E-car dis­rup­tion on crude may have same ef­fect as pan­demic: Sun­cor CEO


TORONTO The shift to elec­tric ve­hi­cles and other low-car­bon tech­nolo­gies could dis­rupt crude oil de­mand on a sim­i­lar scale to the coro­n­avirus pan­demic, Sun­cor En­ergy Inc’s chief ex­ec­u­tive said on Mon­day.

The com­ments are a stark pre­dic­tion in an in­dus­try that of­ten down­plays the im­pact of elec­tri­fi­ca­tion and points to fore­casts of ris­ing global oil de­mand to jus­tify new in­vest­ment and pipe­line ex­pan­sions.

Canada is cur­rently the world’s fourth-largest oil pro­ducer and the sec­tor ac­counts for 10.6 per cent of the coun­try ’s gross do­mes­tic prod­uct.

“While Cana­dian oil and gas will re­main a sig­nif­i­cant part of the global en­ergy mix for some time, we have to take ad­van­tage of new op­por­tu­ni­ties that of­fer at­trac­tive growth prospects,” Sun­cor CEO Mark Lit­tle said in an opin­ion ar­ti­cle for Canada’s Cor­po­rate Knights mag­a­zine, jointly writ­ten by Al­berta In­no­vates CEO Laura Kil­crease.

“The tem­po­rary eco­nomic lock­down trig­gered by the 2020 pan­demic is giv­ing us a glimpse into a not-too-dis­tant fu­ture where the trans­for­ma­tion of our en­ergy sys­tem could dis­rupt de­mand on a sim­i­lar scale.”

Eco­nomic shut­downs to limit the out­break’s spread ground travel to a halt, cut­ting fuel de­mand by roughly 30 per cent world­wide.

Sun­cor, Canada’s No. 2 oil pro­ducer, cur­tailed out­put and cut its div­i­dend by more than half.

The sec­tor also faces mount­ing pres­sure from in­vestors for en­vi­ron­men­tal rea­sons.

Nor­way’s Us$1-tril­lion wealth fund in May black­listed Sun­cor and other large oil­sands pro­duc­ers for pro­duc­ing ex­ces­sive green­house gas emis­sions.

Lit­tle called for fed­eral in­vest­ment to help the in­dus­try di­ver­sify into hy­dro­gen, re­new­able jet fuel and car­bon fi­bre.

Bi­tu­men is rich in as­phaltenes, the feed­stock for car­bon fi­bre, used for mak­ing lighter ve­hi­cles in­clud­ing EVS, he said.

“If we can fig­ure out how to do this af­ford­ably at scale, it has the po­ten­tial to quadru­ple the rev­enue from Al­berta’s cur­rent bi­tu­men out­put,” he wrote.

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