(Bloomberg) -- A group of major oil-sands producers will submit applications for a $12 billion carbon capture project to Canada’s energy regulator this week with an aim of making a final investment decision next year, according to an executive leading the process. 

The project will be ready by 2030 if permits are approved within a year, said Kendall Dilling, chief executive officer of the Pathways Alliance, a group of six oil-sands producers. It’s a “significant milestone” in a project that’s been in the works for years, he said in an interview at the CERAWeek by S&P Global Conference in Houston on Wednesday.

The project — which would be the biggest of its kind in the world — plans to capture 12 million tons of carbon dioxide a year in its first phase, reducing Canada’s oil sands emissions by about 15%. But without Canadian federal and provincial fiscal incentives. it may never be built, Wood Mackenzie warned earlier this year. 

Both the government and industry are making good progress on securing financial backing for the project, which is key for Canada to achieve its goal of becoming net zero by 2050, Dilling said. The passing of the Inflation Reduction Act in the US and green subsidies in Europe have provided momentum in Canada.

“We’re close,” he said. “I wouldn’t say we’re 100% of the way there but I can see light at the end of the tunnel. I think we’ve got a shared view now of the economics of these projects and what support is required.”

The project involves removing emissions from about a dozen facilities across Canada’s oil-sands sector, then transporting them through a 400-kilometer (249-mile) pipeline before burying them underground. 

“I’m optimistic we’re going to get there,” Dilling said. “There’s a collective sense that we just have to. This is too important to the country, too important to the industry.”

©2024 Bloomberg L.P.