Prime Minister Mark Carney and Alberta Premier Danielle Smith have reached an agreement on the broad terms of a new oil pipeline deal aimed at transporting Alberta's oil to the west coast of Canada. This deal is expected to be formally announced at a news conference in Calgary on Thursday.

The agreement will provide Alberta with special exemptions from federal environmental regulations, which have been a barrier to investment in new pipeline projects. Currently, a ban on oil tankers off the northern coast of British Columbia poses a significant legal challenge. The deal is contingent upon Alberta adopting stricter carbon pricing and making a substantial investment in carbon capture technology through the Pathways Alliance, a consortium of oilsands companies.

This agreement marks a potential turning point in the relationship between the federal government and Alberta, which has been strained in recent years. The deal is seen as a way to enhance Alberta's economic prospects while addressing environmental concerns. A spokesperson for Premier Smith's office stated, "We hope to have more to share in the coming days," but did not provide further details.

The proposed pipeline is significant for many Albertans who believe that the federal government has hindered their province's economic growth. The need for new export routes has gained urgency as Canada seeks to diversify its oil exports beyond the United States, especially following previous tensions with the U.S. government.

However, the plan faces opposition from British Columbia Premier David Eby, who has voiced strong concerns about the environmental risks associated with a new pipeline. Eby has pointed to Indigenous leaders in the region who oppose the project, warning that it could jeopardize support for other major developments in British Columbia, such as liquefied natural gas facilities. Despite his opposition, Eby does not have the legal authority to veto the project.

The agreement is expected to include provisions for Alberta to negotiate with the B.C. government as it moves forward with the pipeline project. It will also address the need for Indigenous ownership and engagement in the process. The Pathways Alliance project, which aims to capture and store greenhouse gas emissions, is also a key component of the deal, with an estimated cost of $16.5 billion.

As the details of the memorandum of understanding are finalized, both governments are preparing for a significant public relations effort to promote the agreement and its implications for the energy sector in Canada.