Another oilsands boom? Smith, Carney say this time Canada will be ready

CALGARY — It’s been a relatively quiet decade in Alberta’s oilsands, but the federal and provincial governments believe a new West Coast pipeline coupled with policy shifts might help turn up the volume.

Prime Minister Mark Carney was in Fort McMurray, Alta., this week to announce the first proposal to be deemed in the national interest under legislation passed last year: the million-barrel-per-day Pacific Link pipeline from Alberta to a tanker export terminal in southern B.C.

The designation means the proposal will be subject to a streamlined review process, shepherded by the Calgary-based major projects office.

The pipeline’s economic fate hinges on oilsands companies being willing to spend on expanding their output. At a news conference, Carney was asked whether he expected a return to boom times in the northeastern Alberta oilsands hub city.

“I wouldn’t use the term ‘boom,'” he replied. “I would use ‘sustained growth.'”

The last boom from the mid-2000s to mid-2010s came with the side-effects of cost inflation, labour scarcity and housing shortages. Carney and Alberta Premier Danielle Smith say that if oilsands companies start building again — as they hope — it will be different this time around.

Oilsands companies have for years shied away from the multibillion-dollar megaprojects of more than a decade ago. The last mine to be built from scratch was Fort Hills, operated by Suncor Energy Inc. From when it got the final go-ahead decision in 2013 to its startup in 2018, its cost ballooned to more than $17 billion from $13.5 billion. Lately, instead of so-called “green field” projects, companies have opted to instead tweak their existing operations to squeeze out more bitumen or add to their existing footprints.

Executives have cited a dearth of pipeline capacity, a convoluted regulatory regime and onerous environmental regulations for the chill on large-scale growth projects. But also around the time investment fell off a decade ago, global crude prices cratered amid a supply glut and didn’t have much of a chance to recover before the COVID-19 pandemic virtually obliterated demand.

Fast forward to 2026, and the Mideast war has laid bare the vulnerability of global energy supply chains and left countries clamouring for stable providers. A host of Trudeau-era energy policies loathed by oilpatch players have been undone and Pacific Link has taken a big step forward to becoming a reality, potentially enabling more oilsands crude to reach lucrative Asian markets.

“We learned lessons from the past in building infrastructure,” Carney told reporters on Thursday. He said local mayors are thinking ahead for what their communities need and early participation from First Nations leaders means “a much broader spread of the economic benefits.”

He also cited “another phase of technical innovation” in the industry that didn’t exist previously.

At the news conference, Smith noted the autonomous oilsands haul trucks in the backdrop. Previously, human drivers for those gargantuan vehicles would have received six-figure salaries and might have been flown in and out of the site from elsewhere in Canada, living in work camps, for a week or two at a time.

“(Companies) have managed to find a way to increase production without having the kind of dramatic pressure that we saw in the past of a large number of people moving here, not able to find homes,” Smith said.

The premier said she’s also talked to local municipal leaders about the bridge and road infrastructure that might be needed if production ramps up. She mentioned upgrades to Highway 881, the road that winds through several steam-driven oilsands sites south of Fort McMurray, Alta.

“There’s lots of ways that we can partner with the federal government to make sure those key infrastructure projects get built, so we build on a pace that allows us to keep up,” she said.

Andrew Botterill, who leads Deloitte Canada’s oil, gas and chemicals practice, said the Alberta oilpatch has matured since the last boom.

“What we have is a more efficient, far more aligned group of producers up there than maybe what it was 10, 15 years ago,” he said.

“They’ve come together as an alliance and really recognize that ‘We’ve got to share labour, we’ve got to be less competitive, we’ve got to find ways that we can do things together and not just drive up costs.'”

Oilsands properties are concentrated in fewer hands than had been the case a decade or more ago. Erstwhile producers including Husky and MEG Energy have been bought out and international players like Shell and Total have exited or sharply reduced their holdings.

Lance Mortlock managing partner at EY Canada, flagged a bigger-picture concern over the availability of workers with multiple major projects in the works — not just the Pacific Link pipeline and new oilsands projects, but potentially mines, transmission lines and hydro dams.

“We’re going to need tens of thousands of workers across the country to build this stuff: engineers, professionals, welders, pipe fitters. I’m not sure where all these people are going to come from if we do half the projects that we have the desire to construct,” he said.

“So I’m hoping that there’s going to be more conversation about the workforce and more conversation about how do we sequence these things so we optimize the system from a labour force perspective?”

This report by The Canadian Press was first published Oct. 2, 2026.

Companies in this story: (TSX:SU)

Lauren Krugel, The Canadian Press