Canada and Alberta have agreed on a new phase of an energy agreement that could pave the way for the construction of a major oil pipeline from Alberta to Canada’s west coast. The project is intended to help transport oil from Alberta to Pacific ports for subsequent export to Asian markets.
The official agreement between the Government of Canada and the Government of Alberta was released on May 15, 2026. It states that the parties will continue to implement the agreements set forth in the memorandum of November 27, 2025. Key priorities include developing Canada as a global energy leader, expanding the potential of Alberta’s oil and gas industry, and moving toward the goal of net-zero emissions by 2050.
Official Project Review Timeline
Under the agreement, Alberta must submit an application for the new pipeline to the Major Projects Office no later than July 1, 2026. After that, the federal government plans to consider designating the project as one of national significance. If the process proceeds as planned, such a designation could be granted by October 1, 2026.
The most important date in the agreement is September 1, 2027. By this time, Canada plans to work toward providing a document outlining the necessary conditions for the pipeline’s construction and development. This could allow design and construction to begin as early as the fall of 2027. At the same time, the agreement explicitly states that this is only possible if commitments regarding consultations with Indigenous Peoples are fulfilled.
Construction Has Not Yet Begun
The Alberta government separately emphasizes that construction has not yet begun. Currently, the province is acting as the initiator in the early stages and is preparing an application for federal review. At this stage, the final route of the future pipeline has also not yet been determined.
According to the Alberta government, the proposed pipeline is to be Indigenous co-owned, meaning it will involve Indigenous communities in ownership and partnership. The province states that consultation and collaboration with First Nations and Métis communities must be part of the process from the early stages, particularly during route determination, environmental requirements, construction decisions, and economic opportunities.
Capacity of the Future Pipeline
According to Alberta’s plan, the project is intended to transport over 1 million barrels of oil per day to a strategic port for access to Asian markets. The provincial government explains this as a need to reduce Canada’s dependence on a single major energy buyer and expand the country’s export opportunities.
Alberta’s Carbon Policy
Alberta’s industrial carbon policy was a separate part of the agreement. The agreement stipulates that the price of emissions within the TIER system will be $95 per ton in 2026, $100 in 2027–2029, rising to $130 in 2035, and is expected to reach $140 by 2040. A minimum price mechanism for carbon credits is also provided for, set to take effect in 2030.
Connection to the Pathways Project
Another key condition is the connection of the future oil pipeline to the Pathways project, a major carbon capture, utilization, and storage initiative in Alberta’s oil sector. The agreement explicitly states that the construction of the pipeline and the construction of the Pathways Project are interdependent. The parties aim to achieve a 16 million-ton annual reduction in emissions through the Pathways projects, specifically through CCUS and other technologies.
The project remains in the early stages
Despite the high-profile announcements, the project remains in the early stages. The Alberta government acknowledges that construction has not begun, the route has not yet been selected, and current work involves preliminary planning, technical assessment, economic modeling, and application preparation. The province plans to spend $14 million on early preparatory work and expects a private investor or company to step in to take over the project’s implementation in the future.
Thus, the agreement between Canada and Alberta does not mean that the new pipeline has already been approved or that construction is guaranteed to begin in 2027. Instead, it establishes an official timeline and a policy framework under which the project can move forward to the permitting, design, and potential construction phases. Key conditions remain consultations with Indigenous Peoples, federal review, the possible designation of the project as a national interest project, environmental requirements, cooperation with British Columbia, and the search for a private partner to carry out the project.