KEY POINTS
- Canada’s oil producers target late 2027 for a final decision on the Pathways carbon capture project.
- The Oil Sands Alliance expects fiscal deals with Alberta and Ottawa by mid-November, though laws are still pending.
- The scaled-down plan targets 6 million tonnes of cuts by the mid-2030s and 10 million more by 2045.
Canada’s biggest oil producers are aiming for late 2027 to make a final investment decision on their proposed Pathways carbon capture and storage project, a group representing them told Reuters.
Kendall Dilling, president of the Oil Sands Alliance, said the companies expect to reach fiscal agreements with the Alberta and federal governments by mid-November, which would clear the way for a decision on the multi-billion-dollar plan.
A key piece of Canada’s oil plan
According to Dilling, the window runs from late 2027 into early 2028, though it depends on regulatory approvals. The Pathways project would build a CO2 pipeline and storage hub to cut greenhouse gas emissions from oil sands production, and it anchors a non-binding deal that Alberta and Ottawa signed this year to grow output together.
Moreover, the project has become politically central. Prime Minister Mark Carney wants to shore up the oil and gas sector against US President Donald Trump’s tariffs, yet he insists he still backs climate action. Therefore, he has endorsed Alberta’s plan for a new 1 million barrel-per-day Pacific export pipeline, but only if Pathways goes ahead.
Scaled-down scope draws fire
The alliance, which represents Canadian Natural Resources, Imperial Oil, Suncor, Cenovus and ConocoPhillips Canada, first floated the project in 2021 but hesitated over its cost. In July, the companies signed a deal with both governments setting conditions on carbon pricing, financial support and permitting, though lawmakers have yet to draft many of those changes into law.
Still, environmentalists have criticised the group for scaling the project back from an earlier target of 22 million tonnes of cuts by 2030. However, Dilling defended the revised goal of 6 million tonnes by the mid-2030s and 10 million more by 2045 as a balanced middle ground. Consequently, he rejected claims that the industry has soured on carbon capture, saying it takes a long-term view even as global climate focus cools.
