BUSINESS
03/01/2012 12:29 EST | Updated 05/01/2012 05:12 EDT

Canada's oilsands producers team up to share know-how on environment

CALGARY - A dozen of Canada's biggest oilsands companies said Thursday they will share their environmental know-how with one another, breaking down barriers that have slowed improvement on that front.

"None of us has a monopoly on ideas or wisdom when it comes to the environment," said Steve Williams, the current chief operating officer and soon-to-be CEO of Canada's largest energy company, Suncor Energy Inc. (TSX:SU).

Oilsands development has long been enemy No. 1 for many environmental groups, and has factored heavily into political debates in the United States, Europe and elsewhere. Through their alliance, the oilsands firms hope to deliver concrete evidence their environmental performance is improving.

Williams said the sharing of information will be closely restricted to environmental technologies, and not ones that give companies a financial edge.

The firms will "continue to compete aggressively," said Williams.

"But we know that when it comes to the environment, we'll all win when we start working more closely together."

In addition to Suncor, other members of Canada's Oil Sands Innovation Alliance, or COSIA, include Imperial Oil Ltd. (TSX:IMO), Total E&P Canada, Cenovus Energy Inc. (TSX:CVE), Shell Canada Ltd., Statoil Canada, Devon Canada, BP Canada, Teck Resources Ltd. (TSX:TCK.B), Canadian Natural Resources Ltd. (TSX:CNQ), ConocoPhillips Canada and Nexen Inc. (TSX:NXY).

The man who will head up COSIA, Dan Wicklum, described the organization as a "collaborative hub for innovation" that will have steering committees for four key areas: land, air, water and tailings, the massive wastewater pools that result from the oilsands extraction process and have been a magnet for environmental criticism.

"They'll provide the legal framework within which companies can retain the ownership and the value of their intellectual property, but then share it," Wicklum told reporters.

"Those companies will then be able to understand what other people are working on, they'll be able to reduce redundancy and because it will be a focused effort, they'll be able to build on one-anothers' success."

COSIA isn't a funding agency, won't conduct research itself and will not focus on communications to counter the high-profile campaigns against "dirty" oilsands crude that have long caused headaches for industry, said Wicklum, a scientist who has worked in government and academia, and a former Canadian Football League linebacker.

"Our goal is to simply stick to our knitting, which is improving that environmental performance. We don't have a strong communication wing. We don't see ourselves taking out ads in newspapers and so on," he said.

Environmental collaboration isn't new to the industry. In 2010, seven oilsands companies formed a consortium to share tailings pond cleanup technology. That work is now being rolled into COSIA.

The "chrysalis" of the tailings consortium was Shell's earlier announcement that it had made a breakthrough in speeding up reclamation of its ponds, and that it was willing to share that technology with its rivals, said executive vice-president John Abbott.

"I don't think it was a surprise to many people that Shell had come up with a new technology," he said in an interview.

"But what perhaps was a big surprise to many is that we stood up and said we were prepared to share all of that technology with our competition with a view to driving faster environmental performance improvement."

At least one environmental group praised COSIA, though Ed Whittingham, executive director of the Pembina Institute, said it should have come about a lot sooner.

"It's clear evidence that the 12 companies involved are interested in improving environmental performance and I think it's a recognition that business as usual isn't going to cut it anymore," he told reporters.

"I think the timing was right two years ago. I think we're behind. But it's never too late to begin."

Greenpeace campaigner Keith Stewart had a different take.

"In the absence of any commitments to real reductions in pollution with penalties for not meeting them, this is simply another example of greenwash, where an industry association makes vague promises to clean up its act in order to avoid regulations with real teeth," he said in an email.

He said the audience for the "PR initiative" is not the federal or Alberta governments, "but governments in the U.S. and Europe who are preparing to act on the climate impact of the tar sands because they recognize that Canadian governments won't."

Oilsands development has factored heavily in the heated debates over the Keystone XL pipeline to the U.S. Gulf Coast and Northern Gateway pipeline to Canada's West Coast. It has also made headlines across the Atlantic, with European leaders talking about a fuel quality directive that would penalize oilsands-derived crude.

"There's no question the oilsands has been in a bit of a global spotlight for some time," said Bruce March, CEO of Imperial Oil.

"We understand that the public is expecting something more from us. So really what COSIA is about is creating the conditions that are necessary for us to accelerate our performance improvement and ensuring that it gets done."

Shell's Abbott said COSIA's work will show the industry is not all talk when it comes to the environment.

"We will see accelerated performance improvement in those four priority areas," he said.

"And then we will quite rightly be able to talk about those and demonstrate those to some of our critics."

Alberta Environment and Water Minister Diana McQueen praised the companies' efforts to work together.

"The establishment of COSIA represents an understanding of shared responsibility," she said in a release.

"We look forward to working with the alliance to pool our expertise and knowledge with that of other stakeholders as we continue to deliver environmental excellence."