REGINA — Saskatchewan and Montana have joined forces on a plan to clean up the air by pumping carbon emissions underground.

Saskatchewan Premier Brad Wall and Montana Governor Brian Schweitzer met at the provincial legislature Thursday to sign a memorandum of understanding to work together on a carbon capture project.

Wall said sustainable energy development is "the challenge of this century" and the project could go a long way to reducing the carbon footprint.

"If we don't focus on the technological solutions then we're kind of missing the point," said Wall.

"You can cap and trade all the emissions you want, but the point of what we're trying to achieve together is to find ways to actually do something about the carbon, to capture it to clean up coal generation," the premier told a small crowd.

Schweitzer said action needs to be taken to tackle climate change, adding it's a greater challenge that putting a man on the moon.

"This challenge will be more expensive and we will indeed not have all the technology in place in 10 years. But every great journey starts with an important first step and today ... we indeed are taking the first step to the future," said Schweitzer.

The proposed $270 million project would see carbon dioxide emitted from a coal-fired power plant in southern Saskatchewan piped to Montana where it would be stored underground.

Scientists would monitor the carbon dioxide once it's sequestered beneath the earth.

The carbon dioxide could be pumped back out of the ground and used for enhanced oil recovery -- something already being done in Saskatchewan. EnCana buys the gas from a coal gasification plant in North Dakota and pipes it into an underground reservoir to push more oil out of the ground near Weyburn, Sask.

Wall has already said Saskatchewan will provide up to $50 million for the project. The province has asked the Canadian government to pitch in $100 million.

Montana is looking to secure about $100 million from a U.S. federal stimulus package for the project.

"This memorandum of understanding as near as I can tell didn't commit one nickel from either side. It didn't suggest that the federal governments on either side are committed in any way," said Schweitzer.

But the governor said this is the sort of project that interests the federal government.

A news release from the Saskatchewan government says construction of the plant could begin as early as September 2009 and the plant could be operational as early as the summer of 2011 -- with the financial support of the governments of Canada and the United States.

The goal for the plant is to test a range of technologies in the capture of up to one million tonnes of CO2 over a four-year period.

Critics have said Montana isn't ready for the project because it is extremely expensive. Other critics question the technology itself -- noting that the process burns additional energy, and that little is known about either the long-term impact on the soil or on the potential for leakage.

Schweitzer brushed aside that criticism.

"We can either do nothing and continue to produce electricity with existing coal-fired plants emitting CO2 in much the same way as we have with this technology for the last 100 years, or we can act," said Schweitzer.

"For those people who suggest that this is experimental technology to store CO2 underground, they're smoking pine cones," said the governor.

Montana relies heavily on coal for power. But the project is also important in Saskatchewan because SaskPower, the provincially owned utility, uses coal for the majority of its power generation.

Schweitzer and Wall noted that borders mean nothing to carbon emissions. Wall said something has to be done.

"We need to act. We need to make sure Saskatchewan remains competitive and that our people are well served by actions we take today that we know will benefit decades down the road," said Wall.

"This is about the future."