The Canadian federal government and Alberta have reached a landmark energy deal that pairs a new oil pipeline to the Pacific coast with one of the country's largest carbon capture projects. The agreement seeks to bridge a long-running divide between expanding oil exports and curbing emissions.
The pipeline was the centrepiece of the announcement. Prime Minister Mark Carney said Trans Mountain Corporation, working closely with Pembina Pipeline Corporation, would plan and construct a new West Coast oil pipeline carrying crude out of Alberta.
A route has now been settled. The new line would run from Bruderheim, northeast of Edmonton, to the Roberts Bank area in Delta, British Columbia, following a corridor similar to the existing Trans Mountain pipeline rather than cutting a new path across the province.
That choice of route was deliberate. By using the southern Trans Mountain corridor, the plan sidesteps some of the fiercest Indigenous and provincial opposition to new pipelines and improves the odds that Ottawa formally designates the project as being in the national interest.
That climate commitment has now been put on paper. The Alberta government, Ottawa and several oil sands producers have signed a memorandum of understanding for the Pathways carbon capture and storage project, set as a condition for the new pipeline so that its emissions can be offset. The document formalises an effort that had previously been described only as an agreement on terms.
The memorandum lays out a timeline and a location. It says the Pathways project is to be completed by 2035 and would transport and store captured carbon dioxide in northern Alberta. An updated cost figure was not provided, but initial estimates for the project were $16.5 billion.
The agreement also touches directly on production. It allows for oil output to be increased in order to fill the new pipeline running to the southwest coast of British Columbia, tying the promise of higher exports to the commitment to capture and store the resulting emissions.
In striking the bargain, the two governments traded priorities. Alberta secured a path to move more of its oil to the coast, while Ottawa won new commitments on industrial carbon pricing and methane emissions, part of an effort to tie the pipeline to firm climate action.
The agreement lands as the federal government pushes to strengthen the economy and open new markets for Canadian energy. Framed as a grand bargain between Alberta and Ottawa, it now moves toward the next stages of review and construction, with its ultimate fate still to be worked out.