Prime Minister Mark Carney’s recent Canada Investment Summit has renewed optimism that sizable investments could be coming for big Canadian projects. That remains a hopeful possibility, but as yet, little much more than that. This government has done far more talking than walking, and without follow-through, Canada will be no further ahead.
Even so, Carney has done something savvy and necessary by rallying investment. Investment money has been draining out of Canada like a flushing toilet in recent years. Although the Trudeau era was even worse than those previous, Canada has always been a harder country than many to sink investment dollars when it came to infrastructure projects. Often such projects are provincial or municipal and not structured in a way that offers returns on investment. This leaves Canadian pension funds investing in foreign infrastructure projects instead.
The priority page of the Major Projects Office (MPO) lists some big numbers: 18 projects, nine transformative strategies, 337,000 jobs, $192 billion in new investment and $500 billion in future private sector investment. That sounds wonderful, but these are only projects supported by the MPO, not ones formally given the green light.
Only one project has been approved: Canada’s Nickel Crawford Project, a large nickel-cobalt mine located 40 kilometres north of Timmins, Ontario. The project was brought before the MPO last November and formally approved on July 31 of this year. It is estimated to contribute $70 billion to Canada’s GDP and create 185,000 person-years of employment over its 41-year lifespan. With federal approval secured, Canada Nickel Co. Inc. is advancing detailed engineering and financing, targeting a final construction decision in 2027.
Everything else waits in limbo, just like most Canadian development has for a decade. Last April, federal officials announced a whopping 275 projects were before the MPO. Have any been rejected? We don’t know. Will any get preliminary approval? We don’t know. And it’s not in the government’s political interest to announce any refusals. So long as they don’t, commercial Canada and the electorate’s minds can be filled with every wonderful expectation of their wildest dreams coming true.
MPO or not, Canada remains a regulatory, job-killing labyrinth. The Crawford project is the only mine to go forward among those put forward following the Trudeau government’s Impact Assessment Act of 2019. Those development-smothering frameworks remain. Carney has only authorized a bulldozer so approved projects can smash right through those barriers. It would have been far better for the federal government to restore a more workable regulatory framework.
The MPO is the only reason would-be project proponents are even willing to give their ideas a go. Last decade, the Northern Gateway Pipeline got to the finish line, only to be vetoed by the federal government as coastal indigenous groups complained about environmental threats to northern B.C. shores. TransCanada East had enormous potential, but its 30,000-page application was all for not, as Quebec just didn’t want it. Teck Frontier’s oil sands mine project was withdrawn amidst public complaints about Canada’s regulatory environment.
We can only imagine how much better Canada would be positioned now if these projects had gone ahead. It would have been just in time for the sudden surge in demand from Europe for Canadian energy amidst the Russia-Ukraine War. Supply disruptions following the recent conflict in Iran would have made Canadian oil all the more valuable. Instead, Canada was flat-footed.
Nevertheless, a new era of pipelines and development could well be upon us, better late than never. A Memorandum of Understanding already supports another oil pipeline from the Alberta oil sands to the B.C. coast–albeit in a southern route, not a northern one. Both Ontario and Alberta premiers want a Northern Shield pipeline to connect the oil sands to refineries in Sarnia, a move that has already been welcomed by Manitoba and Saskatchewan premiers.
After years of functioning on life support, Canada is prepared to sink two per cent of its GDP into the military. Six ice breakers will be built in Canada at the Davie Shipyards in Quebec. And this increased military presence could be a forerunner for renewed and expanded use of the Port of Churchill and even a new port elsewhere on Hudson Bay at Fort Nelson. The routes mean 3,000 km less ocean travel for trips to Europe compared to ships coming from the Gulf of America in Louisiana. That makes eminent sense.
A big question remains what the federal deficit will look like at the end of these nation-building projects. Such considerations should always be kept in mind, but at least this project spending will bring real-world results with tangible economic and defense benefits. After a decade of demoralization, Canada’s time to shine may be just ahead.
