Our 2017 air emissions and energy use performance will be available in June 2018, aligning with federal and provincial reporting. This report will be updated.
To improve the efficiency of our operations, we are always looking at the most effective way to use resources.
We address local and regional air quality where we operate by assessing equipment and facilities to mitigate the impacts of our operations. We operate in some of the most tightly-regulated jurisdictions and have rigorous emission controls in all our operations.
Greenhouse Gas Emissions
Husky supports the global response to the threat of climate change, including national commitments under the Paris Climate Change Agreement to keep global temperature rise this century below 2 degrees Celsius. Our discussions with government on proposed policies related to these commitments emphasize the importance of protecting competitiveness. Husky uses an internal price on carbon, testing long-range plans against various pricing scenarios. To strengthen our resilience, we have implemented a number of carbon reduction offset projects and technologies.
Our carbon management approach and metrics are detailed in annual submissions to the CDP Climate Program, which are posted on huskyenergy.com. In 2017 we received a B grade, which exceeds the sector average and is based on our disclosure of: Emissions Management, Governance and Strategy, Risk and Opportunity Management and Verification.
Husky monitors the work of the Task Force on Climate Related Financial Disclosures (TCFD), as well as the Alberta Securities Commission and the Canadian Securities Administrators on how to address recommendations in financial disclosures. Through both voluntary and mandatory reporting mechanisms, we demonstrate our management of environmental, social and governance risks, including climate change. We continue to talk to our investors and other stakeholders on expectations related to climate change disclosure, and ensure we address their priorities.
Renewable & Low Carbon Production
Husky helped pioneer the production of ethanol for use in ethanol-blended fuels, starting almost 30 years ago. We operate two ethanol plants, one in Minnedosa, Manitoba and the other in Lloydminster, Saskatchewan. With total production of 260 million litres per year, we are Western Canada‘s largest manufacturer and marketer of ethanol.
At the Lloydminster plant, we capture up to 250 tonnes a day of carbon dioxide (CO2) to aid in enhanced oil recovery, which involves CO2 being injected into reservoirs to increase oil production. The use of this carbon capture technology allows for the production of some of the lowest carbon intensity ethanol in Canada.
We continue to evaluate additional carbon capture technologies, including at our Pikes Peak South Lloyd thermal project where we have been testing technology that captures CO2 from a once-through steam generator. One pilot underway since 2015 is capturing up to 30 tonnes per day. A second third-party demonstration pilot using different technology has been capturing 0.5 tonnes per day. Based on initial results, we will be supporting further expansion of that technology to a 30 tonnes per day capacity, with expected commissioning in 2019. Husky believes these technologies have the potential to reduce the cost of carbon capture, compared to existing methods, and could turn our Lloyd thermal production into a lower carbon source of energy.
Husky evaluates various ways to reduce the carbon intensity of our upstream and downstream operations. We use a Marginal Abatement Cost Curve (MACC) to catalogue options, including the size of emissions reduction possible, as well economic performance. This allows us to prioritize resources and achieve reductions at the most efficient cost per tonne of CO2e. The MACC also helps different areas of the company share information about emission reduction options.
We are expanding our position in the North American asphalt market, with demand for these products likely to be resilient in a lower carbon market as they are not combusted. We have eight asphalt emulsion production facilities in Canada and the United States, and are the largest marketer of paving asphalt in Western Canada. Husky is committed to innovating in this sector, partnering with the University of Calgary since 1995 to fund the Husky Energy Endowed Chair in Bituminous Materials.
In Alberta, Husky has worked collaboratively with government to develop draft regulations to reduce methane emissions from oil and gas operations by 45 percent by 2025. We have started to reduce methane emissions through the conversion of pneumatic devices and improved gas conservation.
We conserve solution gas at our operations and reduce venting and flaring. Our 2017 performance will be available in June 2018 and updated in this report.
Fugitive Emissions Management Program
Our Fugitive Emission Management Program detects and ensures the timely repair of leaking equipment to reduce emissions. It improves our operating efficiency by tracking where and when leaks occur, minimizing the release of greenhouse gases and volatile organic compounds (VOCs).
Fugitive emissions are gas and vapour leaks, including methane and VOCs, from valves, piping connections, pumps and compressor seals, and other piping system components that occur as part of the normal operation of a facility or plant. Husky uses several techniques to detect a leaking component, including highly specialized infrared cameras that provide a view of normally inaccessible locations such as tank seals and overhead piping from a distance, and ultrasonic detection, which identifies leaking components using sound. These methods create an effective survey, repair and tracking system. Vapour analyzers and ultrasonic measurements can be used to quantify equipment leaks.
A third-party contractor completes a Leak Detection and Repair Survey (LDAR) for the Downstream business annually, checking every applicable component and testing with a vapour analyzer. We undertake maintenance where required. For the Upstream business, LDARs are conducted by Husky personnel, as well as third-party contractors. The reports are shared with the facility‘s staff, and maintenance is undertaken as needed.