Canadian Energy Centre
Canada’s proposed oil and gas emissions cap sends wrong message to allies in Asia: analyst

Prime Minister of Japan Fumio Kishida speaks during the G7 summit at Schloss Elmau, Germany on June 26, 2022 as (L-R) Canadian Prime Minister Justin Trudeau and German Chancellor Olaf Schulz look on. Getty Images photo
From the Canadian Energy Centre
‘We want to fill those pipelines and help Japan and Korea get off Russian supply’
Canada’s proposed oil and gas emissions cap sends a conflicting message to allies in Asia, according to a prominent energy policy analyst.
The plan for the cap – widely seen as a cap on production – is being put together just as Canada nears its first large-scale access to Asia’s growing oil and gas demand, notes Heather Exner-Pirot, a senior fellow with the Macdonald-Laurier Institute.
“Our allies in Asia, particularly Japan and Korea, are waiting for the LNG and the oil,” says Exner-Pirot.
“Everyone knows we only ship to the United States. We haven’t had any real pipeline capacity to the east or to the west. Finally, we’re getting it and now we’re going to curtail production. It makes no sense.”

Heather Exner-Pirot, senior fellow and director of natural resources, energy and environment with the Macdonald-Laurier Institute.
Oil and gas needs in the Asia Pacific region are expected to continue growing through 2030 and 2050, according to the International Energy Agency.
The recently completed Coastal GasLink pipeline is ready to supply natural gas to the LNG Canada export terminal, which is in the final stages of construction and targeted for startup next year.
Meanwhile the Trans Mountain pipeline expansion is weeks away from startup, nearly tripling Canada’s oil export capacity to customers by sea.
The federal plan to cap emissions in 2030 at up to 38 per cent below 2019 levels would require production cuts, according to the Business Council of Canada.
That could threaten world energy security by opening the door to Russia as a bigger supplier instead of Canada, Exner-Pirot says.
“We want to fill those pipelines and help Japan and Korea get off Russian supply and get off OPEC supply, frankly. We want them to have an option,” she says.
“We still haven’t been able to get off Russian oil and gas, and now we want to put in policies that will limit our ability to replace it. Our number one priority should be to replace it.”

A section of the Coastal GasLink pipeline is installed in a challenging section of the Rocky Mountains. Photo courtesy Coastal GasLink
Capping emissions from Canada’s oil and gas sector would come at great economic cost while having negligible impact on the environment, according to analysis by the Montreal Economic Institute (MEI).
“Each time Ottawa forces the Canadian energy sector to contract, it is foreign producers who win,” said MEI public policy analyst Gabriel Giguère.
“Ottawa does not have the means to affect global demand, so reducing local supply will only end up exporting jobs and tax revenues.”
MEI estimates the proposed cap would cost Canada’s economy upwards of $6 billion per year if fully implemented.
Exner-Pirot argues that through initiatives like the Pathways Alliance in the oil sands, Canada’s energy sector already has credible plans reduce emissions and achieve net zero.
“By forcing this abstract date of 2030, you’re making it far more difficult and more expensive, where it will [already] occur within a reasonable timeframe,” she said.
Alberta
The permanent CO2 storage site at the end of the Alberta Carbon Trunk Line is just getting started

Wells at the Clive carbon capture, utilization and storage project near Red Deer, Alta. Photo courtesy Enhance Energy
From the Canadian Energy Centre
Inside Clive, a model for reducing emissions while adding value in Alberta
It’s a bright spring day on a stretch of rolling farmland just northeast of Red Deer. It’s quiet, but for the wind rushing through the grass and the soft crunch of gravel underfoot.
The unassuming wellheads spaced widely across the landscape give little hint of the significance of what is happening underground.
In just five years, this site has locked away more than 6.5 million tonnes of CO₂ — equivalent to the annual emissions of about 1.5 million cars — stored nearly four CN Towers deep beneath the surface.
The CO₂ injection has not only reduced emissions but also breathed life into an oilfield that was heading for abandonment, generating jobs, economic activity and government revenue that would have otherwise been lost.
This is Clive, the endpoint of one of Canada’s largest carbon capture, utilization and storage (CCUS) projects. And it’s just getting started.
Rooted in Alberta’s first oil boom
Clive’s history ties to Alberta’s first oil boom, with the field discovered in 1952 along the same geological trend as the legendary 1947 Leduc No. 1 gusher near Edmonton.
“The Clive field was discovered in the 1950s as really a follow-up to Leduc No. 1. This is, call it, Leduc No. 4,” said Chris Kupchenko, president of Enhance Energy, which now operates the Clive field.
Over the last 70 years Clive has produced about 70 million barrels of the site’s 130 million barrels of original oil in place, leaving enough energy behind to fuel six million gasoline-powered vehicles for one year.
“By the late 1990s and early 2000s, production had gone almost to zero,” said Candice Paton, Enhance’s vice-president of corporate affairs.
“There was resource left in the reservoir, but it would have been uneconomic to recover it.”
Gearing up for CO2
Calgary-based Enhance bought Clive in 2013 and kept it running despite high operating costs because of a major CO2 opportunity the company was developing on the horizon.
In 2008, Enhance and North West Redwater Partnership had launched development of the Alberta Carbon Trunk Line (ACTL), one of the world’s largest CO2 transportation systems.
Wolf Midstream joined the project in 2018 as the pipeline’s owner and operator.
Completed in 2020, the groundbreaking $1.2 billion project — supported by the governments of Canada and Alberta — connects carbon captured at industrial sites near Edmonton to the Clive facility.
“With CO2 we’re able to revitalize some of these fields, continue to produce some of the resource that was left behind and permanently store CO2 emissions,” Paton said.
An oversized pipeline on purpose
Each year, about 1.6 million tonnes of CO2 captured at the NWR Sturgeon Refinery and Nutrien Redwater fertilizer facility near Fort Saskatchewan travels down the trunk line to Clive.
In a unique twist, that is only about 10 per cent of the pipeline’s available space. The project partners intentionally built it with room to grow.
“We have a lot of excess capacity. The vision behind the pipe was, let’s remove barriers for the future,” Kupchenko said.
The Alberta government-supported goal was to expand CCS in the province, said James Fann, CEO of the Regina-based International CCS Knowledge Centre.
“They did it on purpose. The size of the infrastructure project creates the opportunity for other emitters to build capture projects along the way,” he said.

CO2 captured at the Sturgeon Refinery near Edmonton is transported by the Alberta Carbon Trunk Line to the Clive project. Photo courtesy North West Redwater Partnership
Extending the value of aging assets
Building more CCUS projects like Clive that incorporate enhanced oil recovery (EOR) is a model for extending the economic value of aging oil and gas fields in Alberta, Kupchenko said.
“EOR can be thought of as redeveloping real estate,” he said.
“Take an inner-city lot with a 700-square-foot house on it. The bad thing is there’s a 100-year-old house that has to be torn down. But the great thing is there’s a road to it. There’s power to it, there’s a sewer connection, there’s water, there’s all the things.
“That’s what this is. We’re redeveloping a field that was discovered 70 years ago and has at least 30 more years of life.”
The 180 existing wellbores are also all assets, Kupchenko said.
“They may not all be producing oil or injecting CO2, but every one of them is used. They are our eyes into the reservoir.”

CO2 injection well at the Clive carbon capture, utilization and storage project. Photo for the Canadian Energy Centre
Alberta’s ‘beautiful’ CCUS geology
The existing wells are an important part of measurement, monitoring and verification (MMV) at Clive.
The Alberta Energy Regulator requires CCUS projects to implement a comprehensive MMV program to assess storage performance and demonstrate the long-term safety and security of CO₂.
Katherine Romanak, a subsurface CCUS specialist at the University of Texas at Austin, said that her nearly 20 years of global research indicate the process is safe.
“There’s never been a leak of CO2 from a storage site,” she said.
Alberta’s geology is particularly suitable for CCUS, with permanent storage potential estimated at more than 100 billion tonnes.
“The geology is beautiful,” Romanak said.
“It’s the thickest reservoir rocks you’ve ever seen. It’s really good injectivity, porosity and permeability, and the confining layers are crazy thick.”
CO2-EOR gaining prominence
The extra capacity on the ACTL pipeline offers a key opportunity to capitalize on storage potential while addressing aging oil and gas fields, according to the Alberta government’s Mature Asset Strategy, released earlier this year.
The report says expanding CCUS to EOR could attract investment, cut emissions and encourage producers to reinvest in existing properties — instead of abandoning them.
However, this opportunity is limited by federal policy.
Ottawa’s CCUS Investment Tax Credit, which became available in June 2024, does not apply to EOR projects.
“Often people will equate EOR with a project that doesn’t store CO2 permanently,” Kupchenko said.
“We like to always make sure that people understand that every ton of CO2 that enters this project is permanently sequestered. And we take great effort into storing that CO2.”
The International Energy Forum — representing energy ministers from nearly 70 countries including Canada, the U.S., China, India, Norway, and Saudi Arabia — says CO₂-based EOR is gaining prominence as a carbon sequestration tool.
The technology can “transform a traditional oil recovery method into a key pillar of energy security and climate strategy,” according to a June 2025 IEF report.
Tapping into more opportunity
In Central Alberta, Enhance Energy is advancing a new permanent CO2 storage project called Origins that is designed to revitalize additional aging oil and gas fields while reducing emissions, using the ACTL pipeline.
“Origins is a hub that’s going to enable larger scale EOR development,” Kupchenko said.
“There’s at least 10 times more oil in place in this area.”
Meanwhile, Wolf Midstream is extending the pipeline further into the Edmonton region to transport more CO2 captured from additional industrial facilities.
Canadian Energy Centre
Cross-Canada economic benefits of the proposed Northern Gateway Pipeline project

From the Canadian Energy Centre
Billions in government revenue and thousands of jobs across provinces
Announced in 2006, the Northern Gateway project would have built twin pipelines between Bruderheim, Alta. and a marine terminal at Kitimat, B.C.
One pipeline would export 525,000 barrels per day of heavy oil from Alberta to tidewater markets. The other would import 193,000 barrels per day of condensate to Alberta to dilute heavy oil for pipeline transportation.
The project would have generated significant economic benefits across Canada.

The following projections are drawn from the report Public Interest Benefits of the Northern Gateway Project (Wright Mansell Research Ltd., July 2012), which was submitted as reply evidence during the regulatory process.
Financial figures have been adjusted to 2025 dollars using the Bank of Canada’s Inflation Calculator, with $1.00 in 2012 equivalent to $1.34 in 2025.
Total Government Revenue by Region
Between 2019 and 2048, a period encompassing both construction and operations, the Northern Gateway project was projected to generate the following total government revenues by region (direct, indirect and induced):

British Columbia
- Provincial government revenue: $11.5 billion
- Federal government revenue: $8.9 billion
- Total: $20.4 billion
Alberta
- Provincial government revenue: $49.4 billion
- Federal government revenue: $41.5 billion
- Total: $90.9 billion
Ontario
- Provincial government revenue: $1.7 billion
- Federal government revenue: $2.7 billion
- Total: $4.4 billion
Quebec
- Provincial government revenue: $746 million
- Federal government revenue: $541 million
- Total: $1.29 billion
Saskatchewan
- Provincial government revenue: $6.9 billion
- Federal government revenue: $4.4 billion
- Total: $11.3 billion
Other
- Provincial government revenue: $1.9 billion
- Federal government revenue: $1.4 billion
- Total: $3.3 billion
Canada
- Provincial government revenue: $72.1 billion
- Federal government revenue: $59.4 billion
- Total: $131.7 billion
Annual Government Revenue by Region
Over the period 2019 and 2048, the Northern Gateway project was projected to generate the following annual government revenues by region (direct, indirect and induced):

British Columbia
- Provincial government revenue: $340 million
- Federal government revenue: $261 million
- Total: $601 million per year
Alberta
- Provincial government revenue: $1.5 billion
- Federal government revenue: $1.2 billion
- Total: $2.7 billion per year
Ontario
- Provincial government revenue: $51 million
- Federal government revenue: $79 million
- Total: $130 million per year
Quebec
- Provincial government revenue: $21 million
- Federal government revenue: $16 million
- Total: $37 million per year
Saskatchewan
- Provincial government revenue: $204 million
- Federal government revenue: $129 million
- Total: $333 million per year
Other
- Provincial government revenue: $58 million
- Federal government revenue: $40 million
- Total: $98 million per year
Canada
- Provincial government revenue: $2.1 billion
- Federal government revenue: $1.7 billion
- Total: $3.8 billion per year
Employment by Region
Over the period 2019 to 2048, the Northern Gateway Pipeline was projected to generate the following direct, indirect and induced full-time equivalent (FTE) jobs by region:

British Columbia
- Annual average: 7,736
- Total over the period: 224,344
Alberta
- Annual average: 11,798
- Total over the period: 342,142
Ontario
- Annual average: 3,061
- Total over the period: 88,769
Quebec
- Annual average: 1,003
- Total over the period: 29,087
Saskatchewan
- Annual average: 2,127
- Total over the period: 61,683
Other
- Annual average: 953
- Total over the period: 27,637
Canada
- Annual average: 26,678
- Total over the period: 773,662
-
COVID-1911 hours ago
Ontario man launches new challenge against province’s latest attempt to ban free expression on roadside billboards
-
Energy19 hours ago
This Canada Day, Celebrate Energy Renewal
-
Business2 days ago
While China Hacks Canada, B.C. Sends Them a Billion-Dollar Ship Building Contract
-
Alberta1 day ago
So Alberta, what’s next?
-
Alberta10 hours ago
Alberta Next Takes A Look At Alberta Provincial Police Force
-
Bjorn Lomborg2 days ago
The Physics Behind The Spanish Blackout
-
Alberta12 hours ago
Canadian Oil Sands Production Expected to Reach All-time Highs this Year Despite Lower Oil Prices
-
Business14 hours ago
Potential For Abuse Embedded In Bill C-5