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The federal government has offered Indigenous groups a collective 15 per cent ownership stake in the Trans Mountain pipeline, advancing a long-promised plan to give First Nations equity in the federally owned infrastructure connecting Alberta crude to a Vancouver-area export terminal.
In a letter to a First Nation along the pipeline’s path seen by The Canadian Press on Tuesday, an official with the federal Department of Finance said the equity investment would be equally distributed among participating groups “through a low-cost, government-provided loan.”
The Trans Mountain equity offer follows consultations and discussions with 129 First Nations, said John Fragos, spokesperson for Finance Minister François-Philippe Champagne.
Ottawa is now gauging interest before determining the finer details, including the size of individual stakes and the terms for buying in, he said.
“The government’s position on economic reconciliation is long-standing and clear: Indigenous communities must be able to participate in and directly benefit from the projects shaping Canada,” Fragos said in a statement.
He added that each Indigenous group that invests in Trans Mountain is set to receive $2.5 million, intended to compensate for revenue they might have earned had Indigenous ownership been put in place years earlier.
“We’re making up for lost time,” Fragos said in a follow-up call.
The letter to the First Nation says Ottawa will provide eligible groups with up to $100,000 for participation costs, while separately covering independent advisers to assist with due diligence.
Details of the offer will be shared during a series of in-person meetings in Vancouver, Victoria, Kamloops and Edmonton planned for late October, the letter adds.
Ottawa bought the existing Trans Mountain pipeline, its expansion project and related assets for $4.5 billion in 2018 after Kinder Morgan investors raised concerns that regulatory uncertainty made the investment too risky.
It later committed to exploring Indigenous economic participation in the expansion with the 129 Indigenous communities potentially affected by the project.
The expansion began operations in 2024 and increased the Trans Mountain system’s capacity to about 890,000 barrels per day from roughly 300,000 barrels per day.
Finance documents released that year said Ottawa planned to provide Indigenous groups with access to capital to acquire a stake in Trans Mountain.
The documents said the Indigenous stake could be held collectively through a special-purpose vehicle, giving participating groups governance rights and a share of cash generated by the pipeline.
Until now, however, the government had not publicly specified the size of the ownership stake it was prepared to make available.
Offer not good enough says Indigenous industry expert
The federal government’s offer has been met with a mixed response, according to some Indigenous industry experts.
“Fifteen per cent, in my view, is not good enough,” Stephen Buffalo, CEO and president of the Indian Resource Council, said in an interview with Radio-Canada at the Inaugural Forum on Indigenous Energy Ownership and Governance in Edmonton. “It’s kind of insulting, to be honest.
“But you know, this is a time our leaders can really assert their jurisdiction, assert their right and title when they see the deal.”
Stephen Buffalo, CEO and president of the Indian Resource Council, told Radio-Canada that the federal government’s equity stake offer tied to the Trans Mountain pipeline is insulating. (Radio-Canada)
Buffalo said a more respectable equity stake to start negotiations would have been to offer up to 51 per cent.
“And then kind of see where things kind of go given the current circumstances around the world,” he said. “Oil companies are seeing good revenues with the price of oil being where it’s at.
“I’m a strong proponent that First Nations should be able to generate their own wealth.”
Dale Swampy, CEO of the National Coalition of Chiefs, said the idea of giving an equity stake to First Nations who will be impacted by the project is good but still needs finer details to be ironed out.
“I’m curious why the [$2.5-million] offer was that small,” he said. “I mean, the pipeline is going to cost tens of billions of dollars. Ten per cent of that is going to be in the billions of dollars.
“We deserve to be part of any future natural resource development coming up, and that’s all about economic reconciliation.”