A new report is casting doubt on one of the most consequential climate bets Canada has made in years the idea that carbon capture technology can clean up the oilsands enough to justify a major new pipeline.
The Fraser Institute, a Vancouver-based think tank, released a study this week challenging the central premise of the Pathways Project, the sprawling carbon capture initiative in northeastern Alberta’s oilsands that Prime Minister Mark Carney and Alberta Premier Danielle Smith have jointly staked significant political capital on.
The verdict from the report’s author, Senior Fellow Kenneth P. Green, is blunt: the technology simply isn’t there yet.
“The idea that carbon capture, utilization and storage will provide large-scale carbon reduction is unlikely to be as successful as its proponents envision, at least with the technology as it exists today,” Green said.
The stakes couldn’t be higher. Just two months ago, Carney and Smith shook hands on a landmark agreement linking a new West Coast oil pipeline to the Pathways carbon capture and storage project. The two megaprojects are, by design, inseparable Ottawa and Alberta have explicitly agreed that the pipeline won’t move forward unless Pathways does.
Carney has framed the arrangement as a “grand bargain” and called the carbon capture project a “necessary condition” for pipeline approval. He’s dangled the economic upside aggressively, claiming the combined projects will unlock more than $200 billion in direct investment and generate roughly 175,000 jobs across the country.
What he hasn’t offered is a clear accounting of what it will cost to actually make the carbon capture side of that equation work. The last official estimate, dating back to 2022, pegged just the first phase of Pathways at $16.5 billion and that figure has not been revisited in the terms of the new deal.
Green’s skepticism is rooted in a straightforward reading of how carbon capture has actually performed when put to the test. His analysis finds that roughly 73 percent of all carbon capture deployment worldwide has been used not to store carbon for climate purposes, but for Enhanced Oil Recovery a commercial technique where captured CO2 gets pumped underground to squeeze out more oil.
In other words, the technology has largely served the fossil fuel industry’s production goals rather than functioning as a genuine emissions solution. And when it comes to true, long-term underground carbon storage the kind the Pathways Project is actually proposing the track record is thin and the costs are steep.
Even within existing projects, the numbers fall short. Large-scale carbon capture installations have routinely captured less than 80 percent of what was originally projected, according to Green’s findings.
Part of what makes scaling up CCUS so difficult is that capturing carbon dioxide is only the beginning. Once the gas is captured, it has to be compressed, moved through pipelines, and injected into appropriate geological formations where it will stay put ideally forever.
That requires a vast and expensive network of CO2 pipelines that largely doesn’t exist yet. Building it would be a mammoth undertaking on its own, and Green argues it won’t happen quietly.
“Based on experience from both Canada and the United States, it is reasonable to expect significant resistance to the construction of CCUS pipelines by Canadian environmental groups and some local governments,” he wrote, warning that opposition could drive up costs and drag out timelines well beyond current projections.
None of this means carbon capture is a dead end. Green stops short of dismissing it entirely, and proponents of Pathways argue the technology is maturing rapidly and that Canada’s geological formations are uniquely well-suited for long-term storage.
But the Fraser Institute report adds a serious dissenting voice to a policy conversation that has, until now, treated large-scale carbon capture as a more settled proposition than the evidence may support. With federal and provincial emissions targets already under pressure, the question isn’t just whether Pathways can work in theory it’s whether it can work on the timeline and at the scale that Canada’s climate commitments demand.
