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Steam from a Suncor refinery rises at rear as pipes are seen traversing industrial zone dubbed "Refinery Row", also run by energy firms Enbridge and Kinder Morgan in Sherwood Park, near Edmonton, Alberta, Canada November 13, 2016.

CHRIS HELGREN/Reuters

Suncor Energy Inc.'s new report on risks of climate change policies to its business would have been an unthinkable document to publish just a decade ago.

It suggests the age of the ever-expanding oil sands megaproject – the company's foundation – has come to an end if technological developments in transportation and renewable energy continue apace.

Under a range of scenarios that Canada's biggest energy company suggests could play out over the next two decades, prospects for massive new projects in the oil sands are also threatened by such things as weak economic growth or long stretches of low or wildly gyrating commodity prices.

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Indeed, all have been factors in recent years, and that's partly driving a shift in thinking among some of the more enlightened executives and investors. Beware business as usual.

Suncor released its report this week following a push by its own shareholders to spell out climate-related risks and what chief executive officer Steve Williams and his managers are doing to prepare for them. The company is adamant that none of its existing operations will be stranded in any case.

Mr. Williams has been front and centre in sometimes controversial moves on the carbon-reduction front. He's sought common ground with environmentalists who have opposed oil sands development. He and a handful of other executives stood with Alberta Premier Rachel Notley in 2015 when she announced stringent policies to try to lower emissions through a carbon tax, phase-out of coal-fired power and, counterintuitively for any oil man, a cap on CO2 from the oil sands.

He has taken flak for his unconventional approach, first from a few other energy executives, who grumbled about his working outside the confines of the main lobby group, then by the likes of right-wing rabble-rouser Ezra Levant, who organized a petition against Mr. Williams's environment-related initiatives.

Mr. Levant was hot and bothered by the Suncor boss's assertion that some oil sands reserves should stay in the ground. What's not said, of course, is all oil companies have reserves they will never produce because they are too expensive or too dirty to recover – basically the dregs.

This is not 2007, when oil prices began a march well above $100 (U.S.) a barrel, creating an anything-goes approach to oil sands investment. The boom led to massive inflation before crude cratered and prompted a collapse in activity.

Now, with prices still just above $50, the capital-and-carbon-intensive industry faces competition on a number of fronts: from the shale deposits of Texas to an expanding suite of fossil-fuel alternatives.

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Smart investors are trying to gauge what the future holds, if it doesn't include ever-expanding oil production. Indeed, ARC Financial Corp., the Calgary-based private-equity firm focused on energy, hosted a well-attended conference this month to examine advancements in transportation. The topics – from electric and autonomous vehicles to tightening green policies – were talked about in five-, 10– and 15-year time frames and hardly seem the stuff of The Jetsons.

"I've long encouraged people in our industry, the oil and gas industry, not to be in denial, to be vigilant" said Peter Tertzakian, executive director of ARC's research arm.

"We don't need to see a wholesale replacement of the entire transportation fleet to have an impact on our energy consumption, and specifically our oil consumption."

Suncor's report assumes different carbon worlds. In one, technological advancement and falling costs for clean energy lead to low oil prices and declining exploration and production activity. Major new oil sands projects are unlikely to get built.

In another, improving global living standards and advanced technology fuel increased demand for energy, but carbon-intensive industries face rising costs and more stringent standards. Demand for fossil fuels remains, but alternatives take a growing share of the market. A third envisions more global conflict and instability as well as skittish investors and tight capital markets, with environmental concerns taking a back seat to economic woes. That would mean little change in the global energy mix.

This detailed reporting should be the start of a trend. If cost and climate risks played any part in recent sales of oil sands assets by foreign companies, investors should know what those things mean to the companies that bought them.

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