SHARM EL-SHEIKH, EGYPT — It’s standing room only in the Canada pavilion at COP27 Friday morning, and it’s not because there’s a big announcement coming—there haven’t been many of those so far at the 13-day UN climate conference. 

On stage, representatives from Canada’s oil sands are making a pitch and there’s a crowd that wants to hear what they’re saying and another that wants to shut them up. 

It’s Decarbonization Day at COP27 and the question of what role—if any—fossil fuel emitters should play in curbing global warming has triggered intense disagreement between groups of environmental advocates and the band of global oil and gas companies that have descended on the summit. 

“This may be the panel with the highest ratio of media interest to seating capacity at COP,” said moderator Mark Cameron, vice president of external relations at Pathways Alliance, an industry association representing oil sands companies that have set targets to reach net-zero emissions by mid-century.

The Logic met with Cameron the evening before to discuss the industry’s agenda at COP27 and what it’s like being “the skunk at the garden party,” as he put it. 

“The conversations are usually pretty friendly,” said Cameron, adding that the backlash feels more “performative” than genuinely hostile. But on the eve of his panel discussion, he was nevertheless bracing for a protest the following day. 

Partway through the Pathways panel Friday, activists seated in the audience rose from their chairs and, holding white signs that read “kick big polluters out,” quietly walked out of the room. The demonstration was stereotypically Canadian in its politeness—it scarcely interrupted the panel—but its message reverberated throughout the venue. 

Canada’s oil-sector has been a divisive presence at this year’s global climate conference. Activists argue there’s no place for fossil fuels in the global shift to net-zero and that the industry’s presence at the conference serves only as a greenwashing tactic.

Protests of industries that proliferate global warming are a fixture at COP conferences. At the meeting in Glasgow last year, banks took the brunt of activists’ ire for continuing to finance fossil fuel projects while claiming their practices were aligned with net-zero principles. 

But there’s a substantially larger fossil fuel presence at COP27 than in previous years, allowing demonstrators to go straight for their target and putting Canada’s oil and gas delegation on the defensive.

“The reason we’re here is because we have to be part of the solution,” said Cameron. “This isn’t just a meeting for NGOs and governments. It’s a meeting for the people that have to decarbonize.”

Climate action is going to take unprecedented collaboration. Canada’s Pathways alliance cd be a model. Impressive to see indigenous, govt, tech & corporate leaders working together on net zero oil. Also impressive to see at #cop27 how many other countries are too pic.twitter.com/JminK7BcJe

— john stackhouse (@StackhouseJohn) November 11, 2022

Rhona DelFrari, chief sustainability officer at Calgary-based Cenovus, is among at least ten representatives from Canadian oil and gas companies that traveled to Egypt for the climate conference. It’s her first time at a COP and she told The Logic she’s here to exchange information with other fossil fuel companies on how to cut emissions in their operations. “We’re looking at new technologies that are being presented, we’re talking to others about the challenges we’re having in Canada and how we could collaborate with other countries that are facing the same challenges.”

In an email, Enbridge—which has three employees attending the summit—shared a similar motivation. “COP27 is an excellent opportunity for Enbridge to engage with like-minded organizations and stakeholders on finding ways to partner to enhance our greenhouse gas emissions reduction and advance the energy transition through investments in clean technology and innovation,” wrote spokesperson Gina Sutherland. 

Oil-sands firms haven’t just come to learn, of course; they’re in Egypt to market Canada’s fossil fuels to the world. The sector’s large contingent (Suncor was the only company that sent someone to Glasgow last year) coincides with a dire energy crisis in Europe that’s sent countries in the bloc scrambling for new sources of oil and gas after Russia cut their supplies earlier this year. 

“I’m having a lot of conversations these days about energy security and climate change going hand-in-hand,” said DelFrari. “If you do one without the other, it can be really disruptive to entire societies. That’s what you’re seeing right now in Europe.”

DelFrari said Cenovus and its peers can serve low-carbon sources of fuel for the energy transition. “If our’s is the most sustainably produced oil and gas, then we should earn the spot to be that provider well into the future,” she said.

Most of the sector is at COP27 under the Pathways Alliance banner, a coalition of six oil sands companies working on technologies that they say will scrub greenhouse gas output from operations like drilling and refining their products. They’ve pinned much of their net-zero plans on carbon capture, utilization and storage (CCUS) facilities. They’re also looking into small-nuclear reactors to power oil sands operations, and “solvent technologies” to reduce the need for energy-intensive steam needed for extracting oil. Much of the technology is unproven and nowhere near operational. 

“It’s highly ambitious,” said Cameron. “If we lose a year or two to regulatory delays or lawsuits, we won’t be able to achieve 2030 for many of the projects,” he said, referring to the year by which companies have set interim emissions-reduction targets on route to reaching net-zero by 2050. 

The Pathways projects require a lot of money to prove and develop—about $24.1 billion. The group is funded by its members, but Cameron said they’re also looking for government support. “None of these projects make money on their own. They cost billions of dollars, so we are looking for support in various ways,” he said. 

Many attendees at COP27, however, say the oil sector’s focus on cleaning up its legacy business isn’t enough. Even if companies remove greenhouse gasses from their own operations, there’s still the CO2 emitted when the products are burned. 

A UN report released at COP27 on Monday from a task force led by Canada’s former environment minister Catherine McKenna said that “net zero is entirely incompatible with continued investment in fossil fuels” and called for their phasing out. 

The federal government is rolling out financing tools to help decarbonization projects. In the 2022 federal budget, it announced tax credits allowing industrial-scale emitters to write off 50 per cent of equipment costs for CCUS projects, and “direct air capture” projects are eligible for a 60 per cent credit on their costs. In its fall economic statement earlier this month the government also announced it will launch a 30 per cent tax credit for other green technologies like solar, wind and hydro, and small modular nuclear reactors. 

The forthcoming Canada Growth Fund, meanwhile, will inject an additional $15 billion into emissions-reduction projects and firms developing new technology. The fund could guarantee revenue for carbon-capture or hydrogen projects using instruments called contracts for difference. The agreements would require Ottawa to make up the shortfall if the market price for a project’s emissions-reductions falls below set targets. “We’re looking at that pretty closely,” said Cameron. Other support, he said, could potentially come from the Alberta government through the oil sands royalty payments scheme, though he said it’s unclear how the system—which allows companies to deduct part of their capital costs against royalty payments—would apply to CCUS. 

Along with the oil companies themselves, there’s a large delegation supporting the sector from the province of Alberta, led by environment minister Sonya Savage. 

Edmonton Mayor Amarjeet Sohi told The Logic Friday he had come to COP27 to tout the city’s fledgling hydrogen industry, which promises to make clean-burning fuel from natural gas. 

“Edmonton region is poised to be a leader in hydrogen production,” he said. Earlier this week, federal innovation minister François-Philippe Champagne announced construction on a $1.6-billion hydrogen plant will proceed in Edmonton after Air Products Canada, the company behind the project, secured a combined $475 million from the federal and provincial governments. 

Laura Kilcrease, CEO of Alberta Innovates, said she’s in Egypt to focus on “bitumen beyond combustion”—alternative uses for oil sands products that don’t involve burning fuels. Kilcrease said the organization is working with local companies on uses for bitumen byproducts like carbon fibre, asphaltenes and vanadium, a precious metal that could be used in batteries. 

Kilcrease, who was just shaking off her jet lag when she spoke to The Logic, is at COP27 to make deals and partnerships for the industry. “I will feel that this trip is successful, if one positive coalition comes out of this,” she said. “A joint project, adoption of a technology, a new customer for someone in Alberta or Canada—that we make sure we’re not left behind in the world.”