Perception, Reality and Transparency

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Industry is working to improve its communications, but more importantly its actual performance

This article appears in the October issue of Oilsands Review

by Peter McKenzie-Brown and Deborah Jaremko

The oilsands industry is under near-constant attack from environmental groups and other non-governmental organizations (NGOs) bent on putting an end to “the most destructive energy project on earth.” The phrase “stop the tar sands,” and the moniker “dirty oil” are well known, and not taken lightly. The Alberta government and various industry organizations are taking on the challenge of battling negative perception with the facts about existing development, but also with something even more powerful — commitment to do better, and to prove it.

The “Big Lie” and the Age of the Internet
As Adolf Hitler was dictating his book Mein Kampf in 1925, he coined the term “the Big Lie.” A propaganda technique, the Big Lie refers to a falsehood so “colossal” that no one would believe that someone “could have the impudence to distort the truth so infamously.” Hitler used the technique to good effect through his years of tyranny. However, in established democracies things are different. Government, media, academia and business are all held to account, and among those organizations anything like the use of the Big Lie encounters widespread derision.

“Government tends to be constrained by fact,” says Alberta government spokesman Jerry Bellikka, with withering irony. “We are held to account for what we say. If we were to knowingly put out misinformation, academics, environmentalists, opposition politicians, the public and traditional media would hold us to account. When the premier is talking about emission reductions in the oilsands, if he does not say ‘per barrel,’ he is called on it right away.”

But in emergent web-based media, accountability is self-imposed. Most of the influential NGOs use reasoned arguments and collaborate with government and industry as they advocate for their causes; the Pembina Institute comes to mind. However, some major environmental groups use those media without much regard for facts. Therein we may find the 21st Century version of the Big Lie.

“[Some] people are making pretty outrageous claims,” says Bellikka. “What they want is a reaction. It’s one thing to have a discussion based on fact and current data. It’s another thing to put out inflammatory material, not much of which is accurate...it’s to get a reaction and that’s what these campaigns are designed to do. They are based on emotions, on wild accusations. Yet these same groups call governments the propaganda machines.”

The message presented by anti-oilsands groups in various forms — from feature-length documentaries and short YouTube videos to online games and protest actions — is one of environmental and social degradation that has been called as much as “Armageddon.”

“We want to lift the lid on the horrors of oil exploration taking place in a country that has a reputation for being the cleanest in the world,” says Michael Marx, executive director of Corporate Ethics International, the group behind the recent ReThink Alberta campaign. The initiative, spread through the web and via billboards in four U.S. cities as well as London, England, encourages potential tourists to Alberta to reconsider their travel investment until the tar sands industry is no more. “Tar sands mining in Alberta has not only caused irreparable damage to the environment but the health of local communities which have seen a dramatic rise in rare cancers linked to the same compounds found in tar sands operations.”

The dramatic proliferation in the number of groups like Corporate Ethics International, and the growth in public and private grants and contracts flowing to them, have enabled NGOs to become powerful political forces. In a sense, they are now filling a credibility vacuum that has been developing for 20 years. Poll after poll has shown declining confidence in such institutions as government, business and traditional media. This has created great demand for independent information and analysis, which NGOs can easily deliver through web-based communications.

“They do not work with small budgets. They are often well-funded,” notes Bellikka. “[Some NGOs] have told us that when they do one of their campaigns they get lots of donations. Whether [that is] accurate or not, we don’t know; they don’t give us access to that sort of information directly. But, what we do know is that these are very well-funded campaigns. Greenpeace is an excellent example.” Last year Greenpeace had total worldwide income of about €200 million ($272 million), and directed about €28 million ($38 million) of that to off-oil climate and energy campaigns.

From Defence to Proactive Discussion and Education
Although often characterized by highly exaggerated and even inaccurate claims, it is more than big budgets and social media wizardry that grants off-oilsands groups a position in public perception. The truth is that the concerns are not entirely unfounded — oilsands development undeniably does negatively impact the environment. It is communicating the actual extent of this impact that has been the challenging burden of industry and government, but now that mission is being taken a step further.

“We have spent a long time being framed as villains by environmental organizations, and we have been trying to prove them wrong. That was not an effective approach,” says Janet Annesley, vice-president of communications for the Canadian Association of Petroleum Producers (CAPP). “We have to show Canadians our business. We have to show them the kinds of people who work in our companies and the solutions we find to problems in a difficult business. We need to exit the discussion about who is right and focus on doing good work.”

She says that according to CAPP polls, 74 per cent of Canadians say that the industry should be developing the oilsands. “Our strategy should be to say, ‘Yes, Mr. and Mrs. Canadian. You are right. And that is exactly what the industry is doing today.’ The advertising campaign we launched last June is simply following that plan.”

Annesley describes the off-oil NGOs as being driven by an agenda, but shares some consternation about what that agenda is. “They really seem to think that Big Oil is the only thing standing between society and a renewable energy future. That doesn’t make any sense, but they do seem to believe it.”

She continues, “We fundamentally beg to differ. The solutions are not available today. We know that energy demand is increasing, that energy resources are declining and that much of the conventional energy available is in countries that are very difficult to do business with. We know that energy supplies must diversify. We know that energy development is under greater scrutiny than ever before. And we know that the industry has to meet the planet’s growing energy needs in ways that are increasingly environmentally accountable. That is the rock and the hard place in which we sit.”

The industry is widely understood to offer economic benefits to Canadians, she says, and “we are widely understood to be reliable suppliers of energy. However, we are not widely understood to be providing environmental solutions. That’s where we need to focus. We need to be talking about the issues of economic benefits; energy security and environmental care in a balanced way, but that conversation shouldn’t begin with someone dangling from the top of the Calgary Tower [a recent Greenpeace action].”

Roger Gibbins, president and chief executive officer of the Canada West Foundation, sums up the problem nicely. “The oilsands proponents will to some degree always be on the defensive on the environmental front,” he says. “The oilsands industry has a lot of negative images to deal with. The industry has to acknowledge that its work has had an adverse environmental impact in the past, and begin there. I think that if the industry is a bit repentant, and admits it hasn’t done the best job in the past, it will be in a better place to win people’s minds and hearts. Just arguing with environmentalists doesn’t have that effect.”

CAPP’s Responsible Canadian Energy program
In announcing the winners of its Steward of Excellence awards this spring, CAPP launched a new program dubbed Responsible Canadian Energy, which is designed to be a platform from which the industry, unified, can demonstrate and communicate its commitment to responsible resource development.

“The way the world sees us is defined by our performance. The linkages between stewardship and the reputation of the energy sector have never been clearer,” says CAPP president David Collyer. “This is not at all about communicating our way out of a problem. It never has been and it won’t be in the future. We certainly need to focus on communications to improve awareness and understanding, but it is essential that this be underpinned by ongoing improvement. In a world that is always moving and changing, we can’t stand still. We have to do better, and we will.”

Collyer continues that, “For some, the oilsands is the economic saviour of a recession-weary country. For others, oilsands development symbolizes a world that has grown far too dependent on fossil fuels. In reality, the oilsands is neither. The truth, as they say, is somewhere in between. CAPP and its members fully recognize that the reputation of this increasingly important industry is determined by two things: performance and communication. We also know that both must be delivered consistently and authentically over time.”
CAPP says a performance report based on the Responsible Canadian Energy initiative will be issued this fall, with 2010 serving as the baseline year as producers “refine and advance” the program. The report will include data on environmental and social performance, and will be followed by a white paper in December 2010 based on an energy dialogue series in Canada and the United States.

The Oil Sands Leadership Initiative
One of the worst-kept secrets in the oilsands industry is under wraps no longer — that is, the Oil Sands Leadership Initiative (OSLI), a consortium of five major players with a self-described “laser focus” on improvements in environmental performance.

With a $10-million budget for 2010 (expected to double or triple in the coming years), Suncor, ConocoPhillips, Nexen, Statoil and Total have a mind to change the bitumen game.

Gordon Lambert, Suncor’s vice-president of sustainability, explains that OSLI has been up and running for about a year and a half, with 2010 as its first official operational year. He says that the group’s genesis was a recognition of the need to accelerate the pace of environmental performance measurement and improvement, while understanding that in order for continued success in this particular space, the needs of the whole outweigh the needs of each individual company.

“We compete in some areas of the business. We don’t compete in reducing our environmental footprint,” says Lambert. “We felt we could make more progress by working collectively than by working individually. The more ideas you get on the table, the better the chance of success.”

The OSLI charter outlines working groups designed to address water management, carbon management and energy efficiency, land stewardship, sustainable communities, technology breakthroughs and other focus areas as agreed on by its steering committee.

One of the first initiatives that OSLI is working on is a $2.5-million feasibility study into a potential new water distribution plan for the Athabasca oilsands region. Dubbed the Regional Water Solutions Study, Lambert says the idea is to work out whether it is environmentally and economically viable for oilsands producers in the area to reuse water left in mining tailings as steam generation source water for local in situ projects. The notion is not as “blue-sky” as it may sound — Suncor itself already uses its tailings water from mining operations to supply its Firebag steam assisted gravity drainage project. However, Lambert says applying it on a regional scale would require a broad consensus — the subject of the feasibility study.

Another key OSLI initiative is OSTECH, a “technology identification structure based on a web portal.” The group says that through this portal, inventors, entrepreneurs and the general public will be able to submit projects and ideas that can be further developed within OSLI. Lambert says it will be a one-window system for the member companies to share in evaluation of the new technology ideas that are presented to them, reducing duplication of due-diligence efforts.

“Innovation and the oilsands go hand in hand. It has always been that way,” he says. “New ideas are coming forward all the time.”

A key part of OSLI’s mandate is transparency around advancing its performance improvement efforts, which is one of the reasons it did not publicly herald its initial creation.

“We’ve been cautious of waiting to communicate on results and action versus intent,” says Lambert. “In 2011, you will see us stepping out more visibly.”