Climate Change

The landscape near Nexen's Dilly Creek camp, located in the Horn River Basin in northeastern British Columbia, Canada.

Taking Action on Climate Change

Climate change is a global issue requiring solutions from energy producers, governments and consumers alike. At Nexen, we recognize the management of greenhouse gas (GHG) emissions is an important policy and business issue. That’s why we fund alternative energy, engage in public policy discussions on climate change and invest in technologies and innovation to improve the overall efficiency of our operations and further reduce our emissions intensity. We also participate in offset programs such as our Soderglen wind farm.

Compliance through Carbon Pricing

Nexen operates in jurisdictions where greenhouse gas (GHG) emissions are regulated and carbon markets exist:

  • Alberta, Canada – Oil sands and power plant operations in Alberta are subject to a carbon tax. Compliance is met through efficiency improvements, the use of carbon credits earned through our ownership in the Soderglen wind farm, and payment into a technology fund managed by the Climate Change and Emissions Management Corporation (CCEMC). The fund is directed towards researching and developing new low-carbon technologies that offer long-term benefits for the province.
  • British Columbia, Canada – Shale gas operations in northeastern British Columbia are subject to a carbon tax. Nexen pays $30 for every tonne emitted from fuel combustion and flaring to ensure compliance with this tax.
  • UK - Nexen participates in the European Union Emissions Trading Scheme, which has enabled us to meet UK compliance requirements through direct emission reductions as well as the acquisition of European Union Allowances (EUAs) and other eligible credits specified by the Kyoto Protocol.

Pursuing Innovation to reduce GHG Emissions

One of the biggest opportunities for reducing greenhouse gas (GHG) emissions is improved energy efficiency. While the first step is to utilize energy-efficient technology in the initial design and construction of our facilities it also entails investing in the research and development of future technologies that enable the production of oil and natural gas in a less carbon-intensive manner.

Our commitment to supporting research on sustainable and responsible energy systems spurred us to become a founding member of and leading partner in several key initiatives, such as:

  • Nexen is founding partner of the Industrial Research Chair in Field Upgrading and Asphaltenes Processing - Collaborating with the University of Alberta, the Natural Sciences and Engineering Research Council of Canada (NSERC) and Alberta Innovates — Energy and Environment Solutions on a five-year project starting in 2016, aimed at strengthening the oil sands industry by improving energy efficiency and reducing environmental impacts in bitumen processing. Nexen committed $1.25 million to funding these research efforts.
  • Nexen is a founding partner of the Canadian Centre for Clean Coal/Carbon and Mineral Processing Technologies (C5MPT) at the University of Alberta. C5MPT supports sustainable development of Canada’s natural resources with a particular focus on reducing environmental impacts such as greenhouse gas emissions. In 2010, Nexen provided a $1.5 million endowment to fund the Nexen Professor of Catalytic Reaction Engineering within the Centre.
  • Collaborating through Canada’s Oil sands Innovation Alliance (COSIA). Nexen is a founding member of COSIA, an alliance of 13 oil sands producers aimed at accelerating the pace of improvement in environmental performance. Nexen is a member of the land, water and GHG research areas. Through COSIA, Nexen is participating in a number of projects including the Carbon XPRIZE, aimed at converting CO2 from a waste into valuable products.
  • Pursuing energy efficiency through the Enhanced Solvent Extraction Incorporating Electromagnetic Heating (ESEIEH) consortium. This project is testing a technology that uses electromagnetic energy and solvent injection, rather than steam, to heat and mobilize bitumen for in-situ recovery. This technology has the potential to reduce energy use and GHG emissions. The technology is also expected to eliminate the need for water use. In 2012, this project successfully completed an initial proof-of-concept test, a key step in moving the project towards commercial utilization. A two-year field demonstration of the coupled Radio Frequency EM heating and propane injection process started in mid-2014.
  • SAGDOX is a Nexen patent pending in-situ recovery process involving steam and oxygen injection that has potential to improve the energy efficiency of the steam-only process thus reducing the steam-oil ratio. This has the effect of reducing carbon emissions as well as water use.
  • Nexen is participating with other industry partners in the Technology for Emission Reduction and Eco-efficiency (TEREE) working group through Petroleum Technology Alliance Canada (PTAC). The goal is to facilitate technologies that will reduce the industry’s impact on the environment, while improving profitability and eco-efficiency. The group identifies, evaluates and promotes transfer of new technologies through joint studies and information exchanges such as forums.
  • Nexen is funding partner of a project in the UK on CO2 Enhanced Oil Recovery (EOR). This phased Joint Industry Project is undertaking studies to enhance our understanding of CO2 motivated EOR. The aim is to create a commercial use for CO2 captured from power plants and industry. This technology could potentially store 75 million tonnes of CO2 from power plants and increase the amount of oil produced from reservoirs beneath the North Sea by 5% to 25%. This collaboration ensures that our investment in energy research is for the very long-term and is focused on the responsible development of Canada’s natural resources.

This collaboration ensures that our investment in energy research is for the very long-term and is focused on the responsible development of Canada’s natural resources.

Collaborating with Policymakers

Global energy demand is expected to rise as incomes grow and millions of people around the world are lifted out of energy poverty. As a result, there is no easy solution to meeting the world’s energy demand while reducing CO2 emissions. Companies like Nexen are in the business of responsibly developing the oil and gas resources that provides the energy we need today. This responsibility also includes taking action on climate change and working towards a lower carbon future.

To address climate change, industry, governments and consumers need to work together on solutions that include choices about energy sources, technologies and infrastructures. Nexen believes that establishing the right policy framework is an essential part of effective climate policy. We work with governments and other stakeholders to help improve energy literacy through discussions on the challenges and opportunities faced with developing natural resources. Our efforts are focused on encouraging energy and climate change policies that are fair, transparent and provide clarity for companies and the public alike.