The price tag to clean up orphan oil and gas wells in Alberta increased by nearly 50 per cent since last year, bringing the estimated total to $1.66 billion, according to the latest annual report from the Orphan Well Association.

The report, released last month, attributes the increase to an “influx” of orphan wells from a company called Long Run Exploration Ltd. The price tag to clean up the thousands of orphan sites left behind by the company is estimated by the association to be $500 million.

“A surge in inventory is not new for the [Orphan Well Association]. … These struggling companies are on our radar for a long time,” the annual report reads. 

“We know the assets will eventually come our way, and plan in advance with the [Alberta Energy Regulator] to ensure we are ready to tackle the challenge.”

Alberta’s Orphan Well Association is a not-for-profit organization launched in 2002 that acts as a backstop when delinquent oil and gas companies leave behind inactive wells that need to be cleaned up. It was designed to be funded by industry in the form of an annual levy, but has received government grants in the past and gets an annual interest-free loan from taxpayers. 

In response to questions from The Narwhal, Lars De Pauw, the president of the Orphan Well Association, said by email, “The pace of closure will depend on future orphan levies which have not yet been determined.”

All companies pay into an orphan well fund, to make a pool of money available for when companies go bankrupt, or otherwise walk away from their liabilities. Last year, the orphan well levy added up to $144.45 million. This year, after a seven per cent increase set by the Alberta Energy Regulator, it increased to $154.6 million.

Last year, the association safely sealed 721 wells, according to the annual report, and received reclamation certificates for another 850. The report says this is the equivalent of “over 15 square kilometres of land returned to Albertans, an area equivalent to 2,100 [Canadian Football League] football fields (including end zones!).”

That’s not enough to make up for the decades-long backlog of orphan wells, according to public interest lawyer Drew Yewchuk.

“The bottom line is that Alberta’s orphan problem continues to grow,” Yewchuk wrote in a University of Calgary Public Interest Law Clinic blog post about the latest annual report. “All signs point to an orphan well problem that will become too big to solve so that a large share of the costs will be socialized, with taxpayers left to pay the bill for closure work.”

Yewchuk cautions the amount taxpayers could be on the hook remains to be seen. “This is not an all or nothing question of whether costs are passed to the public. Both the federal and provincial governments have already paid some costs for the closure of oil sites, but the amounts are small compared to the total cost,” he told The Narwhal by email. “The thing to watch is how much of the cost gets passed to the public.” 

Alberta’s orphan well problem grows year after year

According to the Government of Alberta, there are an estimated 466,000 oil and gas wells in the province. More than half of those are no longer producing, some of which have been properly plugged, while others are in a state of temporary suspension. And some are orphans: a well that no longer has a legal or financial owner. 

The most common cause is an insolvent or bankrupt oil and gas company that has left behind a long list of wells that were never properly decommissioned or cleaned up. Those wells, pipelines or other related facilities then become “orphans.” 

But they still need to be properly plugged and reclaimed, according to provincial rules. That falls to the Orphan Well Association.

The association’s inventory currently lists 7,382 wells that need to be decommissioned — as in, safely sealed — and 9,148 sites that need to be reclaimed, which means restored to what’s known as “equivalent land capability” to get back to the ecological, agricultural or other pre-drilling state of the land.

These numbers have increased substantially. As of the end of March, the Orphan Well Association reported its inventory included 4,200 orphan wells that needed to be safely sealed and more than 8,000 sites that needed to be reclaimed.

For comparison, in 2013, the Orphan Well Association had just 387 orphans in its inventory of sites that needed to be reclaimed.

The total price tag to clean up wells the association is responsible for has also increased. According to Yewchuk’s analysis, “the total amount owed has increased for five of the last six years and has more than doubled from 2021 to July 2026.”

Thousand of wells were orphaned in April

The thousands of new wells from Long Run Exploration Ltd. that landed on the Orphan Well Association’s books this spring ended up as orphans after a 2024 deal with a Chinese company fell through. That deal would have seen all of Long Run’s shares purchased for $22 million.

In April, the Alberta Energy Regulator announced the company’s wells were officially orphans. That meant 4,031 wells, 383 facilities and 2,121 pipeline segments previously owned by Long Run Exploration Ltd. were transferred to the Orphan Well Association. 

The association reported updated numbers after verifying the status of each site: 2,980 wells and associated facilities and pipelines need to be decommissioned and 938 sites have already been sealed.

The association’s annual report is optimistic the sites do not pose any extraordinary risks.

“Given the nature of the Long Run assets, we do not foresee any of the sites posing a high risk to public safety or the environment,” it said in its annual report.

De Pauw, the president of the Orphan Well Association, said by email, “We have incorporated the Long Run wells into our overall program. We don’t see them any differently as other orphan assets and will continue to prioritize sites based on risk and those on private land while ensuring efficient operations. ” 

Cleaning up one orphan well involved demolishing homes

According to the association, the average cost to safely seal each well is $28,800 and the average cost to reclaim the site is $27,000, though actual costs can vary widely depending on the complexity of the cleanup. 

In its annual report, the association cites an example in Bonnyville, Alta., where a 1950s-era orphan well was found to be leaking methane into a home. Two houses and a duplex were purchased and demolished, and the well was safely sealed — a complicated and expensive endeavour. “The homeowners were disappointed, of course,” Cliff Pybus, land and stakeholder coordinator at the Orphan Well Association, said in the annual report. “But also relieved that the [association] was taking charge and fixing the situation.”

In theory, the levies collected from industry should be enough money to fund orphan well cleanup in the province. But as clean-up bills have ballooned, the auditor general and other critics have warned this may not be the reality.

“In recent years, levy revenues have not been enough to keep pace with the increasing number of orphan sites being transferred to the [Orphan Well Association],” the auditor general wrote in 2023. Back then, the total price tag of cleaning up orphan wells was a little more than half what it is today.

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Canada’s large oil companies are raking in record profits during an energy crisis.

We’ve been here before — but unlike last time, Ottawa isn’t prodding the industry to use more of the money to clean up its act. In some ways, it’s even volunteering to pick up the tab.

The last time was just four years ago, when Russia’s invasion of Ukraine led to Western sanctions on Russian oil and fears about global energy supply. The price of oil shot skyward, and large Canadian oil companies reaped the benefits, taking in billions of dollars in windfall profits.

The oil and gas industry is the largest source of Canada’s greenhouse gas emissions, which cause climate change that scientists say has been driving major heat waves and wildfires across the country this summer, destroying communities and upending lives.

Yet instead of using its windfall during the Russian invasion to invest heavily in non-emitting energy sources, or to widely deploy technology to decarbonize its operations, the industry began funnelling a larger proportion of its revenues to shareholders, while a group of oilsands companies went to governments asking them to cover much of the cost of their proposed emissions projects.

The federal environment and climate change minister at the time, Steven Guilbeault, pushed back, suggesting oil companies needed to put their money where their mouth is when it came to their own publicly stated environmental goals.

“As Canadians see those profits, we need to see reinvestment into cleaner energy instead of share buybacks,” Guilbeault said in a video posted online in October 2022.

Share buybacks are when companies use cash to buy their own shares back from investors. It’s a different way of giving money to them than dividends, which distribute earnings to shareholders.

The Iran war, that began this February, is again leading to big profits for Canada’s oil industry, which are again being directed in part to shareholders.

The conversation has reignited calls for a windfall profits tax on the oil and gas industry, something more than 60 unions and civil society organizations have been calling for.

In a survey this May by Liaison Strategies, 66 per cent of a random sample of 1,526 Canadians reached by landline and cell phone also supported a tax on oil and gas excess profits, with the revenues going to help lower energy bills.

Elbows Up For Climate, which represents almost 300 mayors, councillors and local officials from across Canada advocating for national environmental projects, is one of the groups calling for a windfall tax.

Former Toronto mayor David Miller is the co-chair of Elbows Up For Climate alongside former Montreal mayor Valérie Plante. Miller told The Narwhal such a tax makes sense given the global fossil fuel industry spent decades obscuring the truth about climate change and lobbying governments to roll back climate action, and so is “in many ways responsible” for delaying the economy’s transition to clean energy.

“We are in a frightening summer from wildfire smoke. The damage yet again will be in the billions, and the question is, who should pay for that? Should it be the general public?” Miller, now managing director of a global network of mayors called the C40 Centre, said. “Or should it be the people, the entities, that are causing the problem?”

“The entities that are causing the problem — which is climate change, that’s what’s making the wildfires so bad — are the fossil fuel companies, and they should pay for the damage. It’s a user-pay kind of principle, and because of the profits they’re making as a result of the U.S.-Israel attack on Iran, it’s a very appropriate moment.”

Oil companies argue they already pay significant taxes as well as royalties, which are separate payments that companies make to the province that owns the resources. In 2024-25, Alberta took in $17.2 billion in royalties from the oilsands.

But the Vancouver-based Centre for Future Work has argued that royalties collect “only a small fraction” of the increased revenues from higher oil prices. In 2022, they found, oil and gas profits jumped almost three times as much as the increase in royalties.

Applying a new windfall tax on oil profits today could generate between $18 billion and $46 billion over the next year, depending on the tax rate and how much of a company’s profits it applies to, according to the Canadian Centre for Policy Alternatives.

The Narwhal asked Environment and Climate Change Minister Julie Dabrusin’s office whether she believes, like Guilbeault did, that oil companies should be spending more on emissions reductions, and what she thought of a windfall profits tax.

“Oil and gas companies have an important role to play in driving down Canada’s emissions,” Dabrusin’s director of communications Chris Zhou responded in an emailed statement.

Zhou said the government was focused on “durable, unifying solutions that will deliver sustained emissions reductions over the long term,” including restrictions on methane, a greenhouse gas, in the oil and gas sector, as well as the industrial carbon pricing system.

Oil companies bringing in record-breaking profits amidst Iran war

The Iran war has led to the intermittent closure of the Strait of Hormuz, the chokepoint between the Persian Gulf and Arabian Sea that one-fifth of the world’s oil is shipped through.

It created the “largest supply disruption in history,” according to the International Energy Agency, and sent oil prices higher again. The higher price translated to big profits for the world’s largest oil companies, and those in Canada have been no exception.

Earlier this month, Canadian Natural Resources Limited, one of the country’s largest oil and gas companies, reported $4.5 billion in profit in the second quarter, which covers April to June. That result was “the strongest in the history of the company,” Chief Financial Officer Victor Clinton Darel said.

The company returned $2.4 billion to shareholders in the form of dividends and share repurchases. This year, he added, was the 26th consecutive year of dividend increases.

The record results followed a report from Cenovus, one of Canada’s large oilsands companies, of a $2.9-billion profit in the second quarter, its “best quarterly financial result ever,” president and CEO Jon McKenzie said. Cenovus plans to increase shareholder returns, and sent $1.4 billion to them in the second quarter.

“We would never apologize nor take credit for a higher commodity price environment, but the key is to run well while it lasts and capitalize on the opportunity,” McKenzie said.

A third oilsands firm, Suncor, recently posted a $3.7-billion profit, and returned $1.7 billion to shareholders — it too said it plans to spend more money giving cash to investors in return for their shares.

Imperial Oil, a Canadian firm majority-owned by one of the world’s largest oil companies, ExxonMobil, posted a quarterly profit of $2.2 billion. John Whelan, the chairman, president and CEO, said Imperial has grown its annual dividend for 31 years.

In addition to reaping rewards from the higher price of oil, Canadian companies have also been creating more of it. Oil production hit a new record last year in Canada, and crude oil production hit the highest volume this May since comparable records began in 2016, according to Statistics Canada.

This year, Cenovus expects to join the club of companies worldwide that can produce, on their own, the equivalent of a million barrels of oil per day, on average. Only one other Canadian company can do that, Canadian Natural, which also said it had hit a new quarterly production record.

Oil execs praise Alberta deal that taxpayers could be on the hook for

During their earnings calls this summer, executives praised Prime Minister Mark Carney’s deal with Alberta Premier Danielle Smith — in which the federal government has hinted it’s prepared to spend significant public dollars.

Canadian Natural, Cenovus, Suncor and Imperial Oil are four of the five members of the Oil Sands Alliance, formerly known as the Pathways Alliance, which signed a trilateral memorandum of understanding with the federal and Alberta governments that envisions a new oil pipeline to the West Coast, to be filled with increased levels of oil production, as well as a new emissions reduction project in the oilsands called Pathways, which will rely in part on carbon capture technology.

Ottawa says two government-owned corporations will own most of the oil pipeline and one of them will develop and run it. The only private-sector involvement announced so far is a pipeline company signing a non-binding agreement to take a 10 per cent interest during construction, with possibly another 10 per cent interest when the pipeline begins operating.

Pressed by CBC News to reveal how much federal money would be involved in building the new pipeline, Natural Resources Minister Tim Hodgson said that while he didn’t have “the numbers in front of me right now,” the cost to build an earlier oil pipeline — the Trans Mountain expansion project, which cost between $30 and $40 billion — was a “reasonable thing to look at.”

The government’s deal with Alberta also includes a commitment from Ottawa to “offer financing or support mechanisms” supporting the operating costs of carbon capture and storage projects.

It’s hard to precisely tally up how much this financing and support might cost Canadians, but the government has already committed billions of dollars in the form of carbon capture tax credits, funding for carbon contracts and other related research and development efforts.

At the same time, it’s unclear how much of their own money oil companies are willing to spend on the industry’s infrastructure — whether that’s to move more oil, or to lower their emissions.

Companies tight-lipped about environmental progress, vocal on environmental regulations

Many major oil companies have cited Trudeau-era changes to the federal Competition Act as a reason why they cannot publish information on their environmental performance on their website or in corporate disclosure reports.

The changes introduced an anti-greenwashing requirement for businesses, ensuring they backed up claims about protecting the environment or tackling climate change with evidence. (While the Carney government removed a rule that required this evidence to conform to internationally recognized standards, it left the broader requirement in place.)

Suncor’s 2025 report on sustainability says the company aims to “reduce the greenhouse gas emissions intensity of our base business,” but notes the report intentionally does not contain any “environmental content or data” due to the law. Cenovus says it does not publish any information on its website regarding its environmental performance or targets, for the same reason.

Imperial Oil’s website says it does not publish “an active representation” of its environmental performance although it mentions efforts in “lower-emission fuels,” renewable diesel, lithium and carbon capture technology. Canadian Natural’s website points to reclamation projects, like tree planting, at its oilsands sites.

The four companies, as well as the Oil Sands Alliance, did not respond to requests from The Narwhal for how much money they have spent over the last year on emissions reductions projects, or their opinion of a windfall profits tax.

They have been outspoken, however, about how environmental policy is affecting their bottom lines.

​McKenzie, at Cenovus, said in June that a new oil pipeline to the West Coast could not be ⁠financed by the ​private sector because of Canada’s industrial carbon pricing system. “Industry has been clear that the industrial carbon tax is insidious and it should be revoked,” he said.

On the July earnings call, ​after announcing record profits, McKenzie again described the industrial carbon pricing system as an “uncompetitive carbon tax that uniquely burdens Canadian industry.”

But he praised the Canada-Alberta deal, saying it “creates a framework for governments and industry to work together on production growth, emissions reduction and expanded market access.”

Similarly, Scott Stauth, president of Canadian Natural, said the agreement was a “positive first step” and said it would “benefit all of Canada by providing more jobs, combined with social and economic benefits to our country.”

“It’s a very different mood and tenure today than it has been in the past. We’re encouraged by that,” Suncor president and CEO Rich Kruger said about the Alberta deal, although he also said there was still “a lot of work to do.”

Oil Sands Alliance President Kendall Dilling said in a statement posted July 13 that the trilateral deal was a “framework that is positive for the oilsands industry and provides a step forward to help enable production growth and to advance the Pathways project.”

“It helps meet our shared vision to grow Canadian oil production and benefit Canadians across the country,” he said.

Windfall profits tax could help offset affordability crisis, advocates say

For his part, Carney posted a video online in June suggesting the world needed more of Canada’s fossil fuels, as a result of the Iran War.

“The hard truth is that we don’t control the price of oil, so what we’re doing is helping Canadians through tough times in the short term,” the prime minister explained.

The government suspended the federal gas tax for the summer as an affordability measure, Carney said. But he also argued that addressing global “energy security” means ensuring Canada supplies the world with as much oil and gas “as possible.”

While he acknowledged this “will mean that our emissions will be higher in the next few years than they were projected to be under the previous government’s plan,” he said Canada “can’t afford to restrain the growth of an important part of our energy mix, oil and gas, to meet a short term goal.”

Carney also claimed Canada’s oil would be “produced responsibly and with a clear focus on lowering emissions over time.”

For Elbows Up For Climate, though, the fact remains that carbon pollution from fossil fuels is directly and indirectly the cause of tens of billions of dollars in damages from climate-driven extreme weather, Miller said.

Annual insured losses reached $37 billion between 2016 and 2025, according to the Insurance Bureau of Canada.

“It’s quite remarkable and eye-opening when you look at [insurance] statistics, and those are happening because of the exploitation of fossil fuels,” Miller said.

“Expanding oil and gas production puts more Canadians at risk of extreme weather, extreme heat and other climate-related disasters. We actually can’t afford those disasters.”

Several groups like the Green Budget Coalition, Canadians for Tax Fairness, Seniors For Climate Action Now, For Our Kids and 350.org have also submitted budgetary recommendations to the House of Commons finance committee that endorse a windfall profits tax on oil and gas companies.

Thomas Green, senior manager of climate solutions at the David Suzuki Foundation, part of the Green Budget Coalition, pointed out that the United Kingdom has its own windfall tax.

Between 2022 and 2025, the UK’s Energy Profits Levy raised 9.1 billion pound sterling, or $17 billion at today’s exchange rate.

The coalition wants to see a new levy on oil and gas companies linked to when oil prices exceed certain thresholds — indexed to inflation and periodically reviewed — and for the money to be allocated toward affordability and climate action measures.

“These profits come at the expense of affordability for everyday Canadians,” Green told The Narwhal.

“A windfall profits tax would at least rectify some of the injustice that we see right now.”

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.

Assar Grinde is the kind of man whose calm is infectious, even as he rattles off an encyclopedic knowledge of facts about drought, water and the impacts of fracking on the region he calls home. A cattle rancher by trade who studied geology at the University of Alberta, you get the sense he’d rather be tending his herd than fighting with regulators and oil and gas companies.

But on a Sunday in early July after a morning on the ranch, he sits in the back of his friend Daniel Iseli-Otto’s truck, sporting a sweater knit by Iseli-Otto’s mom, and talks about the reasons he can’t just walk away.

It started three years ago when Lloyd Creek — a tributary of the Blindman River, which runs through the land Grinde’s family has ranched for generations — dried up. It was something he’d never seen before and he says the oil and gas companies were still pulling water from the river.

“We wanted to make sure that the river didn’t dry up because we thought that was crazy,” Grinde says.

He and Iseli-Otto helped found the Blindman River Watershed Society and dove into the labyrinth of data used by the Alberta Energy Regulator and the equally bewildering bureaucratic divisions of the provincial government.

It’s a funny time to be talking about the stress on the Blindman River watershed and the concerns he and Iseli-Otto have when it comes to the vast quantities of fresh water being used by oil and gas companies for hydraulic fracturing, or fracking.

The fields around Rimbey, Alta., about 200 kilometres north of Calgary, are saturated in surreal hues of green, stark against the grey skies of an abnormally wet July that has brought much-needed rain.

It’s a far cry from the drought-like conditions of May and June, conditions that have become all too common in a region suffering through a decade-long dry spell.

But the sudden rush of water isn’t enough to quell the concerns of area ranchers and residents who watched that creek run dry and their drinking wells drop. They say the rain isn’t enough to make up for how much has been lost from the aquifers — the deep underground natural reservoirs that feed those wells.

And then there’s the issue of oil and gas companies using billions of litres of water to crack open the earth beneath those green fields and exploit one of the hottest gas fields going, the Duvernay. They take surface water when there isn’t any to spare, and a fleeting moment of plenty might only make it worse, according to landowners who met with The Narwhal.

Grinde says promises were made by those companies, but rarely kept.

“ ‘We’re going to be taking the water at high flows when there’s too much of it, and we’ll store it and then use it when we need it.’ That was the industry’s sales pitch,” he says, driving through the region southwest of Edmonton along with Iseli-Otto. “But then we’ve been in a drought eight of the last 10 years, and they are still pulling water down.”

Dana Kreil, the chair of the nearby Medicine River Watershed Society, and a councillor for Lacombe County, says there’s no trust in the province to monitor the water and to intervene. Her society has bought its own monitoring equipment and is pressuring the government for solutions.

“You can’t fool the locals,” she says, making it clear she’s speaking for the watershed society and not the county. “There are people telling me the top of their runners wouldn’t get wet in that river. So you can’t tell me that those are acceptable levels for pumping from there.”

‘You only get conflict when there’s scarcity’

The Blindman River, as well as the Medicine, aren’t among the great waterways of the world. With enough momentum, it wouldn’t be hard to leap from one bank to the other. They are slow and meandering, but they are critical to ranchers and farmers.

They are also tenuous.

Neither river is fed by the mountain glaciers to the west. They rely instead on spring runoff and underground aquifers to keep water flowing. This year’s early-summer drenching is an indication of the feast and famine cycles expected to be the norm as the climate shifts — droughts with sudden onslaughts of rain. Grinde says his ranch received almost as much rain in June as it did the entire year previous.

For decades, fracking companies here have been injecting water deep into the ground to break up rock holding gaseous wealth in tight crevasses. That water, vast quantities of it, is almost entirely permanently lost to the water cycle as it remains trapped in the reservoirs that previously held gas. The practice was largely accepted by area landowners, but then water became scarce and drilling activity increased.

“We haven’t had to care about fresh water because we never had this issue before,” Grinde says. “You only get conflict when there’s scarcity, and you have that imbalance between supply and demand, and that’s really what’s happened in the last few years.”

Once Grinde and others started paying attention, they discovered a system of what they say is weak oversight, weak data and regulatory capitulation.

Water use is overseen by both Alberta’s Environment Ministry and the energy regulator — depending on who’s using the resource — and Grinde says it leads to a lot of plausible deniability. Water monitoring in the area is based on a federal government sensor 50 kilometres away in Blackfalds, Alta., but Grinde says it doesn’t actually measure the flow of the river, just the water pressure. Even if it did, Grinde thinks the minimum flows established by the province to determine when a company can pull river water for fracking are too low.

The Alberta Energy Regulator did not answer a question about the monitoring situation on Blindman River, but said monitoring is used to inform when a company can divert water. It noted that monitoring can be seen on the Alberta Rivers site.

The regulator says companies are responsible for measuring flow if there is no station nearby.

“So then that kind of led us down this path of trying to figure out: ‘Do you guys have rules around it?’ ” asked Grinde.

For some in the area, the answer is more uncertain than they’re comfortable with.

Company wants to pull billions of litres from critical freshwater aquifer

In March, Spartan Delta, a fracking company operating in the area, applied for a water licence to pump a maximum of 475 million litres of water per year — about 2.4 million bathtubs’ worth — from the Paskapoo Formation, a vast underground freshwater reservoir that stretches south past Calgary and north past the Athabasca River near Fox Creek.

That raised red flags for those in the region already worried about a strained system.

Grinde wants the government to prevent oil and gas companies from accessing shallow fresh groundwater for fracking, implementing a ban now so that it doesn’t have to draft new rules in the midst of a full-blown crisis.

“Right now [the companies] say, ‘Well, we don’t have any more surface water available to get licensed, we’re just going to start drilling shallow groundwater wells,’ which is really concerning because we don’t know enough about the groundwater, and it’s so vital to everybody who’s living here,” he says.

Tens of thousands of wells tap into the aquifer for drinking water, as do towns across Alberta. According to a report by the federal government, the Paskapoo “supports more groundwater wells than any other aquifer system in the Canadian Prairies,” making it “the most significant supply of groundwater” in the whole region.

That same federal report — published almost 20 years ago — also cautioned the aquifer is slow to recharge and the amount of water that can be pulled from the aquifer might be limited and may have already been exceeded in 2008.

Spartan Delta already pumps water from the Medicine River, with hoses stretching along ditches and culverts throughout the region pulling water into massive reservoirs. It also uses recycled water from its operations, but that only accounts for approximately 10 per cent of its use.

In 2024, the latest year of data from the Alberta Energy Regulator, Spartan Delta used approximately 171 million litres of fresh water for fracking. Its latest application shows the company estimates it will need much more than this, around 1.5 billion litres per year for the next 10 years.

The company did not answer emailed questions but sent a statement instead, saying it is focused on “responsible, sustainable development of oil and gas.”

Spartan Delta said it adheres to all rules and regulations set out by the regulator, Alberta’s Environment Ministry and local bylaws.

“All of our water use is determined by Alberta Environment,” reads a portion of its statement. “The company receives temporary diversion approvals, term licences and has undergone several audits to validate we are in compliance with all of the terms of the water approvals. All resident concerns are evaluated by the appropriate regulating body of our activities during the approval process.”

The regulator also did not directly answer questions emailed by The Narwhal, but did provide information on water use. An unidentified spokesperson said the regulator reviews all water licence applications and considers risks to individuals and the environment. The spokesperson added there are restrictions on water use if levels drop below prescribed thresholds and that restrictions can also be implemented in response to “landowner concerns.”

Analysis on aquifers is conducted by hydrogeology experts, the email said.

Though landowners are concerned about Spartan Delta’s water use, the company is a small player compared to others.

Parallax Energy Operations used almost one billion litres in 2024, while Canadian Natural Resources Ltd., one of the largest oil and gas companies in Canada, used 2.9 billion litres of fresh water for operations across the province. Overall, fracking consumed 20 billion litres of fresh water in 2024, up sharply from the seven billion litres consumed in 2013.

Grinde’s goal is to prove to the province and the regulator that the aquifer is dropping, realizing that officials could just turn around and say, well, it’s a drought.

“But even if it is a drought, the volume of water that the companies are using for fracking is accelerating that,” he says. “It could be that if there’s only a certain amount of water, you have to justify the use for certain things, right? So maybe you have to talk about hierarchy of use.”

Time and again, Grinde, Kreil and Iseli-Otto talk about the amount of work required to collect information, to get in touch with provincial officials, to make someone listen. Without decades of data, the response from officials and companies is: prove it.

“It’s the province’s job,” Kreil says. “It’s not the watershed society’s job. We’re volunteers.”

The provincial government did not respond to questions emailed by The Narwhal.

Alberta ranchers say their bison herd collapsed when a fracking company moved in

It’s easy to look out across the fields and patches of trees and imagine the landscape in central Alberta is largely unchanged, but Iseli-Otto, who works as a carpenter and has lived here his whole life, looks out his truck window and remembers bush where fields now stretch — a child’s wilderness transformed into cropland. It’s a reminder of how quickly things can change. How the immutable becomes a memory.

The change can be slow, or it can come on in a relative blink.

Tucked into a secluded corner of the countryside, is the home of Butch and Nicole Smith, two bison ranchers who have lived and worked in the area for decades, with the dream — shared by one of their daughters — of passing their ranch to the next generation.

Inside the home, a stuffed cougar looks down from its final perch above the kitchen, and the walls are covered in framed rodeo photos showing the victories of the family’s horses. Tail Light was the “team roping heading horse of the year.” Hickory, the “2011 pole bending horse of the year.” Their daughters have won an astonishing number of championship rodeo belts and saddles, all of which are on display.

A hint of the Smiths’ directness, and their frustration, comes in the form of a small sign by the kitchen table: “What (and I can’t stress this enough) the f*ck,” it reads.

Over bison burgers and sausages, the Smiths talk about how Spartan Delta cleared the land across from their feedlot and built two massive reservoirs two years ago to store the vast quantities of water the company pumps. They talk about how construction and pumping for the reservoirs, which bisect a wetland, led to startling changes in their bison herd.

“We started seeing the wildest behaviour from them,” Nicole says. “They’re very habitual animals.”

The herd was refusing to move to the areas they usually feed, and there was a sudden drop in their herd.

Nicole says they had 240 pregnant cows in the fall of 2024, but only 194 live births.

“We had many dead calves, aborted calves and calves that starved as stressed mothers produce not enough milk,” she says.

The Smiths blame the stress of the industrial activity and the disruption to stubborn routines.

The Smiths, however, aren’t the types to sit back and watch. They say they’ve spoken with their MLA, Jason Nixon, with the premier, with two environment ministers — Rebecca Schulz and RJ Sigurdson — and Energy Minister Brian Jean. They are working with Ecojustice, an environmental legal outfit, and were invited by the Alberta NDP to sit in the legislature last spring after speaking with MLA Nagwan Al-Guneid.

Now, after two years of fighting, they’re losing faith and plan to move.

“Neither one of us is a — how do I say it — a sitter arounder. I’m not gonna sit here and be miserable. I can’t even walk anymore because both ways just reminds you of all of it,” Nicole says.

“I’m raging when I hit the end of my driveway — every single time.”

‘There’s very little oversight right now’

Tensions are high in the region where fracking butts up against homes and ranches. In early July, a rumour spread that some of the hoses that pump water from ponds and rivers were shot at, but the Alberta RCMP said there were no reports of an incident on that day. Perhaps most telling was that none of the people who spoke with The Narwhal seemed surprised, although no one supported the idea and warned of the danger of puncturing the high-pressure lines.

There is a real sense that landowners have been abandoned in favour of oil and gas.

Kreil, whose society includes representatives from eight municipalities, including Red Deer, Lacombe County and Sylvan Lake, said the group recently met with the minister of Environment and Protected Areas and the CEO of the Alberta Energy Regulator to talk about the stress on the watershed. In its presentation, the society noted more than half of all fresh water in their watershed is allocated for oil and gas. Temporary water licences are almost entirely for fracking.

She says the minister told them to write a resolution calling for policy changes through the Rural Municipalities of Alberta — an organization which represents towns and districts across the province.

“I think he felt that he had dealt with us enough to say: ‘Write a resolution,’ ” she says.

Kreil stresses she’s not opposed to oil and gas, or to fracking in particular, but there has to be a balance.

“When we went to the minister, we said we want some solutions,” she says. “We’re not just coming here to bellyache and complain.”

Her organization wants to see more wastewater treated and reused, including municipal wastewater, to reduce or eliminate fresh water use. It wants better data on the state of the watersheds and a better understanding of drought and its impacts. And it wants new regulations governing use by agriculture, oil and gas and municipalities.

But those critical of the way fracking companies are operating all point their finger at the regulator when asked what the biggest problem is. The rules are weak and out of touch, responsibility is passed on and there’s no enforcement, they say.

“The problem with the Alberta Energy Regulator is there’s very little oversight right now,” Kreil says.

Iseli-Otto says he tried alerting a contact at the regulator about companies pumping from the Blindman River in May when the water levels were worryingly low, but nothing came of it.

Two days later, he was driving home and the pumps were running.

“So I texted him and I said, ‘Hey man, pumps are running, what’s going on? Why is this happening?,’ ” he says. In screenshots of the text messages shared with The Narwhal, Iseli-Otto then asks if someone from the regulator had checked to see if the pumps had stopped.

“That’s the point at which I got the automated text message saying this number is not monitored.”

Alberta pushes to double production, build pipelines

The regulator is an arms-length government body, but that doesn’t mean it’s entirely independent. The government sets the overall policy direction for the regulator to follow, for example, and the government appoints the regulator’s board of directors.

Recently, it appointed David Yager to the board, a long-time friend of Premier Danielle Smith who also acts as one of her special advisors, and tasked him with overseeing a revamp of the organization.

There have also been revelations of direct intervention from the provincial government into regulatory decisions.

And the direction from the government is clear: it wants to double oil and gas production and it’s willing to incentivize companies to do so, even as it helps finance a new pipeline to the West Coast.

With the push for more production and without more stringent rules on water use, the problems in the area are likely to continue, or increase.

“We’ve had companies tell us ‘We’re not doing anything differently until the government tells us to,’ because it’s a competitive industry,” Grinde says.

“We said to the minister, as long as this is free, they will never change,” Kreil adds.

But in the end, something has to give, she says.

“You can’t be running the people out of water for oil.”

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.

This investigation is a collaboration between The Narwhal and Point Source, a U.K.-based investigative journalism organization.

LNG Canada told the BC Energy Regulator its Kitimat, B.C., gas export facility was likely to emit black smoke continuously for multiple days, a warning that came ahead of key environmental permits being granted, according to recently released documents.

The new documents, obtained by The Narwhal and U.K.-based investigative journalism organization Point Source through freedom of information legislation, raise questions over whether the regulator should have sought more assurances about measures to stop this kind of pollution before permits were granted.

Summary

• LNG Canada has been emitting more black smoke than originally planned and some Kitimat, B.C., residents are concerned.
• Black smoke can indicate gas is not burning efficiently, releasing higher levels of toxic pollutants, according to one expert.
• The BC Energy Regulator knew about the smoke ahead of giving the project approvals but has now ordered LNG Canada to make changes.

In July 2022, LNG Canada — a consortium of five foreign-owned companies led by Shell — submitted a document to the provincial government outlining its expectations around black smoke emissions.

“Given the unpredictable nature of these types of events, it is not possible to give a frequency of them occurring although an estimate is provided,” the consortium wrote. 

The colour of black smoke is caused by a concentration of particulates and unburned fuels, which is toxic. The estimate provided to the regulator said black smoke would be emitted at the facility for between 15 and 60 minutes one to three times per year prior to the facility completing 200 shipments. LNG Canada sent its 100th shipment in mid-June, nearly one year after its first. It also estimated slightly less dark smoke would be emitted continuously from the facility for between five and 15 days on four to six occasions in the first year

Despite this information, the regulator issued LNG Canada a facility permit requiring that black smoke not be continuously emitted for more than 15 minutes. The company committed to that limit, but has failed to keep to it.

On Jan. 6 2026, the export terminal emitted black smoke emissions during non-emergency conditions for more than seven hours. The next day, it emitted black smoke for over two hours. 

In April, the BC Energy Regulator told LNG Canada to identify the root cause of black smoke emissions during flaring at its facility in Kitimat, and implement a fix by October.

In late June, the regulator instituted new requirements, including mandated reporting of instances of black smoke emissions.

A spokesperson with the regulator said the facility’s permit “contains clear statutory requirements regarding black smoke emissions designed to minimize air pollutants to protect public safety and the environment.” 

“When our oversight activities identify non-compliances, such as in this case, we can place additional requirements (e.g., having to report black smoke) on permit holders,” the spokesperson noted in an emailed statement.

Black smoke from the flare stack of a LNG facility usually indicates that gas from the facility is not being burned off in an efficient manner and higher levels of toxic pollutants are being released, according to Tim Doty, a former oil and gas inspector with the Texas state government.

“The black smoke that can be visually seen being emitted from the flare is soot, basically,” Doty said in an interview. “In theory, flares are designed to burn in an efficient way that doesn’t produce this black smoke.”

According to the regulator’s reply to detailed questions, LNG Canada’s new requirements as of June include:

• Report to the BC Energy Regulator (BCER) all instances of black smoke that exceeds 15 minutes in duration and provide operational details concurrent with such instances;   
• By Aug. 15, 2026, submit a report completed by a qualified professional to the BCER that identifies the root causes of the emission of black smoke and measures to prevent the emission of black smoke; 
• By October 15, 2026, identify and implement measures to prevent the emission of black smoke based on the root cause analysis as required by the report; 
• For the months of October 2026 to March 2027, submit a monthly report to the energy regulator BCER completed by a qualified professional that assesses the effectiveness of the measures implemented .

‘I want to have a family’: community members concerned about potential health impacts

For some community members, the black smoke and presence of other potential pollutants are a source of great concern. 

The Narwhal and Point Source spoke to a young resident who we are calling Avery Sutherland, to keep her name confidential and protect her identity. Kitimat is a small town where LNG Canada is a significant employer and a major donor to local causes, and criticism is often seen as a threat to that.

Avery Sutherland said she tried on multiple occasions to get answers to questions about potential health concerns, but LNG Canada representatives would not respond.

“As a young person, I want to have a family,” she said in an interview. “There’s been a lot of back and forth I’ve seen over the last couple of years at different talks that LNG [Canada] gives, where they refuse to directly acknowledge the studies that have been done on the impacts of flaring on women who are pregnant and their children, and how that often leads to like more birth complications and more premature births.”

In response to questions about this, the regulator spokesperson said: “It is important to note for the benefit of residents of Kitimat that air quality measurements in the Kitimat Valley have remained below B.C. Ambient Air Quality Objectives since LNG Canada received its air discharge permit.”

But some critics claim the air quality monitoring program is insufficient.

“The current ambient air pollution monitoring is not sufficient to get a real handle on what the health implications are for the people that are living close to this facility,” Tracey Saxby, executive director of environmental non-profit, My Sea to Sky, said in an interview. “When you dig into the data you realize that there aren’t enough sensors, they aren’t gathering data in the right places and not enough of the sensors are continually operating.” 

The Canadian Association of Physicians for the Environment has said the facility’s flaring activity has exposed residents to “health-harming chemicals, including black carbon and benzene.”

“They are not consistently monitoring for some of the most harmful pollutants, like benzene,” Saxby said. “These are big monitoring gaps.” Health Canada has labelled benzene a known carcinogen since 1993.

In 2024, the U.S.-based Bullard Center for Environmental and Climate Justice published a report highlighting how LNG export facilities degrade air quality by releasing pollutants known to cause respiratory illnesses, cancer and birth defects from prolonged exposure.

Scientific studies have shown that burning gas also releases other toxic pollutants as a result of incomplete combustion, such as volatile organic compounds, nitrogen oxides, sulfur dioxide, polycyclic aromatic hydrocarbons and fine soot particles, which are directly associated with respiratory and cardiovascular diseases and risks to fetal development.

“When you see this kind of pollution, it’s a sign that the flare isn’t being operated correctly and usually that comes with a lot of other emissions that are actively being released that are not visible to the naked eye,” Doty explained.

“It’s likely that the real world pollution levels are far worse than the picture painted by the current data,” Saxby said. “Even though the existing data is very sparse, it shows worrying spikes in benzene levels that raise a lot of questions about the health impacts from the LNG Canada facility.”

As The Narwhal and Point Source recently reported, LNG Canada originally told the regulator it would operate its facility without routine flaring — and then quietly removed this commitment months before commissioning. 

Sutherland wishes the consortium that owns LNG Canada was more forthcoming with information. Its presence in the community has been divisive for as long as the facility has been in development, which means for young residents like herself, it’s been a factious issue for most of their lives. 

“When I was growing up, there were schoolyard and classroom arguments about this since as long as I can remember,” she said of the facility, which was proposed in 2013.

James Smith, another Kitimat resident whose name has been changed to protect his privacy, worked at the plant during construction. He said while he was expecting problems to occur at the facility, he didn’t predict the scale of the impacts. 

“I wasn’t expecting the black smoke,” he said. 

Smith said he’s experienced excessive noise and bad smells at his house since the facility started operations and on multiple occasions found his yard covered in a thin film of black residue.

Doty said the ongoing problems suggest to him the facility’s problem with its flare tip could be causing the black smoke.

“Flares like this should be operating with about 98 per cent combustion efficiency, but there is no way that the flare is operating with anything close to that efficiency,” he said. “If there’s too much pressure going to it, you’re never going to get things to combust properly — and that seems to be what is happening at LNG Canada.” 

In response to questions from The Narwhal and Point Source, the regulator spokesperson noted: “The causes of the black smoke events have not yet been definitively determined.” 

‘Truly massive’ invisible emissions

On top of the elevated levels of flaring at the LNG Canada export terminal, there are increasing concerns about the facility routinely releasing natural gas into the atmosphere.

Natural gas is mostly composed of methane, which is an invisible, odorless and an extremely potent greenhouse gas. When released directly into the atmosphere it is 80 times more powerful than carbon dioxide for its short-term warming impact on the climate.

“If people could actually see the invisible emissions that are being released from the LNG Canada facility that are detectable with an optical gas imaging camera, it would really blow them away,” Doty said. He monitored emissions at the Kitimat facility with a camera.“The emissions that could not be seen with the bare eye were shocking. They were truly massive.”

Doty said the emissions — both visible and invisible — could have “very negative health implications for nearby communities and downwind receptors.” 

“If I was living nearby, I would be very concerned, and I would want the plant shut down, at least in the short term, while it is re-engineered,” he said. He noted the unburned gas could contain volatile organic compounds such as benzene and butane, in addition to the climate-warming methane.

“At the moment, the program to monitor ambient air pollution in the area isn’t effective and doesn’t have enough monitors in place to truly calculate how air quality is being impacted,” he said.

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When a Michigan court shot down Enbridge’s plan to bury a section of its aging Line 5 pipeline in a concrete tunnel under two Great Lakes, Ontario Premier Doug Ford responded with a pipeline pitch of his own.  

“The fuel that powers Ontario’s economy should never be put at risk because of decisions made in another country,” Ford wrote in a post on X (formerly Twitter) on Aug. 1. “That’s why we’re building the Northern Shield Energy Corridor — a new Canadian pipeline, made with Canadian steel, by Canadian workers, exclusively within Canada’s borders.” 

Summary

• The Michigan Supreme Court cancelled the state regulator’s approval of Enbridge’s Line 5 tunnel project, telling it to reassess potential harm to two Great Lakes regions.
• Ontario Premier Doug Ford said the decision highlighted a need to build a new all-Canadian pipeline from Alberta to Ontario.
• Ford’s warnings about relying on energy “decisions made in another country” come as his government continues to push natural gas expansion, and the province increasingly relies on American supply.

His comment came a day after the Michigan Supreme Court ruled in a 6-1 decision against the state commission’s approval of Enbridge’s plan to build a tunnel under the Straits of Mackinac, a narrow, fast-moving waterway that joins Lake Michigan and Lake Huron. The purpose would be to bury a portion of the 73-year-old pipeline, which is currently exposed on the lakebed. 

The pipeline is 1,038 kilometres long, roughly the driving distance between Windsor and Timmins, Ont. It carries crude oil and natural gas liquids (such as propane and butane) from Superior, Wisconsin, passing through Michigan on its way to refineries in Sarnia, Ont.

The court found regulators hadn’t properly studied the environmental harm the project could cause to the lakes before approving it in 2023. Justices said the regulator must study not just the environmental impact of the underwater tunnel, but also how the tunnel would extend the lifespan of the pipeline and what the environmental consequences of that may be. Indigenous nations have said it will increase the risk of oil spills and increase greenhouse gas emissions from the fossil fuels it transports. 

“It is impossible to prevent or mitigate an environmental risk without understanding the nature of that risk,” the justices wrote.

As a result, the project’s approval is now cancelled, with the court ordering the commission to redo its review. The ruling doesn’t shut Line 5 down, but delays efforts to repair it and keep it in commission. 

Enbridge spokesperson Ryan Duffy called the decision disappointing in a statement to Bridge Michigan, saying the company remains committed to “the safe and responsible operation of Line 5,” while it reviews its legal options. 

Michigan Gov. Gretchen Whitmer, who has long fought to shut the pipeline down altogether, said “the pipeline is a ticking time bomb,” pointing to Enbridge’s 2010 spill in the state’s Kalamazoo River, the worst inland oil spill in U.S. history. 

Indigenous communities and environmental groups that brought the case to court celebrated it as a win for the Great Lakes.

Ford took a different route, using the court decision to re-up a pipeline concept he announced with Alberta Premier Danielle Smith in July. The Northern Shield Energy Corridor is a proposed 3,300-kilometre line to carry crude oil from Hardisty, Alta., through Saskatchewan and Manitoba to Sarnia.

If built, Northern Shield would retrace some of the route of the long-dead Energy East proposal from TransCanada, before the company scrapped it in 2017, citing regulatory delays and falling oil prices. That proposal also met significant Indigenous opposition.

Ford has framed it as an all-Canadian pipeline that would be immune to the kind of cross-border legal fights now delaying updates to Line 5. Northern Shield is undergoing a feasibility study, due by the end of the year, with no confirmed cost, timeline or construction approval.

That proposed route of Ford’s new pipeline ends in the same place Line 5 does: Sarnia, next to Aamjiwnaang First Nation. Chief Janelle Nahmabin told The Narwhal her community is “closely following” the discussions around Line 5 and the Michigan court decision. 

“While governments continue to debate energy security and future infrastructure, it is important that First Nation rights, environmental protection and community health remain at the centre of those discussions,” she wrote in an email. 

She pointed to an unresolved crisis in her community over benzene air pollution from industry, and a pipeline spill near Aamjiwnaang’s land into the St. Clair River in March 2026 as issues that need to be addressed before a new pipeline is considered. She said that these “cumulative impacts of industrial development” were the result of “decisions being made elsewhere.” 

“Communities that have carried disproportionate environmental burdens for decades should not be asked to shoulder even more,” she said.

Ford’s pitch for domestic supply comes amid growing reliance on U.S. gas

Ford’s warnings about relying on energy “decisions made in another country” come as his government continues its longstanding push to expand natural gas use, which increasingly relies on American supply. 

Natural gas is largely made up of methane, a potent greenhouse gas that traps heat in the atmosphere. It is the primary source of heating for three-quarters of homes in Ontario.

According to Ontario’s Independent Electricity System Operator, natural gas accounts for nearly 30 per cent of the province’s total generating capacity, up from 28 per cent in 2020. The operator attributes that growth largely to nuclear facilities being taken offline for refurbishments as well as rising electricity demand. 

Ontario is underlaid with a network of pipelines supplying natural gas for heating. According to the province, 3.6 million homes and 160,000 businesses rely on natural gas.

Per analysis by the Canada Energy Regulator, Ontario’s historical reliance on natural gas from Alberta has declined as western producers focus on western U.S. markets. Meanwhile, production in the U.S. northeast has increased, making importing gas cheaper for eastern provinces. As a result, as of 2009, Ontario has become a net importer of gas from the U.S.

Between 2015 and 2020, the most recent data available, imports at three key crossings into Ontario increased by 31 per cent, with most coming through Niagara.

Ontario’s ties to natural gas have deepened under the Ford government

This increase in U.S. natural gas imports is compounded by recent provincial decisions that ensure natural gas remains a key part of Ontario’s energy mix. 

In December 2023, the government took the unprecedented step of overruling the independent Ontario Energy Board after it ordered Enbridge Gas to stop passing the cost of new gas hookups on to homeowners’ monthly bills. Documents obtained by The Narwhal through freedom of information requests showed Enbridge staff in frequent contact with officials in the premier’s office in the lead-up to that decision, and Ford personally called Enbridge to discuss a stalled gas connection. 

Meanwhile, a growing number of Ontario municipalities, including Guelph and Waterloo Region, have pushed back against a long-standing provincial rule that lets Enbridge Gas build pipelines under municipal roads and other public land for free. Enbridge Gas has these decades-long free-access agreements with more than 340 municipalities across the province.

When Guelph and Waterloo Region refused to renew their agreements last year, the dispute went to the Ontario Energy Board, where it is still being deliberated. Energy Minister Stephen Lecce said the province isn’t considering changing the rule despite the municipalities’ calls to do so. 

As all of this plays out, including the Line 5 saga, Enbridge has told investors it expects to return tens of billions of dollars to shareholders over the coming years, in part because of the strength of continued gas demand growth in Ontario.

Updated on Aug. 7, 2026 at 2:026 p.m. ET: This story was updated to include a statement from Aamjiwnaang First Nation Chief Janelle Nahmabin sent to The Narwhal after publication.

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Summary

• As polls suggest a majority of Canadians support building new pipelines, the Alberta government is proposing a new pipeline to the West Coast to help boost production in the oilsands.
• The terms of the pipeline proposal name Alberta and the Canadian government together as majority owners, suggesting taxpayers will foot much of the construction bill.
• Pipelines are very expensive to build. A recent analysis of the federal government’s Trans Mountain pipeline, which is already operational, showed that the pipeline’s revenues aren’t high enough to cover its construction and debt costs, making it a money-loser for taxpayers.

Pipelines, pipelines, pipelines. No matter how you feel about them, it’s hard to escape news of them lately. 

In July, the Alberta government announced it is formally proposing another pipeline to the West Coast. On the weekend, the federal government took another step towards designating the pipeline as a project in the national interest, meaning environmental assessments and other parts of the approval process could be fast-tracked.

Recent polling shows the majority of Canadians — 63 per cent according to the Angus Reid Institute in July — support that new pipeline from Alberta to B.C.

Why? Mostly for economic reasons. A majority told pollsters they were convinced by the argument that Canada needs to diversify its oil markets away from the U.S., while half said oil is just generally important to the economy. Forty-five per cent said the project would create jobs. 

The economic forecast, though, isn’t quite that simple. There’s still the question of who’s going to pay for it. A poll commissioned by the Pembina Institute and conducted by Probe Research in April found a majority of Albertans — 61 per cent — say they don’t want to spend taxpayer money on a new pipeline.

It’s increasingly clear: many Canadians say they do want a new pipeline, but they don’t want to pay for it. Companies aren’t exactly lining up to build new pipelines by themselves either. That raises a question: why?

So what are the economics of a pipeline in Canada? Do they make money? Here’s what you need to know.

How much do pipelines cost to build?

No one is going to build a pipeline on a shoestring. These are multibillion-dollar projects, often crossing multiple provinces. Even expanding an existing pipeline, or building along an existing pipeline route is a huge endeavour involving tens of thousands of people working on the project.

Take the Trans Mountain Expansion project, as an example. That increased the capacity of an existing pipeline, built in the 1950s, from Alberta to the West Coast. That expansion project ultimately cost taxpayers $34 billion — notably, that’s almost $30 billion more than initial estimates. 

The latest pipeline idea making headlines was proposed by the Alberta government, with an estimated cost pegged at between $35.2 billion and $43.7 billion. That proposal was brought forward alongside the federally owned Trans Mountain Corporation, which will lead the project, and Pembina Pipeline Corporation (which is not connected to the Pembina Institute that held the poll). 

Under the proposed partnership, Trans Mountain and the Government of Alberta — through the Alberta Petroleum Marketing Commission — would hold a majority interest. 

So who would actually own it? Well … taxpayers, in a way.

How much have taxpayers spent building pipelines in the past?

It varies. Canadian taxpayers have been on the hook for billions since the Government of Canada purchased the Trans Mountain pipeline in 2018.

And maybe that’s okay. Some would argue that pipelines are infrastructure, much like highways or railways. Others disagree that billions of dollars of public money should be put toward increasing oil and gas infrastructure.

Nonetheless, it continues to happen. TC Energy’s cancelled Keystone XL expansion was backstopped by Alberta taxpayers to the tune of $1.5 billion in 2021.

And it’s happening again. Alberta’s government has already contributed a little more than $18 million to its latest pipeline plan, saying the money went to early planning work “including preliminary engineering, cost estimates, economic modelling, early Indigenous engagement with communities and development of the proposal for federal consideration.”

The Alberta government calls it a “myth” that it will pay for the entirety of the pipeline, saying, “Now that this preliminary work is done, we will work alongside Trans Mountain and Pembina Pipeline to move this project ahead.” But Pembina Pipeline currently has only a 10 per cent stake in the project.

So, in the end, it appears if the West Coast pipeline project moves ahead, it will be governments — and taxpayers — who foot much of the bill.

“I am quite comfortable that this is a good investment for Canadian taxpayers,” federal Energy and Natural Resources Minister Tim Hodgson told CBC in July.

How does a pipeline operator make money?

Whether pipelines are owned by companies or governments (and taxpayers like you), they charge fees for companies to move their products. The fees paid to use pipelines by companies such as oil producers are called tolls or tariffs. 

The Canada Energy Regulator oversees pipeline tolls, saying it ensures “they are just and reasonable.”

According to the regulator, tolls “cover the company’s cost of service, including a fair and reasonable return to pipeline investors.” Rates vary based on many factors: whether there’s a long-term commitment to shipping, how far, what the product is and how much of it.

The Trans Mountain expansion ended up costing so much that the tolls it charges customers to move oil are higher than expected. Still, according to the International Institute for Sustainable Development, only $15.4 billion of the $34-billion cost of the pipeline is covered by the tolls it charges.

Does running a pipeline actually make money?

Let’s look at Trans Mountain Corporation as an example — that pipeline we all own together. 

The company says it is now profitable. It reported its net income for 2025 was $556 million — up from $5 million the year before.

It’s what Minister Hodgson described to CBC as “generating oodles of cash.” 

But that claim has raised some eyebrows. And untangling it is complicated. 

The Trans Mountain Corporation is a wholly owned entity of another company, Canada TMP Finance Ltd., which is itself a subsidiary of Canada Development Investment Corporation, the entity which holds the Government of Canada’s investment in Trans Mountain. Still following? 

Let’s do it in the opposite direction. The Government of Canada owns a Crown corporation. That corporation has a subsidiary, which then in turn owns Trans Mountain Corporation. Hopefully that helps.

The debt of the expansion, and the interest on that debt, isn’t paid off. But Hodgson can claim the pipeline is profitable because of the confusing corporate structure of which Crown corporation holds its construction debt and pays the interest, and which takes in the tariffs, according to a report from the International Institute for Sustainable Development.

The author of the report described Trans Mountain’s profit claims to The Tyee as a “misrepresentation of finances.”

Trans Mountain Corporation did not respond to questions from The Narwhal by publication time.

But a company’s balance books aren’t the only way of looking at it. Industry advocates argue pipelines generate money in other ways too, including tax and royalty revenues and making oil prices more competitive.

For example, a 2024 report from a group created for Alberta credit unions argued the Trans Mountain expansion project resulted in a significant increase in access to markets for Alberta oil and that access significantly narrowed the price difference between a type of Western Canadian oil called Western Canadian Select and a type sold out of Texas called West Texas Intermediate. The report estimated this had already increased revenues by about $10 billion in the first six months the pipeline expansion launched.

There’s little doubt that producing and exporting oil and gas makes money for Canada — and especially for oil and gas companies themselves. But many have argued a fuller accounting would include the significant costs of the health risks, environmental degradation and other damage that comes from increasing carbon pollution from the burning of fossil fuels.

What are the costs of carbon pollution from increasing oil production?

Fossil fuel production is driving climate change and the consequences 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.

As The Narwhal has reported, it’s possible, at least broadly speaking, to compare the economic output of fossil fuels with health costs. The federal energy regulator, for example, has reported the total value of crude oil exports from Canada was $138 billion in 2024. A Health Canada report that same year found the total cost of health impacts attributable to air pollution in 2018 was $146 billion. The cost of many foods produced here is also rising as farming becomes less predictable. 

Estimates vary, but the short answer is climate change is expensive. A 2022 report from Queen’s University projected trillions of dollars in losses in Canada due to climate change this century, with the greatest contributor to that change being the burning of fossil fuels.

Does Alberta produce enough oil to fill a new pipeline?

Trans Mountain is currently “Canada’s only pipeline system transporting oil products to the West Coast.” The company says its 1,200-kilometre pipeline network has room for 890,000 barrels of petroleum products to be shipped each and every day. 

The new pipeline proposed by the Alberta government would be capable of transporting one million barrels of crude oil per day from the Edmonton area to the West Coast.

If it goes ahead, that would significantly increase the network of pipelines leading from Alberta.

There are already several other pipeline systems in use — leading to other locations in the U.S. and eastern Canada — and according to the Alberta Energy Regulator, all of them together could carry 5.4 million barrels per day. 

Currently, Alberta produces an average of more than four million barrels of oil per day. That suggests Alberta’s oil production stands to increase substantially if a new pipeline is going to be filled each and every day. 

Meanwhile the International Energy Agency has predicted global demand for oil from combustible fossil fuels may peak as early as 2027 — raising questions about the long-term outlook for expanded oilsands production.

— With files from Drew Anderson and Carl Meyer

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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.

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.

What a week. Amidst the blur of World Cup shenanigans and Canada Day festivities, politicians dropped not one, not two, but three massive pipeline announcements. 

First, there was the multibillion-dollar federal commitment for infrastructure projects in B.C. What does this have to do with pipelines, you ask? Well, the agreement also included a promise to maintain the federal oil tanker ban off B.C.’s North Coast and $10 billion to upgrade the Roberts Bank export terminal (that’s the huge shipping terminal you can see from BC Ferries as you approach Tsawwassen, FYI). 

That brings us to the second announcement, which came just a few hours later when Prime Minister Mark Carney and Alberta Premier Danielle Smith announced a plan for a southern route for a new oil pipeline to the West Coast that would largely follow the right-of-way for the Trans Mountain pipeline, except — surprise, surprise! — it would end at Roberts Bank. This theoretical pipeline would be planned and built by the federally owned Trans Mountain Corp., with Pembina Pipeline Corp. taking a 10 per cent stake in construction. Oh, and it would cost between $35 billion and $44 billion (mostly in taxpayer money).

As if that wasn’t enough to process, on Monday Ontario Premier Doug Ford and Smith proposed another pipeline called Northern Shield, which would take oilsands bitumen to refineries in Sarnia, Ont. There’s also no private backer for this pipeline and, notably, no formal federal support. The chief of Aamjiwnaang First Nation, meanwhile, says the nation hasn’t been consulted on the proposal thus far and notes it’s still in the midst of a benzene crisis and dealing with the fallout of a March 2026 pipeline spill.

The headlines have been coming so fast and furious, it’s been tough to keep up. I spent the week scouring the internet, trying to get my head around it all. Some of the most insightful commentary I came across was from Amy Janzwood, an assistant professor in political science and environment at McGill University — so I called her up to pick her brain on, well, all of it. 

This interview has been edited and condensed for length and clarity.

What have you noticed about the pipeline discussion in the media over the last week? 

All the media coverage I saw has been stenography, basically. Just regurgitating all of the talking points of [Minister of Energy and Natural Resources Tim] Hodgson, Carney and Smith. It’s been extremely uncritical coverage. The kind of making of a pipeline out of literally nothing other than taxpayer dollars has been quite dizzying and shocking to see. 

The questions I was asked a year ago about pipeline politics are very different than the questions I get now. Before I’d get asked: “What’s the prospect of another major oil pipeline? Is this a political fantasy?” But now there’s a slippage into engaging on the terms of the Smith government. The lack of context I’ve seen in the reporting on this is in part because of the firehose of announcements, and media outlets are just not able to keep up.

You have noted before that legacy media often uncritically repeat the narratives of the oil industry. It sounds like you’re still seeing that? Are any particular examples coming to mind? 

Hodgson has basically become the voice of the industry and I see that repeated verbatim, without any kind of interrogation. One very clear example I see over and over again is the profitability narrative around the Trans Mountain pipeline when we know this is actually not a profitable pipeline. You could argue there are good reasons to have it and we can have that debate, but [federal politicians] like to say that this is a profitable pipeline, which is straight up not true, so that’s one example of things that I see kind of repeated very uncritically.

Given that it’s not a profitable pipeline, what are the real reasons you think we’re seeing such broad political support for it in this moment?

There has been incredibly powerful messaging from the Carney government that we can have it all. We’ve seen this misconstrual of economic anxiety, sort of pinned on the hopes of another pipeline, which couldn’t be further from the reality. 

Pipelines have become kind of a stand-in for the future of oil and gas. It’s become a stand-in for a lot of really difficult conversations.

Canadians are still broadly supportive of climate action and renewable energy, but they’re also more supportive of pipelines now than they have been for at least the last decade. What do you make of that contradiction? 

As political scientists, we’ve long known that public opinion can largely be shaped by our political elites. I’m not surprised when I hear things from our prime minister and minister of natural resources around the need to build more pipelines, that there is this slippage or confusion that this is going to reduce our reliance in any way on the U.S. If you’re not following this closely, then that sounds great, if you’re being told this is what we need to keep Canada prosperous and strong. 

But as someone who has studied pipelines for over 10 years, those are promises new pipelines will not be able to deliver on. I think the public has largely forgotten the cost and divisiveness about Energy East, about Northern Gateway, about Trans Mountain. Unless you’re directly affected and witnessing and experiencing the impacts of these projects, those costs to you, those environmental risks are not salient. It has long been difficult for folks to make that connection when we’re told this is necessary for our economy, and when the economic benefits are as overstated as they often are.

Canadians are repeatedly told that pipelines are what’s needed to keep Canada prosperous and strong. What are political leaders misrepresenting when they say that? 

Fundamentally when we’re talking about major new pipelines, you’re going to need significant greenfield oilsands expansion to fill it. [A greenfield project is a new project built on undeveloped land.] We’ve seen the economics of the oilsands have not been trending towards that for the last several years to decades. Investors in the oilsands were really pressuring companies to deliver on their dividends. There was not an appetite for massive new expansions; it was not economic and it still is not. It would actually harm the industry if they can’t fill the pipeline. 

If we’re now talking about a hypothetical West Coast pipeline, the volatility and the reliance on global oil prices and very uncertain demand … there is not a long-term case to be made for increasing oil expansion to the degree that would be required for a major new pipeline.

This is not economic for the industry, so this will be taxpayer-funded. And there’s no certainty about demand for this hypothetical oil that the industry does not seem willing to produce, although Smith has alluded to doing whatever she can to stimulate further oilsands production with additional provincial support. 

It’s quite misleading to suggest we would need a new pipeline to diversify away from the U.S. I do think we do need to have important conversations about how to become more resilient in light of having the Trump administration. But spending billions of dollars for a pipeline that we don’t think the industry can fill is not the way to do it. 

Politicians also increasingly claim that Canada can indefinitely expand oil and gas production while meeting our climate commitments. Is that actually possible?

The short answer is no. This myth was alive and well under the Trudeau government. The Trudeau government really pioneered this narrative that we can have Trans Mountain and the oil expansion that comes with it and meet our climate targets and use the money from Trans Mountain to pay for the clean energy transition.

The latest iteration of this argument is this promise of carbon capture and storage. My take is that this is something the industry has never really been serious about doing.

Since Pathways Alliance [now called Oil Sands Alliance] announced its carbon capture and storage project in 2022, we’ve seen absolutely no significant investment of any kind in this project. And we know that they’ve just quietly stepped back from the amount of emissions reductions they’re promising.

It’s been quite troubling to see the Carney government so unquestioningly provide this narrative that we can have decarbonized oil — which is, of course, a contradiction.

You have described expanding fossil fuel exports as like saving for retirement by doubling down at the casino. Can you explain why that is?

Let’s not forget that oil and gas is a relatively small part of Canada’s GDP … but looking at the media coverage, you would not know that. 

The conversation we’re having right now is a federal government that has continuously found new and ever-creative ways to subsidize fossil fuel expansions, whether that’s LNG [liquefied natural gas], oilsands or carbon capture and storage, and telling the public that this is necessary. 

Let’s set aside LNG for now (the economics of LNG are a bit different), but about oil specifically, this is an industry that’s had record profits that’s been unwilling to pay for its own pollution — it is a cost the industry has very successfully avoided, whether that’s orphan wells and cleanup or carbon. 

We’re told we need to double down and it’s necessary for economic prosperity. But what we’re seeing is the bill that’s racking up that taxpayers are on the hook for — when there’s an industry that can very well pay for it, and is unwilling to because they know they have a government that will backstop it. They now have a government that will buy a pipeline and that now has a state-owned pipeline company that is promising to be a backer for another new pipeline, which honestly, if you had told me that even 12 months ago, I would not believe you. It is absolutely mind-boggling. 

The Narwhal is going to be following all of these issues closely. If you have thoughts or a story tip email editor@thenarwhal.ca

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Summary

• In early May, 49 birds were found in tailings ponds at Imperial Oil’s Kearl oilsands mine. Later in the month, 95 birds were found dead at the Suncor Firebag site.
• The Alberta government’s oilsands mine water steering committee made recommendations in 2025 to speed up creating standards for treating and releasing tailings, which are generated as a by-product of the oil extraction process.
• Treating and releasing tailings into rivers has been criticized by downstream First Nations, including Mikisew Cree First Nation.

At Jean L’Hommecourt’s cabin north of Fort McMurray, the birdsong is frequently interrupted by the hollow booming of a cannon, a stark reminder of the proximity of the oilsands in an otherwise tranquil setting of muskeg and boreal forest. 

L’Hommecourt got another reminder of her toxic neighbour last month. Announcements about oiled birds in tailings ponds have L’Hommecourt, who is from Fort McKay First Nation, and other community members thinking about the 1.4 billion cubic litres of tailings ponds upstream of their water supply and food sources in northern Alberta. 

The booming cannons heard from L’Hommecourt’s cabin are an attempt to scare away birds that might otherwise land on tailings ponds and perish — but they don’t always work. Fort McKay First Nation notified members that 49 birds were found in tailings ponds at Imperial Oil’s Kearl oilsands mine between May 1 and 8. “Detection and deterrent systems, including the use of drones for hazing, have remained active during this spring migration period,” the notice to members said. The Narwhal reached out to Imperial Oil to ask whether the birds were found deceased, or if any birds had been retrieved and rehabilitated, but the company did not respond to multiple requests for comment. 

“It’s claiming the lives of our waterfowl. That is our traditional foods,” L’Hommecourt, who has been an advocate for clean drinking water, said.  

L’Hommecourt’s cabin is 13 kilometres away from the Kearl mine site and she no longer harvests plants or berries from the area. She is concerned about the effects of air pollution, though she and her husband will still harvest moose, as they live on a diet of traditional foods as much as possible. 

95 more birds found dead at Suncor site in May

Living downstream of tailings ponds has long been a concern for residents in and around Fort McKay, which is in the middle of much oilsands mining activity, as well as in Fort Chipewyan, a remote fly-in community accessible only by plane or winter road that is downstream of the oilsands. Fort Chipewyan has three Indigenous groups: Athabasca Chipewyan First Nation, the Fort Chipewyan Métis and the Mikisew Cree.

On May 24, Mikisew Cree First Nation also notified members that birds were found dead at one of Suncor’s oilsands sites, known as the Suncor Firebag site. 

“After a thorough search of the area, a total of 95 birds have been found deceased in the north-east quadrant of the site, not near any bodies of water,” a spokesperson for Suncor said in a statement.

Birds land on tailings ponds to rest as they migrate. Lights from the work camps, changes in temperature and even a change in headwinds can mean the migrating birds need these pit stops.

When a bird lands in a tailings pond they can become coated with oil, which can reduce the waterproofing in their feathers and can cause them to sink. Birds that can get out of the tailings pond and have the oil removed may have reduced insulation and other negative effects that can lead to hypothermia even from small amounts of oil, according to a federal government report on annual bird mortality in the oilsands.

The Alberta Energy Regulator said it was conducting an inspection of the Firebag site for more information about the dead birds. 

A spokesperson for the regulator said by email that oilsands operators typically use a number of deterrents to stop birds or other wildlife from ending up in tailings ponds, including propane-fired cannons and loudspeakers, scarecrows, human effigies and kites shaped like hawks.

The Narwhal previously reported on an unreleased internal document from the Alberta Energy Regulator in 2021 that showed an “emphasis on the appearance of sophisticated bird protection over data that demonstrate it.”

L’Hommecourt said she is upset that even though there is ample time to plan new deterrents, communities are still receiving notifications about oiled birds and bird deaths. 

Suncor added in a statement that it has a monitoring and mitigation program to prevent its sites from harming wildlife. The cause of death for the birds is currently unknown. 

Bird deaths continue as Alberta plans a new treat-and-release approach to tailings

The announcements have spurred further concern about pollution issues downstream of the oilsands. Mikisew Cree First Nation Chief Billy-Joe Tuccaro went to Ottawa in November to call on the federal government to manage tailings ponds and other industrial waste in a way that protects nearby communities like Fort Chipewyan, where he said he doesn’t feel Indigenous sovereignty or community concerns about water are being taken seriously. 

“So, what they’re saying is that it’s safe. Well, if it’s so safe, build a pipeline, put it right by the [legislature] in Edmonton. The premier can drink it first, then send another pipeline to Calgary, then the Bow, they can drink it as well, those corporate people, and then build one, go to the east, and then Carney could drink it too,” he told The Narwhal. 

“And then they could be the science experiments, the subjects, because we’re tired of it.”

The Alberta government’s oilsands mine water steering committee made recommendations in 2025 to speed up creating standards for treating and releasing the water generated as a by-product of the oil extraction process.

The liquid is a mixture of residual bitumen, heavy metals, clay and sand. Studies show that the “oilsands process-affected water,” as it is called in industry, also contains a toxic slurry of naphthenic acids, volatile organic compounds and polycyclic aromatic hydrocarbons. These can cause health effects including narcosis (cell poisoning) and disrupt the endocrine system, which can cause issues with diabetes, fertility, thyroid malfunction and increased cancer risk.

Tuccaro said there have not been enough studies into the cumulative effects of oilsands mining. While the focus on water safety tends to be on drinking water from the taps, he added there is also an effect from consuming traditional foods such as berries and fish from the area. 

All three Indigenous communities in the Fort Chipewyan area — the Mikisew Cree, the Athabasca Chipewyan First Nation and the Fort Chipewyan Métis — have expressed concerns about the Alberta government’s plans to treat and release tailings pond water. 

Tany Yao, the MLA for the area, did not respond to a media request about the birds in the tailings ponds nor about the Fort Chipewyan residents’ concerns about the plans to eventually treat and release tailings pond water.

Updated June 17, 2026, at 6:43 a.m. MT: Due to an editing error, a previous version of the summary at the top of this article stated all 49 birds found in tailings ponds at Imperial Oil’s Kearl oilsands mine had died. In fact, the company did not respond to questions about whether the birds were confirmed dead, as the article states. The summary also stated birds at the Suncor site were found dead in tailings ponds when the company said they were not found in water, as the article says.

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Summary

• With demand for electricity rising fast, BC Hydro says it needs natural gas power plants to keep operating to ensure the province has enough power.
• Island Generation, a natural gas plant in Campbell River, B.C., was supposed to be decommissioned but BC Hydro is now seeking to renew its contract as the province needs the power. 
• Energy Minister Adrian Dix said Island Generation is facing supply issues due to the Squamish-based Woodfibre LNG project. As the project is not yet operational, Dix’s comments have confused and surprised some politicians and experts.

When a heat wave hits Vancouver Island, residents turn up their air conditioning, flick on fans or adjust their heat pumps. Demand for electricity spikes. That’s also true during cold snaps and long, dark winter nights when more electricity is needed to keep homes lit and warm.

It’s on those days of extreme electricity demand that a Campbell River power plant fuelled by natural gas is most likely to fire up. Island Generation, owned by Capital Power, is one of a handful of facilities in B.C. that use natural gas to produce electricity. It’s what is known as a peaker plant, mostly called on to generate power at times of peak demand.

With a capacity of 275 megawatts, Island Generation can create enough electricity to power about 125,000 homes. It accounts for about one-quarter of all the electricity that can be produced on Vancouver Island. Only about 40 per cent of the electricity used on the island is generated locally. The rest comes from the mainland, transmitted via cables laid across the bed of the Salish Sea.

Over the past five years, Island Generation has operated an average of 15 days per year, according to Adrian Dix, B.C.’s minister of energy and climate solutions.

But, the facility has been having trouble getting the gas it needs to generate electricity at critical times, Dix told members of the B.C. Conservative caucus on April 23. He said the supposed natural gas supply issue is connected to liquefied natural gas (LNG) production. 

“The reason why the supply of gas is affected is that gas is going to a project called Woodfibre LNG in Squamish. That has been the issue between ourselves and Capital Power,” he said. 

Dix’s statement surprised and puzzled the politicians and experts The Narwhal spoke to. Woodfibre LNG is still under construction until at least next year. Until then, there’s no obvious reason the Squamish facility would be using gas that would otherwise go to Island Generation. 

But questions to the Energy Ministry, Island Generation and Woodfibre LNG mostly went unanswered. None provided information needed to clarify the situation with Island Generation’s gas supply.

“Woodfibre LNG will be purchasing gas in the future once the facility is operational,” a spokesperson for the facility said in response to multiple emails and questions, an answer that does not directly address whether the facility is currently buying natural gas, as the minister implied.

The Energy Ministry did not respond to The Narwhal’s request for an interview with Dix or to specific questions about the ministry’s knowledge about Island Generation’s gas supply or its efforts to ensure the facility will be able to get the gas it needs to operate.

Green Party MLA Jeremy Valeriote, who represents the Vancouver-Sea to Sky riding where Woodfibre LNG is located, told The Narwhal he has not been able to clarify Dix’s comments.

“I’m just flagging for the public that it’s been hard for either of us to get any public information on this,” Valeriote said.

‘Where would that extra energy come from?’

BC Hydro’s contract with Capital Power was set to end in October 2026, but it recently applied to the BC Utilities Commission for a new agreement. The application mentions both Island Generation and the McMahon Cogeneration facility in Taylor, B.C., near the heart of the province’s oil and gas industry. The two gas-fired plants could help BC Hydro meet about 80 per cent of a 500-megawatt electricity shortfall it forecasts will materialize by 2030.

Demand for electricity has been rising rapidly in B.C., driven partly by large industrial customers such as LNG terminals and mining operations. BC Hydro has been under pressure to find efficiencies in its system and bring on new generating capacity with an emphasis on renewable sources such as wind and solar.

Meanwhile, the provincial government has been working to usher in an LNG boom, which could put pressure on the electrical grid and increase competition for natural gas.

Valeriote noted BC Hydro is supposed to be phasing out fossil fuel electricity generation, not seeking new contracts with gas-fired plants.

“It’s pretty concerning when we talk about firing up what should have been a decommissioned gas plant on the island that may not even have gas … in those critical, peak times,” he said.

BC Hydro’s submission to the utilities commission argues the Clean Energy Act, which requires it to generate and purchase enough energy to meet demand, trumps the regulations regarding phasing out fossil fuels. 

B.C. Conservative MLA Larry Neufeld wants to know what would happen if Island Generation were unable to operate during a demand peak.

“Where would that extra energy come from?” Neufeld, who serves as his party’s critic for oil, gas and LNG, said. 

“Would that be siphoned off of the Lower Mainland? Would it be imported? Those are excellent questions that the minister would be responsible to answer.”

B.C.’s LNG push and electricity demand

By 2030, there could be three LNG facilities operating in B.C. and a huge increase in demand for natural gas. In May, the Canadian government celebrated an agreement that could see one of them, Ksi Lisims LNG, sell one million tonnes of liquefied natural gas (LNG) per year to Germany, starting sometime in the 2030s.

Another is LNG Canada, located on B.C.’s coast, the first large-scale LNG export facility in the country. 

It is already using up a huge amount of gas to operate: last year, LNG Canada received more than 3.6 billion cubic metres of natural gas. Nearly 10 per cent of what it burned off was because of an issue with one of the flare stacks, as The Narwhal previously reported.

And, it might eventually use much more. Earlier this month, B.C. Premier David Eby, federal Natural Resources Minister Tim Hodgson and LNG Canada CEO Chris Cooper held a press conference about a potential second phase of the project.

The newsiness of this announcement — trumpeting another small step toward a final commitment to proceed — was so thin one reporter asked why a press conference had been called at all. But Phase 2 could make a big difference to the province’s energy supply, as LNG Canada’s demand for natural gas could double as its production capacity rises to 28 million tonnes of LNG per year.

Woodfibre LNG will have a much smaller production capacity. It is expected to produce 2.1 million tonnes of LNG per year and will need about 7.7 million cubic metres of natural gas to do so. That gas will be supplied via a new pipeline branch off the Eagle Mountain pipeline, which currently supplies Vancouver Island, including the Island Generation station.

FortisBC is in the process of building that new section of Eagle Mountain as well as upgrading the section of the pipeline that leads into Squamish. A spokesperson for the company said in a statement that Fortis “regularly assesses system capacity and plans for growth and changing regional needs.”

“FortisBC can meet the needs of existing customers on Vancouver Island and we are continuing to deliver natural gas service in line with our contractual agreements,” the spokesperson said.

The Narwhal also asked Capital Power for an interview to discuss the minister’s comments. In response, a company spokesperson sent a two-sentence statement.

“Capital Power and BC Hydro are engaged in discussions around the future of the Island Generation facility in Campbell River,” the statement said. “Our focus is always to ensure we support the reliable, safe delivery of the power needs of British Columbians.”

A follow-up email with the same questions The Narwhal sent to the Energy Ministry went unanswered.

Conservative MLA Neufeld said British Columbians should not have to worry about a shortage of natural gas, even with a large increase in demand.

“Having spent over 30 years in the industry in northeast British Columbia, I will state that it is my opinion that that is a non-issue,” Neufeld told The Narwhal.

“There is far more than enough natural gas in the ground … we don’t have to be concerned about a supply crunch. Whether that is taken advantage of properly by government and by regulation is another question for the minister.”

But as British Columbians brace for a summer of heat waves and rising electricity demands, the province’s ability to keep power flowing becomes an increasingly important question.

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