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Propogating Poor Image; The Bain of the Oil Sands

Posted by Stacy Richter on May 25 at 10:00 PM
Our continuing research into the effect of media on the overall image of the oil and gas industry affirms that web media is the bain of the Oil Sands.  A study published by the CanadaWest Foundation (CWF) [1] confirms our earlier declarations; The oil and gas industry is getting crushed in online media.

An earlier blog focused on the share of voice and share of media type for Exxon and BP.  The research showed that BP had a very small share of the voice compared to Exxon (see:  Social Media in Oil and Gas: A Snap Shot).  BP’s share of 29.4% paled in comparison to Exxon’s 70.6%.  We observed that spikes in topics surrounding significant environmental or economic events at both companies.  Exxon dominated the chatter after announcing their 2009 Q4 earnings compared to the same announcement by BP. 

In my follow up blog, How Social Media Exasperated BP’s Image After the Gulf Spill, we observed significant changes in the share of voice.  The share shifted to 66.4% for BP.  We also noticed a major shift from blogs to micro media.   The two-week content review showed that the chatter about the spill topped out at more than double the chatter after Exxon’s earnings announcement.

 

The question is.... can these findings be applied to the oil sands? The short answer is YES.  The CWF study compares media coverage of the oil sands for March 2010. 

We noticed that the negative environmental stories transmitted over web media are 5 times that of positive stories in the same medium and more than 2 times that in Canadian media.  This study validates our earlier findings that negative environmental stories travel much more quickly and with more vigor over web media than other media sources in either Canada or internationally.

Given the overall volume of negative stories about the oil sands, I’m not surprised that most of them are focused in Alberta.  I am surprised about the number of negative oil sands coverage in BC.  A large part of the negative discussion in BC can be attributed to opposition of the Northern Gateway pipeline; A pipeline proposed by Enbridge to transport $525,000 bpd of bitumen from Edmonton to Kitimat for transport to refineries in Asia [2].

The debate about producing the oil sands even rages around the transportation of the unconventional oil.  I expect that the opposition has only grown since the tragic spill in the Gulf.

CWF also reviews economic stories.  We observe that the stories across mediums are overwhelmingly positive.  Thinking about level of control, it makes sense that economic stories will swell on the positive side because sources include company reports and press releases. 

 

How does this compare to the environmental stories?  The difference remains in the level of control.  Citizen journalism, circulated almost exclusively through web media, is out of the control of the oil sands companies while financial data remains 100% in control. 

I propose that it does not have to be that way.  Producers who are the target of such negative environmental stories do not have to sit idly by while citizen journalists, who may or may not be fully informed, broadcast their opinion.  Web media is open source.  The oil and gas industry has the means to speak up in its own defence.  Crisis communications is not sufficient.  Proactive communication is required.  Image and trust is built up over time.  Image and trust require constant and consistent communication.



[1]  Canada West Foundation. (2010). Oil sands media monitoring report. Retrieved from

        http://www.cwf.ca/V2/files/Oil_Sands_2010_April.pdf

[2]  EcoBC. (2010). The Enbridge oil sands gamble by Andrew Nikiforuk. Retrieved from

      http://www.ecobc.org/pipelinetarsands/

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6 Comments so far...

I love the comment; "Crisis communications is not sufficient. Proactive communication is required". I'm getting the sense there may be a major thaw coming on this issue with the big producers. However, my fear is that they have 3-5 years of learning to catch up on.

Posted by Jason on May 26 at 10:00 AM

Thanks Jason,

For an industry in the hot seat over so many issues so often, I am surprised that a more complete and proactive communications strategy is not more evident.

I will admit that the oil and gas industry are very good at communicating financial performance and contingencies and even crisis communications. The business environment is changing/changed and I agree with you that the big thaw is coming and then a 3-5 yr acclimatization follows.

Posted by Stacy Richter on May 26 at 5:50 PM

Stacy, it looks like the negative chatter is increasing even throughout the BP Gulf Spill. Do you think that Oil Sands will receive more attention now, even not directly connected, because of the tragedy in the gulf? Is their a "perfect storm" of social media, mainstream coverage, and outrage?

Posted by Rowland Hobbs on May 27 at 6:23 PM

Funny you mentioned that Rowland.

An article released in the May edition of OIlweek discusses this exact issue. The President of Imperial Oil, Bruce March, explained "our record of continuous improvement has been missing from debates on oilsands development, primarily because we, as an industry, have done a poor job of telling our story."

One tweet from @KentChapman46 reads "Exxon to spend $$$ on old school PR to polish it image. They still don't understand authenticity is key."

To answer your question...Yes, I believe that there is a 'perfect storm' of social media, mainstream and outrage coming and most of the producers are piloting the Andrea Gail. As Jason alluded to, Big Oil is ill equipped to pilot this storm.

It's not because they don't have talented communicators on staff or consultants to hire (sorry, had to plug DMD Green), it's that the culture of avoidance and reaction take over.

OIl and gas producers need to find people they trust to make the right judgement calls in this area. People with experience that have the gumption to push their limits.

Thanks for you comments!

Posted by Stacy Richter on May 27 at 11:55 PM

I completely agree. Now is the time to showcase what the oil sands are all about. There are soooo many green initiatives and a culture of continual improvement in the oil patch - the world needs to know about it.

I recently had the opportunity to take a tour of Alberta's Industrial Heartland and was blown away by the scale and the level of investment in technology.

As more upgraders come online, we continue to pursue the opportunity to exert complete control over the environmental stewardship of this process from sand to finished product. By ensuring there is a viable future in the "value added" sector of the oil sands, we not only improve the economy, but also help protect the environment.

I also saw two recent presentations by Suncor regarding their newest "chemical cluster" concept that ensures the most efficient and complete usage of all possible byproducts and even heat recovery is taking place. This will further reduce environmental impacts, create even more jobs and help diversify the economy - combine this concept with the "Port Alberta" concept and we can even expedite and more-efficiently ship the end products to global destinations.

With all the mess in the Gulf right now, we need to take this opportunity to ensure the world knows that not only are the oil sands "green" but they are working in such a way that a disaster like we're seeing in the Gulf of Mexico cannot ever occur - it simply isn't possible.

Posted by Greg Douglas on May 28 at 11:24 AM

Re: "Crisis communications is not sufficient. Proactive communication is required. Image and trust is built up over time. Image and trust require constant and consistent communication."

Great Post! I'm of a similar mindset to your final comments on the need for constant and consistent communications and I would also add transparent. The reason why social media is so effective in driving negative commentary is simply because – people have reason not to trust what the BP’s are providing as news and information and that leads to misinformation. Obviously, social media is new territory for most organizations; it has taken years for organizations to effectively influence standard media outputs. The standard outputs formally included news releases, investor relations, media relations and such, now this new viral media environment will force corporate media responses to be swift and thorough - as evidenced by BP’s media release to talk about its Top Kill process and multiply alternatives strategy – May 24th. http://bp.concerts.com/gom/kentwells_update24052010.htm

Posted by Colin Anton on May 31 at 11:31 AM
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