Summit News

Statoil sees big cut in oil sands CO2

CALGARY (Reuters) - Statoil STL.OL has pledged to cut carbon dioxide emissions from its Canadian oil sands production by 40 percent in 15 years, a top executive said on Monday, as the Norwegian company faces pressure at home to burnish its environmental reputation.

Lars Christian Bacher, president of the oil and gas company’s Canadian arm, said it will cut carbon dioxide emissions from its planned oil sands projects by 25 percent by 2020 and 40 percent five years after that.

Bacher said the technologies to cut the emissions would be available by the time its Corner project, which will produce 60,000 barrels per day of oil, comes on stream in 2015 or 2016, though the initial energy required to get the oil moving would be substantial.

“So in the first couple of years, it will be hard to get that kind of lower emissions, but then we will see that kind of substantial improvements,” he said at the Reuters Canadian Oil Sands Summit in Calgary.

Statoil said its demonstration plant in the oil sands region would start up later this year producing 10,000 barrels a day initially. But an upgrader for the output was still “on the shelf”.

Bacher also said he was open to talking about partnerships with companies that could bring some technology or expertise to Statoil’s oil sands operation, since the Norwegian company did not tend to operate projects with 100 percent ownership.

“If it’s just for the money, we could go for a financial investor,” he said.

The Norwegian government, Statoil’s top investor and majority shareholder, faced political pressure last year to push Statoil to divest its oil sands operations because of the amount of carbon they produce, but the motion was defeated by Statoil’s shareholders.

Bacher said the issue had more to do with the broader environmental agenda ahead of global talks on climate change in Denmark at the end of 2009.

“The attention this topic got last year was more to try to influence decision makers ahead of Copenhagen,” he said.

Statoil is 67 percent owned by the Norwegian government.

Reporting by Braden Reddall; editing by Peter Galloway