Your Concerns, Our Response: Oil Sands

What is the issue?

The Alberta oil sands are a significant investable resource base. At present, Teck holds 20% ownership in the Fort Hills Oil Sands project, as well as a 50% interest in two additional oil sands projects, Frontier and Equinox and several oil sands leases. The Fort Hills project is in the feasibility study stage, while all the other projects and leases are currently in earlier phases.

The main environmental issues associated with oil sands mining include use of local water resources, sustainability of tailings management strategies and greenhouse gases emissions (GHG) produced by the mining and upgrading process. Reclamation, non-GHG air emissions and land disturbance are also important issues for consideration. A number of Communities of Interest (CoIs)—have expressed concern that production of oil from oil sands is inherently irresponsible, or that companies carrying out activities in the Alberta oil sands are not operating in a responsible way.

We identified four overarching issues in relation to oil sands development: water management (What can we do to minimize the draw of water from the Athabasca River?), water quality (What can we do to protect the quality of the water in the Athabasca River?), tailings management (What can we do to improve and speed up reclamation?) and greenhouse gas emissions (What can we do to reduce our emissions?)

What actions have we taken to address the issues?

On the issue of water management, we participate with other industry members, government agencies, Indigenous Peoples, and NGOs through the Cumulative Environmental Management Association in the formation of the Athabasca Water Management Framework. This Framework established guidelines to protect the river’s ecosystem and caps the water use allowed for the oil sands mines during low flow periods. We are also evaluating “off-stream” water storage schemes to avoid removing water from the Athabasca River during winter low flow periods. Water would be stored in ponds during high flow periods in summer months when withdrawals from the river are not as critical.

To address the issue of water quality, operating oil sands companies participate in the Regional Aquatics Monitoring Program. This program provides independent scientific testing of local waterways upstream and downstream of the oil sands region. These reports are made available to the public, government and industry all at the same time to reduce the potential for any perception of bias. We will be closely watching results of forthcoming reports and expect to use these findings as part of our community engagement.

Operating oil sands mines produce fluid tailings, which can take decades to become ready for reclamation. To manage this concern, the Energy Resource Conservation Board (ERCB) recently released Directive 074, which requires that 50% of fluid tailings be captured in dedicated disposal areas after 2013. We are committed to achieving this requirement at our proposed mines so that our tailings impoundments are ready to be reclaimed within five years after active deposition has stopped.

One of the major concerns about oil sands is the perception that they are a dirty source of oil. As shown in the graph below, no oil source is “clean.” Current life cycle GHG emissions from Alberta’s oil sands are quite close to certain other conventional oil sources (like Mexico, Venezuela, and Nigeria). Although oil sands production emits greater emissions than conventional oil and gas production, when we consider life cycle GHG emissions which include emissions from consumption, the life cycle GHG emission difference drops significantly. Our belief is that the oil sands industry must strive to bring this gap as close to zero as possible. In fact, energy efficiency improvements in oil sands production have reduced the average GHG emissions per barrel of oil from oil sands by 38% since 1990 ¹.

Life Cycle GHG Emissions of Various Crude Oils

Source: Life Cycle Assessment Comparison of North American and Imported Crudes, prepared for Alberta Energy Research Institute, Jacobs Consultancy, July 2009

What is the focus of current and future efforts?

Substantive long-term consultation with our CoIs is an essential part of our oils sands strategy. We have identified locally impacted groups and are engaging them in dialogue to ensure that we understand and carefully consider their needs and concerns. This process has been on-going for several years and we anticipate working with our local partners on community engagement throughout each phase of development.

As we move through the exploration and development phase and approach production, we are working hard to ensure that we implement the most effective technology for managing our natural resources. For example, the Fort Hills project is being designed to maximize water recycling and we are currently working to improve our tailings management technologies.

1. Source: 2006 Technical Report, Regional Aquatics Monitoring Report