Carney backs ‘reckless’ LNG project & unproven carbon capture being spun as ‘clean’ oil

This week, a report from the Canadian Climate Institute revealed Canada’s climate progress had stalled entirely in 2024, with emissions flatlining and the oil and gas sector wiping out gains made elsewhere.

Prime Minister Mark Carney, meanwhile, unveiled his “national interest projects”, which critics warn will fast-track Canada further off its emissions reduction path.

Beyond the first five initiatives the Liberal government is sending to the Major Projects Office for consideration, a second set of projects being prepared for approval includes Pathways Plus: “An Alberta-based carbon capture, utilization, and storage project and pipeline that will substantially reduce emissions with additional energy infrastructure that will support a strong conventional energy sector while driving down emissions from the oil sands. Pathways creates the prospect of facilitating low-carbon oil exports from the Alberta oil sands to a variety of potential markets,” Carney’s government announced on September 11.

While in Alberta on the same day, Carney said the carbon capture element is a “necessary condition” for future pipeline construction and that his government is going to “accelerate” work on the joint carbon capture and pipeline initiative, which he described as a “potentially viable project”.

It was an unusual choice of words for a potentially multi-billion-dollar investment forced on taxpayers and being aggressively lobbied for by some of the country’s largest oil companies. 

While Carney described the carbon capture project as “potentially viable”, scientists say the technology is not proven and merely a way for the oil industry to justify pipeline and oil extraction expansion.   

“There’ll be no oil pipeline that’s brought forward to the Major Projects Office, unless there is a decarbonization plan like Pathways,” Carney said. 

“The major project office will continue to do the work that creates the opportunity for the ‘plus’. The ‘plus’ is a potential pipeline to a variety of potential markets.”

The oil industry, through a group called the Pathways Alliance, has been lobbying the federal government for years to get the project off the ground with billions in taxpayer funding.

Through the Alberta government, the Pathways Alliance — which includes Suncor Energy, Imperial Oil, ConocoPhillips, Canadian Natural Resources, Cenovus Energy and MEG Energy — has aggressively lobbied Ottawa for financial assistance to build its carbon capture, utilization and storage (CCUS) project, a 400-kilometre pipeline that would link about two dozen northern Alberta oilsands operations to an underground carbon storage facility near Cold Lake.

The Alberta and federal governments had previously pledged billions of dollars for the project in tax breaks, carbon credits and other incentives. 

Critics say the carbon capture plans are nothing more than a taxpayer-funded government handout to justify massive oil expansion and the construction of new pipelines to get more oil to markets.

Scientists warn that carbon capture, as Carney appeared to question, is not even a viable technology, and that the notion of “decarbonizing” the oilsands is just the latest greenwashing spin by the industry to deflect from the fact that any expansion would cause even more harmful pollution, at a critical time when emissions levels are going in the wrong direction.

Canada is set to miss its 2030 emissions target by a significant margin. But Carney is betting on unproven “decarbonization” claims pushed by the fossil fuel industry with costly and unreliable carbon capture technology, raising concerns he might be prioritizing industry and political calculations over climate action, stakeholders warn.

Environmental Defence’s oil and gas program manager Aly Hyder Ali criticized Carney for proposing decarbonized oil, which is “a dangerous myth…[that] goes against the sense of chemistry on this planet, and is being used to justify the expansion of false solutions like carbon capture.” 

Environmental organizations have voiced concern about the Pathways Alliance lobbying efforts, pointing out that there has been no government assessment to evaluate the various claims being made by the oil industry giants. 

Carney is now being questioned about his apparent support for a plan that has been aggressively pushed by the largest polluters in the country, but has not been scientifically vetted by any government agency. The six oil giants’ claims about capturing between 10 to 12 megatonnes of CO2 annually by 2030 have never been evaluated by the federal government. However, research and past attempts at carbon capture have shown the technology does not come close to delivering what the industry claims.  

The petrochemical industry has been widely condemned for spending tens of millions on public relations and lobbying campaigns to make citizens believe in “clean” natural gas, “decarbonized” oilsands, “resilient hydrocarbons” and “transitional projects”; slogans meant to distract from the scientific fact that there is no such thing as green petrochemicals and the reality that the only way to avoid climate catastrophe is to stop burning carbon-based resources for energy. 

Hyder Ali says the use of such terms, and Carney’s apparent capitulation to the oil industry’s carbon capture myths is part of a dangerous game: “It also gives oil companies a license to keep increasing fossil fuel production under the facade that they’re cleaning up their mess.”

On September 18, the Canadian Climate Institute’s Early Estimate of National Emissions (EENE) report revealed national greenhouse gas (GHG) emissions remained unchanged in 2024, holding at 694 megatonnes of carbon dioxide equivalent, the same level as 2023, a troubling reversal after years of modest declines.

Emissions from the oil and gas sector rose by 1.9 percent, driven by a 3.4 percent increase in oil sands production as Ottawa provided nearly $30 billion in direct subsidies and public financing to the fossil fuel industry.

 

The latest Early Estimate of National Emissions (EENE) from 440 Megatonnes shows that in 2024, the oil sands added 3 million tonnes of carbon dioxide equivalent (Mt CO2e) to Canada’s total emissions, outpacing all other sectors. Overall emissions remained only 8.5 percent below 2005 levels last year, leaving Canada far from its 2030 goal of reducing emissions by 40 to 45 percent from 2005 levels.

(440megatonnes.ca Early Estimate of National Emissions)

 

“The latest emissions data confirm that two decades of climate progress is in jeopardy without a policy reboot from governments right across the country. With emissions flatlining and important policies being scaled back, Canada’s 2030 target is now out of reach—and the longer we take to get back on track, the more Canadians will pay the price,” the Canadian Climate Institute president, Rick Smith, said.

On September 11, Carney unveiled five “nation-building projects” aimed at making Canada “the strongest economy in the G7”, mixing promising initiatives with controversial ones, including Phase two of LNG Canada in Kitimat, British Columbia (B.C.), doubling liquefied natural gas production by chilling gas piped from Alberta and Northeast B.C. into a liquid form for export to Asia with initial shipments already underway this summer. 

“Together, these projects represent investments of more than $60 billion in our economy and will create thousands of well-paying jobs for Canadians,” a statement noted.

 

In the coming weeks, The Pointer will unpack the first series of projects being referred to the Major Projects Office for consideration in detail.

(Prime Minister of Canada)

 

“The whole initiative felt more like a communications exercise than something truly functional—at least for now. Most of these projects were already happening and are often well into development,” University of Toronto Economic Analysis and Policy assistant professor and former federal New Democratic Party Chief Economist, Rob Gillezeau, told The Pointer.

“The government shouldn’t be picking which business ventures succeed. If carbon capture or any other project truly made economic sense, the private sector should be able to deliver it on its own.”

Hyder Ali questions the economic justification for the project.

“Continuing to expand oil and gas projects in the middle of a climate crisis when we're so far off from our climate commitments is absolutely reckless. It's not only environmentally reckless, it's financially reckless,” he said.

“It's a very short-sighted move.”

David Suzuki Foundation’s Indigenous Strategy senior advisor Janelle Lapointe told The Pointer she is “disappointed, but not surprised” since the Prime Minister’s Office has signalled that Carney’s version of nation-building involves reinvesting in the “same extractive industries that have been wreaking havoc on the environment and the climate.”

“The LNG Phase two would completely blow Canada's commitments out of the water and set off a regional carbon bomb, and jeopardize our future competitiveness and the global economy, as you see the rest of the world transition away from fossil fuels into renewable energy,” Lapointe emphasized.

“Not only is it a step back on our climate commitments, but it does not seem to be keeping pace with the rest of the world.”

 

 

Approximately one-seventh of the world's primary energy is now sourced from renewable technologies.

(Our World in Data)

 

Environmental Defence executive director Tim Gray explained that Canada entered the LNG market late, which is already dominated by major players like the U.S. and Russia. Liquefied natural gas, primarily methane, is both “toxic and a potent greenhouse gas”, with climate impacts comparable to coal and oil. 

“With massive project oversupply now coming online, Canada will have invested in more planet-heating carbon while wasting resources that could have developed renewable energy for export to the United States,” Gray noted.

In 2022, methane was responsible for 117 megatonnes of carbon emissions, over 16 percent of Canada’s total greenhouse gas output, according to Environment and Climate Change Canada’s National Inventory report. Nearly half of that, 56 megatonnes, came from the oil and gas sector alone.

 

 

According to The Oil and Gas Emissions Management Regulations Annual Report, Canada has made significant progress in reducing methane emissions from the oil and gas sector, cutting them by more than half through a mix of provincial leadership, federal regulation, and targeted incentives. Pushing LNG projects can reverse that progress.

(Canadian Climate Institute)

 

Canada has yet to finalize its updated regulations targeting a 75 percent reduction in methane emissions from the oil and gas sector by 2030, with draft rules released in December 2023 still awaiting completion.

Similarly, the proposed oil and gas emissions cap, unveiled in November 2024, remains unfinished. The first reporting obligations begin in 2026, under a cap-and-trade system.

Alberta Premier Danielle Smith, a vocal critic of the federal oil and gas emissions cap, calling it unconstitutional and an infringement on provincial authority, welcomed Carney's announcement. Her United Conservative Party previously voted to scrap provincial emissions reduction targets and officially declared carbon dioxide “a foundational nutrient for all life on Earth.”

“When I looked at the first five projects, I thought: ‘Finally, they get it,’ because it’s all the projects that have been difficult to build,” Smith told reporters in Edmonton.

The projects will be overseen by the newly established Major Projects Office (MPO), headquartered in Calgary, launched on August 29 and led by CEO Dawn Farrell, who previously served as President and CEO of Trans Mountain Corporation.

First Nations and civil society organizations slammed the MPO as a continuation of a failed strategy that risks sidelining Indigenous rights, weakening environmental protections and putting corporate timelines ahead of communities.

“We oppose the absolute destruction of this planet. When a supposedly democratic country like Canada sets up an office of cherry-picked individuals whose purpose is to generate profits, not protections, it is not only immoral, it fails to uphold Canada’s constitutional duty to consult, and other constitutional protections owed to Indigenous peoples. All Canadians, and all Indigenous Nations, must stand together to oppose this office and refuse to support it,” Chief Na’Moks, Wet’suwet’en Hereditary Chief, said.

“Projects of national interest must take into account human health impacts, not just short-term economic benefits. First Nations and rural communities bear a disproportionate burden from fracking and LNG infrastructure, with research linking these operations to increased rates of respiratory disease, adverse pregnancy outcomes, and other serious health conditions. LNG development threatens not only health but also sovereignty and Indigenous ways of life, as many First Nations across BC are being forced to defend their territories from this harmful industry,” Dr. Melissa Lem, family physician and President of the Canadian Association of Physicians for the Environment, added.

“Before fast-tracking any more LNG projects, the federal government needs to invest in research and enact stronger regulations to safeguard communities from the health impacts of fracking and LNG, and show the industry is safe, because current evidence suggests it is not. Instead of racing to support major polluters, the government should be protecting Canadians from the mounting healthcare costs and climate impacts that are part of fossil fuel expansion.”

On July 16, chiefs from four First Nations and senior counsel Kate Kempton announced a fast-tracked constitutional challenge against Ontario’s Bill 5 and key parts of federal Bill C-5, arguing these laws grant governments unchecked power to override environmental protections, human rights, and Indigenous consultation.

In response, Carney announced an 11-member Indigenous Advisory Council from First Nations, Métis, and Inuit communities to guide the MPO on September 10.

After the council appointments were announced, some Indigenous leaders voiced concerns over inadequate representation.

“While we acknowledge the First Nations leaders who have been appointed, the Government of Canada is once again moving forward without respecting the voices, jurisdiction, and decision-making authority of First Nations in Manitoba,” Assembly of Manitoba Chiefs (AMC) Grand Chief Kyra Wilson said in a statement. 

“Not one First Nations leader was even considered. This is not inclusion – it is exclusion. First Nations in Manitoba must determine for themselves how they will be engaged, not through a federally appointed body designed in Ottawa…These are nation-building projects that will affect our lands, our waters, and our future generations.”

“As the government of the Métis Nation within Alberta, representing the largest Indigenous population in Canada, the Otipemisiwak Métis Government must be included on the Indigenous Advisory Council to reflect the vital and historic role our Citizens have played, and continue to play, in building Canada,” Andrea Sandmaier, President of the Otipemisiwak Métis Government, added in a statement.

“If the Métis Nation within Alberta does not have a seat at the table, it would undermine reconciliation and weaken the very nation-building these projects are meant to achieve.”

Beyond the five flagship projects, the government is exploring “transformative” strategies still in early stages.

Among the longer-term initiatives under MPO consideration is the Pathways Plus carbon capture plan.

“We're also referring the…Pathways Plus project to the Major Projects Office,” Carney said during the press conference. Pathways “could achieve enormous emissions reductions, taking the equivalent of the emissions of 90 percent of all the cars and trucks in Alberta off the road.”

There has been no independent or government-led scientific study to justify Carney’s claims.

 

The proposed route for the Pathways Alliance carbon capture and storage project would run roughly 400 kilometres from over 13 Alberta oilsands facilities in the Fort McMurray, Christina Lake, and Cold Lake regions to a storage site just outside St. Paul, where carbon dioxide would be buried deep underground. Over the years, rural residents along the pipeline’s path have raised concerns about safety, environmental risks, and a lack of meaningful consultation including potential pipeline ruptures, groundwater contamination, threats to Indigenous Treaty Rights, and the discrepancy between ambitious capture goals and historically lower real‑world carbon capture rates.

(Canadian Energy Centre)

 

Pathways Plus offers the potential to enable low-carbon oil exports from Alberta’s oil sands to diverse markets, and “represents the opportunity to create a major new industry in carbon capture and storage and an essential technology for global decarbonization,” the Prime Minister said.

He positioned it as a required condition for future pipeline development, supporting the long-term viability of the province’s energy sector.

 

Since 2023, the federal Competition Bureau has been investigating the Pathways Alliance. The probe began in April, and that fall, Greenpeace submitted an addendum after noticing the alliance had quietly narrowed its climate claims online. Still, Greenpeace argued “the damage has been done” in misleading the public and urged the Bureau to continue its investigation.

(Canadian Public Transit Discussion Board Wiki)

 

“To fast-track this project without a proper assessment, despite its failed track record and the serious environmental risks it poses, pipelines exploding and impacts on surrounding ecosystems, is extremely risky,” Ali said.

In May 2024, Ecojustice, on behalf of the Athabasca Chipewyan First Nation (ACFN) and several environmental and community organizations, filed a request for an environmental impact assessment (EIA) to evaluate the potential environmental, health, social and Indigenous rights impacts of the $16 billion Pathways Alliance carbon capture project in Alberta’s oilsands, to ensure the implications were fully understood and addressed.

The Alberta government and the Alberta Energy Regulator (AER) denied this request in October, refusing to order the assessment.

“The government's failure to follow through with a thorough Free, Prior and Informed consent process means that Indigenous nations who have concerns or wish to say no to projects have little avenue other than engaging in costly legal battles, which has the opportunity to just balloon the price tags of these projects even more,” Lapointe said.

“The oil and gas corporations and executives are going to make a whole lot of money off of Canadian labour and Indigenous lands, and we are going to be left to clean up the mess.”

What Carney failed to mention during the announcement is that CCS is a solution put forward by the fossil fuel industry, not science.

 

Oil is made up mostly of hydrocarbons, which means its molecules contain carbon and hydrogen atoms bonded together. The very nature of oil is that carbon is a key part of its chemical makeup. To "decarbonize" oil would mean removing the carbon atoms, which isn’t possible without completely altering or destroying the substance itself. So, scientifically, the idea of decarbonized oil is misleading because you can’t remove carbon from oil without no longer having oil as we know it.

(Ecojustice)

 

It is “moreabout prolonging the life of the declining oil and gas industry than actually protecting the planet and reducing emissions,” Lapointe said.

Originally commercialized in the 1970s, carbon capture began as a method known as enhanced oil recovery (EOR), in which captured carbon dioxide was injected into depleted oil and gas reservoirs to extract more fossil fuels. This practice continues to dominate the field: over 70 percent of CCS projects today are still used to produce more oil and gas, with 80 to 90 percent of captured carbon dioxide historically serving this purpose rather than being permanently stored.

As public concern over climate change grew, the oil and gas industry rebranded EOR as a climate solution, and called it carbon capture, utilization and storage (CCUS).

But the rebranding has done little to solve the technology’s persistent flaws. A 2024 study by the Institute for Energy Economics and Financial Analysis (IEEFA) found that 10 out of 13 major CCS projects reviewed either failed or severely underperformed, often capturing far less carbon than promised.

CCS in the power sector has fared even worse. Since 2000, nearly 90 percent of proposed carbon capture capacity for power plants has either been cancelled or suspended, citing technical and economic issues. 

CCS projects often ignore Scope 3 emissions, the largest share of total emissions, which occur when fossil fuels are ultimately burned by consumers. “Carbon-neutral” claims made by oil and gas producers typically account only for a small fraction of total lifecycle emissions, misleading the public.

Hyder Ali called the government’s support for carbon capture technology “disappointing” and “disheartening,” pointing out that the method has been around for 50 years and consistently failed to deliver on its promises. 

“Year after year, decade after decade, it has underperformed, failing to capture the emissions it was supposed to, while costing taxpayers billions,” he said.

Since 2000, carbon capture has accounted for just 0.5 percent of Canada’s total emissions reductions, a David Suzuki Foundation report noted.

“CO2 (carbon dioxide) storage is not necessarily permanent. Physical leakage from storage reservoirs is possible via gradual and long-term release or sudden release of CO2 caused by disruption of the reservoir,” a 2005 Intergovernmental Panel on Climate Change report warned.

In March 2024, the world's first commercial-scale CCS project, Archer Daniels Midland’s (ADM) carbon capture facility near Decatur, Illinois, experienced a significant leak in less than a month, intensifying concerns over the safety of carbon sequestration near the Mahomet Aquifer, a critical source of drinking water for nearly one million people across 14 counties in the U.S..

The public and state officials were not informed of this initial leak until September 2024, when the U.S. Environmental Protection Agency (EPA) issued a proposed enforcement order for violations of the Safe Drinking Water Act.

ADM also reported a second suspected leak in September 2024, which led them to pause all carbon injections.

The same year, Australia's second-largest state, Queensland, banned carbon capture and storage in the Great Artesian Basin (GAB), one of the country’s most vital groundwater resources.

 

The Queensland government enacted critical safeguards to protect the Queensland section of the Lake Eyre Basin in December, and new laws locking in a 75 by 35 emissions reduction target.

(Queensland Environmental Education)

 

In May 2024, the Queensland government announced that the new legislation would prohibit injecting greenhouse gases into the basin, emphasizing its enormous environmental, agricultural, economic, and cultural significance. 

The move came after the state’s independent environmental regulator rejected a CCS pilot project proposed by mining giant Glencore, which aimed to inject liquefied carbon dioxide into the GAB aquifer due to the high risk of irreversible groundwater contamination.

Widespread public opposition, led by farmers, conservationists, and local councils, played a key role in the decision. Groups like AgForce and the Queensland Farmers’ Federation raised concerns about CCS risks to the basin’s water, combining scientific evidence with community experiences. Their pressure pushed the government to reject proposals and enforce a permanent ban. 

The government also committed $32 million to expand bore capping programs, reinforcing its focus on protecting the environment over unproven technologies.

Beyond the environmental impacts, the bill is also steep due to the high costs of CCS technologies.

International Institute for Sustainable Development’s policy advisor, Canada energy transitions, Steven Haig, warns CCS in the oil and gas sector is particularly expensive, sometimes costing up to $200 per ton of carbon. 

“It is also very energy-intensive, slow to implement, and difficult to scale. And the thing is…most projects in Canada focus on increasing oil production through enhanced oil recovery, which may actually increase emissions over time,” Haig told The Pointer.

 

 Canada’s oil production hit record levels in recent years, and 2024 was no exception. For the fourth year in a row, the country set a new high for crude oil and equivalent production as well as exports rising 5 percent compared to 2023. The completion of the Trans Mountain pipeline expansion in May 2024 opened up oil exports to countries beyond the U.S. by nearly 60 percent.

(Statistics Canada)

 

In January, a report by IEEFA warned that the Pathways Alliance CCS project faces daunting financial and technical obstacles that could undermine its viability. The $16 billion project is already expected to rely on taxpayers for half its funding. According to IEEFA, escalating costs, capped and unstable carbon credit revenues, and the risk of chronic underperformance suggest the project may never achieve financial self-sufficiency.

The report draws on the experiences of Alberta’s two operating CCS projects: Shell’s Quest facility and the Alberta Carbon Trunk Line (ACTL). 

Both were heavily subsidized, and both have seen costs rise dramatically. At Quest, operating expenses per tonne of carbon dioxide captured have surged 118 percent since 2016, and ACTL’s costs climbed more than 60 percent in just three years. Neither facility has consistently met its projected capture rates, meaning their actual costs per tonne, closer to $145 at ACTL and $180 at Quest, are far higher than official estimates.

Operating costs for carbon capture facilities like Quest and the Alberta Carbon Trunk Line have risen sharply, with Quest’s costs increasing significantly despite no corresponding increase in the amount of carbon captured. These increases far exceed the modest one to two percent annual escalation rates assumed in official cost projections, suggesting that the true costs of CCS are significantly underestimated.

(IEEFA) 

 

“The Pathways project will likely have to deal with similar challenges of escalating energy, material, and labour costs. If operating costs rise at currently observed industry rates for the life of the project, then total cost per tonne of CO2 at the proposed facility would balloon to levels that make breakeven or profitability highly improbable,” the report cautioned.

CCS has long been promoted as a foundational solution that would allow oil sands producers, responsible for about 95 percent of Canada’s bitumen output and more than 86 million tonnes of carbon annually, to maintain operations in a carbon-constrained world. Yet the Pathways project would capture only 10 to 12 million tonnes per year, a small fraction of total emissions, as it does nothing to address the even larger downstream emissions released when the oil is burned. 

IEEFA warns that the project risks repeating the global pattern of CCS facilities that overpromise, underdeliver, and become dependent on indefinite subsidies. Despite record profits in recent years, oil sands producers have not committed significant private capital to the project and continue lobbying Ottawa and Alberta for more public support.

IEEFA noted “permanently subsidizing a risky, unproven, and high-cost venture” is unlikely to appeal to shareholders, who see little chance of positive returns. The result, the report had concluded, is mounting pressure on governments to act as funders of last resort, exposing taxpayers to the same kind of runaway costs that plagued the Trans Mountain Expansion pipeline.

Since the government purchased the project for $4.5 billion, the cost of the Trans Mountain expansion ballooned to $34 billion in 2024, when it was initially estimated to be $7.4 billion in 2017.

 

On January 30, the Government of Canada quietly revealed a new $20 billion loan for the Trans Mountain Expansion (TMX) pipeline, though the deal was dated over a month earlier, on December 13. The massive loan, issued through Export Development Canada’s Canada Account and governed by the federal Cabinet, pushes total public financing for TMX to an estimated $50 billion. Critics say the funding directly contradicts the federal government’s promise to stop subsidizing the project, and comes at a time when many Canadians are facing an affordability crisis. Oil and banking industry CEOs stand to benefit but it's taxpayers who will be left to shoulder the cost. The loan also brings the federal government’s total financial support for the oil and gas sector in 2024 alone to a staggering $28.5 billion.

(EDC, Map: Government of Canada)

 

Hyder Ali warned that Canadians could be locked into spending $16 billion on the Pathways CCS project, estimated to capture only about five percent of oil sector emissions by 2030. “It just doesn’t make sense,” he added.

“Carbon capture and sequestration (CCS) is a small part of decarbonization, but building more fossil fuel infrastructure expecting CCS to offset emissions is a fairy tale,” Citizens' Climate Lobby Canada director Cathy Orlando told The Pointer.

The move was, however, welcomed by Alberta Premier Danielle Smith, who has argued that such projects make the oil and gas industry a more reliable energy source than low-emission renewables and has floated linking the Pathways project to the approval of a future oil pipeline to B.C.'s northern coast as part of a “grand bargain”.

Pathways Alliance president Kendall Dilling also praised the federal backing, calling it a sign that Ottawa is prepared to collaborate with industry.

“To build Canada’s economic and energy future, we encourage the federal government to continue to work together with industry and other levels of government to advance supportive policies which remove barriers to investment,” Dilling said in a statement.

He also welcomed Smith’s September 16 announcement that large emitters in Alberta will be able to avoid paying provincial carbon levies if they invest in emissions-reduction projects, starting this fall. Smaller emitters can opt out entirely by 2025.

Alberta has also confirmed it will keep its industrial carbon price frozen at $95 per tonne since May through 2026, defying the federal schedule, which mandates an increase to $110 next year.

Smith, who did not indicate whether the freeze would be lifted soon, has defended the freeze as providing "certainty" to industry.

In April, Dilling had also written to Carney requesting Ottawa end the federal industrial pricing.

But Pathways’ call to freeze Alberta’s carbon pricing is hard to square with the economics of CCS, which rely on a strong carbon price to be viable.

The Carney government has given no sign it plans to end industrial carbon pricing anytime soon.

“Economists are basically united on this: if you want to reduce emissions, you need a robust carbon price. Giving up on that sends a clear signal that tackling climate change is no longer a priority,” Gillezeau said.

“You can’t just pick individual projects and say they make sense or don’t. You need a consistent, fair policy—like carbon pricing—that lets the market decide.”

What the Carney government has suggested is that the new climate plan may include ending the oil and gas emissions cap.

Since winning the Liberal leadership in March, Carney has held 25 meetings with fossil fuel lobbyists, and the pace has only quickened since the federal election, a recent Environmental Defence report revealed. In May, he met with representatives from Cenovus, Enbridge, Imperial Oil, MEG, Pathways Alliance, Shell, Suncor, and Tourmaline, and followed up with meetings with the same companies in June, adding FortisBC to the list.

As these backroom talks continue, the reality is: our planet is changing rapidly. 

July 2025 was the third-warmest July in history, coming after the record-breaking months of 2023 and 2024, the World Meteorological Organization reported.

By August 28, leading climate scientists warned that the Atlantic Meridional Overturning Circulation (AMOC), commonly known as the Gulf Stream, is on the brink of collapse due to rising greenhouse gas (GHG) emissions. The powerful ocean currents’ collapse would trigger colder, longer winters, disrupting food production and infrastructure, with scientists estimating up to a 70 percent chance of failure if emissions continue unchecked.

By the end of August, Canada was battling one of its worst wildfire seasons on record, with over 8 million hectares burned, more than double the ten-year average for this time of year, according to the Canadian Interagency Forest Fire Centre and Natural Resources Canada.

By September 10, Arctic sea ice reached its annual minimum extent of 4.60 million square kilometres, tying 2025 for the tenth lowest minimum since satellite records began nearly 47 years ago. In June 2024, Arctic sea ice near Canada was thinner than average.

Scientists have long warned Canada is warming twice as fast as the global average, and its Arctic is warming nearly four times as fast.

They have also pushed for a “global effort to reduce emissions as quickly as possible, in order to stay close to the 1.5 [degrees C] target set by the Paris Agreement.”

As the world’s 11th largest greenhouse gas emitter, Canada faces a critical climate reckoning, and Carney, once a UN Special Envoy on Climate Action and Finance, is expected to lead the way. Critics are now asking why, elected on a promise to fight climate change, he appears to be pursuing Conservative policies that seem at odds with that commitment.

“He won the election on this message of standing up to Trump and nation building, and we know that after another devastating year of climate impacts, climate action is meaningful to many Canadians who are experiencing impacts firsthand,” Lapointe said.

“I think this (CCS and LNG projects) is some tricky greenwashing and positive PR for the industries that are actually responsible for the climate crisis. And it's sad to see that kind of weaponized against the public who are trusting in him to do the things that he was elected on.”

Notably absent from the federal government's projects of “national interest” list, Hyder Ali argued, are initiatives that would help Canada align with the global shift toward a clean energy economy. 

He pointed to examples of what should be prioritized: large-scale and community-based renewable energy projects, a national low-carbon transportation strategy that includes rural transit and regional rail, a major program to build and retrofit affordable, energy-efficient homes, and the creation of an East-West electricity grid to allow clean power to flow across provinces.

“There are so many nation-building projects that deserve to be fast-tracked. But fossil fuel projects? Absolutely not,” Hyder Ali said.

“We’re in this climate crisis because of fossil fuels. There needs to be a real pivot toward clean energy. That’s what will address the climate emergency and build a better future for all Canadians, not just the oil and gas industry.”

Interestingly, in July, the Conflict of Interest Commissioner released a list of Carney’s former financial interests. He had disclosed investments in 567 entities, all held in a third-party-managed account over which he claimed no control. A quick scan of the lengthy list reveals that Carney held shares in at least a dozen renewable energy companies—suggesting he does, at least financially, see renewables as part of the future.

Hyder Ali says it is “unnerving” that despite the urgency, Carney still hasn't made it clear about his direction when it comes to climate action.

“It is disappointing to see that, when given the choice, Canadians voted for climate action, and this is not what we're getting.” 

 

 

Email: [email protected]

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