Will Mark Carney’s choice of ‘major projects’ be powered by politics or economics?

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The 2025 RBC Canadian Open golf tournament, held on the North Course at TPC Toronto at Osprey Valley in Caledon, Ont., had a tough first hole. It’s 542 yards to the pin, with a left curve around trees to one side and rough and sand traps on the other. It’s a challenging par 5.

But what if you move the tee forward by a few hundred yards? What if you move it right next to the hole?

Last week, Prime Minister Mark Carney released his list of the first five “major projects” of national significance to be prioritized for fast-tracking. Most are a long way down the fairway. Some are already on the green.

The first reactor of Ontario’s Darlington New Nuclear Reactor project is under construction. The Port of Montreal’s Contrecoeur expansion project has not finalized all financing or environmental reviews, but most boxes have been checked. The McIlvenna Bay Foran Copper Mine project in Saskatchewan is already more than 50-per-cent complete, while British Columbia’s Red Chris Mine expansion was put on B.C.’s short list of projects prioritized for fast-tracking of permitting back in February. And while the Phase 2 expansion of the LNG Canada export facility on the B.C. coast is still in the planning stage – Phase 1 only began shipping gas to Asia in June – it appears to be a no-brainer.

Reality check: The first ‘major projects’ for fast-tracking are already on the fast track

This is not quite “things previously thought impossible at speeds we haven’t seen in generations,” as Mr. Carney promised in last April’s election victory speech. But I’m here to praise Caesar, not take pot shots at him. I can’t begrudge a minority government for choosing to open with confidence-boosting tap-ins.

But what matters now are the next round of projects, and the round after – or to stick with the golf metaphor, the remaining 17 holes.

The PM last week also announced other projects that he said “could be truly transformative for this country,” but which “require further development.” Among them: a “critical mineral strategy” that ensures “more critical minerals projects get to final investment decisions within a two-year window”; the expansion of the Port of Churchill, Man., including “a new energy corridor”; and Pathways Plus, a massive carbon capture and storage program that could allow emissions to fall even as oil sands production rises, which “creates the prospect of facilitating low-carbon oil exports from the Alberta oil sands to a variety of potential markets.” And facilitating more Western oil production and oil exports can’t happen without new oil pipeline capacity.

There’s a lot to chew on here.

1. Does the Carney government see its role solely as speeding up the regulatory process – getting out of the way of private investors, basically – or will it sometimes be one of those investors? Or the only investor, as happened with TMX, the Trans Mountain pipeline expansion? The Aug. 29 announcement of the new Major Projects Office says that it’s mandate is “to get nation-building projects built faster,” by “streamlining and accelerating regulatory approval processes,” and “by helping to structure and co-ordinate financing of these projects as needed.”
2. To the extent that the regulatory process needs “streamlining and accelerating,” why cherry-pick politically-connected projects for preferential treatment? Instead of giving a handful of big developers safe passage through the government’s regulatory minefield, why not clear the minefield and open the road to everyone?
3. If Ottawa is going to do more than clear roadblocks, and is going to also invest, what will be the criteria for deciding which projects get public funds? Economics or politics?

TMX is the example of how things should go. A recent analysis found that, in its first year of operation, the new pipeline raised the price of Canadian oil to such an extent that it increased the industry’s annual revenues by $13-billion. The government of Alberta also earned an extra $4.4-billion in royalties in the first year, along with $1-billion more in corporate tax revenue, while the feds got an extra $2-billion in taxes.

Most projects grasping for taxpayer cash can promise no such thing. For example, Mr. Carney’s list of those deserving of future federal attention includes a high-speed rail line from Toronto to Quebec City, which has been under consideration for years.

Should Ottawa speed up the regulatory process, to make it easier for a private developer to build better passenger rail? Of course. But should Ottawa fund it?

It would be wonderful to have European- or Japanese-quality rail service in Canada. But at a time when the federal government is trying to find places to cut spending, and has to prioritize scarce dollars, high-speed rail looks like a train powered by politics, not economics.

The Trans Mountain pipeline expansion has delivered returns, with money making money, the definition of investment. It’s difficult to see how public funding of high-speed rail between Toronto and Quebec City would do that. It’s also worth noting that rail’s competitors – the airports and the airlines – run on user-pay. They don’t get a subsidy, and the major airports even pay rent to the federal taxpayer.

Mr. Carney has promised to summit Mount Everest, and he may yet. But Day One saw him conquering the equivalent of Mount Royal. Well, you’ve got to start somewhere.