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It’s no secret oilsands companies intend to ramp up production despite the rapidly worsening impacts of the climate crisis, and one longtime industry executive laid out his arguments for doing just that at a federal committee Monday.
Testimony from Rich Kruger, CEO of Suncor, made a spirited case for continuing to pull fossil fuels out of the oilsands, saying he believes the world is a better place when a barrel of oil comes from Canada compared to anywhere else in the world. His arguments ran back to back with words from acclaimed climate journalist and author John Vaillant, warning that if the world doesn’t stop using fossil fuels, the planet will soon be uninhabitable.
The gulf between the two was echoed by questions from MPs on the Standing Committee on Natural Resources.
Some MPs put the screws to Kruger for the oil and gas industry’s role in the climate crisis, while others sang his praises at the Oct. 16 committee meeting.
Kruger was called to testify after he told Suncor shareholders the company was too focused on the long-term energy transition and indicated a need to maximize profits from its lucrative oilsands assets.
Kruger told MPs those comments refer to the need to make money now in order to afford decarbonization investments.
“We must ensure we're strong today so we can be strong tomorrow,” he told the committee. “Our commitments on decarbonization and being a part of the transition have not changed at all since I've taken over in this position six months ago.”
Suncor reported profits of over $9 billion in 2022.
The committee meeting was marked by tense exchanges between Kruger and NDP MPs Charlie Angus and Heather McPherson and Bloc Québécois MP Mario Simard. MPs heard a handful of witnesses, including Kruger, Pathways Alliance vice-president of external relations Mark Cameron and Vaillant.
"...The oil industry is, in essence, a fire industry, which means it's a CO2 industry, which means it's a climate-changing industry. This is basic chemistry,” said @JohnVaillant after Suncor CEO Rich Kruger testified before a federal committee.
To Vaillant, the committee meeting sounded like a negotiation to maintain the status quo — with a few tweaks, he told MPs, adding the discussion left out the “physics and chemistry that govern our lives.”
“Two hundred thousand Canadians were driven from their homes by wildfires this summer, tens of millions of North Americans were shrouded in toxic smoke, the Amazon River is drying up: If we don't reduce emissions now, we're going to make this planet uninhabitable,” said Vaillant during his opening comments to committee members. Vaillant wrote Fire Weather: A True Story from a Hotter World, a book exploring the wildfires that devastated Fort McMurray in 2016 and the role North America’s oil companies have played.
“The fossil fuel industry is fundamentally lethal to the planet's stability as we know it,” said Vaillant. “Internal memos reveal surgically accurate predictions regarding the relationship between increasing CO2 and the climate disruption we are now experiencing. [ExxonMobil] knew and so did Suncor.”
Knowing the implications of burning fossil fuels, ExxonMobil then embarked on a campaign to downplay and discredit that same science, an investigation by The Guardian revealed.
“They turned their backs on their own science and they did it because they cared about the money more,” said Vaillant. “They did it because they know the oil industry is, in essence, a fire industry, which means it's a CO2 industry, which means it's a climate-changing industry. This is basic chemistry.”
Before coming out of retirement to lead Suncor, Kruger was CEO and chair of Imperial Oil for six years and told MPs he spent 31 years working for ExxonMobil in various roles spanning more than 20 countries.
“Would you say that it has been a catastrophic year for climate-induced wildfire and flood?” was Angus’ first question to Kruger, who then described it as a “tragic year.” This year is Canada’s worst wildfire year on record, with more than 18.3 million hectares of land burned as of Oct. 6.
With a large stack of folders and documents in front of him, Angus then cited internal documents from ExxonMobil that warned it would be “catastrophic for a substantial fraction of the world's population” if the company didn’t change course.
“You knew scientifically that what you were doing was destabilizing the planet,” said Angus, who went on to ask Kruger how much responsibility the oil and gas industry is willing to take for suppressing information that showed it was destabilizing the planet.
Kruger said during his time at ExxonMobil, he “never worked in strategy or research” and suggested Angus direct his questions to ExxonMobil. When pushed on the question of liability and the growing number of lawsuits trying to get oil and gas companies to pay for a portion of the damage wrought by climate change, including one brought against Suncor by three Colorado communities, Kruger said he would not talk about active lawsuits.
Conservative MP Shannon Stubbs interjected during Angus’ line of questioning to object that it was not on topic.
Liberal MP John Aldag brought up Suncor’s decision to sell its wind and solar assets and noted that while Kruger said oil and gas has a long horizon, Aldag has also seen analysis that indicates oil demand will peak within the next decade and start to decline.
“It seems like you're kind of doubling down right now and trying to get every last dollar out of that oil and gas sector,” said Aldag.
Kruger responded that the decision to sell the company’s wind and solar assets was made a year before he took the job, and it was thought the buyers could operate those businesses better than Suncor.
“It's a question of picking those things that you're best at as you participate in the transition,” said Kruger, pointing to Suncor’s St. Clair Ethanol Plant in Mooretown, Ont., which is currently Canada’s largest ethanol facility.
McPherson chose to grill Kruger about the 1,500 jobs Suncor is eliminating this year, asking him how many of those workers are Albertans and how many Canadians are projected to lose their jobs at Suncor over the next five years. Kruger said he did not have numbers but could provide McPherson with a province-by-province breakdown after the fact.
Given Suncor’s record profits, McPherson asked how many of its shareholders are Canadians.
“Our shareholders are tens of thousands of Canadian families, men and women who rely on our stock performance to fund their RRSPs,” replied Kruger, before McPherson cut him off to request a percentage. The “vast majority” was his answer, before eventually offering 52 per cent when pushed again. Institutional investors like banks hold about 65 per cent of Suncor's shares, according to CNN Business.
Suncor has been under scrutiny for a series of worker fatalities as well as a slew of safety violations, Liberal MP Viviane Lapointe noted. Six workers have died on the job since 2020 and in just a few months, from November 2022 to January 2023, the company racked up 32 safety violations and was recently charged with another five by Alberta Occupational Health and Safety. Kruger said his comments to shareholders about focusing on “fundamentals” starts with personnel safety and cited the use of technologies “that can help us run a safer workplace.”
During his testimony, Kruger also said Pathways Alliance’s plans to decarbonize Canada’s oil production with an extensive carbon capture and storage network was a “brilliant strategy” involving a “public-private partnership.” Immediately after the committee meeting, Pathways Alliance’s Cameron clarified that no contracts for a public-private partnership have been signed yet, but that the consortium of six oil companies is “seeking a public-private partnership” with federal and provincial governments.
In French, Simard questioned whether “clean oil” is profitable without substantial financial support from governments, referring to Pathways Alliance's proposal to build a 400-kilometre pipeline to transport carbon captured at oilsands facilities to a storage hub in the Cold Lake region. The Pathways Alliance wants federal and provincial governments to foot roughly two-thirds of the cost of the massive project, in line with public funding for similar carbon capture and storage projects around the world, in order to remain competitive, Cameron told reporters after the committee meeting ended.
Stubbs and fellow Conservative Earl Dreeshen asked Kruger to explain his position on topics like the world’s need for reliable and safe energy from Canada and what the role of Canadian oil and gas is.
At one point, Simard remarked that his Conservative colleagues are “behaving as oil and gas lobbyists.”
Simard asked Kruger repeatedly about the Clean Fuel Regulations, which were designed to require refiners and importers of gasoline and diesel to reduce emissions from producing, processing, transporting and using those fuels.
Kruger said he had “not studied the regulation” but that the company complies with all regulations and believes in reducing its carbon footprint.
The same day Kruger testified, a new analysis revealed Suncor’s Fort Hills oilsands mine expansion in northern Alberta will add 60 square kilometres of new tailings ponds to the landscape over the project’s lifetime. The analysis was done by the Alberta Wilderness Society and Canadian Parks and Wilderness Society Northern Alberta using Suncor’s 2022 planning application to the Alberta Energy Regulator, obtained through a freedom-of-information request.
“From Suncor doubling down on maximizing their profits no matter the cost, to the Pathways Alliance misleading Canadians, to Imperial Oil letting toxic tailings leak into Indigenous communities’ waters for years, it’s plain that oil and gas companies cannot be trusted to take responsibility and clean up their act,” said Alex Cool-Fergus, national policy manager at Climate Action Network Canada in a statement on Kruger and Cameron’s testimony.
Canada’s Competition Bureau is currently investigating a Pathways Alliance ad campaign that Greenpeace Canada argues is “false and misleading” because it suggests the six companies — Canadian Natural Resources, Cenovus, ConocoPhillips, ExxonMobil subsidiary Imperial, MEG Energy and Suncor — are reducing greenhouse gas emissions and helping Canada achieve its climate targets.
Natasha Bulowski / Local Journalism Initiative / Canada’s National Observer