It is near impossible for any energy, mining or infrastructure projects to be successfully developed in Canada today without securing support and consent from affected Indigenous Peoples. In order to secure that support and consent, more Indigenous Peoples are interested in equity participation in such projects, and more project developers or facility owners are interested in partnering with such Indigenous Peoples to facilitate economic reconciliation and to manage project risk.
Indigenous equity helps to align the interests of the parties in the project or facility, share direct benefits, and build capacity. As a result, numerous financing and other funding programs have been developed to support such investments, but are not yet being fully deployed. We expect to see much more activity in such transactions moving forward.
In working with clients in the energy, mining and infrastructure sectors, and reviewing what we see in the market involving Indigenous equity, Fasken has observed how deals in this space are evolving, helping us to anticipate where there may be opportunities and what clients can expect as they manage their projects and business priorities.
Looking back on the past five years, here are the top four trends we have observed to date:
1. Most Indigenous Equity Deals Were in the Energy Sector in Alberta and British Columbia
Of the Indigenous equity deals publicly announced, under construction, or completed/operational in the past five years that we reviewed, all involve energy or related infrastructure; particularly the renewable sector. The highest number of Indigenous equity projects involved renewable energy, specifically wind, hydroelectricity, and solar generation, followed by electricity transmission. However, compared to the past ten year period, wind is decreasing while electricity transmission and others are increasing.
This degree of concentration may be related to the availability of funding initiatives targeted to involve Indigenous groups in the energy sector by way of financing or grants, as well as the appeal of such projects to Indigenous groups. For example, the BC First Nations Clean Energy Business Fund provides for capacity and equity funding from the province to eligible Indigenous governing bodies, located in BC. 
Of the Indigenous equity deals that we reviewed in Canada, the most were in Alberta (30%), British Columbia (20%), followed by Ontario (15%), Saskatchewan (10%), New Brunswick (10%), Manitoba (7.5%), Quebec (5%), and Nunavut (2.5%). This was a significant decrease for Ontario from the past ten year period, and a significant increase for Alberta.
2. The Number of Indigenous Groups Involved Varied by Project Type
In the Indigenous equity projects we reviewed, there was a near-even split between projects involving one Indigenous group and those involving multiple groups.
The number of Indigenous groups involved varied by sector. Within our sample of projects reviewed, the average number of Indigenous groups involved included the following breakdown:
- Linear infrastructure (e.g. pipelines, transmission lines): 15.4
- Transmission lines: 12.7
- Oil & gas pipelines: 19.5
- Non-linear infrastructure (e.g. electricity generation facilities): 1.9
- Hydroelectricity generation: 2.5
- Solar generation: 2
- Wind generation: 1.6
- Other: 2.1
Not surprisingly, linear projects and other projects spanning a larger area, like transmission lines and pipelines, may tend to involve more Indigenous groups given the potential for the project to impact a greater number of Indigenous groups. Further, higher value projects may tend to involve more Indigenous groups to assist with financing and cost sharing, while sole site projects or smaller investments may be limited to one or two groups.
3. Limited Partnerships Are the Most Frequently Used Vehicle for Indigenous Equity Participation
While structures reviewed varied, limited partnerships appear to be the most common as a result of the limited liability they afford the limited partners and the potential tax advantages for the Indigenous limited partner. In some cases involving multiple Indigenous groups, they participated directly in the limited partnership or other vehicle, while in others they formed a collective limited partnership or other vehicle to hold their aggregate stake in the project or facility.
4. Most Indigenous Groups Own a Minority Stake
Within our sample of Indigenous equity projects reviewed, 25% involved Indigenous participants that held majority or full ownership. The average equity interest for minority-owned projects (where reported) was 21%. This was a significant increase over the average equity interest for minority-owned projects (where reported) over the past ten year period at 14.2%.
In the coming year, we are keeping watch on the potential impact of available funding on Indigenous equity participation.
Funding for Indigenous equity projects currently comes from a variety of sources, including government grants, the Canada Infrastructure Bank,  and private lending. Although there are multiple potential sources, a number of them do not yet appear to be fully utilized.
In Alberta, there is substantial support available through the Alberta Indigenous Opportunities Corporation (AIOC), a loan guarantee program offering loans ranging from $20 million up to $250 million for eligible projects.  Eligible projects are those where one or more Indigenous groups are investing at least $20 million in an authorized natural resource project or related infrastructure. 
Notably, half of the Indigenous equity deals that we reviewed from Alberta within the last five years involved the AIOC, and we expect more large projects to receive financing support through this program. We note there are some similar programs in Ontario and look to other Canadian jurisdictions to create analogous bodies to support Indigenous equity ownership.
We anticipate different jurisdictions may unveil new programs and incentives (or perhaps amendments to or expansions of existing programs) in the near future that may continue to move the dial on Indigenous equity participation across the country.
Please note that our analysis is based solely on publicly available information that we have reviewed regarding recent transactions involving Indigenous ownership in energy and infrastructure projects that have been publicly announced, under construction, or completed in the five years prior to the date of publication of this Bulletin, and does not reflect an exhaustive review of all such transactions. Given the limited information available, it is likely that some of these observations are not statistically significant.
 “First Nations Clean Energy Business Fund” (2022) online: Government of British Columbia https://www2.gov.bc.ca/gov/content/environment/natural-resource-stewardship/consulting-with-first-nations/first-nations-clean-energy-business-fund.