Branding Canadian oil green would be good for industry and for climate change: Don Pittis

By Don Pittis, CBC News Posted: Jul 24, 2017 5:00 AM ET

But diehard environmentalists and climate deniers will likely both be hard to convince

To much of the world, Canada’s oil production is indelibly linked to images of tortured landscapes that make oilsands mining seem like something out the evil land of Mordor in J.R.R. Tolkien’s Lord of the Rings.

For that reason and several others, the idea of green Canadian oil may seem like an oxymoron.

But greening Canadian oil is not only possible, there are reasons why it would be good for business and the environment.

Certainly those most worried about climate change may be hard to convince.

Equally, pro-fossil-fuel climate change deniers of the type who agree with U.S. President Donald Trump that “global warming is a total and very expensive hoax,” will also be difficult to persuade.


U.S. President Donald Trump announces last month that the U.S. would withdraw from the Paris climate agreement. He has repeatedly called climate change a hoax. (Kevin Lamarque/Reuters)

Even coaxing less extreme advocates on both sides may be a challenge.

To many climate change campaigners, fossil fuels such as coal, oil and natural gas are the enemy.

During the last few hundred years, industrial humanity has annually released into the atmosphere billions of tons of carbon that had been trapped underground for millions of years.

Reducing the carbon

Scientists have shown that the relatively sudden discharge of all that carbon, as shown in the Keeling Curve, is directly correlated with rising global temperatures.

Keeling Curve, Scripps Institution of Oceanography

The Keeling Curve, named after Charles Keeling who first alerted the world to the dangers of human-caused climate change, records the daily change in atmospheric carbon. (Scripps Institution of Oceanography)

To get the environmentalists on board, any green oil plan would have to show that it was contributing to reduced global greenhouse gas emissions.

If that’s the case, the next question is why people who make their living from oil and gas might want to co-operate.

Despite redneck stereotypes, there are lots of smart people in the oil and gas sector who understand the implications of rising temperatures on the future of the world their grandchildren will inherit.

Too much oil in the ground?

But in the shorter term, there are some good business reasons for making Canadian oil green.

As fossil fuel prices stubbornly refuse to fulfil the promise of a speedy bounce-back to levels that made many of today’s extraction projects feasible, there are signs that there may be no shortage after all.

Oil sands reclamation

Oil companies are reclaiming damaged land, and new techniques using steam extraction produce less carbon and leave surface vegetation unharmed. (Suncor Energy)

In fact, as governments around the world, with the exception of Trump’s Washington, move to limit climate damage and electric cars become cheaper, there are financial experts who say oil prices will stay low for the foreseeable future.

Not only that, but it may be that a lot of oil that we already know about will have to be left in the ground.

But that does not mean oil is suddenly going to disappear from the world economy. 

Petroleum use continues to grow, and even in countries like France that plan to end the use of fossil fuel vehicles, the target date is decades away.

Premium product

In the meantime Canadian oil could set itself apart in the world market by branding itself as green. Of course branding alone — like BP’s attempt at greenwashing — is not enough. It has to be credible.

The strategy of distinguishing your product in a market for an undifferentiated commodity has been proven to work.

In the market for the commodity labelled just plain beef, Angus Beef has been able to charge a premium price. “Free From” branded chicken has done something similar.

In the energy sector Bullfrog Power had an early success charging a premium for green electricity.

By exposing themselves to outside monitors, Canadian diamonds set themselves apart from so-called blood diamonds which were seen as being unethically mined, their profits used to fund African wars.

Like diamonds and like fisheries supervised by the Marine Stewardship Council, Canadian oil producers would have to open their facilities to independent inspectors who would set transparent criteria to indicate their greenness.


If the oil industry is able to show it is steadily decreasing the carbon content of its product, even diehard environmentalists might come on side. (Chris Helgren/Reuters)

Those criteria would have to be hammered out between the industry and environmental groups with reliable green credentials. To satisfy such groups, the criteria would have to have teeth.

Such things as natural gas released or flared would have to be monitored and demonstrate a gradual reduction. Measures of success in rehabilitating damaged ecosystems could be included. Total energy used per unit of energy produced would have to show a decline. 

As Chris Ragan, head of Canada’s independent Ecofiscal Commission, insists, one of the best ways to efficiently squeeze carbon out of the economy is to keep increasing carbon taxes.

That could have several effects.

An increasing carbon tax would steer Canadian individuals and businesses away from using fossil fuels, meaning Canadian oil companies would gradually sell less oil to Canadians.

At the same time it would push the energy industry to invent and commercialize ways of producing oil that created less carbon. It would push the industry to learn how to profit from lower-carbon energy alternatives.

With its carbon tax Alberta is already on the way. Formalizing and documenting and advertising the process of cutting the carbon content of Canadian oil production will be a way for the industry to benefit from its contribution.

Of course that could also mean that environmentally minded consumers around the world might be willing to buy more Canadian oil — a prestige product at a premium price — increasing sales overall while displacing less environmentally produced crude from the marketplace.