Pathways Alliance’s flagship project looks like a big money loser [Video]

The Pathways Alliance’s proposed carbon capture and storage megaproject has not begun construction or even received approval, and yet its business model is already collapsing, according to a global think tank.

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In a study published Thursday, the international Institute for Energy Economics and Financial Analysis (IEEFA) found the $16.5-billion project to pipe carbon dioxide captured from 13 oilsands sites in northern Alberta to an underground storage site south of Cold Lake, using 600 kilometres pipelines, is facing spiralling cost challenges with limited revenue.

Together, the factors are conspiring to threaten the project’s profitability — and therefore, its ability to go ahead.

“Most businesses, when you have an increase in costs, you can increase your revenue to offset that,” said Mark Kalegha, an energy finance analyst with IEEFA, in an interview with Canada’s National Observer. “But if your …