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Latest oilsands mega mine proposal a reality check for Alberta’s emissions cap

Teck Resources underreporting climate impacts of Frontier mine by 48 per cent, analysts say

Public hearings for Teck Resources’ colossal Frontier mine project begin this week — opening an intense debate about whether and how the project’s emissions can be squared with either Alberta’s highly publicized emissions cap or Canada’s commitments to fight climate change.

The proposed mine would produce 260,000 barrels per day of bitumen at its peak, cover 24,000 thousand hectares and — during its 41-year lifespan — tap into reserves in the neighbourhood of 3.2 billion barrels.

Critics of the mine have concerns about issues ranging from impacts on Wood Buffalo National Park (just 25 kilometres from the proposed mine site), to the company’s ability to remediate the site, to whether the project would be the long-term boost for Alberta’s economy that Teck promises.

But perhaps the most controversial of all are the greenhouse gas emissions the mine will produce.

Teck says the Frontier project will produce four megatonnes of greenhouse gas emissions (equivalent to the annual emissions from 856,531 passenger vehicles) for each of the 41 years it is operational — and that its emissions represent the “best-in-class” when compared to other oilsands projects.

But intervenors in the hearings say that neither of these claims are true.

Not only do they assert that Teck’s calculations omit important sources of emissions, but also that they will be nowhere near “best-in-class.”

There are concerns that, because Teck’s proposed mine is poised to push past Alberta and Canada’s climate commitments, the company could also face a huge economic liability as the world moves to decrease carbon-intensive oil consumption and polluters are forced to pay more to emit.

“The Frontier project is not best in class,” Jan Gorski, an analyst with the Pembina Institute, told The Narwhal in an e-mail.

“The compatibility of the project with Canada’s climate targets has not been demonstrated and certainly projects that are anything but best in class shouldn’t be approved.”

Wood Buffalo National Park map

Map of threats to Wood Buffalo National Park complied by the United Nations Educational, Scientific and Cultural Organization (UNESCO).

Best in what class?

Teck’s proposed project rests on years of analyses, estimates and projections about the viability of the project — including its impact on the climate.

According to the Oil-Climate Index, Canada’s Athabasca extra-heavy, high-sulphur bitumen produces the highest total greenhouse gas emissions per barrel in the world, but Teck has said emissions from oil produced at its Frontier mine would be among the lowest greenhouse-gas-intensity products in the oilsands.

The company also told The Narwhal that Frontier “will have a lower carbon intensity than about half of the oil currently refined in the United States,” and in documents filed by Scott McKenzie, director of regulatory and environment for Teck, the company asserts the “project represents best-in-class for greenhouse gas emissions from oilsands developments,” based on the calculation that per-barrel emissions would be 38.4 kilograms of carbon dioxide equivalent.

But numerous intervenors in the upcoming hearings — including the federal government — have raised concerns about the calculations used to come to this conclusion.

In Environment and Climate Change Canada’s submission to the review panel, the agency concluded that “while Teck indicates its intent to make the Frontier Mine project best-in-class with respect to GHG emissions intensity, it is in fact 24 per cent more carbon intensive on a per-barrel basis than the best project.”

The Oilsands Environmental Coalition (of which the Pembina Institute is a member) also doubts Teck’s claims, finding that Frontier’s emissions would be “about average” in the oilsands, and asserting “it is unlikely to achieve the best-in-class standard.”

In its submission to the Joint Review Panel, the Oil Sands Environmental Coalition points out that Frontier’s emissions would be higher than benchmarks set by Alberta’s Carbon Competitiveness Incentive Regulation — regulations that set the standard for oilsands operations to improve their efficiency when compared to an industry average calculated by the Alberta government, with the goal of improving from year to year.

When compared to the 2026 Carbon Competitiveness Incentive Regulation limit, the Oil Sands Environmental Coalition found “the Project’s GHG emissions intensity will be 40 per cent higher” than the limit, which is based on the emissions of the top-quarter of the best-performing bitumen mines.

“Compared to the three other oilsands mining projects that use the same technology, the Frontier mine’s emissions are the highest,” Gorski of the Pembina Institute said.

“New oilsands projects should be required to demonstrate that their GHG emissions intensity is at least as good as the top quartile performers,” the Oil Sands Environmental Coalition concluded.

“Alberta and Canada will be unlikely to meet their [greenhouse gas] targets if sub-par projects are allowed to proceed.”

One of the largest oilsands mines ever proposed advances to public hearings

Critics say Teck lowballing emissions

There are also concerns about whether Teck’s estimates of its annual emissions — four megatonnes of greenhouse gas emissions per year — are grossly underestimated.

The Oil Sands Environmental Coalition found the greenhouse gas emissions of the proposed mine would be substantially higher than the company’s estimates, owing to omissions of sources of greenhouse gas associated with the project.

Gorski told the Narwhal that Teck’s estimate “doesn’t include emissions created during the production of fuel used on site, land use changes or downstream emissions from refining and end-use combustion.”

The Oil Sands Environmental Coalition concluded that actual annual greenhouse gas emissions would be an “additional 48 per cent above Teck’s GHG emission estimate.”

The Council of Canadians, another intervenor in the hearings, has also concluded emissions will be substantially higher than four megatonnes per year.

Bronwen Tucker, Prairies-Northwest Territories regional organizer for The Council of Canadians, told The Narwhal that Teck may well be able to reduce emissions in some areas as new technologies arise, but she is still skeptical of Teck’s emissions projections.

“That number is likely to rise over time, based on the pattern of emissions of other mines,” she said — an assertion supported by research from the Pembina Institute, which found that “the emission intensity of mining operations increased by seven per cent between 2004 and 2015.”

According to the Pembina Institute, “this trend will certainly continue as producers access deeper, lower-quality bitumen and the distance from mines to processing facilities increases.”

If this is true for the Frontier project, its emissions could rise steadily as time passes and bitumen becomes more difficult to access.

There are also concerns the emissions numbers used to calculate a project’s effect on the climate are minuscule when compared to the lifetime emissions of the oil itself — furthering the climate impacts of new oilsands developments.

“It doesn’t include combustion emissions of actually burning the bitumen that’s produced,” Tucker told The Narwhal. “That number would be ten times as high — 50 megatonnes per year if you’re looking at well-to-wheels of this mine.”

Not compatible with emissions cap

Regardless of the emissions calculations, there are concerns that the mine is practically guaranteed to be outside of Alberta’s — and Canada’s — climate commitments.

The Alberta government’s Bill 25, which sought to limit the total greenhouse gas emissions from oilsands development to 100 megatonnes, was passed in 2016 — though regulations to manage the limit are yet to be set.

Oilsands emissions are currently around 70 megatonnes each year, according to government figures. And while 30 megatonnes may seem like a lot of room to grow, many sources from across the board predict the oilsands will grow beyond that limit in the near future.

Teck has said it “believes that project greenhouse gas emissions of approximately four megatonnes per year will not exceed the 100 megatonne annual emission cap established by the provincial government.”

But even the Canadian Energy Research Institute (CERI) — itself partly funded by industry — estimated oilsands emissions in a business-as-usual case will exceed the 100 megatonne cap in less than ten years, by 2026.

Nikki Way, an analyst with the Pembina Institute, is clear there’s no room for a new carbon-intensive mine in the oilsands.

“We’ve already given out rights that cumulatively add up to more than we’ve committed to capping,” she said.

That hasn’t stopped Teck from insisting otherwise.

“As Alberta refines the details of their climate action approach, including carbon pricing and regulation for the 100 megatonne annual limit on emissions from oilsands operations, we are confident that Frontier will fit within the framework put in place by government,” Teck said in a statement to The Narwhal.

Perhaps because of this belief, “Teck has not made any allowance for the cost of compliance within the 100 megatonne cap or the possibility of delay or suspension of the project due to the limit,” according to the Oil Sands Environmental Coalition’s submission to the Joint Review Panel.

If the oilsands do reach the 100 megatonne cap in the future, the Frontier project could theoretically be on the hook for further costs, particularly if it is not, as Environment and Climate Change Canada has pointed out, a best-in-class mine. Added costs could further undermine the project’s economic feasibility.

“Current projections show that greenhouse gas emissions from the oilsands are expected to increase over time, while Canada’s climate goals require emissions to go down significantly,” said Gorski of the Pembina Institute.

“These two trends are not compatible.”

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