Emissions, energy use and air quality
Managing our emissions and improving air quality is a material issue for our company as we aim to provide a product that is competitive with other forms of energy both on cost and carbon, from production through to end use.
Our significant direct emissions sources include:
- Combustion (from equipment such as once-through steam generators, heaters and compressor engines)
- Venting (from pneumatic devices, storage tanks and surface casings)
- Fugitive emissions (leaks)
Our indirect emissions are mainly from electricity consumption.
Minimizing the impact of emissions from these sources is our focus as we aim to reduce greenhouse gas (GHG) emissions intensity and improve air quality through improved operational efficiency and innovative technologies. We know that we can’t tackle the challenge of end-use emissions on our own, so we’re actively speaking to a number of organizations around the world to catalyze and explore collaborative solutions to address this issue. With the right level of commitment and collaboration with the brightest minds from around the world, we believe oil can be a valuable part of the clean energy future we all desire.
Managing greenhouse gas and methane emissions
The table below provides an overview of our goals related to emissions and recent examples of how we’re working towards those goals. Learn more in this section about how we’re managing greenhouse gas and methane emissions.
|Our goals, targets and aspirations6||Our recent performance examples|
Goal: Encourage solutions focused on zero emissions oil from wells to end use.
Target: To achieve a 33 percent reduction in our total upstream greenhouse gas (GHG) emissions intensity by 2026, compared with our January 2016 levels.
See the section below for more information on how we’re working towards our targets and aspiration.
Goal: To provide current and prospective investors with transparent disclosure on the carbon risks associated with our business.
6 Notes on definitions:
Goal: a specific desired outcome that Cenovus has some relative control to achieve. A goal may have one or more targets associated.
Target: a specific, near-term objective, typically focused on the change in a measureable key performance indicator (quantitative). Alternatively, the target can be an action (qualitative) which, once completed, can be more clearly demonstrated in the near-term.
7 Note: Based on an estimate of 4.75 metric tonnes of CO2 emissions per car per year according to a U.S. EPA GHG Equivalencies Calculator (updated March 2014).
Our emissions intensity target
We will address the issue of emissions at our own operations. The focus of our target is to:
- Find ways to reduce the amount of natural gas combustion per barrel of oil produced
- Find lower-energy technologies to extract oil from the reservoir
- Implement carbon capture technologies with storage or utilization
- Reduce vented and fugitive emissions where possible
We’re expecting the majority of our intensity target to be achieved through technology development at our oil sands projects.
Here are some examples of how we’re reducing our GHG emissions and working towards our target:
- Investing in innovation and technologies to drive a lower steam to oil ratio (SOR) at our oil sands assets
- Operating two natural gas-burning cogeneration plants to create the electricity needed for our operations. We also sell excess electricity to the Alberta electrical grid. Cogeneration electricity creates fewer emissions than coal-fired power and traditional gas-fired generation, and helps reduce the overall greenhouse gas emissions in the province
- Planning to integrate more solvent technology using natural gas liquid (NGL) injection in our operations. NGL injection has the potential to reduce the GHG emissions intensity of production up to 30 percent by reducing the amount of steam required. Learn more about how we’re using NGL injection in our operations in the Innovation section of this report
- Focusing on innovation and technology development with the goal of improving energy efficiency and reducing GHG emissions across our operations
- Conducting scenario analysis for new oil sands projects for GHG emissions reduction alternatives prior to finalizing a project plan and moving towards execution. This work will help us understand the capital required to achieve our target and help differentiate opportunities that are a cost to a project versus opportunities that ultimately enable our projects to be competitive both on a cost and carbon basis
- Making energy efficiency improvements and managing venting at our conventional oil and gas operations
Our aspirational zero emissions goal
Only 20 to 30 percent of the emissions from a barrel of oil come from producing it. The rest comes from the end use of that oil. That’s why we’ve set a goal to advance technologies capable of eliminating carbon emissions from the production of oil through to its end use, which is where the biggest opportunity exists.
As an industry, we need to be both cost and carbon competitive. That’s why we support a broad-based price on carbon with some of the revenues going to support the development of carbon reducing technologies. With our industry’s track record for technology development, we believe the transition to a clean-energy economy presents Canada with tremendous opportunity to develop carbon-reducing technologies that other producing nations will want and for our country to become a preferred supplier of low-carbon oil to the world.
Methane is known to have up to a 25 times greater comparative impact on climate change than CO2 over a 100-year period8. That’s why reducing methane emissions is an important way to address the climate change challenge. Cenovus has already made significant progress, and we’ll be looking for further opportunities to reduce methane emissions including at our newly acquired Deep Basin liquids rich natural gas operations in Alberta and British Columbia.
Managing methane emissions is largely about the development and deployment of technology, an area in which Alberta has played a leading role. With its robust regulatory system, including established conservation requirements, limits on flaring and venting and guidelines to minimize fugitive emissions, the province has made significant progress towards established goals for methane emissions reduction. Alberta’s Climate Leadership Plan sets a target of reducing methane emissions from oil and gas production by 45 percent by 20259. We believe Alberta’s plan establishes Canada as a climate leader among the world’s fossil fuel producing jurisdictions and that its methane provisions will play an important role in determining the country’s overall approach.
Methane is the primary component of the natural gas we produce in our operations. Methane emissions mostly occur from venting and from leaks (also called fugitive emissions). Leaks can come from a variety of production equipment including connectors, seals and valves. We have been proactively tracking and managing our methane emissions for many years. As part of this work, we have implemented a system for reporting fuel gas, flared gas and vented gas that is not metered. This is in addition to the production accounting systems that Cenovus has for collecting and reporting metered volumes. We also have a fugitive emissions management program, which we implemented at our operations in 2010. We use a variety of leak detection methods including:
- Continuous gas monitoring instruments in our buildings that activate alarms or shut down operations if elevated gas concentrations are detected
- Optical gas imaging cameras
- Flame ionization detectors
When leaks are found, they are documented and repaired.
We also reduce our methane emissions through initiatives under our Energy Efficiency Fund. Learn more about the Energy Efficiency Fund below. We have installed a variety of technologies and recovery systems across our operations to manage these emissions. For example:
- We’ve been using our extensive natural gas infrastructure to collect, process and sell natural gas that’s produced as a by-product at our conventional operations
- We use compressed air rather than natural gas at our oil sands facilities and most of our conventional facilities to operate pneumatic equipment. Using compressed air eliminates the methane emissions that can occur from using natural gas
- Where possible we use electric motor drive pumps, instead of pneumatic pumps that use natural gas for fuel. Where we do need to use pneumatic instruments, we’ve been installing low-bleed versions at wellsite facilities to reduce methane emissions
- We’ve installed solar panels at some of our conventional oil and natural gas sites to power equipment like chemical pumps
- We ensure that our oil and gas well completion process is designed to reduce emissions and conserve gas as much as possible, in compliance with Alberta Energy Regulator Directive 060: Upstream Petroleum Industry Flaring, Incinerating and Venting. When gas must be flared, the regulations restrict the duration of flaring as well as the volume of gas that may be flared
- We work to conserve solution gas at our conventional oil and gas operations. With the infrastructure at our site, and the extensive network of pipelines, we’re able to separate the solution gas from produced oil and water right at the wellsite, recycling the gas back into the system so we don’t have to vent or flare it
Direct GHG emissions
The increase in company-wide and oil sands direct GHG emissions was primarily due to a seven percent increase in oil sands production and to higher oil sands GHG intensities which are measured as steam to oil ratio (SOR). The higher SOR at our oil sands operations was due to the start-up of new phases at our Foster Creek and Christina Lake operations, which required more steam.
Direct GHG emissions intensity
Our company-wide GHG emissions intensity increased in 2016 primarily due to two factors. First, our oil sands production increased both on an absolute basis and on a relative basis compared to our conventional oil and gas production, which is less carbon intensive. Second, the SOR at our oil sands operations was higher than normal due to the start-up of new phases at Foster Creek and Christina Lake.
Cumulative mass of CO2 injected at Weyburn
In 2016, we safely injected over one million tonnes of new CO2 deep underground at our enhanced oil recovery project in Weyburn, Saskatchewan. That was the equivalent of 30 percent of our company-wide direct GHG emissions for the year. In early 2017, our Weyburn operations achieved a significant milestone, having safely injected over 30 million tonnes of CO2. Historical values have been restated (see footnote EM-11).
Methane emissions and intensity - company wide
Methane emissions and intensity - oil sands
We had lower methane emissions in 2016, mostly due to fewer large venting events related to plant disruptions (i.e. from power outages) than in the previous year. A number of our conventional oil and natural gas facilities, which historically had higher venting rates, were also no longer in operation, leading to lower venting emissions. The increase in oil sands methane emissions in 2015 and 2016 from previous years reflects improved measurement and tracking for corporate responsibility reporting, with 2015 being notably higher due to a single unforeseen isolated venting event.
Energy efficiency initiatives at Cenovus
Our Energy Efficiency Fund focuses on improving energy efficiencies in our day-to-day operations and processes. We invest funds to implement technologies that help us reduce energy consumption (which reduces GHG emissions), and we disclose those reductions as part of CDP’s climate change program.
Over the years, we’ve implemented a number of initiatives that continue to provide energy efficiency benefits:
- Retrofitted our natural gas compression facilities to install air-fuel ratio controllers to increase the fuel efficiency of our engines, and vent gas capture systems to conserve gas that is normally vented to the atmosphere. Emissions Reduction Alberta, (previously called Alberta’s Climate Change and Emissions Management Corporation) provided $2.7 million in funding for this project, which has reduced our CO2 equivalent emissions by about 17,500 tonnes per year.
- Installed a continuous variable transmission at a compressor station fan in our conventional oil and natural gas operations. The variable transmission helps reduce fan speed when temperatures fall and increase when temperatures rise. It’s expected that the system will result in up to a 90 percent reduction in electricity usage.
- Installed a variable frequency drive on one of the pump jack motors at our Weyburn operations. The drive has not only resulted in lower power demand, it also allows us to capture regeneration energy from the pump jack that was being wasted. This pilot project resulted in about a 15 percent reduction in energy consumption for the pump jack, which is equal to over 40 tonnes CO2 equivalent emissions reduction per year.
In 2016, our company-wide energy use increased slightly. This was primarily due to a nine percent increase in oil sands energy use related to the start-up of new phases at Foster Creek and Christina Lake. This increase was offset by a decrease in energy use at our conventional oil and natural gas operations where lower production levels required less equipment use.
The increase in energy use intensity in 2016 was primarily the result of higher energy use during the start-up of new phases at our oil sands operations.
Our oil sands projects are some of the most efficient in the industry, however our operations produce a variety of air emissions, including nitrogen oxides (NOx) and sulphur oxides (SO2) from combustion of natural gas. Our projects are designed to prevent and minimize venting, but methane and volatile organic compounds may be released from non-routine venting caused by activities like process upsets. We address our emissions by:
- Improving how we collect data – more accurate data helps us to determine ways to reduce our impact even further
- Installing scavenger units at each of our oil sands facilities for sulphur removal as per the limits set by Alberta’s Environmental Protection and Enhancement Act
- Using flue gas recirculation technology at Christina Lake to significantly reduce NOx emissions. We have now adopted this as a design standard at the facility
- Engaging in discussions with government to help develop effective air quality policies at provincial and federal levels
Air monitoring at our Christina Lake oil sands project.
Tracking emissions at our conventional operations
In 2013, we began working with St. Francis Xavier University on a project to support monitoring and verification of CO2 injection and to identify fugitive emissions from oilfield operations. Mobile tools and interpretative techniques were developed for large-footprint monitoring of gases at our enhanced oil recovery project in Weyburn. Mounted in a truck, the monitoring system is capable of collecting data across large areas, identifying increased concentrations of pollutants and distinguishing between background levels and various types of emissions. This allows us to quickly determine emission sources and to take appropriate actions. Cenovus purchased the monitoring equipment and the university developed computer programs with the ability to monitor air quality (CO2, methane, and H2S), as well as wind speed and direction, and to identify sources of emissions. Cenovus supported the development of this technology by providing feedback on the scope of work and objectives, and by hosting research students at our Weyburn unit. The university has recently entered into an arrangement with Altus Geomatics to commercialize this technology.
SO2 emissions and intensity
SO2 is a by-product of the fuel combustion process. The decrease in our SO2 emissions during 2016 was primarily due to a lower number of flaring events at our Weyburn facility. This decrease offset a marginal increase in SO2 emissions and intensity at our oil sands operations in 2016.
In accordance with the environmental approvals for our facilities, we recover over 70 percent of the SO2 that’s produced at our oil sands operations.
NOx emissions and intensity
NOx is also a by-product of the fuel combustion process. Cenovus-wide NOx emissions remained relatively consistent in 2016 compared with 2015. The long-term decrease in NOx emissions intensity reflects a shift of our total production towards oil sands, which is less NOx intensive than our conventional oil and natural gas operations.
At our Christina Lake project, we use flue gas recirculation technology to reduce NOx emissions. Our NOx emissions at this facility are at least 50 percent below the regulatory threshold of 400 tonnes.
Total gas vented
Venting is a controlled release of natural gas into the atmosphere. In 2016, we had a decrease in venting in both our oil sands and conventional operations because we had fewer large venting events from plant disruptions than the previous year. A number of conventional facilities, which historically had higher venting rates, were also no longer in operation leading to lower venting emissions. The increase in oil sands venting in 2015 and 2016 from previous years reflects improved measurement and tracking for corporate responsibility reporting, with 2015 being notably higher due to a single unforeseen isolated event.
Total gas flared
Flaring is a controlled burning of natural gas. In 2016, the amount of gas flared at our oil sands operations increased due to a larger number of unforeseen flaring events. However, this increase was offset by a large reduction in flaring events and volumes within our conventional oil and natural gas operations. To better manage flaring and venting, we have a fuel, flare and vent management program aimed at improving the quality of measurement and reporting of flaring data to support better management.