If you follow the news, you have most likely heard about the rail blockades that are hampering the entire Canadian economy.
While the government has made resolving this one of their top priorities, it speaks to a broader picture of investment uncertainty in Canada. On February 23, for example, Teck Resources Ltd. announced that they were abandoning their $20 billion Frontier oil sands mine project, which would have employed over 7,000 Albertans. The rail blockades have also become international news, possibly scaring away potential investors from Canada.
The blockades themselves originate from a multibillion-dollar investment in Canada. The Coastal GasLink pipeline is intended to bring natural gas from eastern British Columbia to LNG Canada in the west. LNG Canada was approved by the current government and is an estimated $40 billion investment by the following companies: Royal Dutch Shell, Petronas, PetroChina, Mitsubishi and Korea Gas Corp. The blockades center around the Wet’suwet’en hereditary chiefs, who do not approve of the pipeline passing through their territory, even though the majority of the Wet’suwet’en band councils approved of the project and made revenue-sharing agreements with it.
To show solidarity with the hereditary chiefs, dozens of railway blockades have appeared across Canada. This caused VIA Rail to shut down all its commuter operations for some time and CN Rail to shut down all of its eastern operations. Furthermore, though the Ontario Provincial Police have cleared one of the significant blockades in central Ontario, others have since appeared. The barricades have produced propane and supply shortages in some provinces and have caused some industries to shut down or slow down their facilities entirely. The rail blockades have directly impacted thousands of Canadians and have already cost corporations in Canada millions of dollars.
The larger story, however, revolves around Canada continuing to be a place in which multinational corporations want to invest. With the Frontier oil sands mine project canceled, the Coastal GasLink pipeline stalled, the future of the Trans Mountain Pipeline still uncertain, and an essential mode of transportation being blocked without a solution in sight, investor confidence has been impacted. The prime minister is continuing to attempt to resolve the impasse with the Wet’suwet’en hereditary chiefs and is bringing together the provincial premiers for a discussion on the economy. However, it may be too late to catch the attention of many corporations wanting to start their next multibillion-dollar project.