Imperial CEO upbeat on Nov. 15 Pathways deal target

Imperial Oil Ltd. chief executive John Whelan says he is encouraged by progress toward final agreements with Ottawa and Alberta on the Pathways carbon storage project, a condition for the Pacific Link oil pipeline to the West Coast to move ahead.

“There’s still a lot of work left to do. That’s only a couple of weeks away, but there’s no lack of energy or desire to get to a definitive agreement,” Whelan told analysts on a conference call on Oct. 30 to discuss third-quarter results, The Canadian Press reported.

Members of the Oil Sands Alliance, which includes Imperial, Suncor Energy, Canadian Natural Resources, Cenovus Energy and ConocoPhillips, reached a non-binding memorandum of understanding with the federal and Alberta governments in July. The parties set a Nov. 15 target to finalize binding agreements with each company. We reported on that Pathways agreement in July.

The link between Pathways and the pipeline was part of a wider accord Ottawa and Alberta signed in November 2025. The idea is that Pathways would offset some of the carbon dioxide emissions that Pacific Link would enable through higher oilsands production. Ottawa recently deemed the pipeline a project in the national interest, a designation now being challenged in court by B.C. First Nations.

Pathways would use a pipeline network to carry carbon dioxide captured at oilsands sites in northern Alberta to an underground storage hub near Cold Lake. The alliance said the project will be able to transport and store about six million tonnes of captured CO2 a year by the mid-2030s, with a goal of another 10 million tonnes of reductions by 2045. That is a significant scale-back from the 22 million tonnes by 2030 the group had earlier targeted.

Under the July memorandum, governments agreed to pursue regulatory and fiscal policies that encourage oilsands growth, which would help fill the pipeline. Ottawa agreed to extend investment tax credits for certain carbon-capture equipment, while Alberta agreed to “financial supports” and has recently alluded to possible royalty incentives.

Imperial reported a third-quarter profit of $2.45 billion, up from $539 million a year earlier, as we covered in our report on its record quarterly profit. West Texas Intermediate averaged US$85.68 in the quarter, up from US$64.97, while Western Canada Select rose to US$71.90 from US$54.62.

The gap between the two benchmarks has reportedly widened by as much as US$30 in recent weeks, roughly double its normal level. Whelan said conditions remain favourable for heavy oil producers, which can turn a profit and pay dividends at prices well below current levels. “The absolute price of WCS remains extremely constructive,” he said.

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