Feds late to LNG party as indigenous-led Cedar project signals new economic model

After years of insisting that there’s no business case, the federal government is coming late to the Canadian LNG party.

On Tuesday, federal Energy and Natural Resources Minister Jonathan Wilkinson was pledging up to $200 million in support for the Haisla-led Cedar LNG project near Kitimat, British Columbia that is redefining how resource development is done in Canada.

It was a notably quiet announcement on the election campaign trail amid the din of the escalating trade battle with the US, but arguably more significant.

That’s because it comes as the massive LNG Canada terminal prepares to begin start-up operations on April 1, marking the country’s largest-ever private sector investment and putting Canada firmly on the global LNG stage.

For local First Nations, the support is better late than never.

“Haisla values of sustainability and environmental protection are core to how Cedar LNG has been designed, and will result in one of the most innovative LNG facilities in North America, with one of the lowest carbon footprints in the world,” said Chief Councillor Crystal Smith. 

Canada’s entry into the global liquefied natural gas (LNG) market is taking shape through a model rarely seen in the resource sector — one where Indigenous communities are not just consulted but leading as equity stakeholders. 

The $4.17 billion Cedar LNG project, developed by the Haisla Nation in partnership with Pembina Pipeline Corporation, is set to be Canada’s first Indigenous majority-owned LNG export facility. 

Historically, large-scale resource projects on indigenous lands have been sources of conflict, with First Nations often sidelined in decision-making and economic benefits. 

Cedar LNG, however, represents a fundamental shift with the Haisla Nation as the majority owner, ensuring direct economic benefits and decision-making power over development on their traditional territory.

Set to begin construction in 2025 and start operations in late 2028, Cedar LNG will use clean hydroelectric power from BC’s hydro grid, significantly reducing emissions compared to traditional LNG facilities. Once operational, it will produce 3.3 million tons of LNG per year for export to Asian markets.

The project is also expected to create 300 full-time construction jobs, 100 permanent operating jobs and contribute an estimated $275 million to Canada’s GDP during construction. Cedar will generate nearly $85 million in annual GDP once the facility is up and running.

Beyond the numbers, industry observers say Cedar LNG is an example of how First Nations-led economic partnerships can reshape Canada’s approach to industrial development.

“Together with our partner, the Haisla Nation… Cedar LNG will bring industry-leading, low-carbon, cost-competitive Canadian LNG to overseas markets,” said Pembina president and CEO Scott Burrows.

It comes as the impending launch of LNG Canada’s $40-billion Kitimat terminal underscores Canada’s emerging role in global gas markets. 

But while LNG Canada is a massive corporate-led project, Cedar LNG highlights a different approach where Indigenous communities own and operate the infrastructure on their land, rather than being passive stakeholders.

As Canada positions itself as a major LNG exporter, the success of projects like Cedar LNG may determine whether economic reconciliation becomes more than just a talking point for grandstanding politicians, or rather, a new reality in the country’s resource sector.