Resolved: Shareholders request that Suncor produce a report, at reasonable cost and omitting proprietary information, outlining how its capital expenditure plans align with its 2030 emissions reductions target and its 2050 net zero pledge.
Supporting Statement: Suncor has a 2030 emissions reduction target of 10 Mt CO2e and a 2050 net zero target. Suncor indicates it is committing 10% of its annual capital budget over the medium term to “investments that advance our low-carbon energy offerings.” Suncor does not provide a rationale for this level of investment and how it aligns with its targets nor disclose specific planned investments and associated emissions reductions.
Similarly, Suncor does not disclose emissions expectations associated with the other 90% of its planned capital budget and whether these investments take the company further from its climate targets. Note that there is no baseline established for Suncor’s 2030 target, nor are Scope 3 emissions included in it, meaning that the vast majority of Suncor’s capital expenditures may contribute towards emissions expansion.
The International Energy Agency projects a three-quarters decline in oil demand in its net zero scenario and Canada’s Energy Regulator predicts oil production in Canada will peak shortly after 2030. These reductions are part of the net zero transition that is an existential threat to unprepared oil companies and is particularly acute for Suncor and other oil sands producers producing a higher cost and higher emitting source of oil than most competitors.
Considering this threat, it is critical that investors are given more clarity on how Suncor’s capital expenditure plans align with its 2030 emissions reductions target and its 2050 net zero pledge
Suncor’s climate plans rely heavily on carbon capture utilization and storage (CCUS) for meeting its climate goals. Yet the company does not disclose spending plans for CCUS, including overall cost and projections of cost-per-barrel over the medium and long term.
Climate Action 100+, a global investor initiative representing US$68 trillion in assets under management, found in its October 2022 Assessment that Suncor “does not meet any criteria” for capital alignment, medium term targets or decarbonization strategy.”
To address investor uncertainty and to manage business risk, we urge shareholders to vote FOR this proposal.