Financing and Ownership Considerations for Indigenous Participation in Major Projects

Indigenous communities in Canada are increasingly pursuing ownership and investment opportunities in major infrastructure, energy and natural resource projects through evolving financing and governance structures. Participation may take several forms, including consultation, procurement, direct equity ownership, governance rights and long-term revenue arrangements.

The Independent Electricity System Operator’s fall 2024 demand forecast projected that Ontario would require 75% more electricity by 2050, supporting significant energy and infrastructure investment. Growth in data centre development driven by artificial intelligence-related computing demand may present further investment and partnership opportunities for Indigenous communities, particularly as Ontario considers its approach to data centre development. For additional context, see our prior update Ontario Releases Draft Data Centre Playbook for Public Comment.

Federal and provincial loan guarantee programs, Indigenous-led lenders and infrastructure financing platforms have expanded access to capital for Indigenous investment. The structuring challenge is shifting from identifying capital to coordinating multiple sources while aligning ownership, control and governance requirements. The appropriate structure will depend on the priorities of the participating Indigenous communities, as well as the applicable commercial, legal and program requirements.

Governance and Ownership Requirements

Access to Indigenous-focused financing is often determined by ownership and governance at the outset. Government programs, Indigenous Financial Institutions (“IFIs”) and other funding sources apply program-specific eligibility criteria. Depending on the program, eligibility may be based on:

• Indigenous ownership or control;
• status as an Indigenous governing body;
• participation through an Indigenous economic development corporation; or
• ownership by one or more Indigenous communities.

Program eligibility may extend beyond ownership percentages to governance rights, decision-making authority and evidence of meaningful Indigenous control. These requirements should be addressed at the outset because they may affect the borrower, ownership vehicle, available funding and rights granted to lenders and investment partners.

Indigenous communities may invest through economic development corporations, special purpose vehicles (“SPVs”), limited partnerships and other project-level entities. These structures can preserve eligibility for Indigenous financing, facilitate investment by multiple communities and accommodate lender, government and co-investor requirements. For major projects, the borrower or investee may be a consortium or SPV owned by several Indigenous communities, whereas operating business eligibility will often depend on ownership and control of the business itself.

Project proponents and Indigenous communities are also formalizing ownership and partnership models at the project-planning stage. Hydro One’s Equity Partnership Model offers First Nations communities an opportunity to invest in a 50% equity interest in certain new large-scale transmission line projects valued at more than $100 million. Such models illustrate how governance and ownership arrangements can be incorporated at the project-planning stage rather than negotiated only after development is underway.

Loan Guarantees and Institutional Capital

Federal and provincial loan guarantee programs, together with Indigenous financial intermediaries and institutional capital, are creating additional pathways for Indigenous communities and businesses to finance equity acquisitions. Recent expansions include an increase in the federal Indigenous Loan Guarantee Program (“ILGP”) from $5 billion to $10 billion and an expansion of Ontario’s loan guarantee program capacity to $3 billion, with eligibility extending across sectors that include energy, mining, critical minerals, pipelines and resource development.

Ontario’s Indigenous Opportunities Financing Program (“IOFP”), administered by the Building Ontario Fund, provides guarantees on credit products such as loans and bonds. Rather than providing loans or grants, the IOFP’s guarantees may improve an eligible Indigenous borrower’s credit position, facilitate commercial financing and reduce borrowing costs. Since 2009, the IOFP has enabled more than $1.3 billion in Indigenous equity participation in infrastructure projects.

The ILGP, administered by the Canada Indigenous Loan Guarantee Corporation (“CILGC”), similarly supports third-party financing for eligible Indigenous groups acquiring ownership interests in major projects across sectors other than gaming.

The Canada Infrastructure Bank (“CIB”) complements these programs through infrastructure lending, project acceleration funding, advisory support and its Indigenous Equity Initiative. The CIB has increased its investment target for revenue-generating Indigenous infrastructure projects to $3 billion.

Recent Transactions

Recent transactions illustrate how federal and provincial loan guarantee programs are increasingly being used to support Indigenous equity investments in major energy and infrastructure projects. The following examples demonstrate the growing scale of these investments and the expanding coordination between federal and provincial programs.

In March 2026, the CILGC issued a guarantee under the federal program in connection with the acquisition by Aamjiwnaang First Nation and the Chippewas of Kettle and Stony Point First Nation of a nearly 20% equity interest in Hydro One’s Chatham-to-Lakeshore transmission line.

At the provincial level, Ontario provided an IOFP guarantee in February 2026 to support a $250 million investment by the Saugeen Ojibway Nation in partnership with Bruce Power for medical isotope production.

In June 2026, the ILGP and the IOFP jointly provided loan guarantee support for approximately $715 million in financing for an investment by the Williams Treaties First Nations in the Darlington New Nuclear Project. The transaction was the first collaboration between CILGC and a provincial loan guarantee program.

These programs require early coordination among Indigenous partners, project proponents, commercial lenders, guarantors and other capital providers regarding eligibility, guarantee coverage, security, priority, distributions and debt-service requirements.

Lifecycle Financing and Growth Stages

Indigenous investment structures may combine multiple sources of capital introduced at different development stages. The appropriate capital stack will depend on the asset, sector, borrower, ownership vehicle, timing, eligibility profile and anticipated cash flows.

Depending on the transaction, the capital stack may include:

• non-repayable or repayable contributions;
• capacity-building, exploration or feasibility funding;
• developmental lending and direct loans;
• government guarantees supporting third-party debt;
• Crown corporation investment or lending;
• IFI-delivered capital;
• senior commercial financing;
• vendor financing or sponsor equity; and
• private, institutional or public market capital.

At the early stages of a mining project, the Ontario Junior Exploration Program may support exploration activities, including activities that create Indigenous employment and business opportunities. At the federal level, the Indigenous Natural Resource Partnerships (“INRP”) Program supports Indigenous participation in natural resource projects that contribute to the transition to a clean energy future. The INRP’s $80 million budget for the 2022–2027 program is fully committed, with the program scheduled to be renewed beginning in 2027–2028.

At the growth and expansion stage, IFIs provide financing and advisory services to Indigenous businesses. Depending on the lender and program, available capital may include startup, acquisition, working capital, equipment and expansion financing. The Indigenous Growth Fund supports the lending capacity of participating IFIs rather than lending directly to operating businesses. The access-to-capital stream of the Aboriginal Entrepreneurship Program (“AEP”) also supports Indigenous small and medium-sized businesses through IFIs and Métis Capital Corporations.

For larger infrastructure and resource projects, financing may incorporate government-backed loan guarantees, CIB financing, commercial debt and institutional capital. For ordinary-course business acquisitions or operating business growth, a simpler structure may be appropriate, such as an IFI loan or AEP-supported financing combined with vendor financing, bank debt, owner equity, community investment or other private capital.

Capital Markets and Equity Participation

Capital markets can supplement project and business financing at later stages. The TSX Venture Exchange provides a public market pathway for qualifying Indigenous-controlled businesses, while Indigenous-led investment dealers such as Cedar Leaf Capital may help connect Indigenous issuers and investors with institutional capital.

Specialized debt and advisory mechanisms may also support direct equity investment. BMO has developed a labelled Indigenous bond framework intended to facilitate debt financing for eligible Indigenous borrowers. The First Nations Major Projects Coalition advises communities considering ownership interests in natural resource and infrastructure projects. The First Nations Finance Authority offers a debenture issuance model that allows participating First Nations to pool borrowing requirements for eligible purposes, including certain economic development and equity investments.

These mechanisms should not be treated as interchangeable. The suitability of public market financing, bond financing, pooled borrowing or direct institutional investment will depend on transaction size, cash-flow profile, governance arrangements, security, investor expectations and applicable program requirements.

Practical Transaction Considerations

A successful financing structure should align program eligibility, ownership and governance requirements with the commercial terms of the transaction. Key issues may include:

• restrictions on stacking public funding or guarantees;
• permitted uses of proceeds and timing conditions;
• security, intercreditor arrangements and priority;
• recourse, guarantees and reserve requirements;
• distribution policies and debt-service coverage;
• project-level versus community-level borrowing;
• tax, regulatory and securities-law considerations;
• governance, information and consent rights; and
• the timing and sequencing of public support, guarantee approvals and commercial commitments.

Parties should also distinguish between consultation and accommodation, procurement opportunities, contractual benefits and direct ownership. Each may contribute to Indigenous participation, but each engages different legal, commercial and governance considerations. Where equity participation is contemplated, the parties should assess the allocation of construction, operating, commodity-price, regulatory and refinancing risks, together with the timing and reliability of distributions available to service acquisition debt.

Early coordination can help avoid conflicts between program eligibility and the transaction documents and clarify how the participating Indigenous communities’ transaction-level governance priorities will be reflected in board representation, reserved matters, transfer restrictions, exit rights and dispute resolution mechanisms.

How Wildeboer Dellelce Can Help

Wildeboer Dellelce LLP is well positioned to assist Indigenous communities and economic development corporations, project proponents, lenders, institutional investors and advisors seeking to structure and finance Indigenous participation in energy and natural resource projects, real estate development, data centres, Indigenous business acquisitions and operating business growth strategies. Our lawyers advise on a full range of transactions through which such participation is implemented, including equity investments and acquisitions, joint ventures and partnership structures, private equity and venture capital investments, securities and corporate finance, banking and secured lending, commercial contracts and the coordination of complex, multi-source and multijurisdictional transactions.

If you have any questions regarding the above, please contact Rob Wortzman ([email protected]), Jeff Hergott ([email protected]), Connor Carroll ([email protected]) or any other member of Wildeboer Dellelce LLP. The authors gratefully acknowledge the assistance of articling student Adele Gurm and summer student Halley Baker in the preparation of this update.

This update is intended as a general summary only and should not be regarded or relied upon as legal advice for any particular client or circumstance.

If you would like further information about the matters discussed in this update, or wish to discuss how they may apply to your circumstances, please contact us.