Carney Says New Alberta Pipeline 'More Likely Than Not' as Asia Demand Grows

Prime Minister Mark Carney signalled on May 1 that a new oil pipeline out of Alberta is now "more likely than not," pointing to surging global demand for secure energy supplies in the wake of the Iran war and Canada's strategic need to push more of its crude into Asian markets. The remarks, delivered the day after US President Donald Trump signed a separate American pipeline approval, mark the most explicit federal endorsement to date of new export infrastructure since the Liberals returned to power.

What was said

Carney told reporters that the federal government and Alberta have been working off a memorandum of understanding signed late in 2025 that committed both sides to identifying viable export routes for additional Alberta crude. He stopped short of endorsing any specific corridor, saying multiple options remain on the table, but emphasised that the project's underlying economics have shifted in favour of construction.

"There are several possible routes for a pipeline," the Prime Minister said, according to remarks reported by the BNN Bloomberg news service. He added that the war in Iran and the closure of the Strait of Hormuz have given Asian buyers an obvious incentive to lock in long-term contracts with stable suppliers, including Canada.

The Prime Minister was careful not to commit to a particular route, an issue that has long been the most politically charged element of any new pipeline. Federal sources cited by The Globe and Mail have indicated Ottawa is leaning toward a southern route on the basis that it would face fewer environmental hurdles and less Indigenous opposition. Alberta Premier Danielle Smith has consistently argued the opposite, pushing for a corridor running to the north coast of British Columbia.

Why the calculus has changed

For most of the past decade, new west-bound pipeline proposals have foundered on a mix of regulatory delay, court challenges, and shifting price signals. The Trans Mountain Expansion, which began operating in 2024, eased some of the political pressure for further capacity. The Iran war has reset that picture.

Brent crude is trading well above $110 US a barrel, with global LNG markets pricing in a sustained disruption to Persian Gulf flows. Asian importers, particularly in Japan, South Korea, and India, have been signalling appetite for long-term Canadian supply. Several of those buyers were already increasing their reliance on US Gulf Coast cargoes after disruptions to Russian supply, but the new shock has pushed them to pursue further diversification.

Carney's pivot also dovetails with his broader argument that Canada's heavy dependence on the US market has become a strategic liability. In speeches to the World Economic Forum in January and to domestic audiences in the months since, he has framed energy infrastructure as part of the same conversation as defence procurement and critical minerals policy.

Who would build it

The federal government's nudge in favour of construction does not by itself trigger a project. A private operator must commit capital, a workforce, and a multi-year construction timeline. Industry executives in Calgary have welcomed the political signal but emphasised the high bar for committing to a project that could cost upwards of $20 billion before route, regulatory, and Indigenous consultation costs are accounted for.

Among the candidates most often discussed are Enbridge and Pembina Pipeline, although neither company has publicly committed to a new Alberta export project. South Bow, the entity spun off from TC Energy that holds the former Keystone XL assets, is also in the mix. Alberta's provincial government has signalled it would consider equity backstops or other forms of support to anchor a project, but Carney has been clear that any federal involvement would have to fit within the framework of his Canada Strong Fund and the broader sovereign-wealth model announced last week.

Indigenous and environmental concerns

Whatever route is ultimately chosen, the project will run through territories with significant Indigenous title interests. The Federal Court of Appeal's history with pipeline review has emphasised the need for meaningful consultation, not just procedural compliance, and any new project will face scrutiny on that front.

The First Nations Major Projects Coalition, which is meeting in Toronto this week for its 9th annual conference, has been at the centre of efforts to position Indigenous nations as equity partners in new infrastructure rather than purely as veto holders. National Chief Cindy Woodhouse Nepinak and Ontario Regional Chief Abram Benedict both opened the conference with remarks emphasising the importance of Indigenous-led financing and ownership in major resource projects.

Environmental groups have been more forthright in their opposition. Climate analysts argue that any new export pipeline locks in decades of additional combustion emissions at a moment when Canada is already struggling to meet its 2030 commitments under the Paris Agreement. Carney's government has pointed to its emissions cap on the oil and gas sector as a structural constraint, but critics say that cap remains incomplete and politically vulnerable.

Provincial response

Premier Smith greeted Carney's comments warmly, calling them "a positive evolution" in the federal posture, while reiterating Alberta's preference for a northern route. British Columbia Premier David Eby was more cautious, signalling that any project crossing the province would need to clear environmental review and demonstrate measurable benefits to British Columbia communities. The Saskatchewan government, often a vocal champion of oil and gas, welcomed the announcement, while Quebec Premier Christine Fréchette focused her own comments on cost-of-living measures rather than the pipeline file directly.

The opposition Conservatives have pressed for faster movement on infrastructure, with leader Pierre Poilievre arguing that the Liberals have wasted years of potential project work. The NDP has been openly hostile to a new export pipeline, calling instead for accelerated investment in renewable generation and grid interties. Within the Liberal caucus, environment-aligned MPs have been quieter than they might have been a year ago, a reflection of how thoroughly the security argument has shifted the party's internal politics.

What it means for energy markets

For energy investors, Carney's comments are a more concrete signal than the rhetoric that has accompanied past Liberal statements on pipelines. They are not yet a regulatory approval, a route selection, or a corporate sponsor, but they make the political path easier than it has been for years.

For Canadian consumers, the connection between a new pipeline and gasoline prices at the pump is indirect. Most Canadian retail prices are set against North American benchmarks rather than Asian prices. Increased export capacity could narrow the differential between Western Canadian Select and West Texas Intermediate over time, raising producer revenues and eventually feeding through to royalty receipts in Edmonton, Regina, and St. John's, but those effects would unfold over years rather than weeks.

For Asian buyers, a confirmed new Canadian pipeline would help anchor long-term sourcing decisions in a moment when their Persian Gulf options have become unreliable. That includes large state-owned utilities in Japan and Korea that have already signalled interest in long-term LNG and crude offtake from Canada.

What's next

The Prime Minister's Office has not committed to a timeline for any project announcement. Industry observers expect Ottawa, Edmonton, and a sponsoring company to work through summer on the route question before any formal launch. Indigenous consultation, which by law must precede a final approval rather than follow it, is likely to be folded into the design phase rather than left for the regulatory back end.

Carney is also expected to address energy infrastructure in greater detail when he returns to Calgary later this spring, an event the federal government has tentatively pencilled in for late June around a Stampede-week appearance. By that point, federal officials hope to have at least the contours of a route preference articulated, even if a sponsor company has not yet stepped forward.

For now, the Prime Minister's words function as a political green light without operational specifics. That on its own represents a meaningful shift after a decade in which pipeline politics in Canada were defined by uncertainty, court cases, and corporate exits. Whether the federal government can convert the new mood into a built project will depend on how quickly Ottawa, Edmonton, Indigenous nations, and a private sponsor can align around a single corridor.