New Directions In Managing Alberta's
Resources:
TrueNorth Energy’s Approach to Integrated Landscape Management”
Remarks by
David Park, President and Chief Executive Officer, TrueNorth Energy Inc.
To
The Alberta Chamber of Resources
Annual General Meeting
Westin Hotel
Edmonton, Alberta
Feb. 1, 2002 Good Morning, everyone. It’s great to see such a big
turnout for this event, and I understand that there are over 400 people
coming to dinner tonight.
That kind of support doesn’t just happen. I want to congratulate
Bill Hunter and the entire Chamber of Resources team for the incredible
work they’ve done to make this a dynamic, effective, and –
most importantly – a relevant organization.
The Chamber, under Bill’s leadership, and with the capable management
of Brad Anderson and his team, has been able to grapple with the biggest
issues facing resource developers and take definitive actions to move
our collective agenda forward.
One of the best examples of the leadership and commitment the Chamber
has shown in recent years is the topic of our discussion today: Integrated
Landscape Management. The ACR has been instrumental in developing the
ILM model and bringing industry, government and academia together to work
toward common goals.
Perhaps the most visible evidence of this work is the Chamber’s
support of the Industrial Research Chair in Integrated Landscape Management
at the University of Alberta. TrueNorth is proud to be one of many Chamber
member companies, along with government and other funding agencies, who
have collectively contributed $2.5 million to fund the Chair for the next
five years.
This means Dr. Stan Boutin, who has spent most of his career studying
the northern boreal forest system, will have the resources to do some
very important research. He will be looking at how we can achieve the
ultimate goal of Integrated Landscape Management: to reduce the size,
duration and intensity of human infrastructure on the landscape.
In other words, to reduce our ecological 'footprint,' so we can make
more efficient use of the resources of this great province – and
protect the environment for future generations.
Which brings me to the theme of my remarks today: Why TrueNorth Energy
believes in Integrated Landscape Management, and how we are putting its
principles into practice.
But first a short commercial for TrueNorth Energy. TrueNorth has proposed
a new $2.5 billion oil sands development about 90 kilometers northeast
of Fort McMurray. It’s called the Fort Hills Oil Sands Project.
Our plan, which is currently in front of regulators, calls for a two-phase
project. The first phase is designed to produce 95,000 barrels of bitumen
per day by 2005, and the second phase will double that production to 190,000
barrels per day by 2009. Our leases contain an estimated 2.8 billion barrels
of oil – enough to sustain production for well over 30 years. We
are aiming to start construction in the fall.
What’s important about our project to this discussion is that we’re
one of several oil sands developers in the Athabasca region. That, of
course, is an understatement. It’s a giant wave of development,
with oil sands and infrastructure projects like power generation facilities,
pipelines and oil upgraders totalling somewhere around $50 billion in
approved and potential development over the next 20 years.
I say “approved and potential” because there is about $20
billion in projects that have been approved, and another $30 billion or
so that are in various stages of planning and regulatory processes.
With all the hype around oil sands development in recent years, we’ve
created a situation where people assume all this development is going
to go ahead at any cost. But, as everyone in this room knows all too well,
unless we take care to balance the economic, environmental and social
aspects of oil sands growth, we could get ahead of ourselves and over-promise
on all counts.
This may look like a hundred yard dash at times, but we should treat
it as a long, steady walk into a sustainable future.
With that little disclaimer, no matter which way we look at it, oil sands
development has the potential to be the most powerful economic driver
this province has seen since the great post-war conventional oil boom.
It’s creating thousands of jobs and billions of tax and royalty
dollars, and it’s solidifying Alberta’s place as the industrial
and financial centre of Western Canada.
It’s the amount, and the pace, and the intensity of oil sands development
that raises valid concerns about the cumulative impact of all these activities.
And I haven’t yet mentioned another key player in Northern Alberta
– a vibrant, growing forest industry that contributes to the economic
health of our province – and also has an impact on the environment.
And a the big question for all of us is: How can we make sure Alberta
and Canada can reap the socio-economic rewards of resource development
– and at the same time ensure there’s a healthy land base
to develop for future generations?
The good news is that we have a solid foundation to build on as we look
for new ways to minimize our impacts. TrueNorth, as a new player in the
oil sands industry, is benefiting from the solid work Suncor, Syncrude
and Albion Sands have done, and continue to do, in working towards sustainable
development.
A fundamental principle of Integrated Landscape Management is that our
industrial activities are inter-related, and that the key to reducing
our ecological footprint is to coordinate our activities at the landscape
level.
The idea of on-the-ground coordination of activities, of collaboration
between companies, and between industries, is very important to the future
of resource development in Alberta. We have a growing problem of what
is being called the ‘fragmentation’ of our forests. Conventional
oil and gas exploration and development, seismic cutlines, forestry, oil
sands development, pipeline construction and road building, are putting
increasing pressure on forest habitats.
Two summers ago, an influential paper was published by the Pembina Institute
for Appropriate Development. It’s called “Patchwork Policy,
Fragmented Forests: In-situ oil sands, industrial development, and the
ecological integrity of Alberta’s boreal forest” and it was
written by Gail MacCrimmon and Thomas Marr-Laing. It was one of the first
papers I read on the subject, and if you haven’t read it, it’s
worth a look.
This report argues that we need a broad policy framework for managing
the cumulative impacts of industrial development, so it can occur in an
ecologically sustainable way.
One of the key recommendations of the report speaks directly to Alberta’s
resource industry. It calls for “Coordination of development activities
between industries and development of best practices and procedures for
individual industries to minimize net disturbance to the boreal forest.”
I have a great illustration of exactly what this means to me, and to
TrueNorth Energy. It’s a story that starts with a dinner conversation
with Bill Hunter in Edmonton in the fall of 2000, and ends with a great
leap forward in Integrated Landscape Management.
It was a memorable meeting because Bill and I talked about how the company
he leads, Alberta Pacific Forest Industries, and TrueNorth Energy might
be able to work together to dramatically reduce the combined footprint
of our operations.
Al-Pac had already done some ground-breaking (or, rather, ground-saving)
work with Gulf -- now Conoco -- by jointly planning road-building into
areas where they both had interests. Together they saved millions of dollars
and reduced the amount of land disturbed by their operations.
As our conversation progressed, we talked about our businesses and our
visions for the future. And we also began to realize that there were opportunities
to work together toward the mutual goal of minimizing our impact on the
land.
Almost a year and a half later, I’m delighted to report that Al-Pac
and TrueNorth have changed our plans so that our operations over the next
five years will now be integrated with each other. The block of land that
Al-Pac had previously planned to harvest over the next several years will
remain untouched, and the cut has now been shifted onto the footprint
of our proposed mine site. Instead of two roads – one to a mine,
one to a logging operation – there will be one.
Our clearing requirements will be synchronized with Al-Pac’s timber
harvest from day one of our project, from clearing land for the plant
site, to building roads and utility corridors, to day-to-day, week-to-week
mining activities. Even the reclamation of the land will be a joint effort
between our companies – and it will be done progressively, minimizing
our footprint and maximizing new forest growth for future harvests.
Our cooperation is so extensive that Alpac has actually seconded one
of its forestry experts to TrueNorth’s environmental project team.
We are sharing information and working together on everything from our
environmental impact assessments to our detailed development planning.
Now I’d like to show you the tangible results of this collaboration.
The first slide I’m going to show you is the footprints of our mine
and Al-Pac’s original planned harvest over the next five years.
The next slide shows the new mining and forestry plan. As you can see,
the footprint is now half of what it was. This is Integrated Landscape
Management at work.
With all the oil and gas development planned for Northern Alberta over
the next 30 years, there is no reason we shouldn’t be able to dramatically
reduce the joint footprint of the energy and forestry industries.
As we plan our resource development activities, we need to keep asking
ourselves the question: how can we cooperate with other players? How can
we integrate our activities to reduce our joint impact and improve our
operational efficiencies?
It will take planning and coordination, and a spirit of cooperation.
But it can be done.
Of course, if industry fails to take the lead and work together to integrate
our activities in this way, someone else will dictate what we do and how
we do it.
Let me give you another example of Integrated Landscape Management at
work.
Syncrude’s Aurora Mine shares a border with our Fort Hills oil
sands lease. And we’re now talking with them about how we might
work together to ensure we get the most value from mining the resources
around the lease boundary.
If both operators mine right up to our common boundary, the mechanics
of mining dictate that we would both leave a sloped area at the border
of our mines. This would effectively sterilize a sizeable amount of oil
sand, wasting the resource. Through joint planning and perhaps some land
swapping, we should be able to get around this. And, ultimately, the more
efficient we are, the smaller and gentler our footprint.
In the coming years I believe there is great potential for all the oil
sands operators to take an even more integrated approach, particularly
in infrastructure and land reclamation planning activities.
So, I’ve given a couple of examples of how we have found ways to
put the principles of Integrated Landscape Management to work. This is
a significant development for our industries, and it bodes well for the
future of our province.
But I should also point out that it’s very early days. We have found
a couple of easy wins and we definitely have some momentum and a good
amount of enthusiasm.
What is now called for is to take Integrated Landscape Management to
the next level – to make ILM as much a part of our core culture
as health and safety is today in our companies.
One of the core principles of Integrated Landscape Management is that
most of the responsibility for reducing our collective footprint rests
with the industrial operators, working in the field, on the ground, sharing
detailed information and taking practical steps to cooperate every day.
ILM needs to happen at the operational level, where companies can make
the sophisticated assessments necessary to make a difference.
But for industry to be truly effective on the ground, we need to better
define public policy around integrated resource management throughout
the province. Government is playing a critical policy role in setting
the overall resource development and environmental priorities for the
province’s land base.
We need a policy framework to guide the long-term direction of resource
development in Alberta. To that end, there is some very good work going
on right now over at Alberta Environment and Sustainable Resource Development.
John Donner, the assistant deputy minister for strategic directions at
Alberta Environment, is leading a major government initiative to develop
an integrated resource management strategy for Alberta.
This is an example where government can add real value. I know that Bill
Hunter is going to talk more about this in his remarks in a few minutes,
and I’m looking forward to hearing his thoughts on this important
issue.
There’s another very important component to effective Integrated
Landscape Management: good research. We need solid, accurate information
about our land base and its ecosystems. The more data we have, the better
decisions we can make as we continue to look for ways to reduce and soften
the footprint of our operations. We can’t set the right priorities,
or make good decisions, unless we have a picture of how the land behaves
in its natural state.
One area of opportunity is wetlands research. Our Fort Hills Project,
like other oil sands developments, will disrupt some wetlands. About 16
percent of Alberta is covered in this kind of terrain, but we still don’t
have a strong understanding of the ecology of certain types of these features,
and their susceptibility or resilience to land use activities.
As development continues, we have identified some land that is similar
to the area we plan to mine that we can use as a control – an undisturbed
area that we can compare to the land that is disrupted by oil sands development.
The goal will be to build a storehouse of data on wetland areas to improve
our reclamation efforts in years to come.
We are currently working with the provincial government, Al-Pac, Ducks
Unlimited and the University of Alberta to have an area west of Fort McMurray
become the focus for this kind of baseline research. The area is called
the Thickwood Hills wetland complex, and it’s a good, representative
example of wetlands similar to those found at our Fort Hills site, which
will also be part of our joint research project.
To that end, TrueNorth and its research partners have applied to the
Province for a notation to help protect the integrity of the research
area over the coming years. TrueNorth is proposing to spend a million
dollars over the next five years to fund this wetlands research. The goal
is to provide our company, and the rest of our industry, with the kind
of data we need to help determine the best management approaches for these
landscapes.
We are excited about this new initiative, and we look forward to working
with the University, Ducks Unlimited, Al-Pac and the province –
and updating you on our progress.
I’d like to conclude my remarks today by focusing on what I believe
is the most important factor in making Integrated Landscape Management
work to increase efficiency, lower costs, and make our ecological footprint
smaller, and lighter.
And that is the winning spirit that pervades this great province of ours.
Just the other day I was reminded that Albertans are more involved in
volunteer work than any other province. Albertans are people who are always
ready to roll up their sleeves and get the job done, because we know if
we don’t do it, no one is going to do it for us.
It’s that volunteer spirit, that ‘let’s-get-it-done’
attitude, that makes the Alberta Chamber of Resources such a great organization.
TrueNorth is proud to work with the Chamber and other organizations to
help make Integrated Landscape Management a tool that will contribute
to a healthy, prosperous Alberta – and a sustainable future for
our children and grandchildren.
END
For more information contact:
Ron Shewchuk
Director, Corporate Communications
TrueNorth Energy
Tel: 403-514-7047
Cel: 403-681-7047
Email: ron.shewchuk@truenorthenergy.com
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