 2026 and IPC has regulatory approval to produce up to 80,000 barrels per day.
FactoryImperial Oil Ltd (IMO.TO) 2018It is the first greenfield oil sands project to be approved since it approved the Aspen plant in 2011, only to suspend it indefinitely a few months later.
It comes after years of weak foreign investment in the oil sands, with international firms deterred by high upfront capital costs, export pipeline bottlenecks limiting production and concerns about bitumen’s high carbon intensity.
Nicholson said IPC’s decision was driven by the strength of Canada’s new export pipeline and IPC’s own strong financial position.
He added that the oil industry’s recent focus on debt repayments and share buybacks has also overstretched global oil supplies.
“Our industry has been underinvested for over a decade, all recent investment has been very short-term,” Nicholson said.
“Still, shareholders’ income is definitely prioritized. But long-term sustainable businesses cannot be built like this.”
Increase in PRODUCTION, Emissions
IPC’s investment underscores the importance of Canada’s vast bitumen deposits, the world’s third-largest crude reserves, amid global concerns about energy security following Russia’s aggression in Ukraine.
But Blackrod points out how the increased production, albeit relatively small, detracts from Canadian Prime Minister Trudeau’s emissions reduction goals and cements Canada’s place as a climate laggard.
According to S&P Global, Canada’s oil sands produced a record 3.15 million bpd in 2022 and is forecast to reach 3.7 million bpd by 2030.
According to the Canadian Climatic Institute, 20Between 05 and 2021, emissions from the oil sands increased by 137% or 48 megatons.
The think tank said that if CCS projects don’t go ahead and the federal government takes over the controversial federal oil and gas They are projected to increase by another 23 megatons by 2030 unless they adopt stricter climate legislation, including a cap on their emissions.
According to analysts, strong global crude oil priceswhile a wave of greenfield projects like Blackrod is unlikely, means oil sands production will continue to grow through existing project expansions.
“Oil sands are long-lived, low-margin assets,” said Wood Mackenzie analyst Scott Norlin. “We use the term ‘cash flow machines.’ They’re just printing money, especially when oil is above $70.”
Reporting by Nia Williams Editing by Danny Thomas and Marguerita Choy
Our standards: Thomson Reuters Trust Principles.
2023-03-20 03:26:33
Source – reuters
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