The chief executive of Imperial Oil Ltd. says he’s encouraged by progress made toward pinning down a final agreement with the federal and Alberta governments to advance the Pathways carbon storage project, which is a condition for the Pacific Link crude pipeline to the West Coast moving ahead.
Members of the Oil Sands Alliance, which includes Imperial and four of its peers, reached a non-binding memorandum of understanding with Ottawa and the province in July. They set a Nov. 15 target to finalize binding agreements with each of the companies.
“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,” Imperial CEO John Whelan told analysts on a conference call Friday to discuss third-quarter results.
“We’re going to make sure we do all the right things that enable us to execute on the definitive agreement. So most importantly is, for me, the shared ambition to make this happen and the work that’s going into that. And I remain really encouraged about where we are.”
The Pathways-pipeline quid pro quo was part of a sweeping accord Ottawa and Alberta signed in November 2025 on a wide array of energy matters. The idea is for Pathways to offset some of the carbon dioxide emissions that Pacific Link, recently deemed by Ottawa a project in the national interest, would enable through increased oilsands production.
Pathways involves a pipeline network that would carry carbon dioxide captured from various oilsands sites in northern Alberta to an underground storage hub near Cold Lake, Alta. The alliance said that the Pathways Project will have the capacity to transport and store about six million tonnes per year of captured CO2 by the mid-2030s. The parties are aiming for another 10 million tonnes of reductions by 2045.
That’s a significant scale-back from the 22 million tonnes of emissions by 2030 they had earlier targeted.
In the July Pathways-centred MOU, governments agreed to pursue regulatory and fiscal policies that would spur oilsands growth, which in turn would ensure the pipeline from Alberta to a tanker port in southern British Columbia can be filled. Ottawa agreed to extending investment tax credits for certain carbon-capture equipment, while Alberta has agreed to “financial supports” to encourage oilsands growth, alluding recently to potential royalty incentives.
The other Oil Sands Alliance members are Suncor Energy, Canadian Natural Resources, Cenovus Energy and ConocoPhillips.
Earlier Friday, Imperial reported a third-quarter profit of $2.45 billion, up from $539 million in the same quarter last year, boosted by higher oil prices.
The profit amounted to $5.11 per diluted share for the quarter compared with a profit of $1.07 per diluted share a year ago.
Total revenue and other income amounted to $16.21 billion, up from $12.05 billion in the same quarter last year.
Upstream production averaged 418,000 gross oil-equivalent barrels per day, down from 462,000 a year ago, primarily due to lower production at Kearl and planned maintenance turnarounds at Cold Lake and Syncrude. Production in the oilsands was crimped by a third-party pipeline outage caused by an electrical transformer failure in mid-September, Whelan said.
“We don’t see systemic issues. We see one-offs that we’re going to learn from,” he said. “We see nothing in the underlying performance that causes us any doubt whatsoever on our future targets.”
Refinery throughput averaged 381,000 barrels per day, down from 425,000 in the third quarter of 2025 as capacity utilization dropped to 88 per cent, compared with 98 per cent in the third quarter of 2025. Imperial says it faced unplanned downtime, also due to a third-party pipeline outage.
The price of West Texas Intermediate, the U.S. light oil benchmark, averaged US$85.68 during the third quarter, up from US$64.97 during the same period a year earlier.
Western Canada Select, the price of heavy crude produced in Alberta, rose to US$71.90 from US$54.62 year-over-year during the quarter.
In recent weeks the price gap between WTI and WCS has reportedly widened by as much as US$30, where normally it would be less than half that.
Even so, Whelan said the market conditions are favourable for heavy oil producers like Imperial, which can make money and pay dividends at a price much lower than it is currently.
“The absolute price of WCS remains extremely constructive.”
This report by The Canadian Press was first published Oct. 30, 2026.
By Lauren Krugel
