Oilsands firms fail to communicate: CEO

The oilsands industry is doing a "phenomenally poor" job in trying to make the public understand the environmental impact of their projects, the CEO of Opti Canada Inc. said Wednesday.

The oilsands industry is doing a "disastrous" and "phenomenally poor" job in trying to make the public understand the environmental impact of their projects, the CEO of Opti Canada Inc. said Wednesday.

A tailings pond reflects the Syncrude oilsands mine site near Fort McMurray, Alta.

"I think we've done a particularly disastrous job of informing people exactly what it is we do and what we're doing to improve it," Chris Slubicki told a conference hosted by oilpatch investment dealer Peters & Co.

"You tell somebody you're CEO of an oilsands company and they let go on you. They lose it. My reaction is not (that) they are naive. My reaction is we have done a phenomenally poor job."

Oilsands producers have been bombarded by criticism over the environmental impacts of their projects, including water use, effects on wildlife and greenhouse gas emissions.

Many of the attacks don't differentiate between steam-driven "in situ" projects — like the one Opti is developing alongside Nexen Inc. at Long Lake, Alta. — and large open-pit mines.

Some U.S. legislators have waded into the debate over whether so-called "dirty oil" should be shipped south through major pipeline expansions.

Two recent leaks on U.S. crude pipelines owned by Enbridge Inc. of Calgary have underscored some of those concerns. A congressional panel in Washington heard from angry Michigan residents Wednesday about a major Enbridge leak in July, which spilled three million litres of crude into a key waterway.

Another Enbridge line in the Chicago area spilled crude last week. There were fears of a third leak near Buffalo on Monday, but it turned out to be a false alarm.

Many of Canada's oilsands producers are participating in an ad campaign launched by the Canadian Association of Petroleum Producers, the main voice of the industry. Some, like Cenovus Energy Inc., are doing their own independent campaigns, too.

One issue the oilsands industry is not as concerned about is the possibility of construction and labour costs spiralling out of control, as they did three or four years ago.

"We do not see the same kind of Gong Show that the industry went through back in 2006, 2007," Cenovus CEO Brian Ferguson told the conference.

"We've had some contractors ask for increases. We've pushed back on that, and they've accepted that."

Cenovus is expecting inflation of between zero and five per cent, Ferguson said.

There are select areas where inflation is more of a concern, like the Bakken oil play in southeastern Saskatchewan. But overall, weak natural gas prices mean lower costs for energy-hungry oilsands projects.