Wildfires are raging in every province and territory across Canada, leaving entire First Nations communities burnt, upending the lives of thousands of evacuees and creating plumes of toxic smoke dirtying the air in major cities like Toronto and New York. 

While some politicians claim the out-of-control wildfires are being primarily caused by improper forest management, scientists agree that climate change, driven by greenhouse gas emissions from fossil fuels, is the main culprit.

To stop contributing to the problem, the Canadian government could be implementing strict limits on the oil and gas industry for their carbon dioxide emissions. But Prime Minister Mark Carney has rejected that idea, opting instead for an unproven technological fix. 

In doing so, The Narwhal reported this week, the prime minister has become the latest in a long line of politicians to make big promises about carbon capture and storage to cut industrial emissions, despite the technology’s meager track record in Canada.

Read on to learn more.

1. Climate change from fossil fuels is making wildfires more severe and more frequent

Climate change is altering rainfall and storm patterns, creating hotter and drier conditions and more lighting strikes, causing fire seasons to start earlier and last longer and making those fires burn hotter, grow bigger and spread quicker. The result: Canada’s most recent fire seasons have been among the worst on record.

There’s only one real way to slow this escalating problem, scientists say: stop using so much coal, oil and natural gas, the fossil fuels that generate the emissions that are trapping heat in the atmosphere, changing the climate and leading to more extreme weather.

In Canada, the oil and gas industry is the country’s largest source of emissions. That’s partly because the type of petroleum in Alberta’s oilsands, the world’s fourth-largest proven oil reserve, requires extra electricity, steam, fuel and machines to turn it into usable products like gasoline compared to some other oil deposits. Oilsands emissions have grown from 41 million tonnes in 2007 to 92 million tonnes in 2024.

2. Carney expects Canada will soon generate more, not less, emissions

As Ontario faces what’s now estimated to be its worst wildfire season on record and other provinces and territories have been similarly devastated in recent years, Carney is focused on coordinating an emergency response with those jurisdictions, including managing the thousands of firefighting personnel and hundreds of aircraft involved. The prime minister says he’s committed to deploying “every resource needed to keep Canadians safe.” 

He also signed a deal with Alberta meant to increase oil production. The deal, which includes a commitment to build a new oil pipeline, is expected to result in more carbon pollution. Carney has admitted his government’s actions will raise emissions. More Canadian emissions means Canada is contributing more to the global problem of climate change that’s making wildfires worse.

Environmental advocate Catherine Abreu, a former member of Canada’s Net-Zero Advisory Body, told MPs in June that Carney’s government has “repealed or weakened virtually every climate policy and regulation that Canada had developed in the last decade.”

3. Instead of capping emissions, Carney is betting on carbon capture technology

Carney’s deal with Alberta promises not to follow through with a proposal, first made during the government of former prime minister Justin Trudeau, to implement an emissions cap on the oil and gas sector. 

A cap is a government mandate to prevent emissions from rising beyond a certain point. It’s something the industry itself previously said was achievable: in 2022 a group of oilsands producers came out with a plan they said could cut 22 million tonnes of annual emissions by 2030. That plan involved carbon capture, a technology that filters out carbon dioxide from industrial exhaust streams and stores it so it doesn’t get released into the air. 

But even though the Trudeau government proposed the emissions cap as a way to ensure the industry followed through with that plan, oil companies fought the cap proposal and Carney eventually agreed not to implement it.

Now, Carney’s deal with Alberta includes an agreement to build a carbon capture and storage network in the province, but the ambition has been dialed back considerably. Five oilsands companies agreed in July to use carbon capture technology to remove just six million tonnes of emissions per year by 2035, and a “range of technologies” to eventually capture 16 million tonnes per year by 2045. 

Compare that with an average of 20 million tonnes a year in new emissions from the oilsands that the Canadian Climate Institute has estimated will result from higher production levels to feed the new oil pipeline in the deal.

4. The track record for carbon capture of industrial emissions in Canada is bleak

Carbon capture and storage is real, and in use at nine commercial operations in Canada. But the technology is expensive and requires lots of new construction to scale up, while globally it has underperformed, according to the International Institute for Sustainable Development.

The results speak for themselves. Over a 24-year period, 68.7 million tonnes of carbon dioxide was captured across Canada, according to Environment and Climate Change Canada. That means the oilsands added more to the atmosphere in one year than carbon capture technology has ever stopped from industrial sources over more than two decades.

While oilsands emissions more than doubled from 2007 to 2024, the cumulative amount of carbon being captured from industrial sources is still “on the order of several [million] tonnes per year,” a Natural Resources Canada spokesperson told The Narwhal.

But that’s relatively tiny, compared to the eye-popping figure of 600 million tonnes a year that a government report had once claimed Canada could theoretically capture.

5. Carney’s support for carbon capture makes him the latest in a long line of politicians to tout its benefits

Despite this underperformance, both Liberal and Conservative federal governments in Canada keep projecting optimism about carbon capture’s prospects, dating back to former prime minister Stephen Harper, who gave a speech in Edmonton in 2007 that sounds strangely familiar now. This week, The Narwhal peered into the historical public record — and the national archives — to show just how real the enthusiasm has been.

In Edmonton, Harper talked about “the exciting new technology called carbon capture and storage.” He told Canadians that, “instead of pumping tonnes of carbon dioxide into the Earth’s atmosphere, we may be able to collect it from our oilsands … and pump it deep underground where it will remain for eternity.” He projected confidence, saying he felt “the era of empty rhetoric on the environment is over” and “we’re taking real action that will produce real, tangible results.”

In 2011, his then-natural resources minister Joe Oliver called Canada “a world leader in carbon capture and storage” and “in an excellent position to use this technology on a wide scale.” (Oliver recently wrote an op-ed opposing the latest carbon capture proposal in the oilsands, in part because of the technology’s spotty track record.)

After Trudeau won power in 2015, his first natural resources minister, Jim Carr, told a ballroom full of people in New York in 2016 that carbon capture is one of “the most pressing issues of the day.” One of Carr’s successors, Seamus O’Regan, would go on to describe carbon capture as “an integral part of lowering emissions” that was part of “how we get to net zero.” In 2021, he said Canada was “on the cusp of doing a lot of these things.”

Last year, Carney’s minister of energy and natural resources, Tim Hodgson, a former oilsands company board member, told a Calgary business crowd that the government, as much as private industry, should be pulling for the carbon capture project in the oilsands. In a faint echo of Harper, he said this government “will not be a government of talk, but a government of action.”

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Summary

• Two decades of records show Canadian politicians making big promises about carbon capture technology.
• In 2008, one government report claimed Canada could capture as much as 600 million tonnes of carbon a year — and carbon capture technology could be “implemented quickly.”
• From 2000 to 2024, a total of just 68.7 million tonnes of carbon dioxide was captured across Canada and experts say the technology has yet to be proven at scale.

It was March 2007. Apple had just debuted the iPhone. The Iraq War was raging. Al Gore’s An Inconvenient Truth had won two Oscars. And the prime minister of Canada was talking about “the exciting new technology called carbon capture and storage.”

“Instead of pumping tonnes of carbon dioxide into the Earth’s atmosphere, we may be able to collect it from our oilsands, our coal-fired electrical plants and other industrial emitters, and pump it deep underground where it will remain for eternity,” Stephen Harper told a crowd of journalists at an event in Edmonton that year.

“If we can perfect this technology, we can use it not only to curb Canada’s contribution to greenhouse gas production, but we could also export it around the world.”

It was the beginning of a long line of claims from political leaders in Canada about how carbon capture could slash planet-warming industrial emissions, including in the oilsands, the world’s fourth-largest proven oil reserve, where 159 billion barrels lie buried under Albertan sand and clay.

For close to 20 years, both Liberal and Conservative governments have talked about using carbon capture and storage technology to filter out carbon dioxide, a greenhouse gas, from exhaust streams and store it so it doesn’t get released into the atmosphere, where it traps heat and causes climate change. Yet, while oilsands carbon pollution more than doubled from 2007 to 2024 to 92 million tonnes, the ability of facilities in Canada to capture carbon from industrial sources hasn’t yet grown beyond a few million tonnes of emissions per year.

Meanwhile, the consequences of fossil fuels and climate change are being felt today. Life is more expensive, cities have dirtier air from wildfires, deadly heat waves and other extreme weather are more common, First Nations are disproportionately threatened with disasters and Canadians are more at risk of poverty, heart disease, cancer and premature death.

Around the time Harper spoke in Edmonton, mining the oilsands was thought to be generating 26 million tonnes of emissions. Since then, the federal national inventory report has recalculated historical emissions using updated methodologies and new data to find it was closer to 41 million tonnes. The petroleum in the oilsands starts as a viscous goo called bitumen, and takes large amounts of electricity, steam, fuel and heavy machinery to mine and transform into usable products. This extra activity means oilsands production has been associated with more emissions than some other oil deposits, adding to its climate impact when its end products like gasoline are eventually burned for energy.

There was also a boom happening when Harper made his remarks. Investment in the oilsands had tripled from 2003 to 2007, leap-frogging manufacturing, while oil and gas operating profits had doubled. Office space in Calgary, where many oil companies are headquartered, had dried up as the province rode a wave of record-low unemployment. By 2009, production levels from the oilsands would muscle out other forms of oil production in Canada.

Scientists agree the way to slow the chaos unleashed by climate change is to stop using so much oil, gas and coal. But Harper wasn’t about to impose strict government limits on oilsands emissions that day in 2007. Instead, he would talk about using carbon capture as a possible environmental and economic solution.

“This is a dream that could truly change the world,” he said.

“Friends, the era of empty rhetoric on the environment is over. We’re taking real action that will produce real, tangible results.”

Nineteen years later, that dream is still waiting to be realized.

From 2000 to 2024, 68.7 million tonnes of carbon dioxide was captured in the country, Environment and Climate Change Canada confirmed to The Narwhal. That means the oilsands added more emissions to the atmosphere in one year, 2024, than carbon capture equipment has ever stopped from industrial sources over roughly a quarter-century.

It’s also a small fraction of the capture amounts once thought possible. A 2008 report that came out of Harper’s announcement said Canada could theoretically capture as much as 600 million tonnes a year, and that carbon capture could be “implemented quickly, within a decade, using existing technology.”

Carbon capture and storage “is a viable way to achieve significant domestic greenhouse gas reductions,” the report stated, and is a “must-have for western Canada which relies on fossil energy.”

Instead, after tremendous attention and investment, this year Canada will be able to capture “on the order of several [million] tonnes per year,” a Natural Resources Canada spokesperson told The Narwhal. (The department declined to offer a precise figure when asked.)

Capturing this amount when the oil industry is sending so much more into the air is equivalent to taking a million cars off the highway while 30 million more drive up the on-ramp.

“Carbon capture has never, ever been proven at scale, or price. That’s just a fact,” Catherine McKenna, a former environment minister under the Justin Trudeau government, said in an interview.

“The oil and gas companies talked to me about carbon capture and storage, and made promises, for like a decade. We have yet to see anything.”

Now, like Harper before him, Prime Minister Mark Carney is putting his faith in carbon capture technology to do the heavy lifting, while he advocates for more oil production.

Carney struck a deal with Alberta that promises not to follow through with a Trudeau-era proposal for an emissions cap on the oil and gas sector.

Instead, the deal, meant to grow oil production and get a new oil pipeline to the West Coast built, includes an agreement to build a carbon capture and storage network in the province.

In July, five oilsands companies agreed to terms that envision using carbon capture to suck out six million tonnes of oilsands emissions per year by 2035. The project, dubbed Pathways, is supposed to use a “range of technologies” to eventually capture 16 million tonnes per year by 2045.

“The Alberta [deal] will build carbon capture and storage,” Carney said in Parliament in January. “It will build our future.” The deal, he told reporters in June, is about “working together, getting results for the citizens.”

His minister of energy and natural resources, Tim Hodgson, a former oilsands company board member, told a Calgary business crowd last year that the government, as much as private industry, should be pulling to get Pathways off the ground.

“All of us — governments and industry — need to get the Pathways project done. This government will not be a government of talk, but a government of action,” Hodgson said.

The federal government was boasting about being ‘a world leader in carbon capture’ in 2011

Harper’s full remarks from that day in 2007 are held at the national archives in Ottawa, where The Narwhal listened to a recording of them in June.

But plenty of other comments exist online in the public record of others talking optimistically about carbon capture to lower emissions.

In 2011, for example, Harper’s then-natural resources minister Joe Oliver said Canada was “a world leader in carbon capture and storage” and was “in an excellent position to use this technology on a wide scale.”

The next year he repeated this message: “Canada is in an excellent position to lead the world in the development, implementation and deployment of carbon capture and storage technology.”

In 2013, he said the government was “devoting significant amounts of money to carbon capture and storage, and we are doing that in co-operation with companies.”

Oliver now opposes the latest carbon capture proposal in the oilsands, in part because of the technology’s spotty track record and uncertain impact.

The trend continued after Trudeau’s Liberal government won power in 2015. Trudeau’s first natural resources minister, Jim Carr, told a ballroom full of energy analysts in New York in 2016 that carbon capture is one of “the most pressing issues of the day.”

The next year, he said carbon capture improves Canada’s “environmental performance.”

One of Carr’s successors, Seamus O’Regan, would describe carbon capture as “an integral part of lowering emissions” and said it was part of “how we get to net zero.” In 2021, he told CBC News Canada was “on the cusp of doing a lot of these things.”

François-Philippe Champagne, who in 2024 was Trudeau’s industry minister and is now finance minister, described Canadian companies then as “world leaders in carbon capture” and portrayed it as one of the “clean-tech solutions for the net-zero economy.”

(Story continues below.)

Two decades of political support for carbon capture

• Jan. 23, 2006: Harper Conservatives win minority government
• May 11, 2006 “Canada is already on the right track, particularly in research on energy efficiency, alternative energy sources and carbon capture and storage technologies. These technological advances will help us reduce greenhouse gas emissions and will enable Canada to capitalize on its huge energy potential for the benefit of all Canadians.”— Christian Paradis, parliamentary secretary to the minister of natural resources, in Parliament
• March 8, 2007 “Instead of pumping tons of carbon dioxide into the Earth’s atmosphere, we may be able to collect it from our oilsands, our coal-fired electrical plants and other industrial emitters, and pump it deep underground where it will remain for eternity. … Friends, the era of empty rhetoric on the environment is over.”— Stephen Harper, prime minister, Library and Archives Canada
• April 4, 2008 “Our government is ensuring that Canada is at the leading edge of clean technologies to reduce emissions and adapt to environmental change. That is why in Budget 2008, we announced $5 million … [to] address outstanding issues in the deployment of carbon capture and storage technologies.”— Gary Lunn, natural resources minister, press release
• Oct. 14, 2008: Harper Conservatives win minority government
• Oct. 18, 2009 “Carbon capture and storage is the most viable technology for reducing greenhouse gas emissions. Our government’s recent investment in large-scale demonstration projects further advances Canada’s leadership in this technology, while building a knowledge base to share this expertise with our global partners.”— Lisa Raitt, natural resources minister, press release
• March 16, 2010 “The $1-billion fund relating to green technology investments, including carbon capture and storage, which was set up in the 2009 budget, is not a research investment. These are demonstration projects investments. … The only known technology to abate carbon emissions from thermal coal plants is carbon capture and storage. It is the only technology that has ever been discovered that can actually abate emissions.”— Jim Prentice, environment minister, at committee
• May 2, 2011: Harper Conservatives win majority government
• June 24, 2011 “Canada is a world leader in carbon capture and storage and we are in an excellent position to use this technology on a wide scale.”— Joe Oliver, natural resources minister, press release
• March 27, 2012 “Canada is in an excellent position to lead the world in the development, implementation and deployment of carbon capture and storage technology.”— Joe Oliver, natural resources minister, at committee
• May 21, 2013 “We are devoting significant amounts of money to carbon capture and storage, and we are doing that in co-operation with companies, because that is the way to do it. Our government is a world leader in carbon capture and storage.”— Joe Oliver, natural resources minister, in Parliament
• Oct. 6, 2014 “We were proud to support the research and development of carbon capture and sequestration, and see the technology developed through commercialization at the Boundary Dam project, a technology that will reduce greenhouse gas emissions at that facility by 90 per cent. We remain committed to growing the economy and reducing greenhouse gas emissions with world-leading technologies.”—Greg Rickford, natural resources minister, in Parliament
• Feb. 19, 2015 “Since 2006, our government has made investments of over $10 billion to transition Canada toward a clean energy economy and help reduce greenhouse gas emissions over the long term. … These funds have helped establish Canada as a global leader in the research, development and demonstration of carbon capture and storage technologies.”— Colin Carrie, parliamentary secretary to the minister of the environment, in Parliament
• Oct. 19, 2015: Trudeau Liberals win majority government
• April 4, 2016 On a North American memorandum of understanding on climate and energy: “It’s an aspirational agreement that focuses our three countries on the most pressing issues of the day … [including] advancing the competitiveness of carbon capture, use and storage.”— Jim Carr, natural resources minister, prepared remarks for a speech
• Sep. 14, 2017 “Carbon capture and utilization technology creates new products and business revenue stream opportunities while improving our environmental performance, creating jobs and driving clean growth in the process.”— Jim Carr, natural resources minister, press release
• Nov. 9, 2018 About a $2-million investment in a carbon capture project: “This project leverages today’s traditional resources to deliver tomorrow’s clean energy solutions. Developing and adopting clean technologies will help Canada meet its domestic and international climate change commitments and help maintain our natural resource advantage for years to come.”— Amarjeet Sohi, natural resources minister, press release
• June 17, 2019 On signing two memorandums of understanding: “The second commits Natural Resources Canada and the Japan Coal Energy Center to work together on clean energy, including carbon capture utilization and storage technologies.”“Canada is taking a leadership role in the clean growth century by balancing the environment and economy both domestically and internationally.”— Paul Lefebvre, parliamentary secretary to the minister of natural resources, press release
• Oct. 21, 2019: Trudeau Liberals win minority government 
• June 15, 2020 “We see carbon capture and sequestration as an integral part of lowering emissions and making emissions more competitive, making our oil and gas industry more competitive.”— Seamus O’Regan, natural resources minister, at committee
• March 9, 2021 “Carbon capture technology creates jobs, lowers emissions and increases our competitiveness. This is how we get to net zero.”— Seamus O’Regan, natural resources minister, press release
• April 21, 2021 “I lead a department of scientists who are looking at things like carbon capture and storage, both onshore and offshore. … We are on the cusp of doing a lot of these things.”— Seamus O’Regan, natural resources minister, interview
• Sept. 20, 2021: Trudeau Liberals win minority government
• March 28, 2022 “We are taking bold action on climate change. … We see carbon capture and underground storage as part of the solution.”— Terry Duguid, parliamentary secretary to the minister of environment and climate change, in Parliament
• Feb. 7, 2023 “We are investing billions of dollars in climate action and into the new economy. We have eliminated six fossil fuel subsidies and are on our way to eliminating nine. We need to use every tool in the toolbox to reduce our emissions, including carbon capture.”— Terry Duguid, parliamentary secretary to the minister of environment and climate change, in Parliament
• May 8, 2024 “My colleagues are well aware that Canadian companies are world leaders in carbon capture and hydrogen fuel cell technology. That’s why we will continue to support the adoption of made-in-Canada clean-tech solutions for the net-zero economy.”— François-Philippe Champagne, industry minister, at committee
• April 28, 2025: Carney Liberals win minority government
• May 23, 2025 “We will invest in carbon capture, methane reduction and other technologies to ensure Canadian oil and gas is not only produced responsibly, but is the most competitive in the world. All of us — governments and industry — need to get the Pathways project done.”— Tim Hodgson, natural resources minister, prepared remarks for a speech
• April 13, 2026: Carney Liberals achieve majority government
• June 25, 2026 “We will deepen co-operative federalism with initiatives [like] Alberta’s proposed carbon capture and pipeline to the West Coast. … With the implementation agreement around carbon capture, [the government is] working together, getting results for the citizens.”— Mark Carney, prime minister, news conference (not online)

The Trudeau government’s emissions cap proposal came together after the Oil Sands Alliance, a group of major producers formerly known as the Pathways Alliance, had publicized a project they originally claimed could cut 22 million tonnes of oilsands emissions by 2030, with carbon capture being a central element of their plans.

The natural resources minister at the time, Jonathan Wilkinson, portrayed the emissions cap as a way to ensure the industry did what it said it could do.

Oilsands companies fought the proposal. A group of them pushed the government to delay and weaken the emissions cap’s rules, saying they needed “flexible and cost-effective” rules and a “long lead time” to prepare. By 2024, the boss of one of the country’s largest oil and gas companies was openly calling for the idea to be abandoned. Alberta Premier Danielle Smith also came out against the proposal.

Last year, after Carney won power, Canadian oil and gas executives and lobby groups called on him to “unwind the past decade” of Trudeau-era policy altogether, killing not only the emissions cap but also other environmental rules. The prime minister has ticked off several boxes on their wishlist.

The Narwhal reached out to more than a dozen current and former government officials to ask them if they stood behind their comments about carbon capture today, knowing what they know now.

Minister Hodgson’s spokesperson forwarded the questions to Natural Resources Canada. A spokesperson for his department responded that technologies like carbon capture are “important tools in Canada’s broader climate toolbox of measures to reduce or remove emissions, while strengthening growth and security.”

Carbon capture and storage “holds great opportunity to advance climate competitiveness, and is an area where Canada can lead internationally and sell components and expertise in global markets,” they said in an email to The Narwhal. It offers a “practical path to reduce emissions, protect and create jobs, sustain economic growth and keep Canadian industries globally competitive.”

A spokesperson for Champagne declined to comment. The others did not respond.

The Narwhal also sent separate questions to Natural Resources Canada directly. Another spokesperson claimed Canada’s industrial carbon capture rates will rise in the coming years.

“While Canada has already captured and stored or used significant volumes of [carbon dioxide] the sector is growing, with new projects and infrastructure expected to come online as technology improves and evolves,” the spokesperson said in an email.

There’s a “growing list of potential projects across multiple industrial sectors” today, they said, and “these projects are expected to increase capture volumes over time.”

Canada doesn’t publish an official forward-looking estimate of carbon capture potential, the department said. And the spokesperson pointed to a number of challenges with carbon capture adoption. For one, the projects are “large, capital‑intensive and technically complex.”

Carbon capture is expensive. The Pathways proposal was initially estimated at $16.5 billion and is now pegged at between $20 billion and $30 billion, despite lowering the amount of emissions it is intended to capture. At times it has seemed like it could struggle to break even, according to the Institute for Energy Economics and Financial Analysis.

The government is offering federal financial incentives for carbon capture, and Carney reversed a Trudeau-era ban on companies from accessing that incentive when they pump the captured carbon into wells to loosen up more oil for extraction.

Despite hitting record profits in recent years, oil companies have in the past largely resisted spending the billions of dollars necessary to build out carbon capture equipment across their large properties. Instead the industry spent years lobbying the government for lucrative public subsidies to install and run carbon capture systems.

Scaling up carbon capture and storage also requires building new pipelines and storage hubs. A Natural Resources Canada spokesperson said the technology continues to “evolve” and investors are looking for enough “market demand for low‑carbon products,” which the government believes has been bolstered with the Alberta deal.

Globally, the technology has underperformed, according to the International Institute for Sustainable Development. One of Canada’s own flagship projects captured less carbon than initially thought. In 2022, more than 400 academics wrote an open letter to Canada saying carbon capture was “neither economically sound nor proven at scale,” despite decades of research.

Carbon capture used to secure social licence for pumping more oil

When it comes to techniques for keeping carbon out of the atmosphere, using carbon capture technology on industrial sources is only one approach.

Other types of technologies, collectively called carbon removal, can draw existing emissions from the atmosphere or store carbon permanently in other forms like rock.

There are 11 million tonnes worth of annual permanent carbon removal capacity in the planning stages in the country, according to Carbon Removal Canada, an independent non-profit. Those plans are for new projects such as direct air capture or carbon mineralization, but not industrial carbon capture.

The Intergovernmental Panel on Climate Change, the United Nations body that provides governments with climate science, has said carbon capture and carbon removal technologies will have to be part of the mix of techniques that countries use to slow the rise in planetary temperatures causing climate change.

It’s a point Steven Guilbeault, who served as another environment minister under Trudeau and helped develop the emissions cap proposal with Wilkinson, raised several times in Parliament. Canada needed to look at every possible technology that could help reduce emissions, he argued.

But the United Nations panel was also clear these kinds of technologies are not a substitute for a “substantial reduction in fossil fuel use,” rather something to be used alongside those efforts.

In an interview with The Narwhal, Guilbeault said Canadian politicians have often misunderstood the difference, seeing carbon capture as “a way to continue pumping oil and gas in Canada.”

“It’s a technology we will need, but it’s not in lieu of reducing emissions, and unfortunately it seems that a lot of people haven’t understood that,” he said.

The technology “is a very convenient, theoretical, technical fix to a larger problem,” Guilbeault said. “We humans tend to look for easy fixes, sometimes, to complex problems.”

Evidence also suggests carbon capture has been popularized by the oil and gas industry to shield itself from criticism. In 2022, a U.S. Congressional probe found oil companies were talking about carbon capture publicly as a way to mitigate their climate impact, but internally were discussing it as a way to secure “social licence” to continue producing fossil fuels.

In June, the investigative outlets ProPublica and Drilled published evidence the oil company BP helped shape an academic paper that oversold carbon capture’s readiness, while the oil and gas industry funded research at universities that boosted the technology.

Guilbeault said he has “always been skeptical” of the oil industry’s carbon capture proposal in Alberta.

His skepticism is shared by former oilsands executive and former member of Parliament Martha Hall Findlay, who helped develop the industry’s initial Pathways carbon capture proposal. She now argues Canada should “postpone” the project and focus on other priorities.

Federal Conservative Leader Pierre Poilievre is also skeptical of Carney’s plan.

A former Harper government minister of democratic reform, and employment and social development, Poilievre has supported subsidizing carbon capture in the oil and gas industry in the past. In 2022, shortly after becoming leader, he said the Canadian energy industry was “leading in the world” on carbon capture, and accused the Trudeau government of being “slow to support it and insufficient in that support.”

In 2023 he asked, “Why do we not use technology instead of taxes to fight climate change? Why do we not support our energy sector in pumping the carbon back into the ground through carbon capture and storage?”

More recently, Poilievre has criticized Carney’s deal with Alberta for committing billions of dollars to a “money-losing carbon capture project that has never been proven anywhere.”

Asked by The Narwhal why he’s soured on support for carbon capture, Poilievre said he only sees value if it’s used to extract more oil.

“When you pump carbon back in the ground and pressurize the geology, and you can bring up more oil, they can then go out and make the world a better place,” he said.

“The other is just pumping air into the ground and getting nothing in return. … How’s it going to make money?”

Updated on July 22, 2026, at 11:48 a.m. ET: This story was updated to include the latest figure for 2007 oilsands emissions from the national inventory report. While a report from Alberta published in 2008 put the figure at 26 million tonnes, the national inventory report has recalculated historical emissions figures with updated methodology and additional data, putting it at 41 million tonnes of emissions.

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Summary

• The Montreal-based tech firm Deep Sky is proposing to build a direct air carbon capture facility in southern Manitoba, and documents obtained by The Narwhal show the company has garnered support from First Nations, rural municipalities and at least one bank.
• Direct air carbon capture involves sucking carbon out of the atmosphere and then burying it deep underground. Deep Sky says its technology is “viable,” but critics have expressed skepticism.
• If built, the facility will require 15 megawatts of electricity to run — which is about enough to power 10,000 homes. Deep Sky hopes to connect to Manitoba’s electrical grid to obtain that energy.

A direct air carbon capture facility proposed for southwestern Manitoba has been shoring up allies in local and Indigenous governments and large corporations, as Montreal-based Deep Sky aims to convince the provincial government its project is ready to launch.

The venture-capital-backed tech firm sent the province a package of support letters late last year encouraging the government to provide the regulatory support and electric power supply needed for Deep Sky’s Manitoba facility to move forward, according to documents obtained by the Free Press and The Narwhal.

“Deep Sky Manitoba is not a speculative concept,” the company wrote in a December letter. 

“It is a commercially viable infrastructure project that is backed by real market demand and presents an economic opportunity for Manitoba on a global scale.”

Deep Sky is proposing a 145-acre facility in the agriculture- and oil-dominant southwestern region that will scrub 30,000 tonnes of carbon dioxide directly from the atmosphere each year and inject it into porous rock formations 1,000 metres below ground. The company says it will use technology first tested at its existing accelerator in Innisfail, Alta., and will finance the $200-million Manitoba project by selling carbon credits.

Deep Sky will need up to 15 megawatts of power — roughly the power draw of 10,000 homes — for the first stage of the project, CEO Alex Petre told The Narwhal and Free Press in December. 

The package included term sheets and letters of intent from five customers and investors, as well as support from local communities. 

While some of the documents are redacted under a section of the freedom of information act that protects corporate privacy, The Narwhal and the Free Press obtained copies of letters from the Dakota Grand Council, the rural municipalities of Pipestone and Two Borders, Frontier and the Bank of Montreal. 

“These documents illustrate that this project is ready to break ground,” the company wrote. 

“We have the customers and the support to bring this investment to the province. We are simply waiting for the final regulatory framework and the confirmation of power supply to unlock this investment.”

Direct air carbon capture: big promises, yet to be proven

Deep Sky’s proposal has been met with skepticism from area residents and climate action groups, who have posed questions about the safety, affordability and long-term impacts of direct air carbon capture. 

While oil and gas companies and some climate experts view the technology as a useful tool to help achieve global net-zero targets, critics say it is prohibitively expensive and not guaranteed to work.

Despite energy agencies, including the Canada Energy Regulator and Manitoba Hydro, predicting direct air capture will sequester millions of tonnes of emissions annually by 2050, facilities aren’t yet keeping pace. The two dozen facilities currently operating worldwide capture less than 10,000 tonnes per year.

But Deep Sky maintains its project will be able to succeed given Manitoba’s “natural advantages,” including suitable geologic conditions, a low-cost hydroelectric grid and a local workforce familiar with oil and gas operations.

The company recently sold North America’s first verified carbon removal credits after successfully storing carbon at its Innisfail facility, according to a press release Monday.

According to the December letter, it has now also secured “strong local buy-in” after hosting information sessions through the fall and winter. 

“Over the past year, we’ve engaged with Indigenous communities, municipalities, provincial partners and regional stakeholders across Manitoba to better understand local priorities and explore how this industry can create lasting economic opportunities for Manitoba,” Jason Vanderheyden, Deep Sky’s vice-president of government affairs and public policy said in an emailed statement. 

“All of these conversations continue to inform our approach as the project advances.”

Deep Sky points to First Nations support for proposed facility

Vanderheyden noted the company’s partnership with the Dakota Grand Council, a collaborative organization representing Manitoba’s Dakota nations.

In a letter to the province dated Dec. 5, 2025, Dakota Chiefs Dennis Pashe and Raymond Brown expressed “strong support for the Deep Sky Manitoba project,” noting it presents an opportunity to reverse “decades of economic exclusion in the region.” 

The project is anticipated to create between 750 and 1,000 jobs during construction, with around 100 permanent positions during operation. The Dakota council said it is working with Deep Sky to ensure its members are prioritized for these roles, and will explore equity opportunities through the relationship agreement. 

“Deep Sky’s Manitoba executive team engaged with us early, right from the start of the project and we found them to be extremely transparent,” Pashe said in an emailed statement. 

“They were also very informative when explaining the project and carbon removal technology, which is important when communities consider something new.”

The company will still need to complete impact and benefit agreements to receive consent from the Dakota Nation, he added.

Local rural governments come out in support of Deep Sky project

The package also included resolutions passed by the rural municipalities of Pipestone and Two Borders in early 2025 declaring support for carbon capture and storage projects, including the Deep Sky initiative, and urging Manitoba to amend its carbon storage rules in collaboration with the company.

Manitoba passed the Captured Carbon Storage Act in May 2024, outlining the legal framework for such projects. The accompanying regulations, which will outline the finer details of a company’s responsibilities when storing captured carbon, were initially expected this spring, according to a December interview with Manitoba’s Business, Mining, Trade and Economic Development Minister Jamie Moses.

It’s not yet clear when the regulations will be finalized.

In response to detailed questions from The Narwhal and the Free Press regarding the province’s support for Deep Sky’s proposal, progress on carbon storage regulations and the company’s power supply request, Moses’ office said in a three-sentence reply, “any decisions regarding that project will be communicated in the coming months” and consultation will continue to take place with affected communities.

Deep Sky looks for connection to provincial grid and hydroelectric power

Alongside local support, Deep Sky has the backing of several large corporations in the technology and finance sectors. 

Frontier is an advanced market commitment group representing some of the world’s largest tech and financial companies — including Stripe, Google, Shopify and Anthropic — in an effort to stimulate the carbon storage industry. 

The company is “actively evaluating Deep Sky for future offtake agreements and are encouraged by the pace of their technical progress,” according to a letter included in the Deep Sky package.

“However, to unlock this global market demand for Manitoba,” the company states, “two critical enablers are required: the allocation of hydroelectric power and a finalized regulatory framework.”

Bank of Montreal executive Grégoire Baillargeon, who serves as a board member for Carbon Removal Canada, wrote a similar letter of support urging the province to “grant the project a high-priority hydro allocation so that construction can begin and Manitoba can secure a leadership position in this emerging market.” 

Neither company responded to follow-up questions.

Any facility needing to draw more than five megawatts must submit a large power supply application, according to Manitoba Hydro (Deep Sky will need up to 15 megawatts of power in its first phase). In an email, media relations officer Peter Chura explained Hydro reviews applications thoroughly to determine feasibility, then forwards requests to the province for review and prioritization. 

Chura said Hydro could not confirm whether it had received a request for power from Deep Sky, as the Crown utility does not publicly discuss customers, applications or proposed developments. He confirmed Hydro has not received any directives from the Manitoba government regarding the Deep Sky proposal.

Julia-Simone Rutgers is a reporter covering environmental issues in Manitoba. Her position is part of a partnership between The Narwhal and the Winnipeg Free Press.

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Summary

• The Oil Sands Alliance, formerly known as the Pathways Alliance, represents the largest companies operating in the Alberta oilsands.
• Since 2021, the alliance has promised a huge carbon capture project that will help reduce oilsands emissions by 68 megatonnes each year, three-quarters of the industrial region’s total.
• In the finalized memorandum of understanding between the Alberta and federal governments, that number has been quietly reduced to just 16 megatonnes annually, a reduction of 77 per cent from the initial promise.

Five years ago, the five largest oilsands producers promised their operations would be net-zero by 2050. The claims were huge: a massive carbon capture and storage project would help reduce emissions by 68 million tonnes of carbon each year.

Now, with a memorandum signed between Alberta and Ottawa to facilitate a new oilsands pipeline to the West Coast and promises of billions in tax credits to support the project, those promises have plummeted. 

In the agreement, finalized in May, it’s anticipated those same producers will reduce their emissions by 16 million tonnes annually by 2045, a significant decline from the original claim.

The pledge to achieve net-zero emissions in the oilsands was part of an intense pitch to governments over the past five years, alongside major lobbying to provide financial support for what could be the largest carbon capture project in the world.

It was put forward by the Pathways Alliance — now renamed the Oil Sands Alliance — made up of the largest companies operating in the Alberta oilsands: Suncor, Cenovus, Canadian Natural Resources, Imperial Oil and ConocoPhillips. 

The federal and provincial governments have now both unveiled tax credits for carbon capture, rolled back environmental regulations aimed at tackling emissions, pledged to fast-track projects and signed an agreement to aggressively push a new pipeline through British Columbia, even without a company willing to build it. 

Patrick McCurdy, a professor of communications at the University of Ottawa who has studied environmental claims by the alliance of oilsands companies, said the walkback fits into a larger pattern of greenwashing — a method in which companies mislead the public through those claims. 

He said the companies will “say whatever is politically convenient and what they can get away with” to build the social licence needed to keep producing oil. 

“They have that now with [Prime Minister Mark] Carney,” he said.

Academic paper found ‘numerous indicators of greenwashing’ in carbon capture project’s messaging

The coalition of companies, then called Pathways Alliance, explicitly called for reductions of 68 megatonnes of emissions per year and celebrated the goal in news releases, editorials and widespread advertising campaigns.The plan, with carbon capture and storage as its centrepiece, would be built in three phases, each phase eliminating between 21 and 25 megatonnes per year, according to those early pledges. There are no other detailed plans highlighted by the alliance to achieve its net-zero pledge. One megatonne is one million tonnes.

As late as December of last year, the Alberta government used the 68 megatonne figure in a presentation to U.S. lawmakers highlighting Alberta’s energy potential.

McCurdy has studied the claims of the Oil Sands Alliance since its inception and co-published a paper in 2023 focused on how it greenwashes information. 

The paper’s conclusion was unequivocal. 

“There are numerous indicators of greenwashing in Pathways Alliance’s public communication,” it reads. “Their messaging omits important information, uses misleading framing and comparisons, and fails to meet standards expected of a credible net-zero plan.”

It says the alliance’s environmental, social and governance claims should raise concern about the viability of its carbon capture and storage project.

Canada does have laws about greenwashing — though they were walked back by the Carney government last year. When those laws passed, Pathways wiped many environmental promises from its website. The anti-greenwashing provisions, part of the federal Competition Act, had been created in part to address the issue of companies advertising they were headed toward net-zero emissions while not presenting evidence showing they were taking any significant steps toward cutting their carbon pollution.

In an interview, McCurdy said it’s typical for oil and gas companies to make big public promises and then lobby behind the scenes to move the yardsticks. 

“I imagine they’re able to reduce these numbers, or change the numbers … because the social licence doesn’t seem to be threatened in the same way it was before,” he said.

The Oil Sands Alliance did not respond to questions from The Narwhal.

The office of Alberta Premier Danielle Smith and the Alberta Environment and Protected Areas Minister Grant Hunter did not respond to emailed questions. 

The federal Privy Council Office did reply, but did not directly answer any of the emailed questions, instead highlighting the balance between economic growth and emissions reductions.

When asked if the federal government is confident the project can achieve the lowered target of 16 megatonnes, Pierre Cuguen, a spokesperson for the Privy Council Office, said the country already has operating carbon capture and storage projects that prove the technology can work in real-world conditions, while noting it aims to be the largest carbon capture project in the world. 

“Pathways will continue to go through detailed design work, regulatory review and investment decisions as the project moves forward,” he wrote.

The oilsands account for a third of all emissions in Alberta

The memorandum of understanding between Ottawa and Alberta finalized terms for everything from an industrial carbon price to building out a national electricity grid, but the terms related to the Pathways carbon capture project still require a three-way agreement with the companies behind the scheme. 

But the governments reaffirmed “their shared objective” of the project reducing emissions by 16 megatonnes annually by 2045, starting with six megatonnes when the project comes online in 2035. 

The oilsands emit approximately 90 megatonnes of emissions each year, almost 33 per cent of all emissions in Alberta. Since 2004, 15 megatonnes of emissions have been captured by existing carbon capture projects in the province, slightly more than one megatonne per year.

Both governments have agreed to walk back carbon price targets, streamline approvals of projects and the federal government has scrapped the proposed oil and gas emissions cap and largely handed environmental impact assessments over to the province. Each represents a lobbying victory for the oil and gas companies.

Sean McCoy, an associate professor of engineering at the University of Calgary who specializes in carbon capture, said the changes in emissions pledges are not due to any changes in technology or knowledge. 

“Let me put it this way, I bet 99 per cent of what we know today about capturing carbon dioxide, more like 99 or even above, we knew in 2021,” he said. 

McCoy said one possible answer to why the project has been scaled back so drastically is cost, comparing it to a home renovation where big plans are reconsidered as the price tag rises. 

“That is pretty common in these sorts of projects, either the cost goes up or the scope of the project shrinks if you’re trying to manage your budget,” he said.

But McCoy points out that even the reduced 16 megatonne figure represents the largest carbon capture and utilization project ever constructed.

When asked if the reduced target was achievable, McCoy said it’s ambitious.

“It’s just really, really big,” he said. “You’ve got to look at the scale of all the different parts, because it’s not like they’re going to capture 16 million tonnes at one smoke stack.”

It’s unclear how much the final project will cost, but estimates point to a budget over $20 billion, and the former CEO of Imperial Oil previously said the alliance was aiming for 75 per cent of the funds to come from the federal and provincial governments. Most of that will come from newly established tax credits.

Carbon capture is ‘always a just-around-the-corner type thing’: professor

There’s a lot we don’t know about the Pathways project, McCoy said, so it’s hard to directly evaluate the plans. 

McCurdy, looking at it through the lens of influence and communication, sees that as intentional. His research includes strategic omissions as part of the greenwashing strategy. 

“These companies, some of the biggest in the country, have the money to focus-group, to get the best creatives to make these campaigns to try and get public sentiment on their side,” he said.

But while earlier oilsands marketing focused on the need to decarbonize and the goal of achieving net-zero emissions, the messaging has changed alongside the reduced emissions ambitions. 

Jon McKenzie, the CEO of Cenovus, told investors in May the debate around oilsands development has been “myopically focused on the climate agenda,” according to the Canadian Press.

It’s a more direct pushback against the earlier claims of the alliance, but for McCurdy, the intent was always to kick the can down the road. 

“It’s always a just-around-the-corner type thing,” he said of carbon capture technology and some of its bigger claims. “It’s a well-known trope to try and look at technology to save us out of this.”

Updated June 5, 2026, at 3:30 p.m. MT: A previous version of this article incorrectly referred to the Oil Sands Alliance as the Oilsands Alliance.

Updated on June 25, 2026, at 3:30 p.m. MT: This story has been updated to correct an error. Past claims of the the Oil Sands Alliance, formerly known as the Pathway Alliance, promised 68 megatonnes of total emissions reduction, not of carbon capture specifically, as a previous version of this article and its headline stated. Carbon capture and storage has always been the centrepiece of the alliance’s plan, and no other detailed plans were highlighted by the alliance as ways to achieve its net-zero pledge.

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Summary

• The federal government will offer tax credits to companies that capture carbon pollution and use it to extract more oil.
• That process is called enhanced oil recovery, and it involves injecting carbon dioxide deep underground to push more oil to the surface.
• Critics say subsidizing enhanced oil recovery operations is counterproductive. It does stop some carbon dioxide from escaping into the atmosphere, but it also enables the production of more carbon-emitting fossil fuels.

Canada is planning to give financial incentives to companies that capture carbon dioxide and use it to produce more oil. The technique, called enhanced oil recovery, was formerly barred from receiving federal tax credits. 

Huh? Enhanced oil recovery? You’d be excused for scratching your head.

The technique uses carbon dioxide to pump more oil (we’ll get into it below) — and is controversial. Can you reduce emissions by pumping more oil? 

But the government’s ban on subsidies for enhanced oil recovery projects was reversed in dramatic fashion last year, first in a deal with Alberta that resulted in cabinet minister Steven Guilbeault resigning.

The government then solidified the change across the country in its latest economic update.

So what is enhanced oil recovery and what are its impacts on emissions and on government finances?

Here’s a primer.

Back up, what’s carbon capture, utilization and storage?

Industries emit a lot of carbon dioxide. Too much. Governments have tried to incentivize companies to reduce the amount of carbon pollution they release into the atmosphere — where it traps heat and contributes to climate-driven problems like increased wildfire, hurricanes, droughts and more.

One strategy is to capture the carbon pollution rather than release it up into the sky, then either store it (storage) or use it to make other things (utilization). When it’s stored, it’s most often injected deep underground.

There are two options in this scenario: one, it can be stored underground, plain and simple. Buried and forgotten.

The second is that you use the carbon dioxide to get more oil out of the ground, then store it. That’s what’s known as enhanced oil recovery — in essence, injecting carbon dioxide into a well so you can get more oil. Globally, it’s by far the most common of the two.

A 2022 report found nearly three-quarters of captured carbon pollution around the world is used to extract more oil.

How does enhanced oil recovery work?

Enhanced oil recovery can involve pumping anything from water to steam to gas deep into the ground to increase pressure in an underground oil reservoir. The goal? To force more oil out of a well. 

But in this instance, we’re talking specifically about using captured carbon dioxide as the pressure builder, often alongside water.

A company will either capture carbon pollution, or purchase it from another source, and then inject it deep underground to push more oil to the surface. Most of that carbon pollution will then remain trapped underground.

A well-designed system will capture emissions from the enhanced oil recovery operation and reinject them back into the reservoir, creating a closed loop, but not all systems will capture all emissions.

Sounds smart, what’s up?

The process can significantly prolong the lifespan of a fossil fuel reservoir, so it makes sense if the goal is to increase or extend production. 

It also creates a bigger market for captured emissions, further incentivizing companies to capture carbon pollution rather than release it into the atmosphere. 

But the issue is that enhanced oil recovery takes carbon dioxide, ostensibly captured to reduce emissions, and uses it to pull more carbon-emitting fossil fuels from the ground.

Determining whether there is a net reduction in emissions from this process is complicated and depends on a lot of factors — including how much traditional production is displaced by enhanced oil recovery, how much carbon is actually stored underground, the impact on prices and demand, how much carbon is produced while recovering oil, the type of oil produced and the lifecycle of the fuel that is produced.

Sound complicated? It is.

Research suggests the process can achieve reductions in per-barrel emissions, commonly referred to as emissions intensity.

On the other hand, enhanced oil recovery produces more carbon pollution than simply capturing and storing emissions permanently underground.

Traditionally, enhanced oil recovery used carbon dioxide that was naturally occurring and already stored underground, but newer methods involve using captured emissions — a critical distinction when discussing the potential of any emissions reductions. 

As one 2025 peer-reviewed meta-analysis of enhanced oil recovery research dryly suggested, “the extent to which [carbon capture and utilization] projects that store captured [carbon dioxide] in oil reservoirs support achieving [greenhouse gas] emissions targets is debated.” 

That study found analyses of the life-cycle emissions of enhanced oil recovery vary greatly — all the way from increasing emissions to reducing them.

So, why are we talking about this?

The previous Liberal government announced tax credits for carbon capture and utilization projects, significantly reducing costs for the companies building them. Projects are typically expensive to build and the government wanted any and all emissions reductions to move ahead. 

It excluded enhanced oil recovery, arguing it was counterproductive to reducing overall emissions and the government’s goal to move toward a net-zero economy.

The Liberals under Prime Minister Mark Carney, however, reversed that decision and announced enhanced oil recovery could receive tax credits, first in a November memorandum of understanding with Alberta regarding a new pipeline, and then again in its latest economic update. Industry cheered the decision, while those concerned with emissions cried foul.

Under Carney’s new rules, a project will have to permanently store 95 per cent of the carbon dioxide used to pump more oil be eligible for tax credits. 

In Alberta, the government already provides tax credits for enhanced oil recovery operations. That program does not include the need to capture a minimum amount of carbon in order to qualify.

Critics call these credits a fossil fuel subsidy. Companies who receive the money from the federal and provincial governments do not. Therein lies the debate.

What will this cost taxpayers?

That will depend on how many producers meet the criteria set by the government.

In 2024, the Parliamentary Budget Office estimated the tax credit would cost the government $5.7 billion between 2022 and 2028 — but that was before enhanced oil recovery was added to the list of eligible projects. It’s unclear what the impact of that addition will be. 

There is one important distinction: the tax credits for enhanced oil recovery aren’t as lucrative as those for storage alone: the amount of money an oil project can recoup is half of what a company that simply stores carbon permanently underground can receive. 

For that reason, the federal government estimates credits for enhanced oil recovery might actually save some taxpayer dollars — $395 million over four years, starting in 2027, according to a federal Department of Finance official responding to questions from The Narwhal.

The official said the savings would come from companies deciding to store carbon for enhanced oil recovery rather than dedicated storage, and receive less public money for doing so.

While incentivizing enhanced oil recovery may represent a savings in terms of tax credits, the costs come from increased emissions and long-term impacts.

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Alberta can have another pipeline to the West Coast — at least theoretically — but only if the oil and gas industry puts carbon capture systems in place to ensure the bitumen that flows through it is “low-emission.”

That tradeoff is at the heart of the “grand bargain” unveiled by Alberta Premier Danielle Smith and Prime Minister Mark Carney in November 2025, when they both expressed support in principle for a new pipeline to connect Alberta’s landlocked oilsands to international markets.

What will make this bitumen cleaner than what currently flows through Alberta’s pipelines? The answer has nothing to do with the product itself, but with the processes that will be used to create it.

According to the terms of Smith and Carney’s memorandum of understanding, the federal government’s support for Alberta’s new pipeline is contingent on the success of a massive carbon capture project being pitched by the Pathways Alliance, a coalition of Canada’s major oilsands companies.

If Pathways companies build the carbon capture infrastructure they’re promising, and use it to “decarbonize the production of their bitumen,” to use Smith’s words, then they can have their new pipeline and ship their product to their collective hearts’ content, the prime minister has promised. (That is, of course, if a company or consortium signs on to acquire the necessary approvals and actually build it — the memorandum stipulates the pipeline will be built by the private sector, with opportunities for Indigenous co-ownership.)

You’re likely to hear a lot more about carbon capture technology, now that Carney has adopted it as a key strategy to thread the needle and reduce Canada’s emissions without forgoing the economic benefits of the nation’s number one export. His office identified the Pathways carbon capture project as a contender for a federal “major project” designation late last year, meaning it could see fast-tracked federal approvals, and his government has extended Trudeau-era subsidies for constructing carbon capture projects.

So, what is carbon capture? And can it really save our planet from the worst impacts of climate change? Read on to find out.

What is carbon capture and storage?

Technologies to lower carbon emissions from industrial processes, which Carney and other politicians are embracing, are known as carbon capture, utilization and storage — often abbreviated as CCUS or CCS.

These technologies capture carbon before it escapes into the atmosphere, and then bury it deep underground (“storage”) or repurpose it to make other products (“utilization”). These systems are often designed with the goal of capturing 90 per cent of the emissions produced by an industrial process — but early carbon capture projects in Canada have failed to achieve that threshold. 

Captured carbon can’t be stored just anywhere. The process requires a porous rock formation deep underground into which the carbon can be injected. On top of that, an impermeable “cap-rock” layer is necessary to seal the carbon in for centuries to come. 

In many cases, sites where oil has previously been removed prove suitable for carbon storage. That’s one reason why the Prairie provinces have so far been the epicentre of carbon storage activities in Canada. According to one estimate, Saskatchewan and Alberta are home to approximately nine per cent of the total onshore carbon storage capacity in North America. 

But the search is on for “pore space” elsewhere, too. The Ontario government has identified the lakebeds and shorelines of lakes Erie and Huron as potential carbon storage locations.

In addition to projects that capture carbon as it’s emitted, there is also technology under development that sucks carbon right out of the air. That’s called direct air carbon capture. It is a less developed and less proven technology, but some companies are trying to make it work — including Deep Sky, a venture capital-funded startup that wants to build a direct air carbon capture facility in rural Manitoba.

What projects already exist? And what is the Pathways Alliance planning?

There are a few dozen carbon capture, utilization and storage projects in operation around the world, but they’ve yet to reach a scale that would make a meaningful dent in emissions. According to the Global CCS Institute, existing projects have the capacity to capture about 64 million tonnes of carbon per year — that’s about 0.1 per cent of global emissions. A recent study estimated that more than 383 million tonnes of carbon dioxide have been stored underground worldwide since 1996.

Comparatively, the latest federal figures show annual emissions from Alberta’s oilsands were 89 megatonnes in 2023, with the broader oil and gas sector in Canada contributing 208 megatonnes of carbon emissions in that year.

The Pathways Alliance proposal doesn’t include the actual capture of any carbon. Rather, it’s a plan for a shared carbon transportation network and storage facility, with individual companies expected to build their own infrastructure for capturing carbon at their facilities and feeding it into the Pathways network. The companies stated in 2023 that their project could lead to a net reduction of between 10 and 12 megatonnes of emissions per year by 2030.

A handful of the world’s carbon capture and storage projects are already located in Canada.

Cumulatively, Canadian carbon capture and sequestration projects stored roughly five megatonnes in 2023, according to federal figures. That is a small fraction of what the projects were predicted to store. That number doesn’t account for all the carbon that was captured: some is injected into the earth to help extract more oil, a process known as enhanced oil recovery.

In Alberta, Shell Canada’s Quest project has been in operation for just over a decade. Quest syphons carbon from one of the company’s Edmonton-area plants and transports it by pipeline to a storage area where it’s injected and stored more than two kilometres underground. The project, which cost more than $1 billion to build, captures and stores about one million tonnes of carbon each year.

Also in Alberta, the Carbon Trunk Line hauls captured carbon from a fertilizer plant and a refinery and pipes it 240 kilometres south to old oil reservoirs. The pipeline has the capacity to transport up to 14 million tonnes of carbon per year, though it only transported 1.5 megatonnes in 2023.

In Saskatchewan, the best-known carbon capture project is the Boundary Dam coal-fired power plant, operational since 2014 and the world’s first commercial-scale coal plant with the technology. Carbon from the Boundary Dam is transported by pipeline to a largely depleted oil field near Weyburn, Sask., where it is injected into reservoirs to loosen up the remaining oil. The plant has never achieved its original goal of capturing one megatonne per year, but it was also an early demonstration project.

How are Canadian governments supporting carbon capture technology?

By paying for it.

The cost to build carbon capture, utilization and storage facilities typically runs into the billions of dollars. Then, there are operational expenses. A 2025 analysis found Alberta’s two major carbon capture and storage facilities each cost tens of millions of dollars per year to operate.

Alberta’s oilsands companies — which collectively posted more than $29.1 billion in profits in 2024 — find those costs too high. The Pathways Alliance has stated on its website that its carbon capture plan “will require ongoing collaboration” with governments, including “making significant investments together.” In theory, carbon pricing should encourage more carbon capture projects, as the more expensive carbon emissions are, the more likely a company is to implement emission reductions strategies.

Yet in 2024, Edmonton-based power generator Capital Power abandoned its plans for a facility, saying carbon capture and storage was “not economically feasible.”

If the industrial carbon tax is a stick, our governments are also dangling carrots in front of major polluters in the form of subsidies.

Under former prime minister Justin Trudeau, the federal government introduced a refundable tax credit that subsidizes up to 50 per cent of the cost of eligible carbon capture, storage and utilization projects. The tax credit first became available in 2022, and the Parliamentary Budget Office has estimated its cost will rise to more than $2 billion per year by 2027-28, as companies start to build their projects and take advantage of the subsidy.

The Alberta Carbon Capture Incentive Program, meanwhile, provides additional provincial grants to companies building carbon capture projects in Alberta.

In Carney and Smith’s memorandum of understanding, both the federal and Alberta governments committed to extending their respective incentive programs to support the Pathways project, which means a significant portion of the megaproject’s $16-billion price tag is likely to be publicly funded. That agreement also included a provision that tax credits for carbon capture extend to projects for enhanced oil recovery — which was previously excluded, as the Trudeau government responded to critics pointing out that extracting more oil results in more carbon emissions not just during production, but when the fossil fuel is eventually used by consumers.

Can carbon capture technology make a dent in climate change?

On its own? No.

Combined with other efforts, especially an overall reduction in fossil fuel use? It might help a little.

The United Nations Intergovernmental Panel on Climate Change has said the technology has the potential to decrease global emissions, but not by anywhere near as much as transitioning to renewable energy sources such as wind and solar. It’s also a more expensive mitigation strategy than moving to renewables.

According to the International Energy Agency, carbon capture, utilization and storage could achieve eight per cent of the emissions reductions needed to reach net-zero in the energy sector by 2050.

In Canada, the oil and gas sector accounted for 30 per cent of the country’s greenhouse gas emissions in 2023; reducing the sector’s emissions through carbon capture, utilization and storage would be a win.

But there’s a catch. That accounting only considers carbon emissions from the industrial processes that make oil and gas products — not the emissions associated with their use.

It’s important for an oil refinery to reduce its own emissions, but carbon capture projects don’t address the emissions produced by the car that eventually burns the fuel produced by that refinery. This is a big deal, because most of the carbon footprint associated with a barrel of oil — 70 to 80 per cent, according to one estimate — comes from the oil product’s end use. In Canada, the highest emitting industry after oil and gas is transportation.

That’s why carbon capture and storage isn’t a silver bullet in the fight against climate change. According to the World Resources Institute, the Intergovernmental Panel on Climate Change’s latest report makes clear there are “no scenarios in which [carbon capture, utilization and storage] would allow continued use of fossil fuels at current levels, let alone expanded oil and gas production.”

The Alberta government estimates the province has about 160 billion barrels of oil still available for extraction in the oilsands. The new pipeline — if it ever gets built — will drastically increase the amount of bitumen that can be shipped to international markets.

By that time, Canada’s billion-dollar investments into carbon capture, utilization and storage technologies might have helped clean up the industries that produce oil in Alberta. But they will have done nothing to address the bigger problem: the use of the oil products themselves.

— With files from Drew Anderson and Carl Meyer

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Since early October, the rural municipalities of Pipestone and Two Borders — agriculture and oil-dominant communities about three hours southwest of Winnipeg — have found themselves at the heart of a techno-futuristic buzz seemingly pulled from science fiction pages.

A Montreal-based, venture-capital-funded startup called Deep Sky has its sights set on the region as a “promising” location to build North America’s largest commercial carbon removal facility.

Digital renderings of the Deep Sky Manitoba facility show rows of high-tech machinery nestled in the idyllic, sun-kissed fields of the Manitoba countryside.

On this 145-acre site, the company’s promotional materials say, state-of-the-art technology will scrub carbon dioxide straight out of the atmosphere and bury it in a rock formation two kilometres underground, where it will remain for 1,000 years. 

This direct air carbon capture technology, according to Deep Sky’s website, will help “save our planet” and “reverse climate change” by sequestering decades worth of  pollution. 

As Deep Sky has begun promoting the project, residents of the Pipestone region have started coming together. More than 250 people attended a mid-November town hall organized by a local group called Grounded in Truth — The Deep Sky Awareness Committee; another 200 showed up at an open house hosted by the company in early December. 

At each meeting residents have come with questions about the project’s potential impacts on land, water, wildlife and property values. They’ve asked how the carbon can be stored safely, and who will be responsible if it leaks. They’ve wondered aloud how an industrial development of this scale will affect their rural way of life. 

After each meeting, residents say they’re left with more questions than answers.

“It does sound like a really promising, exciting technology; sort of the silver bullet that could save us from catastrophic climate change,” said James Wilt, policy development manager with Climate Action Team Manitoba, who presented at the November meeting. 

“But it’s just so unlikely to be that.”

Direct air carbon capture is an emerging technology that some climate experts expect will eventually play a role in net-zero pathways, but is considered a “wild card” given its extreme costs and energy demands. There are about two dozen facilities worldwide, which collectively capture about 0.01 megatonnes of carbon dioxide per year, equivalent to the annual emissions from about 1,300 homes. None are considered a full-scale example of direct air capture, and all have so far failed to capture as much carbon as initially projected.

But Deep Sky CEO Alex Petre believes the proposed Manitoba facility is different, and could help Canada emerge as a leader in carbon capture technology.  

“I think it’s a really exciting time for Canada right now. … I think we have the perfect mix of resources, workforce, geology, energy to be able to actually lead the way in developing this new technology,” Petre said in an interview.

“I’m very confident that with this, we can actually get the industry to a place where, to community members, to everyone else looking at it, we are actually maturing this new industry.”

As Deep Sky continues its quest to put Pipestone “on the map,” The Free Press and The Narwhal set out to understand exactly what the company is planning for southwestern Manitoba.

Who is Deep Sky and what are they proposing?

Deep Sky is a carbon capture tech startup based in Montreal and founded by Fred Lalonde and Joost Ouwerkerk — who co-created the travel app Hopper — and Laurence Tosi, a former executive at Airbnb. 

The company is planning to build a direct air carbon capture facility in southwestern Manitoba where it will scrub carbon dioxide from the air and inject it into a saline aquifer two kilometres below the surface for permanent storage. 

In its first phase, the project would capture 30,000 tonnes of carbon dioxide each year, with the eventual goal of storing one million tonnes annually.

The company plans to finance the project by selling carbon credits to companies looking to offset emissions.

The construction process, which Deep Sky anticipates will kick off in 2026, is projected to generate between 700 and 1,000 jobs; operating the rows of advanced carbon capture technology will create between 50 and 100 permanent jobs, and the project overall will generate $500 million in investment for the region, the company said.

Why southwestern Manitoba?

Deep Sky is looking at a couple locations in the Pipestone and Two Borders region. 

Unlike traditional carbon capture projects, the company said its facilities don’t need to be built near polluting industries, given its plan to pull carbon pollution directly out of the atmosphere. Instead, Deep Sky is looking for a site with the right geological conditions so it can capture and inject the carbon on the same plot of land.

In particular, Deep Sky is looking for an area with both “very deep, porous rock” that can hold billions of tonnes of carbon dioxide and enough thick, impermeable caprock to seal that carbon underground. 

Petre said Manitoba has “the right mix of natural advantages,” including geologic formations with “hundreds of gigatonnes of space to store [carbon dioxide],” a low-emission hydroelectric grid and a workforce familiar with energy, oil and gas projects. 

The company is currently “working with Manitoba Hydro to understand the availability of power … and analyzing different sub areas within Manitoba to understand which location would be ideal,” she said.

The project is expected to be located on Dakota territory, and the company has signed an agreement to explore investment and partnership opportunities with the Dakota Nations of Manitoba.

So how does it work? 

Carbon capture, utilization and storage technology has been in the works since the 1970s as a means of separating carbon dioxide from natural gas products, with the captured carbon dioxide used to improve oil recovery. 

In the decades that followed, as the world became more aware of climate change, companies began investing in the technology as a way to capture emissions. In its simplest form, it’s the process of separating carbon dioxide from the air, and either storing it underground or using it as feedstock for industrial processes like fertilizer production.

There are two ways to go about it. Carbon capture from a point source involves capturing, or “scrubbing,” emissions from an industrial waste stream (exhaust pipes or smokestacks, for example) where carbon dioxide concentrations are highest. The Canadian Climate Institute considers this technology a “safe bet” to help address emissions, and the process is already used widely by oil and gas producers and other heavy industries. 

Deep Sky’s proposal delves into the lesser-studied direct air capture, where carbon dioxide is scrubbed from the open atmosphere. 

The process involves using large fans to suck air through an absorptive material — like a sponge — that can separate the carbon dioxide and allow the rest of the air to pass through, effectively acting like a filter. These sponges are called sorbents or solvents, and can be either solid or liquid.

From there, the spongy material is heated or electrically charged to release carbon dioxide gas, which can be transported to an injection well. It is then deposited more than a kilometre below ground, typically in locations where the geology provides both porous space for the injected carbon and a crust of rock that can seal it. 

Deep Sky plans to build just one well — on the same land where it plans to capture carbon — to limit the amount of transportation involved.

Deep Sky has already built a facility in Innisfail, Alta., where it’s testing “various” direct air technologies and burying the captured carbon at an injection well north of Edmonton. It views the Alberta project, named Project Alpha, as a tech accelerator, where it can evaluate the efficacy of the emerging technology in harsh winter and hot summer conditions. Tech startups with names like Airhive, Skyrenu, Phlair and Skytree have installed (or plan to install) direct air capture machinery on Deep Sky’s five-acre plot. The most successful of these systems, Petre said, will be used at the Manitoba facility. 

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Does this technology actually work? What are the risks?

Pieces of this tech puzzle are already well understood, but that doesn’t mean it’s been feasible thus far. 

Of the roughly two dozen direct air capture facilities already operational worldwide, none have been able to achieve the emissions reductions targets they proposed, several have created more emissions than they’ve sequestered and others have shuttered as funds ran dry.

The limited results have not deterred governments and energy agencies from factoring this technology into long-term climate plans. In 2023, the Canada Energy Regulator projected the country will use direct air capture to remove between 46 and 55 megatonnes of carbon dioxide each year by 2050. Manitoba Hydro’s projections say the province will be able to capture 10 to 12 megatonnes each year in that time with direct air technology — approximately a third of Manitoba’s annual emissions.

Critics are less optimistic.

“There really is no example of this kind of project working at the scale that Deep Sky is proposing anywhere in the world,” Wilt said.

That’s in part because carbon capture is easier and cheaper at high carbon dioxide concentrations. At a chimney, carbon dioxide can represent between four and 30 per cent of the molecules in the air. But in the open atmosphere, carbon dioxide makes up just 0.04 per cent of the air — about 400 parts per million. 

Extracting carbon dioxide at these low concentrations is a much bigger technical challenge with much higher costs. The International Energy Agency projects that direct air capture could eventually cost between US$125 and $335 per tonne of carbon dioxide, while Deep Sky’s carbon capture projects currently cost about US$1,000 per tonne, according to research by the Climate Action Team. 

A big part of that cost is driven by energy use. 

Early load projections for Manitoba Hydro’s 2025 integrated resource plan predict direct air capture projects will consume about 20,000 gigawatt-hours annually by 2050 — approximately the same energy load needed to electrify transportation, space heating and industrial processes combined.

Deep Sky is not deterred by the uncertainties and costs. Petre said while the company is supportive of “a whole number of pathways” to reduce global emissions and reach net-zero targets, Deep Sky is “focused on cleaning up what’s already there.” 

While she understands the technology for direct air carbon capture is still emerging, “it’s not a science experiment anymore,” Petre said.

“We’ve proven the technology, we have a facility which is operational in Alberta, and we’re taking the best of that facility and trying to bring it to Manitoba.”

Petre believes the Deep Sky model, which does not create its own capture technology, but will evaluate a wide range of tech options and choose the most efficient and cost-effective to scale up, will help it succeed where others have faltered. 

When it comes to the required power, she said the first phase of the project will draw 15 megawatts at maximum capacity — roughly the power draw of 10,000 homes — and can be turned down when demand on the grid is highest. As the project grows, Petre said Deep Sky would look to build its own renewable energy infrastructure to meet additional demand.

In recent years, Manitoba Hydro has made no secret of the fact its current generating capacity will not be able to keep up with the pace of electrification, and more generation will be needed as early as 2029 to meet rising demand. 

“It’s certainly something we’re concerned about, that this huge load is going to be added and a lot of electricity is going to be used when it could be used to electrify transportation, buildings and industry,” Wilt said.

In an interview, Business, Mining, Trade and Economic Development Minister Jamie Moses said Manitoba’s progress toward its net-zero and affordable energy targets will rely on a host of initiatives, including electrifying key polluting sectors, building new generating capacity — and testing out new technologies.

“Part of that is making sure we support innovative projects like Deep Sky where they are taking direct air capture, reducing emissions and growing our economy at the same time,” Moses said. “It’s not, for us, an either-or question.”

Where is the money coming from?

The first phase of the project comes with an estimated $200-million price tag. 

According to Deep Sky, the company will not receive funds from the Manitoba government or any municipality, and will instead finance the facility “through its own means.” Moses confirmed the province will not provide any financial support for the proposal, either in funding or tax credits.

So far, the company said it has secured $130 million from a variety of investors, including major banks and venture capital funds. One of those funders is the Bill Gates–backed Breakthrough Energy Catalyst, which provided $40 million in support of Deep Sky’s Alberta facility. The company also received $25 million from Investissement Québec, a provincial Crown corporation, in 2023.

The company’s business model relies on selling what it calls “high-quality carbon credits” to major industries. Each credit represents one tonne of captured and stored carbon dioxide, and is often sold to companies looking to offset hard-to-abate emissions and reach net-zero targets. 

In November 2024, Deep Sky announced its first credit buyers, RBC and Microsoft, purchased a combined 10,000 tonnes of carbon dioxide removals over a 10-year period. 

In an interview with The Logic in November, former Deep Sky executive Phil De Luna — who left the company in July after two years as head of engineering and chief commercial and science officer — warned that the company lacked a reliable revenue stream, adding: “The only revenue-generating model [for direct air capture] is carbon credits, which are a tough sell in today’s environment.” 

Deep Sky will also look to benefit from federal investment tax credits, announced in 2021, which offer a credit of up to 60 per cent for investment in direct air carbon capture projects.

What’s Manitoba’s role?

While the province won’t provide funding for the project, it has signalled its support.

When the company announced in October it had decided to build its facility in Manitoba, its press release included words of encouragement from Moses.

“Manitoba is proud to be advancing a new frontier in industrial innovation — one that strengthens our position as a global leader in climate action,” Moses said.

“Deep Sky’s selection of Manitoba for one of its first commercial carbon removal and storage facilities highlights our province’s commitment to cutting-edge technologies like direct air capture.”

In an interview with CBC, Premier Wab Kinew called the project “a real win for the economy,” and noted the province would change its regulations to help Deep Sky qualify for federal tax credits. 

Manitoba passed the Captured Carbon Storage Act in May 2024, outlining the province’s legal ownership of underground pore space and setting guidelines for companies looking to inject carbon below the surface. 

In a legislative session, Moses explained the bill had been under development since 2023, when the Progressive Conservatives were in power, and had involved consultation with major Manitoba businesses including fertilizer company Koch Industries, Tundra Oil & Gas, New Flyer Industries and Canadian Kraft Paper. 

Manitoba is currently in the process of developing regulations to accompany the law, which will provide further detail about corporations’ responsibilities when capturing and storing carbon. 

Documents obtained through freedom of information requests show Deep Sky has lobbied the province to draft regulations that limit corporate liability and consultation. 

In a letter dated Jan. 17, 2025, Jason Vanderheyden, Deep Sky’s vice-president of policy and government affairs, asked Moses to consider rules that pass liability for the storage sites to the province after projects close, limit the companies’ responsibility to consult with — and compensate — potentially affected landowners and allow carbon to be stored below protected areas. 

The letter suggests these “refinements” to the legislation would be necessary to “ensure its viability and appeal for investments.” 

Petre said the suggested regulations would bring Manitoba’s carbon storage laws in line with those in Alberta, which the company considers a gold standard.

In a response to the company, the province said it would review best practices from other jurisdictions and continue consulting with stakeholders, Deep Sky included. In an interview, Moses said the regulations are likely to be completed in spring 2026.

What’s next?

Nothing about Deep Sky’s southern Manitoba facility is set in stone just yet. 

The company is finalizing an environment act proposal, Petre said, which will need to pass through the province’s environmental approvals branch before a licence is issued. The company will also need to decide where it plans to build, buy land, secure hydroelectric resources and conduct a lot more consultation with local community members — something Petre said Deep Sky is eager to do. 

The company has set a target to break ground in late 2026.

Julia-Simone Rutgers is a reporter covering environmental issues in Manitoba. Her position is part of a partnership between The Narwhal and the Winnipeg Free Press.

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They come from driving a car or taking the bus to the office. Or when employees are given a company-owned smartphone. They can even result from a three-course dinner at a holiday gala — or that box of doughnuts at a meeting. And for companies that extract fossil fuels, they also come when customers use their products.

All are examples of the creation of Scope 3 emissions: greenhouse gases that are indirectly produced by a corporation or institution’s supply chain and everyday operations. 

Employees’ commutes use fuel in the form of gas or electricity. Every step of manufacturing the electronics used at work — from design to mining to parts fabrication and product assembly — creates emissions. Greenhouse gases are also created when the food and drink at company events is procured, transported and prepared. They’re also produced when Canadian oil and gas is used as fuel, whether in this country or another one. 

These emissions will still get into the atmosphere and heat the planet even if oil and gas producers succeed in their ambitious plans to capture and bury the emissions they create when extracting fossil fuels. Yet attempts to get Canadian companies to report them — even voluntarily — keep getting delayed. 

The term “Scope 3 emissions” is technical and bureaucratic. But these emissions, like all greenhouse gases, have real, on-the-ground consequences. The heat-trapping effect of fossil fuel use is driving extreme weather events in Canada and around the world, putting humans, wildlife and ecosystems at risk.

Here’s how to understand these arm’s-length emissions, and why scientists think it’s important to keep track of them, no matter how far away they are. 

What exactly are Scope 3 emissions?

The goal of the Scope scale is to categorize emissions to help understand where they come from and how to reduce them. Scope 1 are direct emissions, which come from sources owned or controlled by a company and include what’s produced by its facilities and vehicles. Scope 2 are indirect emissions produced by generating the many forms of energy — electricity, steam, heating and cooling — households and businesses use day-to-day.

Scope 3 are the least immediate. They encompass both “upstream” emissions made when a company uses a product or service and “downstream” emissions made when its own products or services are used. 

Sara Hastings-Simon, an associate professor in the department of earth, energy and environment at the University of Calgary, said labelling and, hopefully, tracking these emissions is a way to hold companies responsible for emissions created by the goods and services they are producing and encouraging people to purchase and use. Coined in 2001 and formalized in 2011, the term “Scope 3 emissions” considers the ripple effects of a company’s activities on global emissions. 

“Companies have a role, often, in creating the demand for their product,” Hastings-Simon said, which is why she believes they should be held accountable for emissions made all along its supply and use chain. 

Scope 3 are not some intangible drop in the pond of global emissions. They are frequently the “largest source” of emissions for companies and represents the “most significant” opportunity to reduce greenhouse gas globally, according to the Greenhouse Gas Protocol, a Washington, D.C.–based organization that creates global standards to measure emissions. Think about the Alberta oilsands: yes, mining and upgrading bitumen creates emissions. But the burning of the products — say, in consumers’ cars — creates far more of an impact. 

Scope 3 emissions aren’t just a big deal for the oil and gas industry. The Climate Disclosure Project, a non-profit based in the U.K., estimates that more than 90 per cent of emissions from sectors including real estate, financial services, capital goods and mining can be classified as Scope 3.

Canadians in favour of Scope 3 reporting have argued the same. In 2022, the federal NDP stated Scope 3 represent “an overwhelming majority” of Canada’s greenhouse gas emissions, in a report from the Standing Committee on Natural Resources looking at Canada’s long-debated emissions cap. 

In the report, the NDP said that in 2019, emissions from fossil fuels exported by Canada were 954 million tonnes, while total domestic emissions were just 730 million tonnes.“To leave them out of any regulation under a cap would be irresponsible,” the party stated.

What are the criticisms of tracking Scope 3 emissions? 

Some fossil fuel companies have said making them responsible for Scope 3 emissions could lead to actions that are actually contrary to climate goals.

Companies like ExxonMobil, Shell and BP do disclose Scope 3 emissions across their operations worldwide. For example, Shell reported customer emissions from using Shell products in 2024 totaled nearly half a billion tonnes of Scope 3 emissions. 

But a February 2022 report by environmental academics in Japan noted that ExxonMobil argued that reporting Scope 3 could be “misleading.” The paper cited a 2021 ExxonMobil report in which the company argues that if it were to sell natural gas to a country that then reduced the use of coal, it “would result in an overall reduction of global emissions but would increase Scope 3 emissions reported by the Company.”

Others have argued that tracking Scope 3 is “double counting”: because Scope 3 emissions involve so many businesses and producers in a supply chain, they may each be claiming the same emissions. It’s a potential overlap critics say could lead to a distorted view of emissions reductions. The argument is that a manufacturer might track the transportation of its goods as Scope 1 emissions — but all of the retailers and distributors who receive those goods could track them as Scope 3.

Several academic studies and frameworks note ways to make a precise calculation that avoids double counting. 

And Steven Young, an industrial ecologist and associate professor at the University of Waterloo, said calculating Scope 3 isn’t about tracking the total amount of emissions — it’s about companies taking responsibility for the entire supply chain they’re part of creating. 

“Part of the ambition was, well, it’s sort of double counting who’s responsible, but that’s kind of a good thing, if more than one organization is looking out for emissions reductions and management,” he said. 

Hastings-Simon said Scope 3 emissions calculations become essential if a company is claiming to be a part of a “low-carbon solution.” This gets back to the ambitious plans for carbon capture in Canada’s oilsands: even if all the emissions created during production were kept out of the atmosphere, exported fossil fuels would still create greenhouse gases when used elsewhere. 

“If there isn’t a credible explanation for how Scope 3 emissions will be reduced … then from a risk perspective a company should be able to explain why they see a market for their products in a future if there are broad global commitments to move to a net-zero future,” she said. 

The non-profits InfluenceMap and Greenpeace have criticized the Pathways Alliance group of Canadian oilsands companies for not including Scope 3 emissions in public plans to reduce the effect of their emissions, including through carbon capture. Pathways Alliance did not respond to a list of questions from The Narwhal about its Scope 3 emissions or these criticisms. 

Oil and gas companies “aren’t just meeting a demand but actually creating more demand and thus can be considered responsible for some of these emissions,” Hastings-Simon said, pointing to the explosive growth of investment in petrochemical-based plastic production as one example. 

Those in favour of Scope 3 reporting also say it’s key to identifying western corporations that place the most environmentally damaging parts of their supply chains in the Global South. Shifting the burden of those emissions onto those nations while the west seemingly meets climate targets, is a practice scholars call “Carbon Colonialism.”

At the heart of creating — and regulating — these standards is the understanding that global carbon emissions must be drastically cut to avoid the most severe effects of climate change. 

To be specific, the Greenhouse Gas Protocol reports the world needs to reduce emissions by as much as 85 per cent below what we put out in 2000 by 2050 in order to prevent the global temperature from increasing beyond 2 C above pre-industrial levels. Above that level “will produce increasingly unpredictable and dangerous impacts for people and ecosystems” — and Canada is already experiencing an increase in extreme weather that Environment and Climate Change Canada has linked to climate change. 

Are Scope 3 emissions regulated in Canada?

Fun fact: right now, there’s no universal requirement for Canadian corporations to disclose the full range of their emissions. 

Some industries are subject to a patchwork system of disclosure regulations, particularly concerning Scope 1. Since 2004, the federal government has required facilities that produce 10,000 tonnes or more of greenhouse gases annually to report emissions every year. Many provinces have similar regulations that kick in around 10,000 tonnes — although in Manitoba, the threshold is 50,000 tonnes. 

Attempts to introduce Scope 3 reporting — even voluntarily — have been delayed.

Last year, the Canadian Sustainability Standards Board gave corporations a deadline of 2027 to start reporting voluntarily — a timeline it said would prevent the move having an overly negative effect on markets. 

As of 2024, the federal Office of the Superintendent of Financial Institutions started requiring banks and insurance companies to report on plans to address the impact of climate change on their operations. The office has said the rationale behind the move is to protect those industries from legal accusations that they failed to protect investors from risks associated with climate change, such as the cost of extreme weather damages. 

Technically, those regulations make Scope 3 reporting mandatory — but that requirement, too, has been delayed, until 2028. The office said it wanted to align with the Canadian Sustainability Standards Board’s choice to push back Scope 3 reporting policies. It kept Scope 1 and Scope 2 disclosure deadlines in place: depending on the size of the institution, those kick in this year and early next. 

And in April, the Canadian Securities Administrators also delayed its December 2024 pledge to develop “a climate-related disclosure rule.” The group, an umbrella organization of provincial and territorial securities regulators, said in a press release it was pausing plans to figure out disclosure rules for both climate risks and employee diversity, as “in recent months, the global economic and geopolitical landscape has rapidly and significantly changed.”

Climate experts say movement on the issue is too sluggish given the urgency of global warming. Especially since the standards will be voluntary anyway. 

Hastings-Simon said delays on Scope 3 reporting raise a lot of “red flags,” as Scope 3 is a long-established concept corporations should be prepared for. She’s concerned a longer timeline gives companies time to push back against climate regulation altogether.

“Why is there this need for delay?” she said, emphasizing the importance of the government and its agencies having the full picture of Canada’s emissions. If investors or the public want to understand if a company is prioritizing decarbonization, it’s impossible to get the full picture without a Scope 3 disclosure, she said.

How can we reduce Scope 3 emissions?

The Greenhouse Gas Protocol has suggestions on how companies can start tackling Scope 3 emissions. These include reducing the distance between the supplier and the consumer and reducing commutes by offering remote work.

John Robinson, a professor of global affairs and the environment at the University of Toronto, has been leading a team examining how the school can cut its Scope 3 footprint. He said there are essentially two options: either reduce the activity producing the emissions or switch to an alternative activity that results in fewer greenhouse gases. 

He said the first option is under an institution’s direct control. For example, The University of Toronto is trying to make its campus more pedestrian-friendly, so that staff and students can move around emissions-free. 

It’s harder to control the emissions coming from manufacturing and shipping of goods and services it doesn’t produce. 

“Since the activity … can’t always be eliminated or reduced, there is a lot of focus on finding lower-emissions alternatives,” Robinson said.

The tool then is lifecycle assessment, he said. The process aims to calculate the total amount of emissions produced by the goods and services that went into creating an item, allowing institutions to make informed decisions about alternatives. If the school were purchasing desks, for example, it could consider multiple desks from multiple suppliers, comparing how much wood each uses, along with what kind of wood it is and where it came from. Then it could choose the option with the lowest emissions. 

Several consulting firms have software that can help with this calculation, Robinson said. And his own students can do it — as long as they have the information. 

What is the Carney government doing about Scope 3 emissions?

In short, not much. 

Even when the Canadian Sustainability Standards Board’s list comes into play, it will be voluntary. “It doesn’t have much teeth. You can put the information out there and some decision-makers will act on it, but it’s a pretty weak tool,” Young said. 

He said what’s proven to be more effective is carbon pricing — being charged for making emissions as an incentive to reduce them. But one of the first things Mark Carney did after becoming prime minister was remove Canada’s consumer carbon tax. While there is still a price for large emitters, Young said that misses smaller actors in the supply chain.

Meanwhile, Carney has repeatedly said Canada should be a leader in carbon capture and storage, which involves containing the carbon dioxide at the point of emission and then burying it deep underground. 

It’s a technology that has yet to be done at scale and it won’t tackle Scope 3 emissions at all. It’s also expensive. 

Young said carbon capture is a “pacifier” for the oil industry. “It’s a delay tactic, and it won’t work,” he said. “Why would we waste billions trying to come up with a techno fix that only prolongs a bunch of industries that don’t want to change?” 

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Around the world, governments, researchers and companies are scrambling to reduce the sheer volume of carbon pollution created by modern life. Among the ideas gaining traction in Canada is carbon capture — collecting carbon dioxide before it is sent up into the atmosphere. 

The Pathways Alliance group of oil giants want to do just that, collecting carbon pollution from the Alberta oilsands and shipping it approximately 400 kilometres by pipeline to an underground storage site just outside St. Paul, Alta., where it will be injected deep underground — forever.

Though the plan is anything but final, Pathways, whose six members control 95 per cent of oilsands production, did put in its first application for regulatory approval earlier this year and has said it has invested heavily in its plans. 

But the proposal doesn’t sit well with everyone along the pipeline route and the Alberta Energy Regulator recently confirmed the province will not be requiring the project undergo an environmental assessment.

Here’s what you need to know about some very tangible risks Albertans on the ground are talking about as a carbon pipeline might move in next door.

1. How likely is an explosion — and who would respond in an emergency?

Carbon dioxide pipelines are not new — they crisscross North America (mostly for use in extracting more oil from the ground, rather than permanent storage).

Any major project comes with risks. In 2020, a carbon dioxide pipeline ruptured in Mississippi, showing just how serious those risks can be. Within minutes, there were reports of people having seizures or falling unconscious. At least 45 people were hospitalized. The county’s emergency director likened it to “the zombie apocalypse.”

According to the Intergovernmental Panel on Climate Change, “there is no indication that problems for carbon dioxide pipelines are any more challenging than those set by hydrocarbon pipelines.” That said, they may be more subject to what are known as “longitudinal running fractures” — a rapid and catastrophic unzipping, or splitting, of a pipeline — than other gas pipelines.

This leads to many questions for Albertans near the proposed Pathways Alliance carbon pipeline route, including about emergency response vehicles, which have oxygen-dependent engines that can fail if carbon dioxide leaks.

A spokesperson for the Alberta Energy Regulator, which is responsible for evaluating the Pathways Alliance application, said by email that any carbon dioxide pipeline licensed by the regulator is required to have a corporate emergency response plan.

2. How might a leak affect the groundwater?

Albertans alongside the proposed path of the carbon pollution pipeline worry about how a potential leak could impact groundwater, citing similar concerns across the globe.

In Australia, the Queensland government announced it would prevent the storage of carbon pollution under a 1.7-million-square-kilometre area of the state. An environmental assessment found carbon storage would “likely cause an irreversible or long-term change in water quality” if carbon pollution were to migrate through the region’s aquifer, spreading contaminants such as lead and arsenic.

The Alberta Energy Regulator said ensuring carbon dioxide doesn’t migrate into groundwater is a “critical focus area” and that it requires companies “to review the area geology to ensure a high level of confidence.”

3. Will Treaty Rights be impacted?

Several First Nations in the region, including Heart Lake First Nation, Beaver Lake Cree Nation, Whitefish Lake First Nation, Kehewin Cree Nation, Frog Lake First Nation, Cold Lake First Nations and Onion Lake Cree Nation, have been asking questions about the project. Some have expressed concern about their abilities to exercise their Treaty Rights.

“We don’t know how pumping carbon underground will affect our lakes, our rivers — even our underground reservoirs,” Michael Lameman, a councillor at Beaver Lake Cree Nation, told CBC earlier this year. 

Pathways Alliance has not provided enough information about specifics, according to Moronkeji (Kg) Banjoko, who works in the Athabasca Chipewyan First Nation’s Department of Dene Lands and Resource Management. 

“There is no information about what the project will do — as a whole and cumulatively with other industrial development in the area — to the environment, local communities and [Athabasca Chipewyan First Nation’s] Treaty Rights,” Banjoko wrote in an email.

4. Does underground storage of carbon pollution actually work?

Nearly 50,000 megatonnes of carbon pollution are emitted globally each year. The Pathways Alliance plan for the $16-billion project aims to bury 10 to 12 megatonnes of carbon dioxide deep underground each year — roughly equivalent to the carbon pollution emitted by the oilsands every six weeks.

Pathways says it wants to “produce some of the cleanest barrels of oil in the world” and that carbon capture is “safe, proven and reliable.”

But experts like David Schlissel at the U.S.-based Institute for Energy Economics and Financial Analysis are concerned carbon capture is more “hype” than evidence.

“There’s no evidence that it will capture 90 to 95 per cent of the carbon dioxide it’s designed to capture,” Schlissel says, referring to an oft-cited industry standard for carbon capture rates — a baseline target that acknowledges the amount of carbon pollution that needs to be be captured to be worth the investment. Schlissel notes data shows real-world carbon capture rates range from 10 to 78 per cent. 

Others say the technology is an attempt at gaining “social licence” for continued production of fossil fuels — the U. S. House of Representatives’ central investigative committee is one such critic, saying the promise of a tech fix relieves pressure to pivot to energy sources that produce less carbon pollution. 

5. Is Pathways Alliance doing enough to inform and listen to affected communities?

“They were in Dubai, they were in Calgary and Texas and they’re all over the world,” one Alberta landowner says of the places Pathways Alliance representatives have publicly extolled the virtues of their carbon capture plan. But, she says, “They’ve spent about three hours here.”

Some residents along the proposed pipeline route feel shut out of the process, noting that landowners whose properties are directly affected might have a say, but the rest of the community does not. 

More than anything, they say, they want Pathways Alliance to answer their questions about the risks. (Pathways Alliance did not respond to multiple requests for an interview, nor a detailed list of questions about the project.)

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The massive $16-billion carbon capture plan proposed by Pathways Alliance — a group of the largest oilsands companies — will not undergo a provincial environmental assessment, according to a letter from the Alberta Energy Regulator dated Oct. 25 and provided to The Narwhal.

Pathways filed its first regulatory application for the project, which will include a 400-kilometre carbon dioxide pipeline, to the Alberta Energy Regulator in March.

In May, a group of landowners, a First Nation and environmental groups requested an environmental assessment. The project aims to bury 10 to 12 megatonnes of carbon dioxide deep underground each year, roughly equivalent to the carbon pollution emitted by the oilsands every six weeks.

The group, which includes Athabasca Chipewyan First Nation, the Alberta Wilderness Association, Climate Action Network Canada, Environmental Defence Canada and the No to CO2 landowners’ group, requested an assessment to “ensure that the project does not have significant adverse impacts on the regional environment and local communities, including on Aboriginal and Treaty Rights.”

A letter from the regulator to the group, dated Oct. 25, says the agency considered details about the proposed activity such as its location, size and complexity, and other public concerns that have been expressed, and decided “that further assessment of the activity is not required.”

“Therefore, a screening report will not be prepared, and an environmental impact assessment report is not required,” the letter reads.

The Alberta Energy Regulator confirmed an environmental assessment for the Pathways Alliance project would not be required in an email to The Narwhal on Wednesday.

A spokesperson added the regulator’s decision was “based on the current information about the project,” adding it “reserves the right to review this decision should different or new information become available.”

The spokesperson also noted the environmental impacts of the project will be considered under the regular application and approval process, adding that carbon capture projects involve multiple separate applications, which they said “allows focused insight into the details of a project and increases regulatory oversight by reviewing the details of each activity.”

The regulator, the spokesperson added, “is required to consider the social and economic effects of the energy resource activity as well as the effects of the energy resource activity on the environment” during the approval process.

In response to previous questions from The Narwhal, a spokesperson for the Alberta Energy Regulator noted the project does not automatically trigger a provincial environmental assessment. Regulations under Alberta’s Environmental Protection and Enhancement Act, first put into force in 1993, make no mention of carbon capture technology.

Under those regulations, other major projects, like an oilsands mine, refinery or a large hydro dam, would automatically undergo an environment assessment. In the absence of an assessment, the spokesperson said the risks associated with the project would be evaluated under the standard application process.

Local residents told The Narwhal they are concerned groundwater is at risk and that an explosion or a leak could mean asphyxiation caused by odourless, invisible carbon dioxide. Some First Nations have also voiced concern about implications for Treaty Rights, including the ability to hunt, trap and fish.

“The communities that would bear all of the risks from the project deserve to have real answers about the dangers posed to their families,” Julia Levin, the associate director of national climate at Environmental Defence, said in a statement on Wednesday. The statement was sent by the organizations that requested the environmental assessment in May, and offered their reaction to the regulator’s decision.

“There’s a reason the [Alberta Energy Regulator] doesn’t want to put the Pathways project through an environmental assessment. It is because it will expose the environmental impacts, the poor economic viability and the risks to human health,” Chief Allan Adam of Athabasca Chipewyan First Nation said in the statement.

“With our Treaty Rights on the line you can guarantee that [Athabasca Chipewyan First Nation] will fight this tooth and nail,” he added.

Spokespeople for Pathways Alliance and Alberta Environment and Parks did not not respond to questions from The Narwhal by publication time.

Pathways Alliance lobbied to get out of a federal environmental assessment

The Pathways project would be one of the largest carbon capture schemes in the world.

Quest, a carbon capture and storage project by Shell Canada near Edmonton, was required to undergo a joint federal-provincial environmental assessment in 2010, something Athabasca Chipewyan First Nation and environmental groups pointed out in their request to have the Pathways project assessed.

According to the Alberta government, environmental assessments are required “where the complexity and scale of a proposed project, technology, resource allocation or siting considerations create uncertainty about the exact nature of environmental effects, or result in a potential for significant adverse environmental effects” and help to “determine if the project is in the public interest.”

It’s unclear if the project will undergo a separate federal environmental assessment — sometimes carried out in conjunction with the provincial process — if officials determine the project has the potential for significant impacts within federal jurisdiction, including fish, migratory birds, species at risk and Indigenous Rights.

“An environmental assessment is an excellent way to test whether the Pathways claims are actually true — not just about its ability to reduce emissions and help address climate change, but to do so safely and cost-effectively, particularly given all the taxpayer money they want to spend,” Matt Hulse, a lawyer at Ecojustice, said in the statement on Wednesday. “With Alberta unwilling to assess this project, we hope that the federal government will step up.”

In January 2023, Pathways Alliance president Kendall Dilling told the federal government the group needed an “assurance” that its proposal “would not require a federal review under the Impact Assessment Act.”

A few weeks later, staff at the Impact Assessment Agency of Canada, the government agency responsible for federal environmental assessments, were assigned to a working group with oil and gas industry officials, including at least one representative from the Alberta government — a deputy minister.

Environment and Climate Change Minister Steven Guilbeault told The Narwhal in April he did not grant Pathways’ wish to skip a federal review — and that doing so “would circumvent our laws.”

Guilbeault also told The Narwhal in April “there’s no project to speak of right now.”

It’s also unclear if Pathways gave any additional details to government officials about their plans in the period after Guilbeault made those comments.

Jaclyn Sauvé, communications advisor for the Impact Assessment Agency of Canada, said in an email that Pathways Alliance would be responsible for verifying whether its proposal would be subject to federal assessment, noting the agency “has not received any information to indicate this proposal includes any designated physical activities that would make it subject to the [Impact Assessment Act].”

Sauvé added Pathways “is encouraged to contact [the Impact Assessment Agency of Canada] so that we can assist in verifying [its] interpretation.” This portion of the statement was nearly identical to a statement sent by the agency in May. Guilbeault’s office said the minister didn’t have any further comment beyond the statement provided by the agency.

Whatever extra information has been offered to provincial or federal government officials, the public has been unable to see it. Over the summer, Pathways scrubbed its website and social media feeds of much of the information it had provided about its project proposal, citing new federal provisions meant to crack down on greenwashing.

Meanwhile, some aspects of the government’s discussions with oilsands companies behind closed doors are possibly being shrouded in secrecy after federal officials agreed to a non-disclosure agreement.

Federal Conservatives plan to replace assessment law with process that ‘green-lights’ carbon capture projects

The outcome of the next federal election, which will occur within the next year, could eventually change how environmental assessments at that level are carried out.

The Conservative Party of Canada, currently the official Opposition, plans, if elected, to replace the federal government’s “anti-resource bureaucracy” with an approval process that would “green-light” carbon capture and storage projects, as well as fossil fuel projects that produce liquefied natural gas, or LNG, according to deputy leader Melissa Lantsman.

Conservative Leader Pierre Poilievere has made it clear that means he would repeal the federal environmental assessment law, previously known as Bill C-69, which he’s called an “anti-development law.”

Canada Growth Fund appears poised to support the project

Pathways Alliance has been lobbying the federal government for more legal, regulatory and financial support since soon after the group was formed in 2021.

The project would benefit from a federal investment tax credit for carbon capture and storage, but Pathways has said that isn’t enough and it needs more help.

The group has been negotiating with a federal financial agency, the Canada Growth Fund, for additional support. This week, the Globe and Mail reported the fund and the oilsands group are nearing a deal.

Some of the oilsands companies in Pathways are among the largest corporations in Canada, reporting billions of dollars in profits in recent years.

Updated Oct. 30, 2024, at 4:43 p.m. MT: This story was updated to include comment from the Alberta Energy Regulator.

Updated Oct. 31, 2024: This story was updated at 11:55 a.m. MT to include comment from the Impact Assessment Agency of Canada and again at 1:16 p.m. MT to include a statement from the groups that requested the environmental assessment.

The Narwhal’s reporters are telling environment stories you won’t read about anywhere else. Stay in the loop by signing up for our free weekly dose of independent journalism.

The town of St. Paul, Alta., is the kind of place where you can buy a basket of homemade preserves and local beef jerky from the Chamber of Commerce on Main Street. It’s a farming community at heart, surrounded by fields and gently rolling hills. It’s not huge, just under 6,000 people, and the biggest tourist attraction is the world’s first UFO landing pad, which attracts “an average of 20 people per day,” according to the local newspaper.

“It’s not the centre of the universe,” Amil Shapka says with a smile. He’s a retired dentist who describes himself as being “born here, raised here, went to school here, left for the big city, hated it, came back and lived happily ever after.” 

Shapka lives not far from town down a gravel road. It’s “me and the bears and the squirrels,” he says. “Being Ukrainian, there’s a bit of the thousands of generations of farmers in me. Our connection — my connection — to the land is part of my well being.”

But against this backdrop, change is afloat. 

If everything goes according to plan, the town will soon be part of one of the world’s largest carbon capture and storage networks. A $16.5-billion megaproject — much of which could be taxpayer money — is in the works from Pathways Alliance, a group of the six largest oilsands companies. Advocates say carbon capture is a high-tech antidote to the global climate crisis and a solution to reduce heat-trapping emissions created by producing and burning fossil fuels. Critics say it is untested, expensive and not feasible at scale. 

Here in northeastern Alberta, Pathways Alliance seeks a proving ground.

The consortium is planning to build a 400-kilometre pipeline as wide as 36 inches (a little under a metre) to carry carbon pollution from the oilsands. Liquid carbon dioxide will be buried deep under the Earth’s surface, injected into the sandstone that lies more than a kilometre underground. Huge swaths of the province — thousands of square kilometres — are part of what are called evaluation agreements — contracts with the Alberta government that grant a company the right to conduct testing, including drilling wells and injecting substances deep underground, to find good places to store carbon pollution. 

Canadian Natural Resources Limited, a Pathways member, has an evaluation agreement that blankets St. Paul and the surrounding region. Pathways Alliance filed an application for the pipeline to the Alberta Energy Regulator in March — the first step in the approval process.

This worries some local residents, who are concerned groundwater is at risk and that an explosion or a leak could mean asphyxiation caused by odourless, invisible carbon dioxide. They wonder who will respond in the event of an emergency — will it be the local volunteer fire department? Will leaking carbon dioxide interfere with the oxygen-dependent engines of emergency vehicles? Some First Nations are concerned about implications for Treaty Rights and the ability to hunt, trap or fish. Athabasca Chipewyan Chief Allan Adam has asked the provincial regulator to require an environmental assessment of the project “to ensure the rights of [Athabasca Chipewyan First Nation] are protected.”

For others, a new pipeline is good news for the economy and could bring good jobs to the region. Will the project pit neighbour against neighbour? And, crucially, many wonder, will it even work?

“This isn’t really even proven technology. They’re going to roll the dice using billions of public dollars and potentially put our future, property values and access to water at risk,” Shapka says. “Does this serve the public interest?”

In an Alberta community familiar with oil and gas, carbon capture is ‘something totally different’

Penny Fox grew up in Ontario, married a “farm boy” and moved to Alberta in 1987. “If we were millionaires, we’d be farming,” she says with a laugh. As it is, they both have other careers — her in small business development, him in government — and live on a small farm just south of St. Paul where in their free time they sell hay, work in the vegetable garden and add to their sizeable collection of firewood. 

Fox has lived in various parts of Alberta and is familiar with the impacts of oil and gas development. After all, the province already has more than 400,000 kilometres of pipelines criss-crossing under the surface. “We all depend on it,” she says, acknowledging the economic impact of the industry in Alberta and across Canada.

But when she heard a carbon dioxide pipeline was planned across the road from her house, she had a lot of questions. This, she says, doesn’t feel the same as an oil or natural gas pipeline. Although those also come with risks, they have what she views as a reasonable framework for regulation.

“This is something totally different,” Fox says. She’s a member of a grassroots group that formed, as “farmer called farmer, neighbour called neighbour” when representatives of the project — called land agents — started knocking on doors in the region. 

It started with Shapka, who sprung into action when he heard about the land agent seeking access to a neighbour’s property in exchange for a cheque. He rented the local community hall and started making phone calls. 

Fox, Shapka and other community members call themselves the “No to CO2” group. Part of their mission, Fox says, is to get access to the project details — information is scarce, especially since Pathways Alliance scrubbed its website in response to new federal greenwashing regulations — and to understand the risks of the project to the people who live nearby. The alliance did not respond to The Narwhal’s multiple requests for an interview, nor to a list of detailed questions about the project.

“What we were trying to do is not tell people what to do, but give them enough information for them to understand what it means,” Fox says. “We need to ask questions so that we can clearly understand what this is.”

“What happens if the North Saskatchewan gets polluted?” she asks, referring to the major river that flows just north of the community and on to Saskatchewan. “How many communities — how many people — rely on that for a water source? Because, I mean, it’s not just Alberta. It’s not just an Alberta problem.” 

“They should be able to answer those questions.”

Carbon plan could create 15,000 jobs during construction: Pathways Alliance

Some people in St. Paul are excited about the potential benefits of the project — they see it as a major investment in Alberta’s future. Bernie Poitras is one of them. He was a rodeo announcer who worked in the oilpatch before he became the District 12 commander of the Otipemisiwak Métis Government, formerly the Metis Nation of Alberta, last fall. 

Poitras’ family has been in the area ever since his great-grandfather came to Alberta in 1874 from Manitoba. He still finds time to be an announcer at local hockey games, but much of Poitras’ time is now taken up with politics — and that means talking about the carbon pipeline Pathways wants to build through the region. “It is very complicated,” he says over coffee at the local A&W.

“It’s going to employ a lot, a lot, of people,” Poitras says. Many in the community look forward to either joining construction crews themselves, or earning the money the workers spend on restaurants, hotels and other services. 

In a briefing report submitted to a House Committee focused on the environment, Pathways said its project would create “15,000 to 20,000 high-paying jobs during construction, with approximately 1,000 permanent jobs post-construction,” adding it would “stimulate the provincial and national economy.”

Not only that: some see it as an opportunity to be part of a solution to global warming. International organizations like the Intergovernmental Panel on Climate Change and the International Energy Agency say carbon storage is part of a viable path to net-zero emissions — and needs to be expanded rapidly to have an impact. 

Poitras was recently at the Lloydminster Heavy Oil Show, where Pathways Alliance sponsored a fireside chat. There, after talking to people in the industry, he was reassured about the technology. “I don’t really think it’s gonna affect the groundwater,” he says. “It’s not an oil line, it’s a carbon capture line, and it’s going deep underground.”

From groundwater to asphyxiation, northeastern Alberta residents weigh risks 

Not everyone is so sure. Fox, Shapka and others are concerned about myriad other potential risks. Sure, the worst might not happen. But, they wonder, what happens if it does?

When carbon pollution is injected deep underground there are two options: one, it can be used for what’s known as “enhanced oil recovery” — in essence, injecting carbon dioxide into a well so you can get at more oil. A 2022 report found nearly three-quarters of captured carbon pollution around the world is used to extract more oil which, as critics point out, leads to more profit and more carbon pollution. There are more than 8,000 kilometres of carbon dioxide pipelines in the United States, “virtually all” of which are used for enhanced oil recovery, according to the U.S. Congressional Budget Office, which says of 15 carbon capture storage projects in the country as of December 2023, 13 are for enhanced oil recovery.

The second option is for carbon pollution to be “permanently stored” deep underground.

“This is waste disposal,” Shapka says. “This is an industrial byproduct and calling it storage, I think, minimizes what it really is. That stuff’s going to be pumped down there in perpetuity.”

That raises questions, among which concerns for groundwater are prominent. “Water is number one,” Shapka says. 

He’s not alone in his concerns. In Australia, the Queensland government recently announced it would prevent the storage of carbon pollution under a 1,700,000-square-kilometre area of the state. Farmers had pushed for the ban, noting an environmental assessment found carbon storage would “likely cause an irreversible or long-term change in water quality” if carbon pollution were to migrate through the region’s aquifer, spreading contaminants such as lead and arsenic.

The Alberta Energy Regulator, which is responsible for evaluating the Pathways Alliance application, said ensuring carbon dioxide doesn’t migrate into groundwater is a “critical focus area” and that it requires companies “to review the area geology to ensure a high level of confidence” to ensure that. It also requires a hazard and risk assessment be conducted and that all risks are “fully mitigated” before the project will be approved. 

“All carbon dioxide storage projects require a monitoring, measurement and verification plan, to outline how the company will ensure the pollution stays put, and what “remedial actions [will] be taken if anything does go wrong.”

But the possibility something will go wrong remains, which is why several groups are asking for an environmental assessment. In response to emailed questions from The Narwhal, a spokesperson for the Alberta Energy Regulator noted the project does not automatically trigger a provincial environmental assessment (like, say, an oilsands mine or a large hydro dam). If the regulator decides an assessment is not needed, the spokesperson said, the risks associated with the project will be evaluated under the standard application process. 

The spokesperson for the regulator said leaks of carbon dioxide from a pipeline “may briefly” turn surface water into ice “but it would not impact groundwater.” According to the regulator, carbon dioxide doesn’t present risks for groundwater when it’s in a pipeline and the risks exist only when it’s buried deep underground.

A Pathways Alliance land agent told Fox there would be test wells around injection sites — the spots where carbon pollution is buried — to check for leaks or changes to the water, but that doesn’t reassure everyone.

Several First Nations in the region, including Heart Lake First Nation, Beaver Lake Cree Nation, Whitefish Lake First Nation, Kehewin Cree Nation, Frog Lake First Nation, Cold Lake First Nations and Onion Lake Cree Nation, have also been asking questions about the project. Some have expressed concern about their abilities to exercise their Treaty Rights. (None of these nations responded to requests for an interview.)

“We don’t know how pumping carbon underground will affect our lakes, our rivers — even our underground reservoirs,” Michael Lameman, a councillor at Beaver Lake Cree Nation, told CBC earlier this year. (Lameman did not respond to a request for an interview.)

Pathways Alliance has provided a high-level map of the proposed project, but not enough information about specifics, according to Moronkeji (Kg) Banjoko, government relations and consultation coordinator with the Athabasca Chipewyan First Nation’s Department of Dene Lands and Resource Management. “There is no information about what the project will do — as a whole and cumulatively with other industrial development in the area — to the environment, local communities and [Athabasca Chipewyan First Nation’s] Treaty Rights,” Banjoko wrote in an email to The Narwhal.

The nation has a number of concerns, Banjoko said, including “the addition of another pipeline to the landscape which will cross the Athabasca River in multiple places as well as other watercourses, cause construction impacts, destroy animal habitat and create easier sightlines for hunters and predators to hunt caribou and moose.” Athabasca Chipewyan First Nation would like Pathways Alliance to support an Indigenous-led assessment of the project — or, failing that, to request a joint provincial-federal environmental impact assessment. 

Carbon capture and storage “allows [Pathways] to talk a big game about action on climate change before they have committed any serious resources to building the project and reducing emissions — all while continuing to produce record amounts of oil,” Banjoko added.

Past carbon dioxide pipeline explosion in the U.S. likened to a ‘zombie apocalypse’

Ever-present concerns about a leak, or worse, an explosion, aren’t unfounded. 

In 2020, a 24-inch (0.6-metre) carbon dioxide pipeline in Mississippi — in the tiny town of Satartia, population 50 — ruptured after a mudslide. More than 31,000 barrels — nearly 5,000,000 litres — of carbon dioxide were released. Within minutes, there were reports of people having seizures or falling unconscious. The carbon dioxide “immediately began to vaporize,” according to a federal Department of Transportation investigation, and spread across the county. 

At least 45 people were hospitalized and hundreds were evacuated. “It looked like you were going through the zombie apocalypse,” the county’s emergency director told NPR in 2023, adding that people were laying on the ground, shaking and unable to breathe. The company behind the pipeline took two hours to tell the relevant authorities about the explosion (it has since paid nearly US$3 million in fines). Some residents said they spent more than an hour unconscious in a vehicle filled with carbon dioxide and had to have supplemental oxygen for months after the incident. 

In April of this year, another carbon dioxide pipeline ruptured in Louisiana. In September, carbon dioxide leaked from an injection well in Illinois. 

Carbon dioxide pipelines are not new — they crisscross North America, mostly for enhanced oil recovery. In the last 10 years, according to an analysis from the Great Plains Institute, there have been 63 instances of leaks or accidents. Since 1994, carbon dioxide pipeline accidents have released approximately 135,000 barrels — which amounts to more than 21 million litres — in the United States. 

According to the Intergovernmental Panel on Climate Change, “there is no indication that problems for carbon dioxide pipelines are any more challenging than those set by hydrocarbon pipelines.” That said, they may be more subject to what are known as “longitudinal running fractures” — a rapid and catastrophic unzipping, or splitting, of a pipeline — than other gas pipelines and need adequate safety features in place.

This leads to many questions, including about emergency response vehicles, which have combustion engines that need oxygen to run, and can fail when heavier carbon dioxide displaces it.

“I don’t know what’s going on,” NPR reported a 911 caller said when the Satartia explosion happened. “My car stopped, it won’t move.”

That pipeline was just over 1.5 kilometres from the small Mississippi town. In St. Paul, it is not yet exactly clear where the pipeline could run, but early plans suggest it could be a little more than a kilometre from the eastern edge of town. A spokesperson for the Alberta Energy Regulator said by email that any carbon dioxide pipeline licensed by the regulator is required to have a corporate emergency response plan.

“I don’t want to be next to that thing if that pipeline ruptures,” Shapka says, pulling apart a fresh apple muffin. “My roots are here, and everything familiar is here. But I’d really have to question that.”

Pathways Alliance says its technology is ‘safe, proven and reliable’

The potential impacts of the Pathways Alliance carbon pipeline and storage plan are being talked about at kitchen tables along the proposed route. Meanwhile, its potential benefits are being touted around the world, including at the annual United Nations meeting about climate change. 

The problem is real: there is just too much pollution. Nearly 50,000 megatonnes of carbon pollution are emitted globally each year. Around the world, “human activities have raised the atmosphere’s carbon dioxide content by 50 per cent in less than 200 years,” according to the National Aeronautics and Space Administration (NASA). 

In Canada, 677 megatonnes were emitted in 2021. Two weeks ago, the federal government announced plans to introduce draft legislation to cap emissions from the oil and gas industry, something industry leaders oppose. Instead, they and other proponents say capture and storage projects are crucial to reducing carbon pollution and mitigating climate change in the immediate future. 

The Pathways Alliance plan for the $16-billion project aims to bury 10 to 12 megatonnes of carbon dioxide deep underground each year. That’s approximately one-eighth of reported carbon pollution from the Alberta oilsands annually, or roughly equivalent to the carbon pollution emitted by the oilsands every six weeks.

Pathways, whose six members control 95 per cent of oilsands production, says it wants to “produce some of the cleanest barrels of oil in the world” and to be net zero by 2050. Carbon capture, it says, is “safe, proven and reliable.”

But that promise comes with caveats, especially if you ask David Schlissel at the U.S.-based Institute for Energy Economics and Financial Analysis. He’s been following carbon capture closely since 2007 and is concerned that the endeavour is more “hype” than evidence — not to mention the price tag. 

“There’s no evidence that it will capture 90 to 95 per cent of the carbon dioxide it’s designed to capture,” Schlissel says, noting data shows real-world carbon capture rates range from 10 to 78 per cent. When the whole life cycle of carbon capture efforts, which also release carbon pollution, are taken into account, he says, “it’s unlikely to have a major dent in greenhouse gas emissions.”

Carbon capture is an attempt at gaining “social licence” for continued production of fossil fuels, according to the U. S. House of Representatives’ central investigative committee, which is among critics saying the promise of a tech fix relieves pressure to pivot to energy sources that produce less carbon pollution. Global oil production is at record levels in 2024, according to the International Energy Agency, and 2023 was a banner year for oilsands profits.

Both the federal government and the Alberta government have proven eager to financially support the oil industry’s carbon capture plans. 

Carbon capture is “a tool in the toolbox” of reducing carbon pollution, according to Matt Dreis, a senior analyst with the Pembina Institute’s oil and gas program.

“Carbon capture and storage is going to be a big part of emissions reductions in Alberta,” Dreis says. “It’s one of the largest opportunities to reduce emissions from [the Alberta oilsands] sector specifically.”

But critics have balked at the cost — and the amount that could be subsidized by taxpayers. Behind the scenes, Pathways Alliance has been lobbying for tax breaks and incentives from governments, including an “assurance” from the federal government that no part of the project would require a federal review under the beleaguered Impact Assessment Act. 

The potential liability for Canadians doesn’t stop there. In Alberta, the government assumes liability for a carbon capture project after it is officially certified as complete: it asks companies to pay into a “stewardship fund” to cover or offset costs, but otherwise maintenance, monitoring and leaks are the government’s responsibility. In other provinces, like Manitoba, companies will retain responsibility for costs related to leaks or repair.

“Make them financially responsible,” Schlissel says of future risks of leaks. “Let them put their money where their mouth is.”

Schlissel, who is 77, is curious if his doubts will be proven wrong. “I’ve asked one of my younger colleagues [to] do a seance in 30 years and let me know how it comes out,” he says with a rueful laugh. 

‘Just not convinced’: Alberta residents have lingering questions about carbon capture

At her home just south of St. Paul, where she has lived with her husband for the past 14 years, Fox surveys her garden and its late season bounty — tomatoes, pumpkins and some corn that survived a recent bear visit. She gestures across the road, where the pipeline is set to be. 

Right now, it’s just a field.

“They were in Dubai, they were in Calgary and Texas and they’re all over the world,” she says of the places Pathways Alliance representatives have publicly extolled the virtues of their carbon capture plan. But, she says, “They’ve spent about three hours here.”

That leaves many in the community feeling neglected — and undervalued. Is their farming community something of a guinea pig? If something goes wrong, are they a sacrifice zone for a solution to a much bigger problem?

Fox is well aware of the global conversation about carbon pollution and the high stakes for the planet — as well as for fossil fuel companies. “They’re being forced into coming up with a solution around carbon dioxide,” she says. “We’re just not convinced this is it.”

“I’m just not convinced all of this money and all this work is going to make a tinker’s damn of a difference.”

The Narwhal’s reporters are telling environment stories you won’t read about anywhere else. Stay in the loop by signing up for our free weekly dose of independent journalism.