Carney Backs West Coast Pipeline In Win For Alberta And Oil Industry

CALGARY — Canada will develop a new West Coast pipeline to carry up to a million barrels of Alberta-produced oil per day to export markets in Asia, Prime Minister Mark Carney announced Thursday.

Carney, speaking at a news conference in Calgary, said the government will enter into a public-private partnership on a project that marks a dramatic shift in the Liberal government’s federal energy policy and delivers a major political win to Alberta Premier Danielle Smith.

Carney framed the project as a response to growing demand from allies, saying G7 leaders want Canada to supply more energy amid the war in the Middle East and broader global uncertainty.

“Three weeks ago, G7 Leaders called on Canada to provide the reliable energy the world needs to realise our potential as an energy superpower,” he said.

Both Carney and Smith have faced political pressure to keep the country united amid a separatist movement brewing in Alberta, with many separatists expressing frustration that Ottawa has long ignored its energy sector.

Under Carney, Ottawa is embracing Alberta’s decade-long push to expand oil exports, a reversal spurred by President Donald Trump’s trade war, which exposed vulnerabilities in Canada’s economic dependence on its southern neighbor.

The project is also aimed at easing separatist tensions in Alberta, where voters will decide in October if they want to hold a referendum to separate from Canada. Smith has blamed “10 years of bad Liberal policy” under former Prime Minister Justin Trudeau for fueling western alienation, pointing to climate rules and energy regulations she says hurt Alberta’s economy.

In a 17-minute video posted to his YouTube channel earlier this week, Carney acknowledged that his government’s energy policies will increase emissions. He argued that the climate policies championed by Trudeau had become a political wedge — and fodder for Alberta separatists.

Carney has promised to fast-track the pipeline through the federal permit process, and Smith has previously said she wants to see construction start by next year.

“There is no doubt whatsoever that this pipeline is a project that’s in the national interest, one that will help connect Alberta oil to global markets and strengthen our country’s economic future for decades,” Smith said.

The Alberta government is teaming up with the Trans Mountain Corporation, a federally owned company, and Calgary-based Pembina Pipeline to build the project.

“As this process moves forward, it's financially viable, it's attractive, it unlocks enormous value for the country and value for the equity holders, which will include both our governments, federal government through TMC, as well as indigenous partners,” Carney said.

Neither Carney nor Smith would say how much public money would be put into the project, saying that remains part of negotiations.

Earlier Thursday, Carney stood with British Columbia Premier David Eby in Vancouver to announce a Canada-B.C. “cooperative prosperity agreement” that pledges federal funding to help develop the province’s liquefied natural gas and mining projects.

Eby cut short a trade mission in China to be at the prime minister’s side on a day of double-barreled announcements that Carney said were necessary in a “more dangerous and divided world.”

Eby had traveled to Beijing to meet with PetroChina executives, hoping to sway the company to commit to Phase 2 of LNG Canada to double the Kitimat facility’s production.

Carney downplayed suggestions the B.C. announcement was designed to placate West Coast constituencies.

Eby, whose progressive government is unpopular among British Columbians, has been a prominent critic of the Carney government’s work with Alberta on pipeline plans.

While Eby said the new deal with Ottawa does not require B.C. to support Alberta’s pipeline, having a multibillion-dollar deal in hand softened his tone.

“We recognize our constitutional position,” Eby said. “We do not have the authority to stop a new pipeline.” He said it was a win that B.C. has been able to keep its northern tanker ban in place — restricting any new pipeline to southern passages.

“We have anxiety about the impact of any new pipeline project period on British Columbia’s coast,” Eby said, touting the agreement’s “very clear safeguards” on spill protection as a condition to the province’s support for any future oil export terminal along its coast.