Imperial Oil, TransCanada CEOs Say New Emissions Rules Not Necessary

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CALGARY -- The CEOs of two of Canada's biggest energy companies spoke out Friday against recent moves by federal and provincial governments to toughen emission-based regulations.

Russ Girling, CEO of TransCanada Corp., said he believes new federal requirements that take into account upstream emissions when reviewing pipelines are not needed.

Oil and natural gas projects are already subject to vigorous regulation, Girling said, adding that the regulatory process for pipelines should focus on safety and spill response rather than issues he said aren't germane to pipeline development.

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TransCanada CEO Russ Girling says measuring upstream emissions when approving pipelines is unnecessary. (Canadian Press photo)

"The emissions, both upstream and downstream, are reviewed in other regulatory processes, when those facilities themselves are approved. Once approved, all we do is move that product from A to B,'' Girling told his company's annual general meeting in Calgary.

"So I think what we've determined is those emissions will be part of the review, but what I think what the review will determine is that building a pipeline really doesn't have an impact on the rate of growth for production or the rate of refining.''

Girling added that he hopes efforts by the Alberta and federal governments to cap and lower emissions will help reduce the "noise'' around the issue as it relates to pipelines.

TransCanada is proposing to build Energy East, a 4,600-kilometre pipeline that would ship oil from Alberta to as far east as Saint John, N.B., if approved. The $15.7-billion development has been the source of some controversy, particularly in Quebec.

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Imperial Oil CEO Rich Kruger objects to the Alberta government's imposition of a 100-megatonne-per-year limit on oilsands emissions. (Canadian Press photo)

At the Imperial Oil annual general meeting, CEO Rich Kruger took a similar position on the issue of regulation, though his was specifically directed towards the Alberta government's cap on oilsands emissions.

Kruger said he feels there's room to negotiate with the province on rules around the 100-megatonne-per-year oilsands emissions cap announced last year. The industry currently emits about two-thirds of that total.

"Our personal view is we didn't think the cap was necessary,'' he said.

"We think with existing regulatory practises and procedures, the drive to improve overall environmental performance, there were other ways to do it. That said, we will work and have been working with the government on putting the right regulations in place so industry overall can maximize production under the cap, achieve the objectives the government has set out and do it in a way that's acceptable to industry.

"So the message is 'Stay tuned.'''

When Premier Rachel Notley unveiled the emissions cap in Edmonton in November, she was joined and supported by top executives from four oilsands producers: Suncor Energy Inc., Royal Dutch Shell PLC, Cenovus Energy Inc. and Canadian Natural Resources Ltd.

At the time, an Imperial Oil spokesman said it would study the proposal before forming an opinion.

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