Given its massive debt and never-ending deficits, Ottawa should not waste tens of billions of dollars in tax credits and cash on a project that has no chance of achieving its public policy objective, even if it does give the prime minister political cover.
The boondoggle in question is the Pathways Project, a $16- to $24-billion (excluding cost overruns) carbon capture and storage (CCS) network in northeastern Alberta sponsored by the six largest oilsands companies. Its mission is to capture greenhouse gas emissions from over 20 oilsands sites and transport them via pipeline to an underground storage hub near Cold Lake.
Political Cover at a High Price
Prime Minister Mark Carney has made Pathways a condition for approving any major oilsands pipeline project, on the grounds it would eliminate emissions from drilling, processing and flaring. But such upstream emissions are only 15 per cent of the total. Downstream emissions from consumption in transportation, industrial use, power generation and buildings account for the rest. Alberta Premier Danielle Smith obviously knows this but succumbed to the feds' extortion because it was the only way to get them on side.
Criticism from Former Supporters
In a recent opinion piece, Martha Hall Findlay, chair of the University of Calgary's School of Public Policy and former Liberal MP, came out against Pathways, which she spent years helping create. She belatedly admits it would entail significant cost “with, frankly, a negligible effect on global emissions.” A dramatically changed world provides a reason for her about-face: “Canada's priorities are now clearly economic diversification, national defence, national security — nothing less than our sovereignty.”
Findlay is correct that geopolitical events make the Pathways project even more indefensible, but without massive government subsidies CCS was never economically viable, according to the Institute for Energy Economics and Financial Analysis (IEEFA). And another reason for her change of mind existed when she helped create Pathways: Canada produces a mere 1.3 per cent of global GHG emissions; the oilsands represent 12.4 per cent of Canada's total emissions; and Pathways' first phase would likely reduce global emissions by less than 0.02 per cent — or one in 5,000 — with an undetectable impact on global temperatures. Even worse, the IEEFA says no CCS project anywhere has ever reached its target CO2 capture rate, and most miss by a lot.
Technical and Economic Failures
CCS projects have a troubled history around the world, with chronic underperformance, ballooning costs and technical failures. For example, in May 2024, Edmonton-based Capital Power cancelled a $2.4-billion project built to capture up to three megatonnes of greenhouse gas emissions from its gas-fired Genesee generating station in Alberta. The reason? It was not “economically feasible.”
Even hard-line green NGOs oppose CCS. Environmental Defence called it a billion-dollar scam based on junk science, with associate director Julia Levin saying: “Carbon capture is unnecessary, ineffective and expensive.” Mind you, her solution is to prevent energy projects from being created in the first place.
Safety Risks Ignored
Then there are the safety risks, which have not been adequately addressed. When stored in deep saline aquifers or depleted reservoirs, compressed CO2 can leak into groundwater or the atmosphere. In 1986, a release in Cameroon killed about 1,700 people. In 2020, the rupture of a CO2 pipeline in Mississippi resulted in dozens of hospitalizations and the evacuation of an entire town. Apart from the dangers of carbon dioxide poisoning, fluid injection can induce earthquakes by altering underground pore pressure, according to the U.S. Geological Survey.
