A growing number of Canada’s oil and gas companies are receiving independent certification for their work in emissions reduction.
Five producers at six sites in Alberta and B.C. are now certified by New York-based non-profit Equitable Origin for their progress in environmental and social performance.
It’s part of a rapidly increasing trend in North America toward third-party certification, according to Thomas Fox, president of Calgary-based Highwood Emissions Management.
“If you look at what’s happened in the last year, it’s just been kind of an explosion in interest and participation. And we expect that trend to continue,” Fox said.
Equitable Origin’s program was born in 2009 out of concerns over oil development in the Amazon basin.
“The founders saw that everybody kind of paints the oil and gas industry with one brush and it has had a very negative reputation at different points in time. So they saw the opportunity to promote responsible energy development using market-based mechanisms that recognizes and rewards responsible energy producers,” said CEO Soledad Mills.
There’s a huge amount of opportunity for the industry to get ahead of emission regulations and take advantage of the evolving economy where oil and gas companies are being rewarded for their initiatives, Fox said.
“It really is early days right now but we do think there will be increasing amounts of interest in certifying natural gas as low carbon.”
Third-party verification is important for Vermillion Energy, said vice-president Yvonne Jeffery. Equitable Origin certified Vermillion’s natural gas operations near Drayton Valley, Alberta in October 2021.
“We think it’s really important to provide our stakeholders – our investors, our communities, [and] the people who eventually purchase our products – with a sense of confidence that when we say it’s responsibly produced, it is responsibly produced,” Jeffery said.
The company scored an average 89 per cent on metrics including corporate governance, transparency and ethics; human rights, social impact and community development; Indigenous peoples’ rights; fair labour and working conditions; and climate change, biodiversity and environment.
Together, sites owned by Vermillion, ARC Resources, Pacific Canbriam Energy, Pipestone Energy and Crew Energy scored an average 85 per cent across these metrics.
Fox said oil and gas companies that want to certify their product will abide by a set of rules that are developed by an independent organization.
Those rules typically require some combination of estimating emissions, demonstrating that certain technologies are being used in certain ways, and demonstrating that certain procedures are being followed and training exists for emissions management.
Jeffery said Equitable Origin is the only certification that she knows of that takes a wholistic look at all the elements of sustainability – the environmental, social and governance (ESG) pieces.
The certification model was developed through a multi-stakeholder process.
Mills said Canada is home to the first certified natural gas site in the world. That was at the end of 2019 and it was a company called Seven Generations, which has since merged into ARC Resources. The certified site is the Kakwa River project near Grande Prairie, Alberta.
Importantly, certification is not a one-time “stamp of approval,” but a process for continuous improvement, said Paul Myers, CEO of Pacific Canbriam Energy. The company’s northeast B.C. Montney natural gas operations were certified in 2021.
Myers said the company since its beginning has fostered a culture with sustainability at its core. It recognized that natural gas would be an important part of the global energy supply in the future and that sustainable development would not only create a competitive advantage but it is the right thing to do.
“Early on, we invested in a water recycling hub and water distribution pipelines with a vision to ultimately connect the entire field and eliminate emissions from water trucks. We are now fully connected [and] in 2021 we recycled 92 per cent of our produced water,” he said.
“We use innovations such as waste heat recovery at our main gas plant to completely eliminate the need for gas-fired process heat, vapour recovery units to capture processing vent gas, and electrification of control systems at multi-well pads to eliminate methane-emitting pneumatic devices.”
Vermillion’s Jeffery said that independent certification is important because oil and gas will continue to be required long into the future as alternative energy sources become available.
“It’s important to ensure that traditional energy sources have been responsibly produced, and certification offers a way to verify that level of excellence.”
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