Oil and gas megaprojects dominated the news through much of the weekend and Monday, with Natural Resources Minister Tim Hodgson maintaining that a new pipeline is a good investment for taxpayers, Alberta and Ontario proposing another pipeline route to oil refineries in Sarnia, and one of the world’s biggest oil and gas companies selling off its interest in a proposed offshore oil development off the coast of Newfoundland and Labrador.

When Prime Minister Mark Carney and Alberta Premier Danielle Smith unveiled plans for a new West Coast Pipeline last Thursday, the province put the cost of the project at $35.2 to $43.7 billion. The details in the announcement had analysts calculating that federal and provincial agencies, backed by taxpayers’ dollars, would cover 90% of that budget, contrary to Carney’s earlier assurances that the project would be contingent on a private sector proponent.

A day later, Hodgson told CBC’s Power & Politics the pipeline would be a good deal. “I am quite comfortable that this is a good investment for Canadian taxpayers,” he told guest host Catherine Cullen.

So far, the only possible, as yet unconfirmed private investor in the project is Calgary-based Pembina Pipeline Corp., with a 10% stake.

Hodgson told Cullen the Trans Mountain pipeline expansion, which the previous federal government bought for $4.5 billion before its final price tag ballooned to $35.6 billion, “is a money maker. It’s one of the best assets that this the country has. It is generating oodles of cash.”

But Simon Fraser University climate and environment specialist Thomas Gunton told CBC the pipeline is operating at a loss when its staggering debt is taken into account. He said Trans Mountain only acknowledges $12 billion of that debt, and disputes the Crown corporation’s decision to declare $23 billion in loans as equity.

“In my mind those are all public dollars going to a massively profitable industry,” said West Coast Environmental Law staff lawyer Eugene Kung. “These companies are recording record profits, and yet expecting Canadians to pay for the infrastructure that only they will use. I think for Canadians struggling with the cost of living, it’s a slap in the face.”

Previously, the Institute for Energy Economics and Financial Analysis described Trans Mountain as a “financial quagmire” and a cautionary tale against risking public funds when businesses back away.

“Oil infrastructure development, once seen as a financial boon, is beset by rising costs and lower price trends,” said IEEFA energy finance analyst Mark Kalegha. “As the Canadian government experiences pressure to pay industry infrastructure costs from public coffers, it’s time to step back and take a hard look at the energy questions Canada faces.”

‘Vibes Don’t Make a Pipeline’

In a follow-up story Saturday, CBC picked up mixed reactions on whether Ottawa should pick up the tab for another taxpayer-funded pipeline.

“If you look at Canadian history, nothing we’ve done that has been really big has been purely private,” said Martha Hall Findlay, a former Suncor Energy executive now heading the University of Calgary School of Public Policy.

Economist Kent Fellows, an associate professor at the public policy school, agreed that federal and provincial infrastructure funding was common up to the 1980s.

“If we view infrastructure as sort of this… base or foundation for well-functioning markets, there is an argument that government intervention here does make a little bit of sense,” he said. But “as a fundamentalist free market economist, I am a little bit disappointed that we can’t let the market take care of this one.”

“You want to have that private involvement,” agreed Heather Exner-Pirot, director of natural resources, energy and environment at the Macdonald-Laurier Institute. But “this is an enormously expensive nation-building project, very difficult for any private proponent to accept it all on their balance sheet.”

But while the CBC story attributed private investors’ failure to step up to Canada’s past attempts to regulate the industry, online comments went in a different direction.

“The difficulty in finding a private company to lead the project reflects the questionable business case for a new pipeline,” the Winnipeg-based International Institute for Sustainable Development wrote on LinkedIn. “For taxpayers, lessons from the federal government’s purchase of the Trans Mountain Pipeline Expansion also demonstrate the clear risks.”

And now, “global oil demand is expected to peak by around 2030,” IISD added. “With the new pipeline not expected to be operational until 2034, it faces a weakening market from its very first day of operation. When demand goes down, so will the return on investment. As majority owners, taxpayers would be left to carry the lion’s share of the losses.”

“A pipeline is not a road, a transmission line, or a port. It’s for one product for one industry and benefits primarily one province and a specific set of financial players,” wrote portfolio manager Martin Grosskopf. “It will come online perhaps in 10 years, when the geopolitics will be different and Asian demand for Canadian heavy oil will be less.”

“This is not energy security. It is energy delusion and pandering,” he said.  “My father worked in the oil industry his whole life, but he’d be embarrassed to witness this level of public largesse for a mature, profitable industry.”

“This pipeline ‘proposal’ may as well be scratched on the back of a napkin,” Amy Janzwood, assistant professor in McGill University’s Department of Political Science and Bieler School of Environment, told Energi Media’s Thoughtful Journalism blog. “The ‘proposal’ does not identify a specific route but sketches out a ‘corridor’ with two route ideas through southern British Columbia across unceded Indigenous territories.”

That means Canadians “are being asked to accept a multi-billion-dollar taxpayer-funded pipeline on faith: that long-term oil demand will materialize because politicians say so,” Janzwood said. “But vibes do not a pipeline make. Planned additional expansions to the Trans Mountain and Enbridge Mainline systems would bring sufficient capacity to even the federal energy regulator’s most optimistic export growth scenario.”

3,300 Kilometres from Alberta to Ontario

The next big reveal came Monday morning, when Smith and Ontario Premier Doug Ford announced a route for a proposed west-east oil pipeline. The Northern Shield Energy Corridor would run 3,300 kilometres from Hardisty, Alta., to refineries in Sarnia, Ont., without crossing the U.S. border, The Canadian Press reports. It would carry an initial 500,000 barrels of crude oil per day, with potential to expand to 800,000 barrels.

The still-preliminary proposal stems from an agreement Ford and Smith made at last year’s Stampede to study an energy corridor connecting the two provinces.

Ford said that study is ongoing and is expected to be finished before the end of the year. He said an estimated cost and proposed building schedule for the pipeline would be determined as part of the study.

“No one would ever think in 100 years this would be done,” Ford said. “We’ll reach out to the private sector, but we won’t hesitate to do what the government of Canada and Alberta is doing,” he added, referring to the public subsidies on offer for the proposed West Coast Pipeline.

Smith said the pipeline, if built, would allow for Alberta oil to be refined and used within Canada, but would also open the door to European markets, CP writes.

“This pipeline is another signal to investors that Canada is once again open for business and the best country on Earth from which to secure a reliable source of [fossil] energy,” she said.

Saskatchewan Premier Scott Moe said in a news release that the proposal has his support and would generate revenue needed to invest in health care, education and public safety.

Asked whether the project has the support of Manitoba Premier Wab Kinew, Ford said he’s confident they would “work something out.”

“I think the world of Premier Kinew,” Ford said, adding that building a pipeline to Sarnia would open the opportunity for another line to the Port of Churchill in northern Manitoba.

A spokesperson for Kinew didn’t address questions about the pipeline proposal on Monday, but said the government was discussing the Port of Churchill’s future with First Nations, northern communities, and the Manitoba Crown Indigenous Corporation.

“Major nation-building projects have to be built the right way,” the spokesperson said in a statement.

CP has a longer look at past, defunct pipeline proposals whose apparent resurrection is so far “being driven by politicians rather than the private sector.”

Emily Hunter, senior program manager for Ontario climate at Environmental Defence Canada, called the Alberta-Ontario proposal “a divisive distraction from the infrastructure Canadians actually need,” at a time when Ontario has no shortage of oil supply.

“If private investors are unwilling to finance a pipeline to the West Coast, Premiers Ford and Smith need to explain how an even longer pipeline to Ontario could possibly make economic sense,” she said in a release. “Real energy security means investing in renewable power, an east-west clean electricity grid, public transit, and electric transportation—not pillaging the public purse to expand oil exports.”

“Like many countries in the world, Ontario is dependent on imported oil—and that dependence has become a vulnerability given how uncertain the world now is,” said Janetta McKenzie, director of the Pembina Institute’s oil and gas program. But “instead of building a new pipeline, Ontario has better options to fortify its future,” beginning with electric vehicles that “cost less to own and operate than internal combustion engine vehicles and can be powered with electricity that is generated in Ontario.”

Bay du Nord Loses an Investor

Meanwhile, oil and gas multinational BP announced Monday that it has sold off its share in the proposed Bay du Nord offshore oil project off the Newfoundland coast, leaving Norwegian state fossil Equinor as the sole remaining owner, CP reports.

“We’re proud of our partnership with Equinor and the work we’ve done together to develop the Bay du Nord project,” said Gordon Birrell, BP’s executive vice-president of upstream.

“However, BP is exercising strict capital discipline, allocating it to the opportunities that create the most value for BP.”

BP will continue to hold a 100% interest in two exploration licences offshore Newfoundland and Labrador.

Equinor, two-thirds owned by the Norwegian government, aims to make a final investment decision on the project early next year, subject to market conditions and regulatory and internal approvals.

“Over the past few years, we have strengthened Bay du Nord by improving the business case and reducing key risks. This transaction reflects our confidence in the project as we continue maturing it towards a final investment decision,” said Philippe Mathieu, Equinor’s executive vice-president for international exploration and production.

“We will seek opportunities to bring in partners as part of the project’s further development.”

Equinor estimates recoverable resources of more than 400 million barrels of oil in the project’s first phase, which is expected to cost $14 billion. First oil is targeted for 2031.

CP says the Newfoundland and Labrador government is expected to decide later this year whether to buy a stake in the project. Premier Tony Wakeham interpreted Monday’s news as a “positive step forward” for Bay du Nord and the province’s offshore oil and gas industry, with Equinor now taking on its full ownership.

“That is a strong vote of confidence in Bay du Nord, in our province, and in the long-term potential of our offshore,” he said in a release.

Sierra Club Canada said BP’s exit signals the project is not worthy of public investment.

“If BP doesn’t see Bay du Nord as a good investment in terms of return and debt, that is a massive warning against any public investment in the project, and against the Bay du Nord project’s viability,” Communications Director Conor Curtis said in a release. “That BP has now exited shows this project is not viable and we need a rapid, community-focused buildout of transmission infrastructure for renewables like offshore wind.”

The province has said Bay du Nord would deliver about $6.4 billion in royalties, taxes, and a 10% equity stake in the project’s first 25-year phase. Without the equity stake, the province would bring in about $5 billion, officials have said.

It Isn’t Just Happening in Canada

Meanwhile, a Bloomberg News analysis of International Energy Agency data shows the global share of private sector energy investment going into oil, gas, and coal declining from 50% in 2015 to 28% today. It’s the public sector that “still invests most of its money in dirty power, and state support for fossil fuels is likely to rise to the highest level since 2022 this year,” with public investment set to hit $1.1 to $1.43 trillion this year, according to a UN Development Programme study.

“To judge by the way many people discuss the energy transition, we’re engaged in a fight between green ideologues in government and academia on the one hand, and a more realistic private sector that recognizes the innate superiority of fossil fuels on the other,” writes climate and energy columnist David Fickling. “Follow the money, and you’ll see precisely the opposite picture,” with public investment in what he calls “dirty power” still holding at 53%, down from 67% a decade ago.

“That actually understates quite how bad things are, because the state doesn’t just fund carbon-based energy by investing in its production,” he adds. “It also pumps out subsidies to make it artificially cheap. That encourages us to use more polluting energy, and deters us from making the switch to cleaner, more affordable alternatives.”

This year’s subsidies will likely hit their highest levels since 2022, Fickling says, since many governments’ first response to the energy price shock brought on by the disruption in the Strait of Hormuz was to cut taxes and introduce price supports for key fossil fuel products.

Segments of this story were first published by The Canadian Press on July 6, 2026.