Oil and gas companies need to integrate AI into their operations so that they can extract more fossil fuels—which can then be used to power more AI.
That is the pitch that Canada’s leading AI company, Cohere, is making to the oil and gas industry, even as its CEO Aidan Gomez argues publicly that it is important for the tech industry to be aligned with “environmental goals.”
“As energy demand surges globally, driven in part by the explosive growth of AI data centers, oil and gas companies face significantly new operational, market, and environmental pressures,” explains a Cohere e-book from 2025 that advertises the AI company’s services to the fossil fuel sector. “AI has the potential to change the industry’s trajectory quickly, thereby better equipping it to address the growing supply-demand imbalance.”
An X post from the Toronto-based Cohere in early 2025 claimed that “AI-driven analytics optimize drilling, leading to more efficient resource extraction,” while predicting that “the oil and gas market for AI & ML [machine learning] is projected to surpass $4.9 billion by 2034, with GenAI playing a pivotal role in this growth.”
Using AI to increase the production of fossil fuels, which are then used to power the explosive growth of AI data centres, might seem like a strategy designed mostly to increase profits for fossil fuel and tech companies.
But that’s not the way Gomez is pitching Cohere to Canadians. He promises his company will deliver huge societal benefits, including bringing “down the cost of living for the average Canadian” and developing “cures for different diseases and ailments.”
Variations of Cohere’s fossil fuel-forward business model have been adopted across the industry by Amazon, Microsoft, Google, and other tech giants, according to Paris Marx, tech critic and author of the new book Hyperscale: The Ambition and Excess of Big Tech’s Data Empires.
“It feels like another example of just how intertwined the fossil fuel industry and the tech industry have become since the advent of generative AI taking off,” Marx told DeSmog in an interview. “There were relationships between them in the past, but now it’s just fully out in the open how simpatico their interests are, because more data centres means more fossil fuel demand”.
Cohere did not respond to DeSmog’s request for comment.
‘Playbook for Oil and Gas’
In mid-September, 10,000 people gathered in Montréal for Canada’s largest AI conference. One of the most anticipated speakers that day was Gomez, who in 2023 was named by Time as one of the 100 most influential people in the world working in AI.
Cohere, the company he co-founded in 2019, recently received a funding commitment of $1.6 billion from Mark Carney’s Liberal government, helping bring its valuation to nearly $36 billion, and making it Canada’s most valuable AI firm and a significant player in the global industry. Gomez spoke on multiple occasions at the ALL IN conference from September 16-17, where he described AI as a nation-building technology for Canada. “I think Canadians are strategic. And if we look at where we are right now in our geopolitical situation, we need to gain leverage on the world stage. That is frankly the project for our country. If we want to remain sovereign, if we want remain an independent country, we need leverage on a global stage. This is a place where we can win,” he said. Gomez also assured attendees that data centres “can be completely in line with environmental goals,” adding that “with the type of energy that goes into these data centres, we need to make sure that it’s clean.”
Cohere has in some cases prioritized renewable energy for its computing power, as it will be operating its AI models through a Bell data centre in Merritt, BC, that is powered by hydroelectricity.
Nevertheless, the vast majority of new data centres proposals in Canada involve fossil fuels. Canada’s federal government has previously identified 15.5 gigawatts of new gas capacity planned for data centres, which could cause an increase of somewhere between 33 to 63 megatonnes of annual greenhouse gas emissions.
While Gomez promoted the use of clean energy on stage, his company is trying to secure contracts with fossil fuel companies, including to help boost their production and refining capacity.
Cohere’s 2025 e-book makes the case for “creating an AI-empowered oil and gas company”. It details “how energy sector leaders can harness generative AI— including agentic AI systems — to transform the oil and gas value chain, spanning upstream exploration and production to midstream logistics, downstream refining, and services.”
Examples include helping to “identify the ideal drilling locations”, supporting pipeline monitoring and leak detection, and taking care of transportation logistics. The book offers the example of Shell using AI to improve efficiency in deep-sea exploration, “boosting offshore oil output”.
DeSmog recently reported on a new study that found AI could increase global energy-related carbon dioxide emissions by between 1.2 and 4.8 percent, largely from improving productivity in fossil fuel production. Large fossil fuel companies, like Chevron, Equinor, ExxonMobil, and Shell are already integrating AI into their operations.
Cohere argues in its e-book that fossil fuel companies are well-positioned to meet the massive electricity requirements of new data centres. “AI offers a transformative leap — a way to help the sector meet surging energy demand,” it argues.
The explosive growth of AI data centre proposals can in turn “provide markets” for the oil and gas industry, according to an internal strategy document prepared for the Clerk of the Privy Council, one of the top advisors to Prime Minister Carney.
Global AI Player
Gomez isn’t the only Canadian CEO attempting to portray AI as environmentally sustainable. Mirko Bibic, CEO of Bell Canada, said at the ALL IN conference that his company is developing AI with “Canadian environmental stewardship”. Bibic explained that Bell’s data centres will use closed loop cooling systems, and that the company is going to “use best-in-class building practices to minimize the emissions”.
The conference took place on the heels of Bell’s announcement to expand an AI hub in Saskatchewan by 900 megawatts, which will be powered by gas.
“Bell is committed to building AI infrastructure responsibly,” the company said in response to questions from DeSmog, adding that the Saskatchewan proposal “will be subject to the provincial environmental impact assessment process.”
Cohere is the only Canadian company that develops large language models (LLMs), which it does for governments, companies, and other enterprise users rather than consumers.
The company recently finalized a merger with German AI company Aleph Alpha, a move that Cohere says will allow it to compete directly with OpenAI and other tech giants in certain markets. “We are now the largest AI company outside the United States and China,” Gomez said in late October, following the news of the company’s $36 billion valuation.
“We need this technology,” Prime Minister Carney said in announcing his government’s investment in Cohere’s latest funding round. “That’s why this company’s growth has been so extraordinary. It is in all our interests for Cohere to succeed, and now all Canadians will have a share in that success.”
But Cohere’s products will specifically create “greater profitability” for the oil and gas industry—at least according to the AI company’s promotional materials.
“The question is no longer if generative and agentic AI will reshape the oil and gas sector, but rather how quickly organizations will position themselves to benefit,” Cohere’s e-book argues.
The publication ends with a quote from Vicki Hollub, CEO of the U.S. oil company Occidental Petroleum: “Technologies … like AI will determine whether we stagnate — or surge forward.”
