Alberta oilsands operations, which have become Canada’s top natural gas user, were cleared tangentially of charges that their value is inflated following a decision Tuesday in the New York climate change case against ExxonMobil Corp.

In part of his ruling, New York Supreme Court Justice Barry Ostager wrote that ExxonMobil was entitled to use Alberta policy to estimate the worth of assets in the province as a more reliable yardstick than theoretical projections of global penalties for carbon emissions.

According to Ostrager, New York Attorney General Letitia James failed to establish enough evidence that ExxonMobil violated laws in connection with its public disclosures to account for “past, present and future climate change risks.”

Ostrager wrote Tuesday that the state had “failed to establish by a preponderance of evidence” that ExxonMobil had violated the state’s Martin Act or executive law in People of the State of New York et al v. Exxon Mobil Corp. (No. 452044-2018).

The oilsands figured in the failed prosecution claim that ExxonMobil misled investors with a double standard by using an internal “DataGuide” that allows the company to rate local climate change policy liabilities for greenhouse gas (GHG) emissions lower than its published international “proxy cost.”

Ostrager said the “ever evolving GHG country-by-country guidance contained in scores of pages of appendices to ExxonMobil’s annual DataGuide is no more than just that — guidance by corporate planners with the express caveat that where local specifics can be ascertained, those specifics should be substituted for the guidance.”

The judge said, “This point is exemplified by ExxonMobil’s operations in Alberta, Canada, which was a significant focus of the Office of the Attorney General’s trial presentation.”

Ostrager accepted the explanation for low estimates of Alberta carbon emissions penalties, and resulting high oilsands asset values, provided by retired ExxonMobil CEO Rex Tillerson, who testified during the trial.

“We encourage the local organization to go become informed about your regulatory environment, particularly on projects where it could be important, and use your best assessment of what is this investment really going to experience over its life,” Tillerson said during testimony.

“The Alberta government doesn’t want to put the oilsands out of business,” he said. “It’s important to them from a jobs, economic, tax revenue” point of view. “And always in Alberta, the industry has always had a very kind of healthy dialogue with them, and they listened.”

In short, said Ostrager, “the nonpublic DataGuide expressly contemplates that the GHG cost assumptions in the DataGuide should not be uniformly applied by ExxonMobil’s planners in a mindlessly consistent fashion if better information is available.”

ExxonMobil and 70% Canadian affiliate Imperial Oil Ltd. have been oilsands pioneers since the 1960s and rank among the top producers of the northern Alberta resource. Like some of their industry peers, ExxonMobil and Imperial have suspended most new oilsands projects.

However, neither current oil prices nor Canadian carbon taxes are said to be to blame for the pullback in oilsands production. The industry instead has attributed the pause to full pipelines, regulatory delays holding back facilities additions, and production quotas enforced by the Alberta government to prop up prices.