A faster deduction is tax paper. It is not a construction start
Speaking Tuesday in Edmonton, Oil Sands Alliance president Kendall Dilling said Prime Minister Mark Carney's permanent Productivity Mega Deduction could help the first-money problem on the proposed Pathways carbon-capture system. Carney announced the measure Monday at the Canada Investment Summit. Qualifying investments acquired on or after September 15 can be deducted in the first year they go into use. Ottawa says that cuts the marginal effective tax rate on new business investment from about 13 percent to 6.4 percent.
Dilling said the write-off is one pillar the alliance has asked for, and that Pathways is not a standalone carbon-capture bid. He described a package that also needs operating support, room to grow production, and better access to export markets. The project would put capture units on multiple oilsands sites, a shared CO2 line, and a storage hub in the Cold Lake region. First-phase capture is described at about six million tonnes a year. Dilling said roughly two years of early work could put major pipeline construction around 2030, with operations near the current 2032 target.
Alberta Energy and Minerals Minister Brian Jean told the same conference that Alberta, Ottawa, and the five alliance producers are working toward final agreements by mid-November. The July memorandum set November 15 as the date for binding papers. The alliance is Canadian Natural Resources (TSX: CNQ), Cenovus Energy (TSX: CVE), Imperial Oil (TSX: IMO), Suncor Energy (TSX: SU), and ConocoPhillips Canada. Jean said Alberta's capture incentive is meant to sit beside the federal investment tax credit and run through 2035.
This is conference talk dated this week. No listed producer posted a Pathways FID, a new capital number, or a construction start. The next dated test is still November 15.