Photo: https://www.canadianenergycentre.ca/

The proposed Pathways Alliance carbon capture project remains in limbo as questions grow over cost government support and whether the broader infrastructure needed to make it viable will ever be built.

The project, first advanced in 2022 by a consortium of Canada’s largest oil sands producers, centres on a massive carbon capture and storage network in northern Alberta. Plans call for more than 20 facilities to be linked by a roughly 400-kilometre pipeline system that would transport captured carbon dioxide to an underground storage hub.

Initial estimates placed the cost at about $16.5 billion, though broader buildout scenarios have been cited as high as $75 billion. Industry proponents have pushed for substantial public support, with requests that governments cover a majority share of capital costs through tax credits, grants and other incentives.

That funding structure has placed taxpayers at the centre of the proposal. Federal and provincial governments have already signalled willingness to cover more than half of upfront costs, while additional public financing tools have been explored to reduce risk for private companies. Analysts have warned that without carbon pricing or continued subsidies the project may never proceed, raising the possibility it becomes a long-term public expense rather than a commercially viable development.

Despite years of discussion the project has not reached a final investment decision. Regulatory filings have been submitted for elements such as the carbon pipeline, but construction has not begun and timelines have slipped. Industry uncertainty policy changes and high operating costs have all contributed to delays, with reports indicating the project is effectively stalled.

The Pathways proposal has also been tied to a broader push for a new oil pipeline to Canada’s West Coast. Federal and provincial discussions have suggested the two projects would move forward together as part of a strategy to expand exports while reducing upstream emissions.

That linkage introduces another layer of uncertainty. No private sector proponent has stepped forward to build a new pipeline to tidewater and previous projects in British Columbia have faced years of legal challenges, regulatory hurdles and political opposition. The provincial government in British Columbia has rejected new pipeline proposals and multiple Indigenous groups have opposed similar projects in the past over land rights and environmental concerns.

Past experience suggests those barriers are unlikely to ease. Major pipeline proposals such as Northern Gateway were ultimately cancelled after court rulings and sustained opposition, highlighting the difficulty of securing approvals for new export routes across B.C.

Without a pipeline to the coast the economic rationale for both expanded oil sands production and associated carbon capture infrastructure becomes weaker. The absence of a clear route combined with political resistance means the likelihood of a new pipeline being built remains uncertain.

At the same time criticism of the carbon capture plan itself continues. Environmental groups and policy analysts argue the technology is costly and may not deliver meaningful emissions reductions when broader lifecycle emissions are considered.

For now the Pathways project remains a proposal dependent on government backing and linked to infrastructure that has yet to materialize. With no final investment decision and no confirmed pipeline route the future of the project is unclear while the financial exposure for taxpayers continues to be a central concern.