Canada Backs New Oil Sands Pipeline Amidst Global Fossil Fuel Phase-Out Efforts
Canada has signed a memorandum of understanding (MOU) with Alberta to support a new oil sands pipeline that would expand fossil-fuel production and loosen environmental regulations. This MOU would delay methane regulations, cancel an oil and gas emissions cap, and exempt Alberta from clean electricity rules. The move contrasts sharply with international commitments made at COP28, where there was a global pledge to transition away from fossil fuels.
The pipeline expansion would enable an increase of approximately one million barrels per day, raising concerns among environmental groups and Indigenous communities. First Nations have expressed opposition to this expansion and vow to protect the Great Bear Sea from oil tankers associated with the project.
Within the Canadian government, the policy shift has led to political fallout. Environment Minister Steven Guilbeault resigned from Mark Carney’s cabinet rather than defend the retreat on environmental protections. Changes also include a review of major project environmental assessments, proposed weakening of greenwashing laws, and suspension of Canada’s electric vehicle sales mandate.
Critics have also highlighted the limited effectiveness of carbon capture and storage (CCS), noting that according to the International Energy Agency (IEA), CCS underperforms and even under ideal circumstances would address only about 20% of lifecycle emissions, with the majority (80%) arising from burning the fuel itself.
Globally, momentum towards fossil-fuel phase-out continues. Around 80 countries back a road map for this transition, and 18 nations participate in the Fossil Fuel Treaty dialogues. Colombia and the Netherlands are scheduled to host a global conference on fossil fuel phase-out in April 2026. Meanwhile, investments in renewable energy are outpacing fossil fuels, exemplified by China’s solar rollout in 2024, which is expected to exceed the rest of the world's combined capacity.
In contrast, the UK government is taking steps to address climate change by banning new oil and gas licenses in the North Sea, strengthening a windfall tax, and accelerating the phase-out of fossil-fuel subsidies, illustrating divergent approaches to energy policy between countries.
