The Canadian government signed a partnership with Germany’s Heidelberg Materials to support a proposed C$1.4 billion ($1.04 billion USD) carbon capture utilization and storage (CCUS) unit at the company’s Edmonton cement plant.

If the project goes ahead, it will create North America’s first carbon-neutral cement plant and is expected to capture over 1 million tonnes of carbon dioxide annually. Canadian energy infrastructure firm Enbridge (ENB.TO) is developing the carbon sequestration hub where emissions will be stored.

The two parties signed a memorandum of understanding to start negotiations.

Support would come from Canada’s Strategic Innovation Fund, which invests in major projects.

This milestone is fundamental to achieving a viable business case that will allow this ground-breaking, first mover project to be realized.

A while ago, Canada expanded eligibility for CCUS investment tax credits to include cement and concrete plants.

There is a growing urgency for rapid decarbonization in high-emitting sectors, including the cement and concrete industry, and by working hand in hand with the industry, they can support the adoption of innovative technologies that will contribute to lower emissions and increased competitiveness.