Prime Minister Mark Carney and Alberta Premier Danielle Smith have reached an initial agreement on a memorandum of understanding that would grant Alberta exemptions from federal environmental laws and lend political support to a new oil pipeline to the B.C. coast, as per sources from CBC News. The formal announcement is scheduled for a joint press conference in Calgary on Thursday.
The deal’s conditions include Alberta’s adoption of a stricter industrial carbon pricing system and a substantial investment in carbon capture by the Pathways Alliance of oilsands companies. Multiple sources familiar with the plan revealed these details to CBC News under condition of anonymity until the release of the memorandum of understanding (MOU).
This landmark agreement is anticipated to mend the strained relationship between the federal and provincial governments, with a significant PR campaign expected to accompany the announcement. The agreement is likely to include exemptions for Alberta from federal greenhouse gas regulations, notably the net-zero clean electricity rules, contingent on Alberta enhancing its industrial carbon pricing mechanism.
Implementing an effective carbon pricing strategy for major emitters, such as the oil and gas sector, is recognized as a crucial step in reducing harmful emissions by climate policy experts. This move could render the federal government’s proposed oil and gas emissions cap unnecessary, as outlined in the Carney government’s Climate Competitiveness Strategy in the 2025 budget.
Furthermore, the budget revealed plans to amend Competition Act rules to combat misleading environmental advertising practices, commonly known as greenwashing, a move that has been met with opposition from the Alberta government and industry groups.
The forthcoming agreement on Thursday is expected to address the necessity for Alberta to engage with the B.C. government regarding a potential pipeline to the northwest coast. Reports have already surfaced indicating that the energy deal will address the Alberta to northwest B.C. oil pipeline and potential exemptions to the oil tanker ban in specific areas.
Moreover, the MOU is likely to emphasize Indigenous ownership, equity, and the importance of trilateral engagement involving B.C. Premier David Eby confirmed discussions with the prime minister about the agreement’s details, which are yet to be finalized.
B.C.’s Energy and Climate Solutions Minister, Adrian Dix, highlighted that the agreement focuses on a speculative pipeline without a confirmed route or buyers, emphasizing the preliminary nature of the project. The Alberta premier is also under pressure to address her party’s membership at a United Conservative Party convention in Edmonton over the weekend, underscoring the urgency of the agreement.
While Natural Resources Minister Tim Hodgson hinted at potential exemptions to the tanker ban if supported by First Nations and jurisdictions, the Alberta government refrained from providing further specifics, indicating that more information will be forthcoming in the following days.
The agreement is also expected to prioritize the completion of the $16.5-billion Pathways Alliance carbon capture and storage initiative, which aims to capture greenhouse gas emissions from northern Alberta facilities and transport them to an underground storage hub near Cold Lake, Alta.
Greenpeace Canada’s senior energy strategist, Keith Stewart, criticized the preliminary details of the MOU, labeling it a “historic betrayal” of Canada’s climate commitments and Indigenous rights due to the potential increase in carbon emissions resulting from expanded oil production.