The Federal Government Finalizes Energy Deal with Alberta Despite First Nations Concerns

The federal government has struck an pipeline agreement with Alberta focused around proposals to build a new heavy oil pipeline extending from the Alberta's bitumen reserves to the western shoreline, a politically volatile project anticipated to encounter stiff opposition.

“This is a positive development for Alberta and a positive step forward for Canada,” Mark Carney stated on Thursday as he met with the Alberta premier, Danielle Smith. He emphasized that the agreement “lays the foundation for an industrial transformation” and included more than a conduit, but atomic energy and data facilities. “This demonstrates effective governance,” he remarked.

The pact was commended by Smith for its capacity to “unlock” capital infusion in the region.

Carney and Smith made the announcement after weeks of negotiations, which mark a dramatic shift in relations between the federal government and Alberta. Both sides have clashed in recent years amid claims by the province that Ottawa is harming its economic potential by imposing emission limits.

The core of the deal is to increase oil and gas exports while striving to achieve the national emission goals. Carney’s government will exclude a proposed conduit from the existing coastal oil tanker moratorium and emissions cap. As a trade-off, Alberta must raise its industrial carbon pricing and invest in a large-scale carbon sequestration initiative.

Notably, however, no corporation has expressed an interest in supporting the initiative, which would probably face stiff opposition from the province of British Columbia and First Nations communities on the western seaboard.

The move also reflects a political shift by the prime minister, who, before entering politics, built a reputation as an economist guiding capital markets towards a net zero future. Now, he must sell a strategy that seems contradictory to those principles.

The agreement has already prompted grumbles from officials within the governing party. A senior minister Gregor Robertson, for example, argued against the controversial Trans Mountain pipeline expansion when he was the city leader, calling it environmentally irresponsible. Carney must also convince the ex-environmental official Steven Guilbeault, a longtime environmental activist who now serves as minister of Canadian identity and culture.

Talks between Alberta and the national administration specifically left out neighbouring British Columbia, whose leader has expressed firm resistance to a fresh conduit passing through his province. David Eby has stated he opposes a pipeline and the possibility of permitting oil tankers through the narrow, tempestuous waters of the northern shoreline. Alternatively, his administration proposed increasing the capacity of the existing Trans Mountain pipeline.

But the provincial administration is adamant it wants a new pipeline, not merely expanded capacity, and has consistently promised to present a plan by spring.

Prior to enacting legislation in June that gave his government the power to bypass ecological rules and fast-track projects in the national interest, the prime minister stated any proposed conduit would have to have the support of First Nations whose territory is unceded to provincial or federal governments.

Prior to federal and provincial leaders made their announcement, however, First Nations declared any proposed conduit was essentially doomed from the start.

“We are here to remind the Alberta government, the federal government, and any interested corporate backer that we will never allow crude carriers on our shoreline, and that this conduit initiative will never happen,” said Marilyn Slett, the president of the Coastal First Nations (CFN), a organization that represents eight First Nations along the coast.

Slett, the chosen leader of the Heiltsuk governance body, has earlier cautioned about the dangers of an crude leakage in a remote area with limited emergency resources, having observed a 100,000-litre diesel spillage near her community in 2016. She said no deal could “supersede our legal and ancestral claims, or undermine our profound bond with the sea”.