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Alberta's Premier Danielle Smith and Prime Minister Mark Carney announced a conditional support for a new pipeline to transport Alberta's oilsands bitumen to international markets, contingent on implementing carbon capture systems to ensure lower emissions. This 'grand bargain' requires the Pathways Alliance, a coalition of major oilsands companies, to establish carbon capture infrastructure.

The federal government has identified this project for potential fast-tracked approvals and has extended subsidies for carbon capture initiatives. Current technologies, known as CCUS or CCS, aim to capture up to 90% of emissions, but existing Canadian projects have fallen short.

Alberta's oilsands emitted 89 megatonnes in 2023, with the Pathways project projected to reduce emissions by 10-12 megatonnes annually by 2030. Significant public funding is expected for the estimated $16 billion project, which also includes tax credits for enhanced oil recovery despite rising concerns about the overall carbon footprint from fossil fuel use.