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The Canadian oilsands

Hydrocarbon Engineering,

At BP’s annual general meeting on 15th April 2010, BP faced a rebellion from several individual and major shareholders surrounding the company’s involvement in Canada’s oilsands. The campaigners are demanding more details with regards to the environmental impact of extracting and producing oil from this area.

What BP says
BP Chief Executive Officer, Tony Hayward has stated that continuing with the Sunrise project (joint venture between BP and Husky Energy) is ideal at the moment and hugely feasible as oil price stability is likely to be maintained over the next five years. The proposed project is worth approximately US$ 2.4 billion and a final decision is now expected by the end of 2010.

What Greenpeace says
A Greenpeace press statement discussing the Sunrise debate at the BP meeting said:

A shareholder resolution aimed at getting BP to disclose more information about its controversial decision to exploit the tar sands of Canada received significant support today, with nearly 15% of shareholders refusing to back the company’s position. These voters either abstained or actively supported the shareholder resolution, which demanded more information about environmental, legal and reputational risks associated with the carbon intensive project.

Greenpeace Execitive Director John Sauven said, ‘for too long BP has embraced a culture of secrecy and attempted to silence dissent, but today’s vote has changed all that. BP can no longer ignore warnings about threats like volatile oil prices, carbon regulation and reputational damage because institutional investors are now raising the same concerns as environmental NGOs and indigenous communities.’

‘There is a growing coalition of organisations opposing BP’s decision to exploit this environmentally damaging resource, and today’s events should be viewed as a taste of things to come. BP’s executives would be well advised to consider if the tar sands are worth the lasting damage that this campaign could inflict.’

Sinopec and the oilsands
Despite the concern surrounding BP’s proposed plans to invest in the Canadian oilsands, Sinopec has announced that it is considering making an investment. The company is considering an integrated oilsands strategy to ensure state controlled producers are sent to an upgrader or refinery in Canada rather than shipped abroad. Sinopec bought into Syncrude Canada in early April and sees this proposal as the next step towards increasing its Canadian production portfolio.

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