Evidence of meeting #112 for Environment and Sustainable Development in the 44th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was energy.
A video is available from Parliament.
Chief Executive Officer, Suncor Energy Inc.
I'm apparently pretty popular today.
Let me start on the record profits for a minute. Two of my colleagues said this, and I'll be quick so I can, perhaps, get my answers in. We are a global, capital-intensive industry that goes with cyclic prices on a commodity. In the last four years, yes, we've had a record profit year, and, yes, we've had a record loss year.
On average, over the last four years, we've made $17 billion—big numbers, big industry. In those same four years, we've paid $17 billion in taxes and royalties, and each and every year, we've paid an additional $8 billion in salaries, wages and benefits to Canadians who also pay taxes.
Yes, we're a big business, and the numbers are big, but it goes up and down. You characterize us as having record profits. We did one year, yes, but then also remember the year that was a record loss. Those are the last four years on the roller coaster of global oil and gas.
NDP
Laurel Collins NDP Victoria, BC
When you make record profits, when there are headlines that say the oil and gas sector has made more money than it's ever made before, how are Canadians supposed to trust that you will invest that in decarbonization instead of putting it into the pockets of your shareholders and into bonuses for yourselves, because that's what we've seen?
You have been part of the oil and gas industry for decades and part of companies that have misled Canadians for years and years. Your companies knew that there was a climate crisis. They knew that climate change was real, yet funded misinformation to try to convince Canadians that the climate crisis was not as serious as it is.
Liberal
The Chair Liberal Francis Scarpaleggia
We have to stop here because that completes the first round of questions.
We will now begin the second round.
Mr. Deltell, go ahead.
Conservative
Gérard Deltell Conservative Louis-Saint-Laurent, QC
Thank you very much, Mr. Chair.
Ladies and gentlemen, welcome to your Parliament of Canada.
We all agree that climate change is real and that we need to adapt to it. Consequently, we have to reduce pollution and emissions.
As we obviously know, the oil industry plays a major role in Canada in both our economic and energy-related lives and that it has considerable impacts on the environment.
We use oil at home in Quebec. According to recent studies published by HEC Montréal, 18 billion litres of oil are used every year, which represents an 87% increase.
We will fight for Canadian oil for as long as we need it. Why is that important? Because, in Canada, we have very high human rights and environmental standards.
Remember that Canada makes equalization payments to many provinces. Quebec receives $13 billion in equalization.
Now I'm going to ask some questions, and I'd like all the witnesses to answer each of them.
First, by how many percentage points have you managed to reduce the industry's environmental footprint or the amount of pollution generated by producing a barrel of oil?
Let's begin with you, Mr. Kruger.
Chief Executive Officer, Suncor Energy Inc.
I don't understand the context of the time frame. I think it varies by time frame and by the type of production we have.
I don't have a simple answer to that question.
Conservative
Gérard Deltell Conservative Louis-Saint-Laurent, QC
If you produce more, obviously you'll have more emissions. We understand that. However, if you count your emissions by each and every barrel, did you reduce the emissions by each barrel over the last year or over the last years?
Chief Executive Officer, Suncor Energy Inc.
Thank you.
I'll be quick so my colleagues can answer.
Right now, for example, we're the largest blender of biofuels in consumer products—diesel and gasoline. This is reducing the carbon intensity of individuals in terms of not only the product we produce but that they're consuming. We're now investing $1.7 billion to cut the emissions at an oil sands plant by cogeneration—going from coke-fired boilers to natural gas-fired boilers. That project will be complete by the end of this year. You'll see the corresponding emissions reductions thereafter.
The activities and the money we're spending now are benefiting and reducing the carbon content of what we produce and the way our consumers use it.
Conservative
Chairman, President and Chief Executive Officer, Imperial Oil Limited
If I could comment from Imperial's perspective, I'm quite proud of the progress we've demonstrated in reducing the emissions intensity of each barrel we produce. As I mentioned in my opening comments, from 2013 to 2016, we reduced that intensity by 20% per barrel. Since 2016, we have reduced by an additional approximate 10%.
As I mentioned, we have an objective to reduce it by 30% by 2030. Of course, collectively, as the Pathways Alliance, we've all set objectives to work together to achieve net zero by 2050. I'm quite proud of that progress, and we are going to continue to invest. We're very committed to this objective.
Conservative
President and Country Chair, Shell Canada Limited
Thank you very much, Mr. Chair.
We are not a major oil producer in the country of Canada, but what I can share with you is that we have scope 1, scope 2 and scope 3 targets.
On a global basis, for scope 1 and scope 2, we've reduced by close to 60% of our 50% target for 2030. That's from a 2016 time frame. I'd also comment that, with respect to methane emissions, we reduced by 70% between 2016 and the end of last year. We have a very clear commitment to continue to reduce our methane emissions to near zero by 2030.
As I mentioned earlier, we have a commitment to reduce scope 3—the emissions from our customers—by 15% to 20% by 2030. We've also made a commitment to reduce emissions from our oil products by 15% to 20%.
Thank you.
Conservative
Gérard Deltell Conservative Louis-Saint-Laurent, QC
When we talk about reducing emissions, it's a never-ending story. If you challenge yourself, you will have to reduce year after year.
What is the target for this year to reduce emissions, and how much money do you intend to invest in the reduction of pollution?
Liberal
The Chair Liberal Francis Scarpaleggia
We only have time for a single answer. Whom would you like to hear answer your question, Mr. Deltell?
Liberal
The Chair Liberal Francis Scarpaleggia
We have time for one answer. Who would like to answer that one?
The clock is running—three, two, one.
Okay. We'll go to Ms. Taylor Roy.
Liberal
Leah Taylor Roy Liberal Aurora—Oak Ridges—Richmond Hill, ON
Thank you very much, Mr. Chair.
Thank you to the witnesses for being here. I listened with great interest as you all made your opening remarks, and I noted a few things.
Jon McKenzie said that the oil and gas industry is good for Canadians. Suncor CEO Richard Kruger said that we should be producing more oil in Canada because we have strong social accountability and climate action measures.
Ms. Pierce, you said that you were happy to be healthy and in good spirits and wished that we all were too.
I want to comment on those things because words are all fine and good, but it really depends on the context and on who is listening to those words.
When you talk about the oil and gas industry being good for Canadians, Mr. McKenzie, it really depends on how you define “good”. When you were speaking of it, it was all economic measurements—I would suggest you left out a couple of economic measurements such as share prices and executive compensation—but most Canadians believe that what is good for Canadians is keeping global temperature increases to less than 1.5°C and certainly less than 2°C. They believe that good health and economic justice is good for Canadians, and they believe that not seeing out-of-control forest fires, floods and droughts is certainly good.
Indigenous people I've spoken to also believe that we have a duty to protect our planet for the next seven generations. It seems that is in a bit of opposition to the economic good that you referenced.
Additionally, the social accountability and climate action measures you mentioned, Mr. Kruger, are one of the reasons you're here. It doesn't seem that the oil and gas industry is living up to those measures that we have in place in Canada. With the increase in production of fossil fuels, carbon emissions have continued to increase. The industry is against a cap on emissions, which would provide social accountability and more climate action. It's also against methane regulations. All of those things would help to ensure that Canadians believe that the social accountability and climate action we want in Canada were being met by the oil and gas industry.
Lastly, Susannah, our youth are not in good spirits. I speak to many of them, and they're experiencing climate anxiety and despair, quite frankly. Elderly people are suffering from heat domes and poor air quality. Homeowners have seen their homes washed away, and farmers are struggling to keep their farms up through droughts. This is a different reality from what you're talking about.
Your emissions from the industry have increased. You have this belief that you'll meet the goals by 2050, but we haven't seen action. There seems to be a lot of uncertainty about the industry meeting its goals for 2030, the 22 megatonnes.
I would like to request that every one of the companies table their specific plans and the investments they're going to be making that have been board approved to get to net zero, with the 2030 interim targets, and what investments you have made and are going to make to reach those goals, because, while words are good, actions are better.
Thank you.
Liberal
Leah Taylor Roy Liberal Aurora—Oak Ridges—Richmond Hill, ON
I'd like to ask every company about the specific commitments they have made to get to that 22-megatonne annual reduction by 2030, their current investments. I know that Pathways Alliance has a large project.
Perhaps we could start with you, Mr. Kruger. What has Suncor committed to investing as of right now to get to that target by 2030?
Chief Executive Officer, Suncor Energy Inc.
We publish every year an annual sustainability report and a climate report that details at length the actions we're taking and the commitments we've made. Unless you want to take the rest of the time, I could read through that report, or I could send it to you. That might be a little easier.
Liberal
Leah Taylor Roy Liberal Aurora—Oak Ridges—Richmond Hill, ON
No, I just want to know the specific investment targets you're making in CCUS right now.
Chief Executive Officer, Suncor Energy Inc.
CCUS is around the preparation and the negotiation to determine an appropriate framework for the Pathways Alliance carbon capture and storage. We can't do that on our own.
Liberal
Leah Taylor Roy Liberal Aurora—Oak Ridges—Richmond Hill, ON
You're still in discussion. You've not made any commitments to investment right now.
Chief Executive Officer, Suncor Energy Inc.
We can't do that on our own. We need a regulatory framework, and we need the right fiscal framework to enable the competitiveness of the industry and to do it so that everybody benefits from it.
The people committed are showing up at the table each and every day with their sleeves rolled up. They're working hard at multiple levels of government to try to get this done.