The initial set of deadlines outlined in the energy and climate agreement between Prime Minister Mark Carney and Alberta Premier Danielle Smith are anticipated to be missed, highlighting early obstacles in the deal which involves the exploration of a novel export pipeline from Alberta to the West Coast. Smith acknowledged setbacks in discussions when questioned about the matter at the CERAWeek by S&P Global event in Houston, Texas, on Monday.
Last November, Carney and Smith signed a memorandum of understanding granting Alberta specific exemptions from federal environmental regulations and providing political backing for a new oil pipeline to the B.C. coast. The agreement includes several deadlines to be met by April 1, such as a collaboration agreement on impact assessments, a methane equivalency agreement, a carbon pricing equivalency agreement, and a trilateral MOU with the Pathways companies.
While progress has been made on the initial agreement, challenges persist regarding the industrial carbon tax and collaboration with oilsands companies on the Pathways carbon capture project. The Oilsands Alliance, a coalition committed to achieving net-zero emissions, plans to implement the Pathways project in phases between 2027 and 2040, aiming to capture emissions from 20 oilsands facilities in northern Alberta and transport them via pipeline for underground storage near Cold Lake, Alta.
Concerns from the industry have been raised regarding the industrial carbon pricing policy following Carney’s decision to retain the industrial carbon tax while eliminating the consumer carbon tax. The Canadian Association of Petroleum Producers expressed worries about increased costs for carbon emissions affecting the country’s competitiveness, especially with the U.S. employing various strategies to achieve energy and geopolitical objectives.
Smith remains optimistic about attracting interest from foreign entities and sovereign wealth funds for investing in the potential pipeline project, despite no private company demonstrating commitment yet. She highlighted the involvement of foreign companies in Canada’s energy sector, citing LNG Canada as an example, a consortium of international firms that operate a natural gas export facility in Kitimat, B.C.
The Alberta government is actively refining the proposal for the new oil pipeline project, exploring potential port locations in British Columbia, with Smith expressing confidence in attracting foreign investment, possibly from Asian, Middle Eastern, Canadian, or American partners.