Cedar LNG, seen under construction in Kitimat, B.C., in 2025, shows the transformative potential of Indigenous project ownership, writes Lawrence Schembri.Jesse Winter/Reuters
Lawrence Schembri is a former deputy governor at the Bank of Canada and a board member of the Tulo Centre of Indigenous Economics.
Protecting Canada’s economic sovereignty is now job one for our federal government. An all-hands-on-deck effort is under way to confront the threat of U.S. trade policy by strengthening Canada’s economy, including the diversification of exports.
Major natural resource, electricity and transportation projects are central to this effort, and nearly all occur on Indigenous lands. Their success depends on meaningful Indigenous participation, including as equity partners. However, persistent gaps in access to early-stage, risk-tolerant financing limit Indigenous participation.
Indigenous communities are open for business. More major projects will become a reality if Indigenous governments, businesses and entrepreneurs have access to financing comparable to that available to non-Indigenous entities. Indigenous access to flexible and scalable capital is almost non-existent. Current programs focus mostly on later-stage or lower-risk financing, leaving early project development and equity participation underfunded.
While loan guarantees offered by the federal government and several provincial governments are a positive step, they are best suited for projects that are at or near completion. Indigenous participation requires other financing tools for the earlier, riskier phases of projects and to provide the scale of finance needed for them. These tools will ensure more projects get under way and completed.
To close these financing gaps, the First Nations Financial Management Board (FMB) and other Indigenous organizations have proposed that the federal government establish the Indigenous Development Finance Organization (IDFO). This is a practical, achievable and Indigenous-led solution. The IDFO would raise funds through global capital markets and deploy them as flexible financing options to support Indigenous equity participation in major projects.
Because of this capacity to attract and provide financing at scale, the IDFO would enable Indigenous communities, businesses and entrepreneurs to participate in major projects as full economic partners.
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The vast majority of the 17 projects that have been referred to the Major Projects Office (for being in the national interest) are on traditional Indigenous territories. They represent almost $125-billion in capital expenditure.
Over the past 15 years, major projects with Indigenous ownership totalled more than $60-billion. When we consider the potential for Indigenous equity to drive major projects forward, that’s just scratching the surface.
But the potential can only be realized through access to reasonably priced financing. Indigenous communities and businesses need flexible, Indigenous-led financing solutions to participate in these projects and benefit from their procurement supply chains. Canada, in turn, needs meaningful Indigenous participation to happen in order for the country to achieve its economic potential in the face of increasing global pressures.
Indigenous ownership also strengthens environmental outcomes by embedding traditional knowledge, long-term stewardship and accountability into project governance. And it advances economic reconciliation. In short, it’s good for Canada on many levels.
When it comes to opening up the Indigenous economy, Indigenous-led institutions point the way forward. The First Nations Fiscal Management Act institutions are a prime example. In addition to the FMB, they include the First Nations Finance Authority, First Nations Tax Commission and First Nations Infrastructure Institute. These institutions have demonstrated how Indigenous-led financial governance helps achieve sustainable economic development, but their scope is limited.
The Indigenous-led IDFO would build upon their success and encompass all three Indigenous groups: First Nations, Métis and Inuit.
Complementary tools, such as an Indigenous bonds framework, like green or ESG bonds, could facilitate access to global capital and support Indigenous equity participation.
We see the potential of Indigenous ownership in projects like Cedar LNG in British Columbia, the world’s first Indigenous majority-owned LNG project. Now under construction, Cedar LNG presents transformative opportunities for both the Haisla Nation and the region.
Haisla Nation chief councillor Crystal Smith, right, speaks to Cedar LNG official Mike Eddy at the project site in Kitimat, B.C., in May, 2025.Aaron Whitfield/The Globe and Mail
We also see the potential in massive green energy projects, such as the Duchess Solar project, a 19.8-megawatt solar facility being constructed in Duchess, Alta., with Cold Lake First Nations as majority owner, in partnership with Elemental Energy.
With an Indigenous-led IDFO, many more transformative projects will move ahead. Indigenous-led is the key term here. We have repeatedly seen that when Indigenous communities have the tools to develop their economies, they achieve better outcomes than those of government-run programs. Let’s invest in success.
The federal government can act now by committing to establish the IDFO and investing in the capacity required for Indigenous communities to evaluate and participate in major projects that align with their values and needs.
Indigenous prosperity creates prosperity for all Canadians. The success achieved through Indigenous-led institutions shows the way forward.
We know what works. We also know that the world is desperate for Canada’s resources. The question now is whether we are ready to act.
Let’s seize this opportunity to build on success for the benefit of all Canadians.