Canada and the United States appear set to take an initial step towards a North American climate-change treaty Thursday during President Barack Obama's visit to Ottawa.

Sources from both countries say they expect Harper and Obama to announce an agreement that would serve as a building block towards a continental cap-and-trade system.

One American official said the leaders are expected to take a modest first step Thursday by announcing a clean-technology deal that would boost the practice of carbon capture and storage.

That deeper integration would be a precursor to the loftier goal of North America-wide greenhouse gas targets — something that would require extensive negotiations.

"Some kind of co-operation on technology appears likely going forward [Thursday]," the U.S. official said.

"But vis-a-vis cap and trade, specifically, that's probably premature."

A Canadian official concurred when asked whether an environmental deal would be announced Thursday: "I think that's a fair expectation."

Both governments have publicly signalled an intention to work more closely on the environmental file, now that a U.S. administration skeptical of climate change has been replaced by Obama's more activist team.

Environmental, political implications

An integrated North American approach would not only carry environmental implications, but also political ones in Canada and internationally.

In negotiations to replace the Kyoto accord, it would create a common front of North American countries that have supported weaker targets against Europeans who favour more stringent ones.

It would also help deflect international criticism of the Harper government as a climate-change laggard, by aligning it with a White House considered friendly to the cause.

Obama himself hinted at greater co-ordination this week.

When the president was asked about climate change during an exclusive interview with CBC News this week, he steered the conversation toward green technology and specifically referred to carbon capture. He described it as a way to reduce emissions without crippling the economy.

"[If] Canada and the United States can collaborate on ways that we can sequester carbon capture greenhouse gases before they're emitted into the atmosphere, that's going to be good for everybody," Obama said.

"Because if we don't, then we're going to have a ceiling at some point in terms of our ability to expand our economies and maintain the standard of living that's so important."

More integration could also help dim the growing chorus of international protests against Alberta's oil sands as dirty energy.

U.S. environmentalists have taken out ads deriding the oil sands, and Greenpeace activists staged a protest in Ottawa on Wednesday urging Obama to take a stand against them.

Carbon capture technology still in infancy

But in his CBC interview, the president suggested that technology could help address the pollution problem that exists not only with Canadian oil, but also with U.S. coal.

Carbon sequestration is an emerging, but still-embryonic technology that involves harnessing emissions and pumping them deep into the soil.

The Canadian government has provided $375 million to help develop the technology in recent years, and also promised a five-year, $1-billion green technology fund in the recent budget.

But critics have dismissed the federal commitment as inconsequential, with the provinces and private industry being required to put up the vast majority of the money.

Other critics question the technology itself — noting that the process burns additional energy while little is known about either the long-term impact on the soil or on the potential for leakage.