A Syncrude oil sands mining facility near Fort McKay, Alberta, September, 2022. The Ottawa-Alberta MOU had targeted April 1 to agree with oil sands companies to develop a multibillion-dollar carbon capture and storage project.ED JONES/Getty Images
Alberta Premier Danielle Smith on Tuesday cast doubt on meeting the first set of deadlines under the province’s memorandum of understanding with Ottawa aimed at setting the stage for a new oil pipeline to Canada’s West Coast.
Speaking at a major oil conference in Houston, Ms. Smith said the two sides are making progress on two of four provisions that were to be finalized by April 1, but the other two – involving the thorny issues of carbon pricing and a CO2-capture project in the oil sands – remain unresolved.
Negotiations are still under way and are constructive, according to a statement from her office.
“We will continue to do our best to meet the April 1 deadline for all or most of these four milestone agreements, and continue to prepare our government’s West Coast pipeline application for submission by June,” the statement said.
Ms. Smith and Prime Minister Mark Carney signed the MOU in November, with goals to unlock Alberta’s energy sector and diversify export markets in the face of U.S. President Donald Trump’s trade war, laying the conditions for construction of a new oil conduit to the Pacific.
Earlier this month, federal Energy and Natural Resources Minister Tim Hodgson said Ottawa has no intention of backing down on any of the parts of the agreement as the government faces pressure to relax some of the environmental provisions the two sides agreed to. He acknowledged the schedule could slip.
Alberta and federal officials have finalized a co-operation agreement that gives Alberta jurisdiction over regulatory approvals for major projects within the province, and the two sides expect to come to an agreement soon on cutting methane emissions by 75 per cent from 2014 levels by 2035, according the Premier’s office.
However, they have not yet come to terms on the other items. On those, the province is “committed to agreements that protect affordability for Albertans and enhance competitiveness for industry,” it said.
Under the MOU, Alberta’s industrial carbon price would rise eventually to $130 per tonne in exchange for exempting Alberta from federal clean electricity regulations.
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Meanwhile, the parties had targeted April 1 to agree with oil sands companies to develop a multibillion-dollar carbon capture and storage project. The MOU laid out a plan to have the Pathways Project in northern Alberta built by 2040 to achieve emissions reductions at date-specific intervals.
That proposal came under new opposition on Tuesday, when a group of First Nations leaders and members of rural communities said they had formed a coalition to fight the proposal, citing health and safety concerns.
A key point of contention for the group, called No CO2 Pipelines Alberta, is a 600-kilometre conduit that would carry carbon dioxide past a number of Indigenous and farming communities for storage of the greenhouse gas deep underground.
The group called on the federal government to conduct an environment impact assessment after the provincial regulator denied a request to assess the impact.