Ottawa to launch new loan program
Initiative aims to help Indigenous communities borrow funds to invest in commercial projects
The federal government is expected to announce a new loan program to help Indigenous nations raise money to participate in commercial projects and decrease reliance on federal resources.
Justin Bourque, the President of Athabasca Indigenous Investments and Asokan Generational Developments, said he anticipates next week’s fall economic statement will include some component of the loan guarantee program but it will not be fully outlined.
Bourque said the program will increase the opportunities for Indigenous communities to invest in commercial projects on or adjacent to their lands, prioritize the needs of their communities and decrease reliance on government funding.
Advocates for the idea have been lobbying the government to ensure the program is open to all business opportunities including mining, oil and natural gas — a key condition for Indigenous communities.
Exactly how the federal loans will be structured is not yet known, but the program aims to close the gap for Indigenous communities that want to invest in otherwise inaccessible projects.
Bourque said he met with officials from the Prime Minister’s Office last week to discuss the program and ensure it included oil and gas projects. Otherwise, he said, the program cannot truly provide economic reconciliation.
“The government cannot be in a position to dictate where and who and how those relationships take shape. Some Indigenous communities across Canada only have oil and gas in their backyard and there is no other industry,” Bourque said.
“Excluding them puts divisiveness within their opportunity and it’s really not for the government to set that standard.”
Last month, the First Nations LNG Alliance, First Nations Power Authority, Indigenous Resource Network and Athabasca Indigenous Investments wrote a letter to Prime Minister Justin Trudeau’s office asking to meet to provide input on the loan guarantee program, including making oil and gas projects eligible for loans.
First Nations Power Authority CEO Guy Lonechild is also expecting the fall economic statement to include the program.
The fall economic statement is set to be delivered by Finance Minister Chrystia Freeland on Nov. 21. Natural Resources Canada was unable to confirm whether it will contain the new loan program or whether the oil and gas sector will be eligible.
Currently, there are only three provinces with Indigenous loan programs: Alberta, Saskatchewan and Ontario.
The Alberta Indigenous Opportunities Corporation, which launched in 2020, facilitates Indigenous investments in “natural resources, agriculture, telecommunications or transportation sectors and related infrastructure.” The corporation has helped with more than $511 million in loan guarantees to over 27 Indigenous communities in the province.
On Nov. 1, Alberta increased the corporation’s investment capacity from $1 billion to $3 billion for the fiscal year of 2024 to 2025.
The Saskatchewan Indigenous Investment Finance Corporation was established in 2022 and provides between $5 million and $75 million in loan guarantees for eligible “natural resource and valueadded agriculture projects.”
Ontario’s Aboriginal Loan Guarantee program has $1 billion in resources to support Indigenous participation in “electricity infrastructure projects, including renewable energy infrastructure” and transmission projects on behalf of the provincial government.
Athabasca Indigenous Investments have the largest Indigenous equity in the energy sector to date with the AIOC. Last September, communities in Northern Alberta represented by Athabasca Indigenous Investments joined a partnership with the oil and gas company Enbridge for seven pipelines in or adjacent to their territories worth $10 billion through a $250-million equity loan guarantee. The nations now collectively have about 11 per cent equity in the project.
This partnership has been “very impactful and very important for the futures of these communities,” Bourque said.
Some communities have used the funds to build schools and hire teachers, create and provide services for elders and buy infrastructure for their communities.
Bourque said by allowing Indigenous nations to participate in the energy sector, it also allows Indigenous people to be active participants in decarbonization and the environmental stewardship of the projects by recognizing Indigenous values.
“Now you’re finding what once was an engagement that was at odds is now coming into an alignment,” he said.
Toronto Star Newspapers Limited