In a significant move for Canada's energy sector, Prime Minister Mark Carney and Alberta Premier Danielle Smith signed a transformative memorandum of understanding in Calgary on Thursday, November 27, 2025, aimed at advancing the construction of new oil pipelines to Asian markets.
A Landmark Agreement for Alberta's Energy Future
The signing ceremony at Calgary's McDougall Centre marked a potential turning point in federal-Alberta relations. Premier Smith described the day as "a really great day for Albertans," highlighting the resolution of long-standing disputes over what she termed nine "bad laws" that have hampered energy investment in the province.
The comprehensive agreement includes several key components that address Alberta's energy priorities while setting new environmental targets. Prime Minister Carney characterized the MOU as "multi-faceted" and potentially "transformative" for Canada's industrial landscape.
Key Components of the Agreement
The MOU outlines several specific commitments that could reshape Canada's energy policy:
- Federal designation of an Alberta bitumen pipeline to Asian markets as a "project of national interest"
- Collaboration to facilitate approval and construction of a privately-funded pipeline capable of carrying over one million barrels per day to Asian markets
- Immediate suspension of federal Clean Energy Regulations and commitment not to implement a federal oil and gas emissions cap
- Development of thousands of megawatts of AI computing power, including sovereign computing for Canada and allies
- Joint development of carbon pricing and emissions stringency factors through Alberta's TIER framework by April 1, 2026
- A target of 75% reduction in methane emissions based on 2014 levels by April 1, 2026
- Consultation with Indigenous groups in British Columbia to ensure economic benefits from pipeline projects
Resolving the "Nine Bad Laws"
Smith had previously set a deadline of resolving the contentious federal regulations before this year's Grey Cup, matching Carney's self-imposed deadline for announcing nation-building projects. The so-called "nine bad laws" included the oil and gas emissions cap, the Oil Tanker Moratorium Act, and the now-suspended ban on gasoline and diesel car sales.
"I think it's going to unleash an incredible amount of investment and allow us to work together on important nation-building projects," Smith stated after the signing. She expressed appreciation that the prime minister had "heard our concerns and responded to them."
The new pipeline project would complement the existing Trans Mountain expansion, which is expected to supply approximately 400,000 barrels of oil to Asian markets. Both leaders emphasized that the Pathways Alliance Carbon Capture project, valued at $16.5 billion, would play a crucial role in reducing the environmental impact of oil sands development.
Carney concluded that the agreement was made "in the spirit of cooperation, partnership and trust" and would help Canada move forward "more efficiently and effectively" in its energy transition while strengthening national resilience and sustainability.
