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Derrick Digest for April 20, 2017: Canadian collaboration key to future success of oilsands

 

The Derrick Digest is a weekly collection of curated content, based on events from across the oil and gas industry, that caught our eye at Pennine Petroleum Corporation.

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APRIL 20, 2017

With the exit of multinational players from Alberta's energy sector, Canadian companies are turning what could be a challenge into an opportunity.

Canadian companies are doing it for themselves.

Rather than seeing the recent exit of multinationals from Alberta’s energy sector as a negative, players such as Cenovus Energy Inc. and Canadian Natural Resources Ltd. are taking a positive outlook. Canadian companies have a better understanding of issues specific to our country, the line of reasoning goes.

“The oil sands require a focus on environmental issues like carbon pricing, indigenous issues, things like that, that are very specific kinds of skills that companies need to have for Alberta, for Canada,” said Harrie Vredenburg, a professor at the University of Calgary’s Haskayne School of Business. “Some of the multinationals are not necessarily particularly suited to that. In all those things, it does favour the Canadian firms.”

Something else in the companies favour is hardwired into Canada’s DNA: the desire to get along. In a quintessentially Canadian agreement, companies including Canadian Natural Resources, Cenovus and Suncor Energy Inc. have agreed to share proprietary technologies royalty-free.

“Canadians will always try to negotiate and to find common ground and collaborate before we become confrontational and adversarial,” said Dan Wicklum, chief executive officer of Canada’s Oil Sands Innovation Alliance.

Advances include amping up efficiencies in steam operations, or replacing steam altogether with microwaves or radio frequencies. Wicklum said moves such as these could help cut costs by as much as 40 per cent and reduce emissions by as much as 80 per cent.

Vredenburg, one of three U of C professors who co-authored a study on the 20-year history of open innovation in the Western Canadian oil and gas industry, says organizations that have senior executives involved in the innovation sharing are more likely to have better outcomes. It also helps to steady the ship when the industry is going through a rough patch and inter-firm sharing can be challenging.

“Culture also matters. Some companies have a more collaborative information-sharing culture while in other firms a strong Not-Invented-Here syndrome is prevalent. The former, obviously, are more suited to the open innovation model than the latter,” Vredenburg says.