Ottawa and Alberta are moving forward on a new oil pipeline, with construction expected to begin in autumn 2027.
The proposed West Coast oil pipeline will run from Alberta to the British Columbia coast, designed to transport more than one million barrels of crude oil per day to Asian markets.
Crude oil is expected to begin flowing through the pipeline by 2033. However, there are currently no private sector companies investing in the project.
Prime Minister Mark Carney and Alberta Premier Danielle Smith have signed a deal for the new pipeline, with a construction date of Sept. 1, 2027.
The deal also lowers the effective carbon price for Alberta to $130-a-tonne by 2040, instead of 2030, as previously laid out in a memorandum of understanding (MOU).
The province estimates that the new pricing will save the Alberta oil industry about $250 billion by 2050.
The deal also includes headline carbon benchmarks of $115-a-tonne in 2030, $130 by 2035, and $140 by 2040. Alberta’s headline carbon price is currently set at $95-a-tonne.
The effective carbon price is the market value of carbon credits and offsets, which allows producers to buy credits to offset their cost.
There is hope that private oil and gas companies will invest in the new oil pipeline, but so far, no firms have come forward to support the project, meaning it will be funded entirely by taxpayers.
The Canadian Climate Institute criticized the planned new pipeline, saying it will put Canada’s target of net zero emissions by 2050 well out of reach.
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