{"id":382180,"date":"2025-06-08T12:47:46","date_gmt":"2025-06-08T10:47:46","guid":{"rendered":"https:\/\/climatescience.press\/?p=382180"},"modified":"2025-06-08T12:47:47","modified_gmt":"2025-06-08T10:47:47","slug":"canada-pm-carney-floats-imaginary-decarbonized-oil-pipeline","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=382180","title":{"rendered":"Canada PM Carney Floats Imaginary \u201cDecarbonized Oil\u201d\u00a0Pipeline"},"content":{"rendered":"\n
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From Science Matters<\/a><\/p>\n\n\n\n

By\u00a0Ron Clutz<\/a><\/p>\n\n\n\n

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Reality intrudes in National Post article Alberta and Ottawa tout a grand bargain on \u2018decarbonized\u2019 oil but some are skeptical.<\/strong><\/a>  Excerpts in italics with my bolds.<\/p>\n\n\n\n

Carney said he\u2019d consider fast-tracking a new oil pipeline
to the West Coast if it shipped \u2018decarbonized barrels\u2019<\/strong><\/em><\/p>\n\n\n\n

OTTAWA \u2014 \u201cGrand bargain\u201d<\/strong> was the phrase of the day on Parliament Hill after Prime Minister Mark Carney and his provincial counterparts found common ground on oil and gas development.  \u201cIf (the Conservatives) were listening to yesterday, there is a grand bargain,\u201d Energy Minister Tim Hodgson boasted to the Opposition benches.<\/em><\/p>\n\n\n\n

\u201cThere is a bargain that the Premier of Alberta has signed onto<\/strong>.\u201d  Alberta Premier Danielle Smith left Monday\u2019s first ministers\u2019 meeting<\/a> with a new deal exchanging oil sands access to coastal waters for massive investments in decarbonization technologies<\/strong>, but experts warn this could be a costly pipe dream. <\/strong><\/em><\/p>\n\n\n\n

\u201cI\u2019m worried we\u2019re seeing (the first ministers) fall into a trap of wanting to have their cake and eat it too,\u201d<\/strong> said Tim McMillan, a partner at Garrison Strategy and the former head of the Canadian Association of Petroleum Producers.<\/em><\/p>\n\n\n\n

\u201cThere\u2019s real potential there<\/strong> (and), if further developed, the federal government will look to advance it,\u201d said Carney<\/strong>.  But McMillan says the devil could be in the details.<\/strong><\/em><\/p>\n\n\n\n

\u201cI don\u2019t know exactly what they\u2019re talking about with decarbonization, but\u2026 it may be linked to carbon capture<\/strong>, which does not increase our exports (or) investability<\/strong>,\u201d said McMillan.  \u201cIf (carbon capture) becomes a long-term requirement for new projects, it will likely have a negative effect on<\/strong> future investments in Canada\u2019s upstream oil and gas sector.\u201d<\/strong><\/em><\/p>\n\n\n\n

The Calgary-based Pathways Alliance<\/a>,<\/strong> a group of six major oil sands producers, has put forward a $16.5-billion decarbonization network<\/strong> that would reroute carbon emissions from nearly two dozen facilities to an underground hub near Cold Lake, Alta.  The big-ticket project has been at a standstill for years over government funding<\/a>.<\/strong><\/em><\/p>\n\n\n\n

Smith said Monday that the financial windfall of a new West Coast bitumen pipeline serving markets in Asia<\/strong> could help make the economics<\/strong> of the Pathways project work.  \u201cIf we had a million barrel a day pipeline going to the northwest (British Columbia) coast, that would generate about $20 billion a year in revenues\u2026 that seems like a pretty good value proposition if both of those projects can proceed at once,\u201d said Smith.<\/em><\/p>\n\n\n\n

Carney and Hodgson have both paid lip service<\/a> to the Pathways project<\/strong> in recent weeks, but the venture still faces an uphill battle.<\/strong>  A recent independent analysis found the project was likely to lose money<\/a> due to the limited recyclability of captured carbon.<\/strong><\/em><\/p>\n\n\n\n

\u201cEven under optimal conditions, the Pathways project may struggle to break even, and real-world operations are rarely optimal,\u201d<\/strong> read the study, prepared by the Institute for Energy Economics and Financial Analysis.  \u201cThe Canadian federal government and the province of Alberta may be pressured to make up the likely shortfall,\u201d it continued.<\/em><\/p>\n\n\n\n

\u201cAn unprofitable carbon capture project will struggle to bring lasting positive economic benefits to host communities and become dependent on external financial subsidies to maintain operations.\u201d<\/strong><\/em><\/p>\n\n\n\n

McMillan also noted that Canada\u2019s two biggest competitors in the heavy oil industry,<\/strong> Mexico and Venezuela, are unlikely to follow suit with large-scale carbon capture projects of their own, giving each an edge over Canada on a per-barrel basis.<\/strong><\/em><\/p>\n\n\n\n

Footnote:  \u201cSome are skeptical\u201d understates the case.  \u201cDecarbonized Oil\u201d is a Ruinous Farce.<\/strong><\/h4>\n\n\n\n

The Study is Financial risks of carbon capture and storage in Canada: Concerns about the Pathways Project and Public Energy Policy. <\/strong><\/a> Highlights in italics with my bolds and added images.<\/p>\n\n\n\n

Cost challenges threaten the ability of a large, planned carbon capture project to achieve financial sustainability.<\/strong> The Pathways Alliance plans to capture<\/strong> carbon dioxide (CO2)<\/strong> generated at 13 oil sand processing facilities, compress<\/strong> the gas and send<\/strong> it by pipeline to a storage hub<\/strong> near the Cold Lake region in Alberta. Publicly available financial information on the Pathways project is scant. It is instructive, however, to analyze the experiences of two existing commercial carbon capture facilities in Alberta<\/strong>\u2014the Alberta Carbon Trunk (ACTL) line facility and Shell\u2019s Quest facility.<\/em><\/p>\n\n\n\n

The Institute for Energy Economics and Financial Analysis (IEEFA) examined the two currently operating CCS projects, together with current policy and provincial carbon market dynamics. The resulting report identified troubling cost implications<\/strong> for the Pathways CO2 transport and storage project and raises the concern that the Canadian federal government and<\/strong> the province of Alberta<\/strong> may be pressured to make up the likely shortfall.<\/strong><\/em><\/p>\n\n\n\n