Premier Smith with PM Mark Carney, Oct 2025
CALGARY — Prime Minister Mark Carney is expected to announce a new energy agreement with Alberta today that would clear a path for a possible pipeline to British Columbia’s coast while confirming the federal government will drop its emissions cap on the oil and gas sector. Many political observers say the deal is as much about removing the cap as it is about any future pipeline route to tide water.
The agreement is described by federal officials as creating the conditions needed for a potential pipeline, though it will stop short of guaranteeing one. Carney has said any project would still require support from the B.C. government and from affected First Nations. The B.C. government under Premier David Eby has already said it wants to be at the table, and several coastal First Nations have voiced opposition to new bitumen export routes.
Premier Danielle Smith entered negotiations pressing for commitments tied to a new line to the coast and relief from environmental measures introduced under Justin Trudeau. In return, Ottawa secured Alberta’s willingness to strengthen its industrial carbon pricing system, which Smith froze earlier this year. Federal sources say Carney views tougher provincial methane rules and expanded carbon capture projects as key trade-offs for dropping the emissions cap.
The deal is also expected to outline how Ottawa and Alberta will handle future energy disputes after years of strained relations. Federal Energy Minister Tim Hodgson has told MPs that while Ottawa holds jurisdiction over interprovincial pipelines, major projects must work with provinces and Indigenous rights holders. Smith has said Alberta will act as the initial proponent for the pipeline plan, with a formal pitch to Ottawa’s major projects office expected by spring 2026.
Carney signalled earlier this month that he was prepared to revisit tanker restrictions along B.C.’s north coast. The legislation, introduced as Bill C 5, gives cabinet the ability to waive certain rules for projects deemed in the national interest. Ottawa has not confirmed whether today’s announcement will include changes to that policy, but federal MPs from B.C. say any move toward a new pipeline must involve their province directly.
More details of the agreement are expected when Carney and Smith appear together later today.
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