Carney & Smith agree to start building new pipeline as early as 2027

Alberta Premier Danielle Smith said the agreement provides a "pathway to the construction of a new oil pipeline to Asian markets commencing as early as September 1, 2027."

Facebook (Danielle Smith)

Author: Quinn Patrick

Prime Minister Mark Carney and Alberta Premier Danielle Smith announced an agreement on a series of climate targets that could see the construction of an oil pipeline to the northwest B.C. coast as early as next year.

The implementation agreement builds on a memorandum of understanding Ottawa signed with Alberta in November, including an effective carbon price of $130 per tonne by 2040.

The deal is likely to push the Carney government to be more lenient with other provinces following the federal carbon price after the Supreme Court of Canada ruled in 2021 that all jurisdictions must be treated equally on carbon pricing.

Alberta’s effective industrial carbon price would also rise to $140 per tonne by 2040, up from the current $95 per tonne.

Canada and Alberta will also jointly issue 75 million tonnes of carbon contracts for difference to support emissions-reduction projects, with costs shared equally between the two levels of government.

“In other words, we will have skin in the game so that the market actually works,” Carney told reporters on Friday.

Carney called the agreement “the largest global initiative for carbon capture and storage,” adding that “the proposed pipeline depends on that alliance, which will achieve emissions reductions equivalent to taking 90 per cent of the vehicles off Alberta roads while generating over $16 billion in GDP.”

According to the prime minister, it could create up to 50,000 jobs across Canada.

In March, Carney and Smith reached an agreement-in-principle to bring a “one project, one review” approach to major infrastructure initiatives in Alberta.

Smith called it a “good day for Alberta” and the rest of the country.

“I’m happy to announce that we’re signing an agreement today that clearly sets out a pathway to the construction of a new oil pipeline to Asian markets commencing as early as September 1, 2027,” said Smith.

“The proposed West Coast pipeline would transport more than one million barrels of oil per day. This landmark agreement builds on the collaboration between the federal and provincial governments following the signing of the Alberta-Canada Energy Agreement.”

The agreement would see Alberta submit a proposal for a new oil pipeline to the Major Projects Office by July 1, with Ottawa designating it as a project of national interest by Oct. 1.

The deal is likely to push the Carney government to be more lenient with other provinces on the federal carbon price, after the Supreme Court of Canada ruled in 2021 that all jurisdictions must be treated equally under carbon pricing rules.