Millions of barrels of oil extraction halted in Canada
At least 39 tar sands oil extraction projects have been frozen in Canada, as falling oil prices and divestment campaigns squeeze profits, according to campaign group Oil Change International.
The analysis – based on industry data and Rystad Energy UCube – concluded around 1.6 million barrels per day of planned expansion is currently not going ahead.
Delayed or on-hold projects now contain nearly 13 billion barrels of total resources, which would amount to 7.8bn metric tons of CO2 if extracted and burned.
A recent UCL study suggested that the majority of the world’s fossil fuels must not be burned if we are to stay within the 2°C global warming target. Specifically, around 33% of the world’s oil reserves must go unused.
“The case for the tar sands is crumbling,” said Oil Change International campaigner Hannah McKinnon “The tar sands are bad for the climate, the environment, impacted communities, and now the sector itself is struggling to justify many new projects.”
Campaigners attributed the slow-down to ‘global efforts to defend the climate’, as well as the depressed oil price.
Earlier this week Edinburgh University announced plans to divest its £250m endowment from companies involved in coal and tar sands extraction. The move follows similar announcements from Oxford University in May, and the Church of England in March.
The Guardian newspaper likened the global divestment campaign to the anti-apartheid movement, as the total worth of divested stocks soared past $50bn in September last year.
The falling oil price is also contributing to the slow down, as most of Canada’s untapped bitumen has a break-even price of $95 a barrel, according to CarbonTracker, around $30 higher than current values.
Oil Change International research director Lorne Stockman said: “This report is some good news for the climate, but the battle is far from over.
“Every day of delay for tar sands projects is a good day for our future, but this is an industry determined to dig it up.”
“But while the industry puts its head down and tries to charge ahead, people around the continent are rising up to defend our communities and climate, and their efforts are clearly paying dividends.”
Head in the tar-sand
In related news, shareholders at Chevron and Exxon both rejected measures to reduce their companies’ impact on the climate, at their respective GM’s this week.
Exxon chief executive Rex Tillerson said the company did not plan to expand into renewables, because “we choose not to lose money on purpose.”
By contrast, 98% of BP shareholders recently voted to publish more information on emissions and low-carbon investments. Shell passed a similar resolution in February.