As global companies abandon the Canadian oil sands at a time of low oil prices and huge losses, some of them are also concerned that producing one of the world’s most carbon-laden fossil fuels may be bad business in a warming world.
A wave of sell-offs began last year when Murphy Oil and Norway’s Statoil decided to pull out of the oil sands. Royal Dutch Shell followed last month, selling most of its operations to Canadian Natural Resources as part of a $7.25 billion divestment. Shell will maintain a small stake in the oil sands, however.
Shell’s announcement was followed by Marathon Oil, which said it would sell its oil sands subsidiary to Shell and Canadian Natural for $2.5 billion. Finally, at the end of March, ConocoPhillips struck a $13 billion deal to offload its oil sands business to Calgary-based Cenovus Energy after losing about $1 billion in the oil sands each year since 2014.
“As a high-carbon intensity, high-cost producer, the oil sands are in trouble,” said David Keith, a physics and public policy professor at Harvard University.
Multinational energy companies, including ExxonMobil, Shell, Statoil, Total and others flocked to the oil sands over the past decade as oil prices