Oil sands producers join to tackle environment issues

Canadian Oil Sands Innovation Alliance (Cosia), which represents 12 of the largest Canadian oil sands producers, has been formed to ‘find solutions to the environmental challenges of oil sands development through innovation and collaborative action’.

 

The alliance brings together industry competitors to work on developing solutions to environmental issues associated with oil sands development, covering water, land, greenhouse gases and tailings – a toxic waste byproduct stored in open lakes.

 

The initiative has been welcomed by many industry observers. This collaborative competition may go some way to addressing the problems highlighted in a new report by Ceres which tracked SEC-mandated disclosure on material risks to investments in fossil fuel extraction.

 

The report finds that hydraulic fracturing – fracking – for natural gas and oil creates wide-ranging environmental risks, including proliferating emissions of the potent greenhouse gas methane from wellheads all across the US.

 

It also says that oil sands production is one of the most carbon-intensive forms of oil production on a lifecycle basis, making it vulnerable to a low-carbon fuel standard. 

 

“This report should act as a ‘wake up’ call for investors in assessing risks in this important sector,” said New York state comptroller Thomas P DiNapoli, trustee of the $150bn New York State Retirement Fund.

 

The report finds that oil and gas companies are providing inadequate information to allow investors to fully gauge their exposure to evolving climate risks and opportunities.

 

Ceres recommends companies improving disclosure and performance by providing more information about both risks and opportunities presented by climate change. It also says investors should continue encouraging companies and securities regulators to improve climate-risk reporting.

 

Ceres also believes securities regulators, including the US Securities & Exchange Commission and the Canadian Securities Administrators, must improve climate reporting in the oil and gas industries by closely reviewing whether company filings comply with their recent guidance on environmental disclosure.

 

Federal and state governments, it says, should also communicate scientific findings and other climate change data to companies, investors and securities regulators.