In a significant move for Canada's energy future, Prime Minister Mark Carney and Alberta Premier Danielle Smith have forged a new cooperative agreement. The two leaders met in Calgary, Alberta, on Thursday, November 27, 2025, to sign a memorandum of understanding (MOU) designed to position Canada as a dominant force on the global energy stage and facilitate the construction of a new oil pipeline.
A New Partnership for Energy and the Environment
The landmark pact represents a compromise between federal and provincial priorities. In a key trade-off, the agreement will suspend the federal clean electricity regulations in Alberta. In exchange, Alberta has committed to extending its provincial industrial carbon pricing program. This arrangement aims to balance economic development with environmental accountability, all while working towards the shared national goal of achieving net-zero greenhouse gas emissions by 2050.
Prime Minister Carney emphasized the strategic importance of the deal. “In the face of global trade shifts and profound uncertainty, Canada and Alberta are striking a new partnership to build a stronger, more sustainable, and more independent Albertan and Canadian economy,” he stated. “We will make Canada an energy superpower, drive down our emissions and diversify our export markets. We want to build big things, and we’re building bigger and faster together.”
Key Provisions and Potential Impacts
Beyond the regulatory swap, the MOU contains another critical element with far-reaching implications. The federal government, under Carney, has agreed to consider an ‘adjustment’ to the federal oil tanker ban currently in place off the coast of British Columbia. Such an adjustment would be a crucial enabler for a new pipeline seeking to transport Alberta oil to tidewater for export.
The memorandum outlines a joint vision to “unlock and grow natural resource production and transportation in Western Canada.” This includes a focus on infrastructure for oil and gas, liquefied natural gas (LNG), renewable energy, and critical minerals. The governments also affirm their commitment to early and meaningful consultation with Indigenous Peoples, respecting Aboriginal and Treaty rights, and advancing economic opportunities through Indigenous ownership and partnerships in such projects.
Paving the Way Forward
This agreement signals a potential thaw in what has often been a strained relationship between the federal government and Alberta on energy and environmental policy. By aligning their objectives, both levels of government aim to foster the conditions necessary for major infrastructure projects. The deal is framed as a necessary step to navigate global economic uncertainty, diversify Canada's export markets, and leverage innovation and technological development, including in Artificial Intelligence, to become a source of clean energy for the world.
The full text of the memorandum of understanding has been made public, providing a detailed roadmap for this new chapter of federal-provincial cooperation aimed at establishing Canada as a global energy superpower.
