CNQ-T Revival Hinges on Government Agreements

Canadian Natural Resources Ltd., parent company to CNQ-T, may revive its $8.25-billion expansion of the Jackpine oil sands project in northern Alberta, pending policy agreements with provincial and federal governments.

The company's president, Scott Stauth, attributed the initial pause in March to uncertainty surrounding government regulatory policies on carbon pricing and methane, which added an economic burden for long-term growth.

However, a recent memorandum of understanding (MOU) between Alberta, Ottawa, and five oil companies, including CNRL, has changed the project's outlook. The MOU pushes forward a massive carbon capture project in the province's north and sets a Nov. 15 deadline for governments to come to definitive agreements with oil companies on policies that aim to boost crude production.

Stauth said if there is a successful agreement, CNRL will reassess its plans for Jackpine, as well as expansions of its Jackfish and Horizon operations, and the new greenfield project called Pike 2. The agreements must provide oil companies with assurance that all objectives outlined in the MOU will be met.

Those goals include expanding global market access for Canadian oil, reducing emissions, streamlining regulatory frameworks, and developing fiscal policy to enable sustained and substantial oil sands development and production growth.