Canada Ties New West Coast Pipeline to Oil Sands Expansion

By Tsvetana Paraskova - Jul 14, 2026

• Canada advances a new 1 million bpd West Coast oil pipeline, with Ottawa, Alberta, and major oil sands producers agreeing on a framework that ties the project to emissions reductions and expanded exports to Asian markets.
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• Oil sands producers commit to the Pathways carbon capture project.
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• The project reflects Canada's push to diversify away from the U.S. market.

Canada’s biggest oil sands producers, the Alberta provincial government, and the federal government have reached a new milestone in advancing the planned new West Coast pipeline that would move another 1 million barrels per day (bpd) of oil sands output from the top oil province to the British Columbia coast.

The parties on Monday unveiled the backgrounder document of the deal for the new pipeline, West Coast Oil Pipeline (WCOP). In this, “Alberta has agreed to implement financial supports to enable the oil production growth needed to underpin new export capacity, including the pipeline to Asian markets and the Trans Mountain Expansion (TMX) optimization.”

The new pipeline hinges on the five top oil sands producers, Canadian Natural, Cenovus, ConocoPhillips Canada, Imperial Oil, and Suncor, committing to the Pathways carbon capture and storage (CCS) project and to reduce their operational emissions. This was a key demand from Mark Carney’s federal government to agree to the new 1-million-bpd pipeline to expand Alberta’s oil production and Canada’s export base with new customers in Asia.

Committed to Pipeline and Emissions Reductions

In the deal, the federal government touted the emission reduction goals, the creation of jobs, and additional energy sovereignty by attracting buyers of Canada’s oil other than the United States.

The province of Alberta stressed the fact that oil sands producers have been given the green light to double oil production, and that the deal unlocks billions of dollars in investments and production needed for the new West Coast projects.

Environmental campaigners, of course, slammed the backgrounder document released on Monday as “a master class in greenwash.”

The new WCOP will need additional years and a lot of permits, including in B.C., to begin working for the oil sands companies and for Canada’s crude oil exports to Asia. But the recent major milestones, from the official approval early this month to this week’s backgrounder laying down the commitments of the parties, are moving the project closer to reality

If it weren’t for the geopolitical upheavals and crises in the past year, the project may have never cleared any hurdles beyond Alberta’s provincial government. But the U.S. trade and tariff policies and threats to Canada’s independence prompted Canadian politicians to work on making energy exports less reliant on the U.S., which imported 90% of all the oil Canada was exporting in the year before U.S. President Donald Trump returned to the White House for his second term in office

Threatened by tariffs and negative rhetoric from Trump’s White House, Canada chose to become an energy superpower by expanding its crude and LNG exports into Asia, the market that’s always hungry for energy commodities.  

Oil Pipeline Milestones

The WCOP is a major move toward bringing increased volumes of Canadian crude to the West Coast for exports to Asia. 

The milestones in the project include the commitments the governments and the industry made, which were announced by Canada and Alberta on Monday.

The government of Canada and the five top producers united in the so-called Oil Sands Alliance (OSA), have agreed to establish a regulatory working group to improve the efficiency and effectiveness of federal statutes and regulations governing oil sands development. Canada has also agreed to advance financing to support operating costs for CCS projects, including measures to enhance the durability of the Clean Fuel Regulations (CFR). In addition, the federal government has agreed to review and address technical clarifications and industry concerns related to the CCUS Investment Tax Credit.

The OSA companies have agreed to advance the emissions reduction projects in line with agreed milestones, work with Canada and Alberta to support oil sands production growth associated with the new WCOP, and to prioritize Canadian technologies, suppliers and supply chains, including Canadian steel and aluminum.

Alberta’s commitments feature the implementation of financial supports, yet to be detailed and defined, extension of its Carbon Capture Incentive Program to 2035, and issuance of a Carbon Sequestration Agreement for the Pathways CCS projects and its planned storage complex.

Alberta has also agreed to apply a 120-day approval timeline for qualified projects and establish a bilateral working group with the OSA to address provincial regulatory barriers to oil sands investment and growth.

Commenting on the backgrounder document, Danielle Smith, Premier of Alberta, said,

“The West Coast oil pipeline and Pathways Project are two critical steps towards making Canada an energy superpower and ensuring Alberta remains a destination of choice for investment, innovation and responsible energy development.”

Tim Hodgson, Canada’s Federal Minister of Energy and Natural Resources, noted that “Over the last eight months, we have been steadily delivering on each commitment in the Canada-Alberta MOU, working with Alberta and the energy industry to build major energy infrastructure, reduce emissions, create jobs and prosperity, and secure energy sovereignty.”

Alberta’s minister of Energy and Minerals, Brian Jean, said that “Growing Alberta’s energy production and reducing emissions can go hand in hand.”

But campaigners are having none of this rhetoric.

Keith Stewart, senior energy strategist at Greenpeace Canada, told The Canadian Press, “This is a master class in greenwash, as the pollution reductions committed to in this agreement are only seven per cent of current carbon pollution from the oilsands and would be dwarfed by the additional pollution enabled by a new, taxpayer-financed pipeline.”

By Tsvetana Paraskova for Oilprice.com

Who are the partners behind a proposed new West Coast oil pipeline?

By

The Canadian Press

Opens in new window

Published: July 03, 2026 

Alberta’s pitch to the major projects office for a new oil pipeline to the West Coast is being billed as a public-private partnership, though its current structure skews almost entirely toward the public end of the spectrum.

Ninety per cent of the proposal would be in the hands of provincial and federal Crown corporations — at least in the beginning. Energy infrastructure company Pembina Pipeline Corp. would be a minority partner.

Here is a rundown of what each entity does and what they bring to the table:

Trans Mountain Corp.

The new pipeline would have a familiar builder and route. It would largely follow the path of the existing Trans Mountain pipeline that runs from the Edmonton area to the B.C. Lower Mainland. Trans Mountain Corp., a federal Crown corporation, would be its developer, builder and operator.

The Trans Mountain pipeline has been delivering Alberta crude to southwestern B.C. since the 1950s. Its former owner, U.S. company Kinder Morgan, proposed an expansion in 2012 to almost triple its capacity to 890,000 barrels per day. As costs ballooned and the project got snarled in court delays, Kinder Morgan walked away. The federal government bought the pipeline for $4.5 billion in 2018 to see the expansion through to completion. The project ended up costing $34 billion, a stark increase from its 2017 estimate of $7.4 billion.

Trans Mountain is a subsidiary of the Canada Development Investment Corp., which answers to Parliament.

The Trans Mountain expansion started up in May 2024, and is now operating at full capacity. Since that time, the corporation has returned $2.2 billion to its owner, the Canadian government, in the form of interest and dividends. The price oilsands producers receive for their heavy crude has also risen as their product is now able to now reach Asian markets in meaningful volumes.

Plans are underway to further expand Trans Mountain to almost 1.2 million barrels per day through additional pump stations, chemical additives and some new pipe.

The proposal before the major projects office would “integrate really well with our legacy pipeline,” Trans Mountain chief executive Mark Maki said.

“Same corridor, you can use some of the same people, the same systems,” he said. “All of the stuff that we have already built becomes very, very useful to the new pipeline.”

Alberta Petroleum Marketing Commission

The commission is the “business arm” of Alberta’s energy department, said Richard Masson, a former head of the provincial Crown corporation. A stake in a new pipeline falls within its mandate to “try to do things that are in the interest of Albertans as the owner of the resource,” he said.

The APMC has a history of committing barrels to early-stage pipeline projects, like the Trans Mountain expansion and Enbridge’s Line 9 revamp in Ontario and Quebec several years ago. It also committed volumes to the defunct cross-Canada Energy East proposal put forward by TransCanada Corp., now TC Energy.

Up until now, APMC’s biggest and most complicated investment was a deal to supply bitumen to a refinery north of Edmonton.

“This is a big step. There’s no question about it,” Masson said of the West Coast pipeline plan. “APMC has never done anything like this before.”

Pembina Pipeline

Pembina’s core business is natural gas gathering, processing and transport in Western Canada. It is also constructing the Cedar liquefied natural gas plant and export terminal in northern B.C. alongside the Haisla Nation.

Pembina brings “capital discipline” and “operating expertise” to the pipeline partnership, Prime Minister Mark Carney said Thursday.

“And that enriches it.”

In 2021, Pembina formed a 50-50 partnership with a coalition of First Nations and Métis communities to buy Trans Mountain, though the federal government has signalled it has no plans to put the asset up for sale any time soon.

In the meantime, under a “non-binding heads of agreement,” Pembina is to hold a 10 per cent interest in the new West Coast project during construction with the opportunity to double its stake once the pipeline starts up. It said its role would be “complementing, rather than replacing” Trans Mountain as the project’s lead partner.

“The project represents a once-in-a-generation opportunity to advance nation-building energy infrastructure that strengthens Canada’s economy and expands access to global markets for Canadian energy,” said Scott Burrows, Pembina’s chief executive.

“Our participation will be evaluated through the same disciplined lens we apply to every capital decision. We have approached our involvement in a way that is measured, that preserves our financial flexibility and that incorporates meaningful protections — so that any participation remains consistent with our financial guardrails and creates durable value for our shareholders.”

There is one area where Pembina’s established core business would intersect with a new bitumen pipeline, Masson noted. In order for thick, tarry bitumen to flow through pipelines, it needs to be diluted with liquids that come as a byproduct of natural gas production.

Pembina has plants where the liquids — often referred to as condensate or diluent — are separated out of the gas that comes out of the ground. With all of the oilsands pipeline expansion on the books, the sector is short on those liquids, Masson said.

“If we’re going to do all this, we have to more than double the amount of diluent produced in Canada, which is huge.”

Indigenous partners

The Alberta government says Indigenous equity partnership and consultation will be an “essential part” of the project, with the provincial and federal governments both saying they will “facilitate opportunities” for communities to invest through their respective Indigenous loan agencies. But Masson doesn’t see Indigenous groups coming on board until the pipeline starts generating steady cash flow.

This report by The Canadian Press was first published July 3, 2026.

Companies in this story: (TSX:PPL)

Lauren Krugel, The Canadian Press

 

Downward trend in oilsands emissions intensity continues: S&P Global Energy

By

The Canadian Press

Opens in new window

Published: June 24, 2026 

Suncor's base plant with upgraders in the oilsands in Fort McMurray Alta, on Monday June 13, 2017. THE CANADIAN PRESS/Jason Franson

A new analysis from S&P Global Energy says the greenhouse gas intensity of the oilsands has declined for the 13th straight year, with a two per cent drop in 2025.

The research firm says the average emissions per barrel of marketable product has fallen by 31 per cent since 2009, with every year but one in that time — 2012 — seeing a decline.

The biggest gains have been in mining operations, which have improved how they manage waste heat and maintenance.

S&P Global Energy says that while emissions intensity continues to decline, absolute emissions have risen, albeit at a slower rate.

Between 2024 and 2025, it says absolute emissions rose two per cent due to a 150,000-barrel-a-day rise in overall production.

Kevin Birn, vice-president and head of carbon research at S&P Global Energy, says if oilsands production rises, absolute emissions growth would be expected without the use of carbon capture and storage technology.

“The downward trajectory of oilsands emissions intensity is now a well-established, multi-decade trend,” said Birn.

“Ongoing optimization efforts to maximize output from existing facilities, which are much more capital efficient compared to new projects, has been a critical factor, and this is expected to continue.”

This report by The Canadian Press was first published June 24, 2026.

No Pathways, no pipeline: How the massive carbon storage project would work, if built

By

The Canadian Press

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Published: May 25, 2026 

The Cenovus Christina Lake oilsands facility steam-assisted gravity drainage pad southeast of Fort McMurray, Alta., is shown on Wednesday, April 24, 2024. THE CANADIAN PRESS/Amber Bracken

CALGARY — There’s no pipeline without Pathways and no Pathways without a pipeline.

That was the quid pro quo spelled out in a sweeping energy accord signed between Alberta and Ottawa in November.

Alberta is spearheading early planning and regulatory work on a potential new one-million-barrel-a-day pipeline to the West Coast that would provide an outlet for increased oilsands production and boost exports to Asia. But the “grand bargain” with Ottawa to help clear the way for the pipeline calls for a meaningful offset to the carbon emissions it would enable.

Enter Pathways: a multibillion-dollar plan to transport and store 16 million tonnes of carbon dioxide a year from the oilsands by 2035. The project has been in the works for around four years, but the companies proposing it, the province and federal government have yet to figure out how they’ll share the costs and the risks. The Alberta-Ottawa agreement set an April 1 deadline to reach a three-way deal, but the matter remains unresolved.

The Pathways project is being proposed by the Oil Sands Alliance (formerly the Pathways Alliance), which is made up of five major oilsands players: Canadian Natural Resources Ltd., Cenovus Energy Inc., Imperial Oil Ltd., Suncor Energy Inc. and ConocoPhillips Canada.

Carbon capture and storage is “probably the most cost-effective pathway for most industrial decarbonization in Alberta,” said Brendan Frank, vice-president of policy at Clean Prosperity, a climate policy group.

Here is a rundown on the technical and economic aspects of Pathways:

Capture

Pathways members would be responsible for installing carbon capture equipment at their own oilsands sites. Flue gases would be collected from boilers, steam generators and other combustion equipment. A chemical process would separate out the carbon dioxide, which would then be compressed into a liquid. Costs would vary site by site due to the transport distance to the storage hub and how emissions intensive each operation is, Frank said.

Transport

A project overview posted by the Oil Sands Alliance in March says it’s proposing to build a more than 650-kilometre pipeline network to bring CO2 from as far north as the Fort McMurray, Alta., area south to a storage hub in the Cold Lake, Alta., region. It does not account for the investments needed in the individual oilsands plants to capture emissions. The plan includes 16 small lateral segments connecting to 13 oilsands sites, both mines and steam-driven operations. The laterals would feed liquefied CO2 into a wider transportation artery, which would then connect with a distribution line running to the storage hub.

Storage

At the storage hub, the gas would be injected deep underground in the Basal Cambrian Sandstone formation, which sits one to two kilometres below the surface. The spongelike sandstone has spaces that can be filled with CO2. Above that formation is thick, non-porous rock salt that can act as a barrier to keep the carbon dioxide in the ground.

Costs

The overview did not include an updated cost estimate, but in 2022 the alliance said the first phase would include $16.5 billion in investment by 2030.

The project has been in limbo for years as the companies, Ottawa and Alberta try to reach an agreement on how the costs should be shared.

“We can pay for some of Pathways,” Cenovus CEO Jon McKenzie said in an interview in April. “We can’t pay for the entire burden.”

The federal government already offers an investment tax credit for carbon capture projects, which industry players have said is helpful but does not go far enough to defray the cost. Alberta has its own grant program that covers 12 per cent of eligible capital costs.

In Canada, the government’s financial support for carbon capture has been on the capital cost side, helping projects get up and running. In the U.S., by contrast, companies shoulder the upfront construction costs and get generous tax credits for ongoing operations.

Where the carbon price comes in

The capital cost from government help is welcome, said Chloe McElhone, research manager at Clean Prosperity. But at the scale of Pathways, certainty is needed decades into the future.

“You need to be complimented with the ongoing operational support, and that’s what carbon markets are providing.”

The Alberta and federal governments agreed earlier this month to target an effective carbon price — the value carbon credits and offsets go for on the market — of $130 a tonne by 2040. Several environmental groups said that’s too long a horizon.

“This price schedule is not strong enough to spur the necessary near-term private investment to reinvigorate the Pathways carbon capture project,” said Chris Severson-Baker, executive director of the Pembina Institute clean-energy think-tank.

Climate advocates did, however, welcome the inclusion of carbon contracts for difference in the federal-provincial “implementation agreement.” Those act as an insurance policy of sorts, giving clean energy investors certainty in the carbon pricing regime in the years ahead. Should each level of government fail to maintain their commitments or repeal their respective climate policies, each would “assume sole liability” for the contracts.

Analysis from Clean Prosperity found carbon prices between $130 and $150 should be enough to make some, if not all, of Pathways viable, said Frank.

“I’d say the implementation agreement represents material progress toward making the Pathways project economic,” he said.

“It offers a lot more certainty than market actors had previously.”

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Lauren Krugel, The Canadian Press

This report by The Canadian Press was first published May 25, 2026.

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