In a dramatic shift from years of political discord, the Alberta government and the federal government under Prime Minister Mark Carney have signed a groundbreaking memorandum of understanding that is being hailed as an absolute game changer for Canada's energy sector.
A New Era of Collaboration
The deal, signed on Thursday, November 27, 2025, in Calgary, marks a significant departure from the prolonged battles over energy and environmental policy that have characterized federal-provincial relations. Alberta Premier Danielle Smith expressed optimism about the new collaborative spirit, stating that working together on a common cause unleashes the economy.
While acknowledging that disagreements will persist, Smith emphasized that foundational economic issues should no longer be a source of conflict. The agreement has garnered support from many leaders within Alberta's oil, gas, and electricity industries, who see it as a promising development for future investment and job creation.
Key Components of the Landmark Deal
The memorandum of understanding delves into several critical areas that align with long-standing requests from the industry and the province. One of the most significant provisions allows Alberta to submit a proposal for a major bitumen pipeline to the Pacific Coast to the federal Major Projects Office for consideration.
This proposed pipeline would have the capacity to move at least one million barrels per day. If the project secures a private sector backer and receives regulatory approval, the MOU stipulates that it will be exempted from the federal tanker ban. This exemption is designed to enable the export of bitumen from a strategic deep-water port to Asian markets, a crucial step for diversifying Canada's exports.
Furthermore, the deal addresses the contentious federal emissions cap for the oil and gas industry. In a major win for Alberta, Canada will not adopt the oil and gas industry emissions cap, a policy the province and industry argued would effectively serve as a production limit.
Pathways Forward and Potential Hurdles
The agreement also fosters collaboration on other strategic projects, most notably the Pathways Alliance $16.5-billion carbon capture network in the oilsands. This initiative is seen as vital for reducing emissions while sustaining the industry.
However, the path forward is not without its challenges. The memorandum states that Canada and Alberta will engage with British Columbia to ensure its residents share in the substantial economic benefits of the proposed pipeline. This will be a critical point of discussion, as B.C. Premier David Eby and some coastal First Nations have already voiced opposition.
Another key priority outlined in the MOU is creating opportunities for Indigenous co-ownership of major energy projects, aiming to ensure local communities benefit directly from development.
Despite the optimism, industry leaders and policymakers agree that considerable heavy lifting lies ahead. Upcoming discussions on the specific details and implementation timelines for these projects will be critical to turning this political agreement into tangible economic and environmental progress for Alberta and Canada.
