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OttawaAlberta Deal Sets Path to West-Coast Bitumen Pipeline, Eases Federal Rules

The deal faces steep hurdles from B.C. leaders, Coastal First Nations and uncertain private financing.

Overview

  • Prime Minister Mark Carney and Premier Danielle Smith signed an MOU to pursue a new pipeline to the Pacific, with potential adjustments to the 2019 north-coast tanker moratorium if the project is deemed a national interest and includes Indigenous co-ownership and benefits.
  • Alberta agreed to raise its industrial carbon price to $130 per tonne by April 1, while Ottawa will suspend clean electricity regulations in the province pending a new pricing pact and will not implement a federal oil-and-gas emissions cap.
  • The agreement pairs any pipeline with the Pathways Alliance carbon-capture plan and sets an April 1 timeline for a new industrial carbon-pricing deal and a methane cut target of 75% by 2035 relative to 2014 levels.
  • Political fallout was immediate as former environment minister Steven Guilbeault resigned from cabinet, and B.C. Premier David Eby and Coastal First Nations reiterated firm opposition to a new pipeline and any lifting of the tanker ban.
  • No private proponent has emerged; CIBC Capital Markets analysts say they do not expect industry to lead while B.C. and First Nations remain opposed, even as Alberta funds early work toward a Major Projects Office application.