Climate change leadership

The world needs more Canadian energy

Canada’s crude oil and natural gas resources are safely and responsibly developed with world-leading standards, under comprehensive regulatory oversight and emissions regulations, and significant technology investments. As the world’s demand for energy increases, significant crude oil and natural gas resources will need to be developed.

Canada is well positioned to be a global leader in supplying these resources in a lower carbon emissions future. We believe that an effective approach to greenhouse gas (GHG) emissions management relies on strong environmental policy and regulation, innovation and technology.

Canadian Natural continues to work together with industry, government and other stakeholders to encourage technological innovation, energy efficiency and targeted R&D as methods of maintaining a competitive oil and natural gas sector. Collaboration is essential to achieving long-term emissions reductions.

Canadian leadership on climate change

The Government of Canada’s commitments to reducing GHG emissions, along with climate frameworks in several Canadian jurisdictions, positions our country as among the most responsible crude oil and natural gas producing jurisdictions globally. Canadian Natural supports Canada’s leadership in the Paris Agreement as a pathway to reduce emissions and drive innovation. We also support federal and provincial government goals to reduce methane emissions by 45% by 2025.

Canadian Natural and the Canadian crude oil and natural gas sector are delivering game-changing environmental performance. We recognized the need to reduce GHG emissions, leveraging technology and Canadian ingenuity to deliver results, and will continue to do so. Canadian ingenuity and the ability to leverage technology have turned what was a high-intensity oil in 2009 (on a wells-to-combustion basis) into a premium oil.

Climate change is a global issue and Canadian technologies and innovation used to reduce or eliminate GHG emissions in the extraction of oil and natural gas can be adopted by other producers and industries around the world, like cement production and agriculture, as well as in office buildings and homes, to accelerate the global reduction of GHGs. If the rest of the world achieved what our industry has in terms of flaring standards, GHG emissions could be reduced by 23% — equivalent to taking ~110 million cars off the road (or more than three times the number of vehicles on the road today in Canada). Having more Canadian oil and natural gas on the global market can reduce global GHG emissions.

Integrated GHG emissions management strategy

With a strong commitment to reducing GHG emissions, our long-term aspirational target is net zero emissions in our oil sands operations. We have taken significant steps to reduce our emissions through a comprehensive strategy and investments in technology and innovation. Our integrated strategy includes:

• Integrating emission reduction in project planning and operations.
• Leveraging technology to create value and enhance performance.
• Investing in Research and Development (R&D) and supporting collaboration.
• Focusing on continuous improvement to drive long-term emissions reductions.
• Leading in Carbon Capture and Sequestration/Storage (CCS) projects.
• Engaging proactively in policy and regulation to effectively manage climate risks and opportunities, including trading capacity and offsetting emissions.
• Considering and developing new business opportunities and trends.

Leading performance

Canadian Natural has developed a pathway to reduce emissions intensity below the global crude average. This pathway includes CCS projects, methane reduction projects, natural gas production and further advancements in technology. Leveraging technology and innovation have led to significant reductions in Canadian Natural’s GHG emissions. Learn more about our leading performance and long-term programs that are driving GHG reductions in our 2019 Stewardship Report to Stakeholders.

Resiliency of Canadian Natural's strategy

As part of evaluating climate change related risk and opportunities, Canadian Natural reviews independent external scenario analyses developed by energy firms and agencies representing a range of hypothetical paths of development through to 2040.

These external scenario analyses are a tool used to support business planning and identification of risks and opportunities. A number of variables and assumptions are considered related to markets, commodity prices, policy, regulation, technology, efficiency and reputation, and incorporate a range of assumptions for lower carbon emissions environments. This process has influenced our investments in CCS and carbon utilization projects, as well as the potential use of molten carbonate fuel cells, and research into the production of biofuel from algae.

As the world evolves toward a lower carbon emissions energy system, we expect there will be improved, less carbon intensive ways of producing and consuming crude oil and natural gas. Across the range of ambitious climate change scenarios, the expectation is that there will be substantial global production and consumption of crude oil and natural gas for decades to come. According to the IEA 2019 Sustainable Development (most stringent) climate scenario, crude oil demand would be close to 70 million barrels per day by 2040 from 2019 levels of approximately 100 million barrels per day. While global demand is potentially impacted in 2020, the expectation is that crude oil and natural gas remains an important part of the global energy mix for the foreseeable future.

In addition, global demand for natural gas is expected to grow, continuing to be an important source of energy and a way to significantly lower global GHG emissions. Natural gas is an integral part of Canadian Natural’s plan and the pathway to a lower carbon emissions future. As one of the largest producers of natural gas in Canada, Canadian Natural’s natural gas assets deliver improved environmental performance as a clean burning hydrocarbon.

Canadian Natural’s balanced portfolio of light, synthetic, and heavy crude oil and natural gas represents one of the strongest and most diverse asset portfolios of any energy producer in the world. The strength of our assets, along with our integrated GHG Emissions Management Strategy, helps to mitigate climate change risks to our reserves. As a result, Canadian Natural believes that our reserves face limited risk even under more ambitious climate change scenarios.