Latest updates: Carney says energy deal sets 'necessary conditions' for new pipeline to B.C.

replete(p) speech communication | 'Great daytime for Alberta and Canada' says ian smith after signing MOU with Carney government

‘This is Canada working,’ Carney, Smith meet ahead of MOU energy infrastructure signing

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Michael Bernstein, who heads the Clean Prosperity climate policy think-tank, told me that the credit price in the agreement is high enough to spur companies to invest in low-carbon tech, including spending billions on carbon capture.

The deal sets a deadline of April 1 for Alberta and Canada to reach an agreement to ramp up the minimum price of carbon credits to $130.

"I do see this as a positive step forward for climate policy, because it is a practical and hopefully enduring way to balance decarbonization and resource development," he said.

For context, carbon credits in Alberta are currently trading around $25 per tonne of carbon. These credits are held by companies that outperformed their emissions standards — a sort of reward that they can sell to other companies who go over their limits.

But $25 is low, indicating there's an oversupply of these credits in the market. Analysts say that’s stalling emissions improvements, which means strengthening this pricing system could be the most important climate outcome from this deal.

Carney notes that there's a commitment in this agreement to develop nuclear power in Alberta, but also new transmission interties to move clean electricity between Alberta, B.C., and Saskatchewan.

That influx of nuclear power and clean energy from neighbouring provinces will help Alberta develop massive energy-hungry AI data centres, Carney said. That will onshore the storage of Canada's data and information — the “sovereign cloud” Carney sees as a potential major project.

"It's a very ambitious and comprehensive partnership," Carney said of his deal with Smith.

Carney says this agreement is "about much more than just a pipeline."

He says of course the pipeline is "an important component of this," but it's also crucial that Alberta has agreed to build Pathways Plus, a carbon capture initiative to make the oilsands less emissions intensive.

As Smith conceded earlier, she was not a fan of carbon capture when she first entered the political scene — now she thinks it's a good idea because of its potential to make Alberta's oil and gas cleaner. The CO2 it captures can also be used for enhanced oil recovery, Smith said, meaning it can help dislodge more oil deep underground to extract.

Carney said going forward on Pathways — which is itself a massive undertaking that will cost billions and employ thousands during construction — will make Alberta's oilpatch "an entirely new industry" and make "Alberta energy competitive for the long term."

Carney asked if he's willing to approve a pipeline even if B.C, First Nations don't agree

Prime Minister Mark Carney says the agreement signed Thursday between the federal government and Alberta is 'the first step' and added that several things have to happen before a pipeline is built, including a private sector proponent and 'full partnership including equity ownership' with Alberta and B.C. First Nations and the province of B.C.

Carney was just asked by reporters what will happen with this deal if British Columbia — or First Nations — don't agree to a pipeline on their territory.

The prime minister replied that the deal is a "first step" and that "several things have to happen" before a pipeline can be built.

Without a private investor in such a project, he said, "there's no pipeline."

But he said the memorandum outlines "substantial economic benefits" for First Nations groups and British Columbia if a pipeline goes ahead.

The agreement doesn't include specifics on what those benefits would be for B.C. But it includes language around First Nations getting partial ownership of the pipeline.

Carney said the MOU is about establishing the “necessary conditions” for a new pipeline.

Asked about whether Albertans can really trust a Liberal prime minister to follow through on a commitment to develop the province's energy sector, Smith said Carney and others have had to "recalibrate" their thinking on conventional energy.

She said wind, solar and batteries alone cannot power an industrial economy — and this memorandum of understanding is a recognition of that. She said global turmoil — the war in Ukraine and conflict in the Middle East — has forced leaders to rethink the value of developing oil and gas at home.

"We will trust but we will verify," Smith said of Carney and the federal government. "We have to proceed somewhere with a measure of good faith."

Smith said what's different is that she thinks Carney understands the national unity issues that are at stake this time around. She said Trudeau "would have never moved this far on these issues."

"Justin Trudeau created the [Alberta] independence movement," Smith said, and she counselled Carney that "he could take the wind out of it" by pursuing "good policy."

'The MOU does not contain a veto,' says Smith on B.C., Indigenous support for pipeline

When asked about the power of B.C. Or a First Nation to veto a potential pipeline deal, Alberta Premier Danielle Smith responded that there is a 'requirement for consultation' and 'an imperative for Indigenous ownership.' Smith added she did speak to B.C. Premier David Eby last night said 'there’s lots in the agreement that we can focus on together.'

Smith says the memorandum of understanding "does not contain a veto" for B.C. Or anybody else for this pipeline.

But that doesn't mean Albera and Canada don't want to work with B.C.

Smith said trilateral conversations will start right away.

She said the other priority is getting Indigenous communities onside — and making funds available so First Nations and Métis communities can take an equity stake.

She said both Alberta and Canada believe it's "imperative" that there be Indigenous co-ownership of this new infrastructure.

(As a reminder, the now-defunct Northern Gateway project to northwest B.C. Had the support of 31 First Nations and Métis communities, who together were part of the Aboriginal Equity Partners that owned a third of the proposed pipeline.)

Hi I’m Yasmine Ghania, a senior reporter in Prince Rupert, B.C., about 770 kilometres northwest of Vancouver. It's a city that Smith has said would make a viable end point for the North Coast oil pipeline. I spoke with Arnie Nagy, a Prince Rupert climate activist and member of the Haida Nation, who strongly opposes a new pipeline over fears it could lead to an oil spill.

“We have a right to protect what is ours,” he said. €œWe haven't surrendered anything to the Crown. These are our traditional territories belonging to the First Nations. We decide what's best for First Nations in our territories. Not somebody from Alberta.”

Today’s deal between the federal and Alberta governments could cement Canada’s position as one of the world’s largest fossil fuel producers, while pushing its climate targets even further out of reach.

At the same time, the deal could help strengthen the crown jewel of Canada’s climate plan: the industrial carbon pricing system, which is considered by experts to be Canada’s strongest tool to push companies to drive down their emissions, bring new efficiencies to the oilpatch and spur investment into expensive carbon capture projects.

“It has the potential to work. This could actually be a watershed moment for decarbonization,” said Michael Bernstein, president of Clean Prosperity, a research non-profit that studies decarbonization policies that can grow the economy.

“Industrial carbon pricing is at the heart of a strong climate policy, and it can drive many tens of millions of tonnes of emissions reductions, but only if the design is really done carefully and properly.”

Today's deal between Smith and Carney comes during a slump in the oilpatch. Oil and gas prices are both weak, which is why companies are cutting back on spending.

In fact, drilling activity in Western Canada is down about nine per cent this year.

Job losses began in the spring and are continuing now, according to a report this week by Enserva, which represents oilpatch service companies.

The outlook for 2026 is just as gloomy, as oil prices are not expected to bounce back.

Premier Smith says today is a monumental day for Alberta — and this agreement with Ottawa turns the page on an "extremely difficult time for hundreds of thousands of Albertans" who rely on the energy industry for their livelihoods.

She said many Albertans have questioned the "long-term viability of our nation" given what the last Liberal government did to tie up development.

She said the Trudeau era was "dark times" because it seemed like Alberta's natural wealth would be "trapped and wasted" and now, with Carney, the federal government has agreed to "cease their attempts to throttle our energy industry."

Smith said Carney's decision to go forward with a new pipeline will help Canada reduce its dependence on the U.S. Market, which is crucial in this era of American protectionism.

(Don't forget, according to the Canadian Energy Regulator, 93 per cent of Canada's total oil exports went to the U.S. In 2024, which makes Alberta's oilpatch in particular dependent on the whims of the American market.)

Smith says “this is a new relationship, a new starting point” with a prime minister who cares about Alberta’s prosperity.

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