Media Audit
Audit
To better understand the general sentiment about Canadian oil sands projects throughout Canada and the United States, an audit of Canadian and United States media coverage was conducted between January 2007 and May 2008. The audit focused on four topics relating to Canadian oil sands: investment, environment, projects and climate change. The perceived advantages and disadvantages from oil sands development are reflected in the media analysis below.
Overview
The tone and depth of the media coverage in Canada was significantly different compared to the U.S. The Canadian coverage was more widespread than the American coverage and, while it included the benefits of oil sands development, generally placed focus on the negative aspects of oil sands projects, especially when environmental and climate change issues surfaced. The U.S., on the other hand, focused less attention on environmental impacts from the oil sands and more on the prospect of having a potentially long-term oil supply from a North American trading partner. These divisions in the American and Canadian perception are reflected in this media audit, showing Americans to have a more positive outlook about the oil sands than their neighbors to the north.
Canadian Audit
The Canadian media audit revealed significant negative trends in both the environment and climate change sectors. On topics relating to the environment, approximately 80% of the articles reported a high negative sentiment toward the oil sands, while topics specifically related to climate change reached 70% between January 2007 and May 2008. Many of the articles focused on the recently released Environmental Defense Report that criticized new technology incorporated to help reduce greenhouse gases.
Other articles centered on northern Alberta towns, like Fort Chipewyan, upset about new oil projects in the area, and on the rising studies of cancers shown to be directly related to citizens living close to these oil sands projects. Within the last month (April 2008), the oil sands have once again come under intense scrutiny by the media. This time the negative publicity centered on one main topic — 500 ducks found dead from the Syncrude oil pond just north of Fort McMurray. 81% of the articles contained negative sentiments toward the oil and gas industry after this incident. Even articles that were more positive in scope referenced the Syncrude oil pond and the social responsibility oil companies have to our environment.
Articles on the topic of investment and project development were more positive in scope, but only slightly. Between January 2007 and May 2008, the articles for both topics focused on capital gains for the economy, the rising dollar, and increased Canadian investments contributing from oil and gas. Nevertheless, the media also gave considerable attention to towns affected by these projects, the lawsuits that developed against oil companies from the citizens, and how increasing royalty rates are causing the federal government to overestimate future developments. Since the beginning of 2008, the media has once again shifted its focus back toward soaring oil profit numbers (produced from Q1 of 2008), new project developments, and more specifically, EnCana’s company split.
United States Audit
The United States coverage of Canadian oil sands was fairly sparse for the time period specified
(January 2007- May 2008) with only 49 national media clips. The overall tone of the coverage was fairly balanced, but slanted toward favorable, with 59% of the articles having a positive sentiment. The audit revealed Americans to be in favor of oil extraction from a “neighboring democracy” (Detroit News, 03/05/08), simply because of the ease with which they can obtain the product.
Americans also favored the idea of investing within North America for their oil, potentially creating a self-sustaining continent, as opposed to acquiring their supply from overseas. Yet, they also criticized Canadian oil sands methods because of the processes involved in extracting the heavier oil (compared to the oil extraction methods in the U.S.), which causes more harm to the environment, and destroys some of the “last great wildernesses of our time” (Financial Times, 12/15/07).
Analysis
The Canadian media audit revealed negative trends in both the environment and climate change sectors from January 2007 to January 2008 and the trend is continuing into 2008 (January 2008 to May 2008 analysis). On topics relating to the environment, 82% (114/139) of the articles reported a high negative sentiment toward the oil sands, while topics specifically related to climate change reached 63% (37/58) between January 2007 and January 2008. Many of the articles focused on the recently released Environmental Defense Report that criticized new technology incorporated to help reduce greenhouse gases. Other articles centered on northern Alberta towns, like Fort Chipewyan, upset about new oil projects in the area, and on the rising studies of cancers shown to be directly related to citizens living close to these oil sands projects.
Articles on the topic of investment and project development were more positive in scope, but only slightly. Between January 2007 and January 2008, 56% of articles relating to oil sands investments revealed a negative sentiment (116/204), but the project development articles exposed a high percentage, 60% positive sentiment from the media (120/201). The articles for both topics focused on capital gains for the economy, the rising dollar, and increased Canadian investments contributing from oil and gas. However, the media also gave considerable attention to towns affected by these projects, the lawsuits that developed against oil companies from the citizens, and how increasing royalty rates are causing the federal government to overestimate future developments.
Between January 2008 and May 2008, articles that focused on environmental and climate change became increasingly more negative in scope. 74% (90/121) of media articles held the oil sands in a negative light when reporting on environmental issues with climate change articles reporting an 80% (24/30) negative tone from the media. Although some of the articles focused on global warming and environmental issues, the majority of the environmental articles found concentrated on one main topic—dead ducks from the Syncrude oil pond. Even the articles with a more positive sentiment referenced the Syncrude oil pond and the social responsibility oil companies have to our environment. With that said, 56% (90/169) of the articles still had a positive sentiment when discussing oil sands investment and new projects in Canada. The majority of the investment articles concentrated on soaring oil profits, new project development, and more specifically, EnCana’s company split.
Key Quotes
“Canada's second most valuable company made a big announcement today. Energy giant Encana says it's now going to split itself into two companies. It's yet another signal that the oil sands driven economy in Alberta continues to sizzle even as fears of a North American-wide recession grow.”
CBC Television Broadcast, 05/11/08
“Japan Canada Oil Sands ready to boost output; High oil prices spur major expansion. Ten years after building an in-situ oil sands demonstration plant, Japan Canada Oil Sands Ltd. (Jacos) signaled Thursday it is ready for commercial production with an expansion that could cost $750 billion.”
Calgary Harald, 05/09/08
“The company at the centre of an environmental debacle that killed hundreds of ducks at an oil sands tailings pond north of Fort McMurray has taken out full-page newspaper advertisements apologizing for the incident. The resulting deaths of an estimated 500 waterfowl have left the Alberta government and the oil sands industry struggling to convince the world they are not just paying lip service to cleaning up their operations.”
Edmonton Journal, 05/04/08
“Just five migratory ducks have been saved so far after hundreds landed on a tailings pond at Syncrude Canada, though rescue crews remain hopeful more can be saved.”
Fort McMurray Today, 05/01/08
“The federal government's plan to cut greenhouse gas emissions will have a marginal impact on Alberta's oil sands producers, but will still weigh on new projects faced with escalating costs, analysts say.”
Calgary Herald, 04/28/07
“Washington momentum is building in the United States for adoption of a national cap-and-trade system to reduce greenhouse gas emissions….”
Globe and Mail, 04/09/08
“As world leaders met this month in Bali to discuss climate change, global greenhouse gas emissions continued to increase daily. Canada is among the worse offenders. Primarily because of the oil sands, Canada's emissions have increased since 1990 by 33 per cent. When deforestation is entered into the equation, the figure is 54 per cent.”
Montreal Gazette, 12/15/07
“Canadian Oil Sands, which has a 37% interest in the sprawling Northern Alberta oil sands miner and synthetic-crude processor, earned $262-million, or 55¢ a unit, up from a year-earlier $91-million (20¢). That beat an average estimate of 40¢ a unit among analysts surveyed by Reuters Estimates.”
National Post, 04/26/07
“Located near Wood Buffalo National Park and once Canada's richest fur-trading post, Fort Chipewyan looks like an idyllic place. But the elders soon started to tell their new doctor stories of deformed fish and bleeding muskrats and how an unusually high number of local people had been ‘taken with cancer’.”
Globe and Mail, 05/19/07
“Three Calgary-based oil companies announced Monday deals to borrow a total of $2.3 billion -- primarily aimed to fund their share of capital costs for oil sands projects.” Edmonton Journal, 06/26/07
“These operations emit about 20 million tonnes of greenhouse gases each year, and that massive contribution to climate change will grow proportionately as projects forecast to quadruple production by 2020 come on- stream. The projects' impact is even greater, though, because they tear up vast expanses of boreal forest to get at the sand, wiping out an immense storehouse of carbon.”
Toronto Star, 10/07/07
“Suncor Energy Inc. plans to use new technology that would create a smaller mining fleet and thereby lower operating costs and minimize environmental impact at its Voyageur South oil sands projects, says Raymond James analyst Justin Bouchard.”
National Post, 02/27/07
“The Conservative government was criticized harshly last fall when it announced that its targets for at least the next 13 years would not require companies to reduce their overall emissions, but rather reduce their intensity. That means greenhouse-gas emissions from the production of each barrel of oil would decrease, but if a company is selling more barrels of oil each year -- as is widespread in the oil sands -- overall emissions would keep going up.”
Globe and Mail, 02/26/07
Analysis
U.S. coverage of Canadian oil sands for the time period specified (January 2007 to May 2008) totaled 49 national media clips. The overall tone of the coverage was fairly balanced, but slanted toward favorable, with 29 positive articles and 20 negative articles. Parameters were set to conform to research conducted by FH Calgary.
The team evaluated each piece for four themes: investment, environment, projects and climate change. Of these four themes, investment (29) and environment (16) were most prevalent, while climate change (12) and projects (11) received less, but still a fair amount, of coverage. Where articles covered more than one of the four themes, all relevant topics were noted and accounted for appropriately.
Key Quotes
“The investor groups called BP’s Canadian move ‘a disturbing step backward’ for a company that has invested billions in alternative energy and has touted its efforts to be environmentally friendly.”
Houston Chronicle, 4/18/08
“The challenge is how to produce and refine enough oil to meet rising energy demand while mitigating carbon-dioxide emissions. Refiners have set a goal to improve energy efficiency 10 percent over the next decade, and one way they are making progress is capturing excess heat from their operations to produce additional electricity.”
Fort Worth Star-Telegram, 4/1/08
“In addition, proved Canadian oil-sands reserves decreased 3.3% to 694 million barrels, as of yearend 2007.”
BusinessWeek, 4/1/08
“U.S. consumers should be excited about the availability of vast oil reserves in a neighboring democracy with a market economy. Unfortunately, they are not. First, few Americans are aware of the importance of Canadian oil. Second, there is an environmental cost to the production of oil made from tar sands that, while real, has been exaggerated.” Detroit News, 3/5/08
“In Canada, oil sands are now the single largest contributor to the growth of gases linked to climate change.”
Wall Street Journal, 2/6/08
“We used to say the oil sands market was worth between five and 10 new mining shovels. As we move into the next 24 months, it’s more like 10 to 20 shovels a year. The growth is like a mushroom cloud, and it’s going to keep going because the price of oil is not coming down any time soon.”
Milwaukee Journal Sentinel, 1/4/08
“Here is one of the last wildernesses of the world, and we’re going to fritter it away. There will be a day of reckoning, and Canada and the oil companies will pay the piper.”
Financial Times, 12/15/07
“It’s heavy oil; it does generate more carbon dioxide in the refining process than light oil,’ said Greg Stringham, vice president of markets for the Canadian Association of Petroleum Producers. ‘But there are significant mitigative measures that can be taken.”
Sacramento Bee, 12/9/07
“Oil shale and tar sands are other sources of liquid fuel that are harder on the environment than petroleum. High oil prices already have sparked a boom in Canada’s tar sands business.”
National Public Radio, 11/14/07
“’We’re very keen on seeing [the money] reinvested in the country and particularly in the province where it was raised,’ said Marcel Coutu, chief executive of Canadian Oil Sands Trust.”
Wall Street Journal, 11/12/07
“Producers should be allowed to drill the entire U.S. Outer Continental Shelf, which holds an estimated 110 billion barrels of crude oil. And the Canadian oil sands and U.S. oil shale deposits, both estimated at the equivalent of a trillion barrels, should be developed.”
Fort Worth Star-Telegram, 11/7/07
“These Alberta oil sands are some of the dirtiest oil products you can process,’ said Melissa Malott of the conservation group Clean Wisconsin.”
Milwaukee Journal Sentinel, 9/14/07
“The people who understand the industry the best understand that long term the most substantive solution is in the oil sands,’ says Charles Swanson, managing partner in the Houston office of Ernst & Young. ‘The fundamental economics are stronger than the stuff we hear about today that is trendy and sexy,’ he says, referring to ethanol and other biofuels.”
Wall Street Journal, 7/10/07
“It’s essentially a sure bet because the oil sands is sound oil,’ Wood Mackenzie oil analyst Conor Bint said.”
Houston Chronicle, 4/6/07