Here is a fairly standard way to negotiate with someone bigger than you. You make a list of things you want. You attach a consequence to the list: if I don’t get these things, something bad happens, and it happens to both of us. Then, if it works, you get some of the things, you announce that the relationship has never been better, and you tell everyone to forget about the bad thing.
That’s roughly where Alberta Premier Danielle Smith is now. Last year, after setting up a panel tour to collect Albertans’ grievances, she said this: “You know what Ottawa can’t help but be fixated on? ... Punishing our energy sector and layering on policies to keep it in the ground.” That came nearly two months after the Liberals won a fourth straight election under their new leader, Mark Carney. It was a long-running Alberta genre. Her predecessor, Jason Kenney, once accused Ottawa of “killing the golden goose.”
This fall Albertans are heading into a referendum that could eventually lead to a vote on separation, and Smith told CBC News’s Joel Dryden something quite different: “I do think Canada is working better than it ever has.” She will vote for Alberta to stay. Her explanation is that the province has “finally” found a federal government willing to move quickly on major projects like the Pacific Link pipeline, and one that isn’t “standing in the way” of Alberta developing its resources. Carney, she said, is a “different type of leader.”
I think he understands the Constitution. I think he respects the constitutional division of powers. There’s areas that are federal jurisdiction, and areas of provincial jurisdiction.
The theory, which Smith has been laying out for months and says Carney shares, is that you kill separatism by settling the actual disputes. Carney made his own version of that pitch over Thanksgiving, arguing that you can’t build pipelines on fault lines. He calls the arrangement “tough collaboration.” Smith says Alberta and Canada are “walking together” for the first time in a long time.
The scorecard
The list, in this case, is the “nine bad laws.” Smith set them out in March 2025 and said that failing to deal with them would cause an “unprecedented national unity crisis.” In brief, they were: the oil and gas emissions cap; handing oversight of the industrial carbon tax back to the provinces; the net-zero power regulations; the EV mandate; repealing Bill C-69, the Impact Assessment Act; guaranteeing Alberta “full access” to oil and gas corridors; lifting the B.C. tanker ban; ending the ban on single-use plastics; and “halting the federal censorship” of energy companies.
The premier’s office now counts seven of the nine as “scrapped or reformed.” “Investment is soaring and major projects are moving forward again. This is proof of progress and a more collaborative relationship,” spokesperson Ryan Fournier wrote in an email. Seven out of nine is 78 per cent, which is a very good result for a list that came with a unity-crisis clause attached. Not everyone was pleased with how Ottawa got there: some critics said the revisions would roll back environmental protections, and others raised concerns about Indigenous consultation.
Heather Exner-Pirot, director of energy, natural resources and environment at the Macdonald-Laurier Institute in Ottawa, says the changes are real. Canada had a “terrible reputation” for investment under Justin Trudeau, she said, and “the corrections to the ‘nine bad laws’ … those are all meaningful, in that they have attracted investment.” Also: “I don’t think anyone would have anticipated two years ago that we could be where we are here today.”
What if they stop getting along?
The separatist reply is the part I find most interesting, because it isn’t about the policies at all. It’s about counterparty risk. Keith Wilson, a constitutional lawyer and one of the best-known figures in the independence movement, put it like this:
They’re just saying, ‘Hey, we’re getting along.’ Well, what if they stop getting along? I am not satisfied to have the future of my children’s success and prosperity hinge upon whether the prime minister and a premier have a good personal relationship.
In finance this is called key-person risk. Investors in a fund run by one brilliant manager worry about the day that manager leaves, and they write contract terms to protect themselves. Wilson’s argument is that Alberta’s improved terms are a personality, not a contract. Carney says he respects the division of powers. Fine, but that is something he believes, and the next prime minister may not believe it.
Wilson has more specific complaints too. Earlier this month the Alberta Court of Appeal ruled that the federal Impact Assessment Act is still unconstitutional. “I’m sorry, but this is just … political platitudes, absent substantive action,” he said. “If the prime minister was serious about these things, he would offer to change equalization. He would announce that he’s going to follow the court decision, and repeal Bill C-69 [the Impact Assessment Act]. Surely, people aren’t this gullible. But maybe they are?”
The government pipeline
Then there’s Pacific Link, which would carry one million barrels of oil a day from Alberta to the B.C. coast. Earlier this month the federal and Alberta governments announced it had become the first project designated in the national interest, which means its federal approvals and regulatory reviews get fast-tracked. Smith counts it as a win. Cory Morgan, who runs the third-party advertiser Pathway to Independence, said in a recent video that it is the opposite: “This is a nationalized pipeline. Is that really the only way to get something done in Canada, is to have the government do it? That’s not a good sign, guys.”
Exner-Pirot’s answer starts with Trans Mountain. When Kinder Morgan stopped construction, the Trudeau government bought the project for $4.5 billion in 2018. It ended up costing $34 billion, about seven and a half times the purchase price. If you are a private company looking at a West Coast oil pipeline, that is what the risk looks like, and it is why she thinks the state has to carry it: “The particular circumstances of a west coastal pipeline are terrible. I think, [it is] justified for government to de-risk it, and to show that it can be done.” She also points out that plenty of other projects are going ahead without subsidies, including LNG Canada’s Phase 2 expansion in Kitimat, B.C., and an Enbridge natural gas pipeline expansion worth $4 billion. “So, the idea that we’re not building anything else except for this one project with government funding or backing is simply not true.”
So each side has turned the other’s evidence around. To Smith, a federally backed pipeline proves Ottawa has finally come onside. To Morgan, it proves Canada can only get things built when the government does the building. Both are describing the same pipeline.
The goodwill is also less stable than the premier’s office makes it sound. On Thursday, the provincial government pushed back quickly on comments Carney made about the “No to the Nine” campaign. The referendum itself has already energized Alberta’s New Democrats.
There is also an odd bit of incentive design in all this. Smith’s list got results partly because it came with a threat. If the threat goes away, so does the leverage, and the two outstanding items stay outstanding. Wilson’s answer to that is to keep the threat permanently, which is a coherent negotiating strategy but a strange basis for a country. Smith’s answer is to trust Carney. That is either statesmanship or a single-name concentration, and the referendum is not really set up to tell you which.