The federal government is set to announce millions in funding for the Mackenzie Valley Highway project next week, according to a source with knowledge of the matter. 

iPolitics is not naming them because they were not authorized to speak publicly.

A government advisory suggests Transport Minister Steven MacKinnon and Crown-Indigenous Relations Minister Rebecca Alty will make the announcement in Norman Wells, N.W.T., Tuesday morning. 

The territory’s Deputy Premier, Caroline Wawzonek, is also set to attend the announcement. 

Late last week, Ottawa published a notice in the Canada Gazette for the Mackenzie Valley Highway, the next step in considering whether to list the project under Schedule 1 of the Building Canada Act as a project of national interest. 

READ MORE: N.W.T. hopes national-interest highway designation will help secure federal investment

The status enables a regulatory shortcut, with all federal approvals bundled into a single conditions document instead of requiring separate permits from different departments. 

In the case of the Mackenzie Valley Highway, however, the federal government has limited say in fast-tracking the assessment process, as it falls under the purview of a co-management board created out of modern land claim agreements. 

The Mackenzie Valley Environmental Impact Review Board, which conducts the environmental assessment that will determine whether the project moves forward, recently announced it would be expanding its review to include a northern segment running from Norman Wells to Inuvik.

The proposed highway initially included that segment, before financial constraints forced the Northwest Territories government to change the scope of the project in 2015. 

The Mackenzie Valley Highway project was split into two phases: a 321-kilometre stretch from Wrigley to Norman Wells, followed by a later extension to Inuvik.

In community meetings for the Mackenzie Valley Highway project last spring, presenters from the territorial government said that extension had become increasingly important to securing federal funding.

The cost for the first phase to Norman Wells is estimated at $1.65 billion, with the northern segment to Inuvik estimated to cost an additional $2 billion, according to the CBC.

Recently, the Member of the Legislative Assembly for the Sahtu, Danny McNeely, expressed concerns that a separate environmental assessment for the second phase could delay the project, inducing regulatory uncertainty that would hurt efforts to secure federal funding.

Last week, the review board issued a notice saying it would broaden the scope of its current assessment of phase 1 to include the northern segment.  Community consultations about the re-scoping are to be held in the Gwich’in, Sahtu and Dehcho regions in the coming weeks.

The board expects the Northwest Territories government to file new project descriptions that will include anticipated environmental impacts by March 2027. 

The millions in federal funding set to be announced next week, then, are about funding availability, not project approval.

The source of the funding has not been confirmed, though the newly created $1-billion Arctic Infrastructure Fund could be a likely candidate, as it was set up to support projects that improve regional connectivity and strengthen supply chains. 

Many parts of that region currently rely on winter roads that are growing increasingly unreliable because of the climate crisis. 

The highway would create a direct route from Yellowknife to Inuvik, reducing travel times from 38 hours to 23 hours, according to the Major Projects Office.

The special federal agency says it would also enable resource projects like mining across the Dehcho, Sahtu and Beaufort Delta regions and generate new tourism potential through the creation of a “scenic driving loop” through the Northwest Territories and the Yukon.