Canadian Natural Resources Ltd (CNRL) has said that it will defer plans for CAD150mn ($110mn) worth of spending related to front-end engineering and design (FEED) work on its Jackpine oil sands mine expansion project. The disclosure came during the company’s fourth-quarter earnings announcement, released last week.

CNRL’s president, Scott Stauth, said on the company’s March 5 earnings call that the spending had been included in the company’s 2026 capital budget. However, he went on to say that Jackpine was being deferred owing to a lack of finalisation of government regulatory policies related to carbon pricing and methane. He said that this creates uncertainty and economic burden for CNRL’s long-term growth investment.

“Once there's more certainty on improved regulatory policy, improved timelines, and additionally egress, we will reassess the economic viability of this project,” Stauth continued.

The Jackpine expansion is estimated to cost CAD8.25bn ($6.1bn) and once it is online, it is anticipated to add 150,000 barrels per day (bpd) of bitumen production at CNRL’s Albian mine north of Fort McMurray, Alberta.

In total, CNRL is cutting CAD310mn ($228mn) from its capital expenditure budget. As well as deferring FEED work on Jackpine, this reduction also reflects continuous improvement and efficiency gains on the company’s development programme, CNRL said in its earnings release. The company’s updated capex budget for 2026 is now CAD5.99bn ($4.4bn), down from CAD6.3bn ($4.6bn) previously.

Alberta Energy and Minerals Minister Brian Jean told CBC News last week that he and his government remained optimistic, despite the deferral of Jackpine.

“It’s not surprising that investors would like to see the outcome of these negotiations prior to investing billions in the sector, especially after a decade of uncertainty while Justin Trudeau was prime minister,” Jean, who represents the Fort McMurray-Lac La Biche riding in the Legislative Assembly of Alberta, told the news service.

Indeed, Trudeau had tried to strike a balance between supporting Canada’s energy industry while pursuing energy transition initiatives but had become unpopular with energy industry players and supporters by the end of his tenure.

Stauth’s mention of egress also illustrates that oil sands producers are likely to take a cautious approach to new expansion projects until they have more certainty on new takeaway capacity options out of Alberta. There has been talk of recent months of the potential to build a new pipeline to the British Columbia coast, with such an initiative supported by both the Alberta government and the federal government under Canadian Prime Minister Mark Carney. However, private sector player would need to advance any new project and so far no company has come forward.