Alberta
New $1 billion pipeline deal spreads Indigenous ownership through Alberta, B.C. and Saskatchewan
From the Canadian Energy Centre
By Will Gibson
‘We are writing the history of tomorrow today, not living the outcomes of our forefathers’
In a landmark agreement announced July 30, a consortium of up to 72 Indigenous communities in Alberta, British Columbia and Saskatchewan will buy a 5.34 per cent stake in TC Energy’s NGTL natural gas network.
The agreement is backed by a $1 billion loan guarantee from the Alberta Indigenous Opportunities Corporation (AIOC).
TC Energy’s sprawling NGTL network spans 25,000 kilometres and handles about 10 per cent of North America’s natural gas, connecting production in Alberta and British Columbia to domestic and export markets.
Map courtesy TC Energy
The loan guarantee has similarly impressive scope and size, quadrupling the AIOC’s previous largest financial commitment, a $250 million loan guarantee provided to 23 Indigenous communities in September 2022 to help purchase an 11.57 per cent stake in seven Enbridge oil sands pipelines in northern Alberta.
The deal will raise the AIOC’s support of Indigenous equity ownership in resource projects to over $1.68 billion since 2019.
“I’ve participated in three of these transactions, including the Enbridge loan guarantee, and you can see an evolution in the size and complexity of these agreements,” says Justin Bourque, founder and president of Âsokan Generational Developments, a consultancy that specializes in partnerships between Indigenous communities and industry.
“They are building on the good work from previous deals and it’s wonderful to see the AIOC expanding into neighbouring provinces, where these types of agreements will have significant benefits to the participating Nations in B.C. and Saskatchewan as well as Alberta.”
Âsokan Generational Developments president and founder Justin Bourque pictured on his trap line in northern Alberta with the Long Lake oil sands facility in the background. Photo for Canadian Energy Centre
The new agreement also demonstrates growing comfort among Indigenous communities, industry players and lenders as these equity arrangements become more commonplace, says Heather Exner-Pirot, director of energy, natural resources and environment at the Macdonald-Laurier Institute, an Ottawa-based think tank.
“There are some formidable challenges with trying to negotiate with multiple communities across different treaty areas and provinces, but this shows the confidence the Alberta government has in backstopping these bespoke deals with communities and companies when the merits of the project deserves it,” says Exner-Pirot, who also serves as a special advisor to the Business Council of Canada.
Heather Exner-Pirot, senior fellow with the Macdonald-Laurier Institute. Photo supplied
“It also demonstrates the confidence from the lenders in these equity deals for pipelines. And that confidence is well founded because these existing pipelines are a stable business that generate the revenues to pay back the loan as well as income for the communities to use as well.”
The announcement builds on momentum for Indigenous ownership of Canadian energy projects, including June’s announcement that the Haisla Nation and Pembina Pipeline Corporation will move ahead with the Cedar LNG project.
The floating LNG export facility on Canada’s west coast will be the world’s first with Indigenous majority ownership.
Bourque sees the agreements providing a framework for future partnerships between Indigenous communities, government and industry beyond equity ownership.
“This is an important stepping stone in our evolution and it’s exciting to see it continue through pursuing opportunities in energy development, decarbonization and energy transition projects,” Bourque says.
“We are writing the history of tomorrow today, not living the outcomes of our forefathers.”
Photo courtesy TC Energy
Exner-Pirot also sees a bright future for collaborations between Indigenous communities and energy companies, in part because the federal, Saskatchewan and BC governments now also offer loan guarantee programs.
“These deals take months, if not years, to come together and what this shows is the AIOC, Indigenous communities and energy companies have found a template that works,” she says.
“The NGTL loan guarantee is the biggest but it won’t be the last one.”
Better, faster, more affordable auto insurance
Alberta’s government is introducing a new auto insurance system that will provide better and faster services to Albertans while reducing auto insurance premiums.
After hearing from more than 16,000 Albertans through an online survey about their priorities for auto insurance policies, Alberta’s government is introducing a new privately delivered, care-focused auto insurance system.
Right now, insurance in the province is not affordable or care focused. Despite high premiums, Albertans injured in collisions do not get the timely medical care and income support they need in a system that is complex to navigate. When fully implemented, Alberta’s new auto insurance system will deliver better and faster care for those involved in collisions, and Albertans will see cost savings up to $400 per year.
“Albertans have been clear they need an auto insurance system that provides better, faster care and is more affordable. When it’s implemented, our new privately delivered, care-centred insurance system will put the focus on Albertans’ recovery, providing more effective support and will deliver lower rates.”
“High auto insurance rates put strain on Albertans. By shifting to a system that offers improved benefits and support, we are providing better and faster care to Albertans, with lower costs.”
Albertans who suffer injuries due to a collision currently wait months for a simple claim to be resolved and can wait years for claims related to more serious and life-changing injuries to addressed. Additionally, the medical and financial benefits they receive often expire before they’re fully recovered.
Under the new system, Albertans who suffer catastrophic injuries will receive treatment and care for the rest of their lives. Those who sustain serious injuries will receive treatment until they are fully recovered. These changes mirror and build upon the Saskatchewan insurance model, where at-fault drivers can be sued for pain and suffering damages if they are convicted of a criminal offence, such as impaired driving or dangerous driving, or conviction of certain offenses under the Traffic Safety Act.
Work on this new auto insurance system will require legislation in the spring of 2025. In order to reconfigure auto insurance policies for 3.4 million Albertans, auto insurance companies need time to create and implement the new system. Alberta’s government expects the new system to be fully implemented by January 2027.
In the interim, starting in January 2025, the good driver rate cap will be adjusted to a 7.5% increase due to high legal costs, increasing vehicle damage repair costs and natural disaster costs. This protects good drivers from significant rate increases while ensuring that auto insurance providers remain financially viable in Alberta.
Albertans have been clear that they still want premiums to be based on risk. Bad drivers will continue to pay higher premiums than good drivers.
By providing significantly enhanced medical, rehabilitation and income support benefits, this system supports Albertans injured in collisions while reducing the impact of litigation costs on the amount that Albertans pay for their insurance.
“Keeping more money in Albertans’ pockets is one of the best ways to address the rising cost of living. This shift to a care-first automobile insurance system will do just that by helping lower premiums for people across the province.”
Quick facts
- Alberta’s government commissioned two auto insurance reports, which showed that legal fees and litigation costs tied to the province’s current system significantly increase premiums.
- A 2023 report by MNP shows
Alberta maintains a balanced budget while ensuring pressures from population growth are being addressed.
Alberta faces rising risks, including ongoing resource volatility, geopolitical instability and rising pressures at home. With more than 450,000 people moving to Alberta in the last three years, the province has allocated hundreds of millions of dollars to address these pressures and ensure Albertans continue to be supported. Alberta’s government is determined to make every dollar go further with targeted and responsible spending on the priorities of Albertans.
The province is forecasting a $4.6 billion surplus at the end of 2024-25, up from the $2.9 billion first quarter forecast and $355 million from budget, due mainly to higher revenue from personal income taxes and non-renewable resources.
Given the current significant uncertainty in global geopolitics and energy markets, Alberta’s government must continue to make prudent choices to meet its responsibilities, including ongoing bargaining for thousands of public sector workers, fast-tracking school construction, cutting personal income taxes and ensuring Alberta’s surging population has access to high-quality health care, education and other public services.
“These are challenging times, but I believe Alberta is up to the challenge. By being intentional with every dollar, we can boost our prosperity and quality of life now and in the future.”
Midway through 2024-25, the province has stepped up to boost support to Albertans this fiscal year through key investments, including:
- $716 million to Health for physician compensation incentives and to help Alberta Health Services provide services to a growing and aging population.
- $125 million to address enrollment growth pressures in Alberta schools.
- $847 million for disaster and emergency assistance, including:
- $647 million to fight the Jasper wildfires
- $163 million for the Wildfire Disaster Recovery Program
- $5 million to support the municipality of Jasper (half to help with tourism recovery)
- $12 million to match donations to the Canadian Red Cross
- $20 million for emergency evacuation payments to evacuees in communities impacted by wildfires
- $240 million more for Seniors, Community and Social Services to support social support programs.
Looking forward, the province has adjusted its forecast for the price of oil to US$74 per barrel of West Texas Intermediate. It expects to earn more for its crude oil, with a narrowing of the light-heavy differential around US$14 per barrel, higher demand for heavier crude grades and a growing export capacity through the Trans Mountain pipeline. Despite these changes, Alberta still risks running a deficit in the coming fiscal year should oil prices continue to drop below $70 per barrel.
After a 4.4 per cent surge in the 2024 census year, Alberta’s population growth is expected to slow to 2.5 per cent in 2025, lower than the first quarter forecast of 3.2 per cent growth because of reduced immigration and non-permanent residents targets by the federal government.
Revenue
Revenue for 2024-25 is forecast at $77.9 billion, an increase of $4.4 billion from Budget 2024, including:
- $16.6 billion forecast from personal income taxes, up from $15.6 billion at budget.
- $20.3 billion forecast from non-renewable resource revenue, up from $17.3 billion at budget.
Expense
Expense for 2024-25 is forecast at $73.3 billion, an increase of $143 million from Budget 2024.
Surplus cash
After calculations and adjustments, $2.9 billion in surplus cash is forecast.
- $1.4 billion or half will pay debt coming due.
- The other half, or $1.4 billion, will be put into the Alberta Fund, which can be spent on further debt repayment, deposited into the Alberta Heritage Savings Trust Fund and/or spent on one-time initiatives.
Contingency
Of the $2 billion contingency included in Budget 2024, a preliminary allocation of $1.7 billion is forecast.
Alberta Heritage Savings Trust Fund
The Alberta Heritage Savings Trust Fund grew in the second quarter to a market value of $24.3 billion as of Sept. 30, 2024, up from $23.4 billion at the end of the first quarter.
- The fund earned a 3.7 per cent return from July to September with a net investment income of $616 million, up from the 2.1 per cent return during the first quarter.
Debt
Taxpayer-supported debt is forecast at $84 billion as of March 31, 2025, $3.8 billion less than estimated in the budget because the higher surplus has lowered borrowing requirements.
- Debt servicing costs are forecast at $3.2 billion, down $216 million from budget.
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