Ontario Premier Doug Ford, left, and Prime Minister Mark Carney at the Darlington Energy Complex in Courtice, Ont., on Oct. 23. The federal government has reached draft agreements with Ontario and Manitoba intended to speed up the review process for major projects.Laura Proctor/The Canadian Press
Ontario and Manitoba struck draft agreements with the federal government this week to streamline reviews for major projects, as part of a larger push by Prime Minister Mark Carney to fast-track resource development and infrastructure building in the face of U.S. trade uncertainty.
The co-operation agreements will allow the provinces to take the lead role in environmental assessment and Indigenous consultation for major projects – a significant devolution of authority from Ottawa to the provinces.
Prince Edward Island and New Brunswick signed similar draft agreements last month, while British Columbia has had an agreement with Ottawa in place since 2019.
Under the mantle of “one project, one review,” the agreements are meant to reduce overlap between provincial and federal environmental impact assessments and Indigenous consultation, which are required before major projects, such as large mines, pipelines or dams, can be built.
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The agreements will apply to projects that fall under the purview of the federal Impact Assessment Act, which is designed to evaluate and mitigate the potential environmental consequences of large-scale developments. This is not limited to projects that make it onto the list of the federal government’s new Major Projects Office.
Around eight projects each year typically meet the threshold for an impact assessment review, according to the federal government.
The hope is to speed up Canada’s notoriously sluggish approvals system, which can leave large projects in limbo for years as they bounce between different levels of government and various departments.
“We’ve got to move with speed. We’ve got to get on with building. We can’t be among the slowest to do things at scale, be it critical mineral projects or large-scale energy projects,” said Stephen Lecce, Ontario’s Minister of Energy and Mines.
Ontario Premier Doug Ford, the former chair of the Council of the Federation, had pushed for a streamlined process as the head of the premiers’ group.
The emphasis on accelerating the approval of large projects comes as Mr. Carney and the premiers try to reorient the Canadian economy in response to the sharp protectionist turn by President Donald Trump’s United States.
On Nov. 13 in Terrace, B.C., Mr. Carney announced the second batch of referrals to the Major Projects Office, including Ontario’s Crawford nickel project and New Brunswick’s Sisson mine.ETHAN CAIRNS/The Canadian Press
That means building transportation infrastructure to improve interprovincial trade and get more Canadian goods to the coasts and out to overseas markets. It also means trying to improve the country’s investment climate to attract capital at a moment when favourable access to the U.S. market is no longer guaranteed and business investment is frozen.
Over the summer, Ottawa passed Bill C-5, allowing it to designate “nation-building” projects that would be fast-tracked through the regulatory approvals process. There was some pushback at the time from Indigenous and environmental groups worried Ottawa could use this legislation to ram projects through.
Much of the public focus has been on the Major Projects Office, which has been tasked with getting the designated nation-building projects through the thicket of regulations and to help co-ordinate public- and private-sector financing. So far, 11 projects have been added to the list, including a handful of critical minerals mines, two liquefied natural gas projects and a port expansion.
The co-operation agreements between Ottawa and the provinces could prove even more significant than the MPO when it comes to changing the regulatory burden large projects face.
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“These initiatives are taking a hard look at existing environmental and permitting processes and regimes and saying, how do we maintain the current level of environmental protection and reputable decision making, but do it better, do it faster, do it with less confusion and more certainty, and do it for the whole economy, not specific projects,” said Zach Parston, national leader of the infrastructure and major project advisory practices at KPMG Canada.
The Ontario and Manitoba draft agreements were posted online Tuesday for a one-month consultation. Keean Nembhard, a spokesman for federal Environment and Climate Change Minister Julie Dabrusin, said Ottawa is optimistic that more co-operation agreements with other provinces will be advanced soon.
The agreements don’t change the standards project proponents must meet on either environmental issues or Indigenous consultation. But they will change who is doing the lion’s share of the assessment work, with the provinces taking the lead – if they request it – and Ottawa playing a supporting role.
There is already an example of this in British Columbia. Four of the five impact assessments begun since 2019 in B.C. have been led by the province, including for the Cedar LNG facility near Kitimat, which was approved in 3½ years.
To date, Cedar LNG is the only major project to make it through the entire process since the new Impact Assessment Act was introduced in 2019.
Construction on the Cedar LNG project in Kitimat, B.C., in August.Jesse Winter/Reuters
Jay Khosla, executive director of economic and energy policy at the Public Policy Forum, and a former assistant deputy minister with Natural Resources Canada, said that Ottawa has always had the ability to delegate assessment authority to the provinces – so long as federal standards are met. But Ottawa has typically been risk adverse.
“They’ve been talking about this for years, and only now do they start to really move in earnest,” Mr. Khosla said, chalking up the change to the direction coming out of the Prime Minister’s Office.
This push for federal-provincial co-operation also follows a Supreme Court decision in 2023 that found Ottawa was overstepping its constitutional authority by using the Impact Assessment Act for aspects of projects beyond federal jurisdiction. This pushed Ottawa to amend the act in 2024.
The key question now is how the provinces will meet the federal standards, so as to avoid litigation from environmental or Indigenous groups.
“The real test of this is, ‘Can you go to court and demonstrate that you’ve met your obligations?’ As long as they work very effectively together, have the right people on the process, it should stand the test of time,” Mr. Khosla said.
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The proposed changes are making some environmental groups nervous. Keith Brooks, programs director at Environmental Defence, said he’s worried about Ottawa giving more latitude to the Government of Ontario.
“Ontario is not a jurisdiction that is taking environmental protection and/or climate action very seriously at all,” he said, citing the province’s recent move to scrap climate change targets.
Ontario Regional Chief Abram Benedict offered a more optimistic view of the draft agreement, which clearly spells out that both Ottawa and Queen’s Park must respect Indigenous rights when it comes to major projects assessment.
“We hope that these are not just nice words and sentiments but will serve as a road map for First Nations, Ontario and Canada to follow so that everyone can prosper,” Mr. Benedict said.
“First Nations are willing partners and play a vital part of Canada’s economy. We have long said we are not opposed to development. But development must be done the right way.”