Alberta says pipeline proposal on track for July 1 deadline, as uncertainty hangs over project

Alberta says pipeline proposal on track for July 1 deadline, as uncertainty hangs over project

Province's agreement with Ottawa set Canada Day as target for pipeline submission

Questions still hang over the Alberta government’s pipeline proposal to Ottawa’s major projects office, just days ahead of its deadline.

The federal and Alberta governments agreed last month to set a deadline of Canada Day for the province to submit a proposal for a new pipeline. Ottawa would then have until Oct. 1 to designate it as a project of national interest.

The agreement also includes a plan to increase Alberta's industrial carbon price, though at a slower pace than previously projected, rising to $130 a tonne by 2040, rather than hitting $170 per tonne by 2030.

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When the deal was announced, the province said design and construction of a new pipeline could begin as early as September 2027. On Friday, Smith’s office said their proposal is still on track to meet next week’s deadline.

“Alberta’s government is finalizing our proposal for a one million barrel per day pipeline to Canada’s west coast for submission to the Major Projects Office by July 1,” said Sam Blackett, the Alberta premier's press secretary, via email.

But Richard Masson, former Alberta Petroleum Marketing Commission CEO, said it’s unclear the July 1 target will be met, especially as other deadlines between the province and federal government were already missed earlier this year.

The primary question still hanging around the project, he said, is if it’s commercially viable.

“For a pipeline to be commercially viable, you need to have producers saying, ‘Yes, we want this. We’re ready to sign up for it.’ We haven’t heard that,” said Masson.

“I think they’re a long ways off from a real project yet.”

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Alberta has considered three pipeline routes through northern British Columbia for a new major oil export pipeline, as well as a fourth route through southern B.C.

Masson expects a southern route is more likely, given the tanker ban and opposition to a pipeline to B.C.’s north coast. But without a clear proponent or strong commercial support, he said he's unsure what that leaves for a pipeline announcement next week.

Pathways still under negotiation

The memorandum of understanding also stated construction of the Pathways carbon capture project is "mutually dependent" on a pipeline.

The Pathways project is being proposed by the Oil Sands Alliance (formerly the Pathways Alliance), which is made up of Canadian Natural Resources, Cenovus Energy, Imperial Oil, Suncor Energy and ConocoPhilips Canada.

Pathways, a project to transport and store captured carbon dioxide from oil sands facilities in northeast Alberta, has been in the works for years. But the companies proposing it and the provincial and federal governments, have yet to decide how to share the costs and risks.

On Friday, Oil Sands Alliance president Kendall Dilling said via email that negotiations between industry and government are ongoing.

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A missed deadline wouldn't come as a shock, Masson said, given the complexity of the project. But he said it underlines the uncertainty surrounding the project, and serves as another example of governments missing their own deadlines.

“Part of what we’re trying to do as a country is rebuild our credibility that we can get things done, and when you miss your own deadlines then you’re not sending that message very well,” said Masson.

Andrew Jeffrey is a multimedia journalist with CBC Calgary. He previously worked for CBC News in his hometown of Edmonton, reported for the StarMetro Calgary, and worked as an editor for Toronto-based magazines Strategy and Realscreen. You can reach him at andrew.jeffrey@cbc.ca.