Welcome to Economic Insights, your twice-weekly deep dive into the major projects and policy shifts shaping the Canadian economy.

Stories we are following:

• Ottawa has reached a deal with Quebec to transfer nearly $10 billion over 10 years to fund infrastructure projects. According to the province, that means Québec will be getting more than its fair share of investment from the federal government. Ahead of the October elections, Prime Minister Mark Carney insists this is “about policy, not politics.”
  
• Kebaowek First Nation and Canadian Nuclear Laboratories (CNL) are racing toward a court-mandated deadline to salvage consultations over a proposed nuclear waste facility in Deep River, Ont. Kebaowek First Nation tells iPolitics they are prepared to take the high-stakes federal UNDRIP case all the way to the Supreme Court.

Canada reaches deal with Quebec on billions of dollars in infrastructure funding (CP)

Prime Minister Mark Carney and Quebec Premier Christine Fréchette announced a deal Tuesday that will see the federal government transfer nearly $10 billion over the next decade to fund provincial infrastructure projects.

• The vision: Standing alongside Quebec’s newly minted premier and Infrastructure Minister Gregor Robertson at a public transit garage in Longueuil, Carney framed the package as an investment to deliver “more rapid, affordable, and dependable infrastructure” to Quebecers. The funds are earmarked for a wide array of assets, including public transit expansions, hospital renovations, and higher education.
• The breakdown: The core of the funding package comes from the federal public transit fund originally established in 2024. Under the terms of the deal, Quebec will secure nearly $6 billion for public transit projects, including for the Québec City tramway.

“Today, I am pleased to announce that Quebec is getting its fair share. In fact, it is receiving more than its fair share of federal investment,” said Fréchette. 

• No strings attached: Fréchette said Québec has been able to secure a lot from Ottawa without making policy concessions. She touted intensified talks between the federal and provincial government since she assumed the premier’s office in April.
• The timing: Opposition parties at the Quebec legislature questioned the timing of the announcement. They say the Coalition Avenir Québec (CAQ) government is being strategic, a few months before a general election scheduled in the fall. Parti Québécois Leader Paul St-Pierre Plamondon said Tuesday that the Carney government was aiming to keep his party out of power.
• That tramway though: Securing additional federal backing for the Québec City tramway is no doubt a relief for the CAQ, which has long been embroiled in a divisive local debate pitting the transit project against its own car-centric “third link” promise. Needless to say, we can’t wait for Jean-René Dufort’s take on the next episode of Infoman.

Justin Roy is a councillor for Kebaowek First Nation and has been the community’s main voices on the proposed nuclear waste facility in Deep River, Ont.

First Nation prepared to take federal UNDRIP case to the Supreme Court (iPolitics)

With a court-mandated deadline of September 30, 2026 rapidly approaching, Kebaowek First Nation and Canadian Nuclear Laboratories (CNL) are locked in a precedent-setting consultation process over a proposed near-surface nuclear waste disposal facility in Deep River, Ontario.

• The backdrop: This follows a 2025 Federal Court ruling by Justice Blackhawk. The decision marked the first time the court formally interpreted how Canada’s United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) legislation influences the Crown’s constitutional duty to consult. Justice Blackhawk ruled that UNDRIP raises the legal bar, demanding a robust pursuit of “free, prior, and informed consent” (FPIC)—though she clarified that FPIC constitutes a right to a rigorous process rather than a veto over major projects.
• A 13-step process: Kebaowek First Nation councillor Justin Roy described the court-ordered redo as a massive undertaking. The community has established its own assessment law and a volunteer committee holding weekly sessions to evaluate the project. The committee will ultimately issue a verdict: a yes, a no, or an approval with conditions.
• Information friction: Roy noted ongoing issues with CNL, alleging that information requests dating back to last September remain outstanding.
  “How can we talk about mitigation and accommodation when people aren’t informed?” Roy told iPolitics.
• Another case: In a related challenge on species at risk, also launched by Kebaowek, the Federal Court of Appeal issued a ruling last Thursday criticizing the environment minister’s transparency when permitting the project.
• What’s next: The Canadian Nuclear Safety Commission has committed to responding to Kebaowek’s concerns before issuing a new decision. However, both CNL and Kebaowek have appealed aspects of the original ruling, and are waiting for an imminent court of appeal decision.
  
• Top court: Roy says both parties are prepared to fight the case all the way to the Supreme Court, where it could potentially be heard at the same time as the B.C. mineral rights case.

By the numbers:

$33: The price of carbon credits per tonne in Alberta’s TIER market last week, down 14 per cent from the week before. The province has committed to putting a minimum price floor of $60 in 2030.

$2.75B: The newly confirmed federal funding allocation for the Québec City tramway, amounting to at least 36.2 per cent of the total costs for the project, close to the 40 per cent the province was hoping for. 

2: The consecutive number of quarters showing negative economic growth in Canada, matching the baseline textbook definition of a “technical recession.”

Major projects watch:

– Documents shared by Alberta during private consultations with leaders in B.C., and obtained by CBC, show several ports and routes as options for a new bitumen pipeline. Potential exit points include Observatory Inlet, Prince Rupert and the Nasoga Gulf. In more recent consultations, Alberta officials have shown a general corridor instead of a specific route. Government representative Ron Poole reportedly told B.C. community leaders he’s there to collect “honest opinions” and that at this point “there is no route… I can’t even tell you if it’s going to go north or south.” Alberta hopes to start building a pipeline by 2027. 

– In the summer edition of MBIZ, an in-house publication of the Manitoba Chambers of Commerce, Sio Silica says it plans to spend $125 million on Port of Churchill infrastructure if it  receives provincial approval to extract sand from below the surface of southeastern Manitoba. The provincial NDP government previously rejected an application from the company, citing concerns for drinking water. The revised pitch now includes a much more scaled back sand mining proposal. 

– The president of Tenaris in Canada tells SooToday’s James Hopkin that increased demand in the country’s oil and gas sector is the primary driver behind the company’s planned $306-million expansion in Sault Ste. Marie. Martin Castro says the modernization of the company’s hot rolling mill will enable the steel pipe manufacturer to bolster its productivity at a time when Ottawa is placing increased emphasis on developing the country’s oil and gas resources.

– Fledgling player Inceptio Oil and Gas Limited has secured a two-month extension to post a $52.5-million deposit for two new exploration licences off Nova Scotia. Inceptio was the sole bidder in the province’s latest offshore licensing round. The extension marks an attempt to revive Nova Scotia’s offshore sector, which has been dormant since ExxonMobil and Encana capped their wells in 2018, reports CBC.

Headlines:

• With praise for Carney — and a shot at Trudeau — support for oil drilling draws applause at Energy NL (Ashley Fitzpatrick, CBC)
• UK Green wave sparks hope for Canada’s lone-seat party (Aya Dufour, iPolitics)
• Lion Electric is back—and smaller than ever (The Logic)
• Trans Mountain pipeline will run at full capacity in June, CEO says (Emma Graney, Globe and Mail)
• Federal minister pours more cold water on N.B.’s LNG idea (Adam Huras, Postmedia News)
• Ksi Lisims project would increase B.C.’s greenhouse gas emissions (Tara Carman, CBC)
• $122M in EV rebate claims made since start of new program as dealers wait to be paid (CP)
• Carney too cryptic on sovereign wealth fund (Adam Radwanski, Toronto Star)
• New Joint Report Alleges Human Rights and Capital Markets Risks in Ontario’s Ring of Fire (University of Toronto Faculty of Law, Anishnawbe Business Professional Association)
• Powering Up: Canada’s New National Electricity Strategy (McMillan)
• Carney addresses technical recession, says economy going through ’settling-in’ period (CBC)
• Spring Economic Update 2026: Canada considers private investment in the airport sector (Dentons)
• Varcoe: Canadian pipeline industry on ‘edge of something really big’ as more projects advance (Chris Varcoe, Calgary Herald)
• Mexico arrests suspected cartel hitman over Canadian mining murders (AFP)
• LNG Canada contractors set to prepare B.C. terminal site for potential expansion (Emma Graney, Globe and Mail)
• Canada has access to Anthropic’s powerful Mythos AI model, minister says (Sean Boynton, Global News)