Just a few years ago, an Indigenous community’s involvement in a resource development project that could impact its traditional territory, like a pipeline or mine, would typically unfold like this.
The individual or entity driving the project – known as the project proponent – would identify nations or communities that could be affected. The proponent would then approach those groups with a so-called benefits agreement that promised compensation in the form of revenue, jobs, subcontracting opportunities, or community amenities – things like community centres, training opportunities, or upgraded roads. In exchange for these contractual benefits, the Indigenous party would agree not to hinder, block, or delay the project in any way.
Over the last five years, such arrangements have increasingly been eclipsed by a new type of offer to Indigenous parties: equity. Driven by reconciliation mandates, government loan programs that have made capital more accessible to Indigenous groups, and court decisions affirming Aboriginal title over significant tracts of land, the trend of offering Indigenous groups an ownership stake in projects has given those groups the chance to take a real seat at the table, rather than just a predetermined sliver of a project’s rewards. And in stark contrast to the benefits agreements that proponents approached Indigenous communities with for decades, these new arrangements actually hand substantial control over to Indigenous parties.
Now, lawyers who focus on resource transactions say that among these types of deals, another new norm is emerging: equal or majority Indigenous ownership.
“The level of the ownership that nations are taking in projects has changed,” says Sam Adkins, a partner at Blake, Cassels & Graydon LLP, whose practice focuses on Indigenous and project development matters. “Instead of seeing a 10 percent interest, you might see a 49 percent interest or 51 percent interest.”
“The margins are slimmer [for the proponents] the more the nations own the projects,” says Malcolm Macpherson, a partner at Macpherson Law LLP whose practice focuses on increasing First Nations’ participation in the economy.
“But it’s clear that … in order for permitting timelines to be met and for proper social license to be achieved, the nations have to be very substantive owners of projects,” Macpherson adds. “I would say that, especially on the larger [projects], it won’t be long before the base minimum [for Indigenous equity] is 51 percent.”
That value – 51 percent – is often cited in discussions about Indigenous equity, emblematic of what Macpherson calls the “tug of war” between the interests of proponents on the one hand and Indigenous groups on the other. From the proponents’ perspective, 51 percent is the minimum ownership stake required for a project to qualify as Indigenous-owned, opening the door to government contracts and other opportunities. It also still leaves the proponents with significant control over day-to-day project management, which can help reassure lenders who want proponents to retain their authority to make major project decisions.
For many Indigenous communities, a majority stake is significant because it means “repatriating ownership over their territory and resources,” Macpherson says.
“There’s a sort of moral alignment,” he says. “They’re able to go back to their members and say, you know what, we’re majority owners of this project in our territory, and we now have a pay and a say over what is happening over the extraction of the natural resources in our territory.”
To understand how we got here, Al Hudec, who serves as senior counsel at Farris LLP and advises on commercial deals involving Indigenous parties, suggests looking at history. Before the 1970s, he says, proponents rarely considered how their projects would impact Indigenous territories or consulted Indigenous communities about resource development.
That began to change over the next two decades. First, in the 1970s, the federal government established a process to review the environmental impact of development projects; later, the Constitution Act, 1982, went into effect. The act requires the federal government to consult Indigenous groups before engaging in conduct that could infringe on Aboriginal or treaty rights (s. 35). In the decades that followed, courts across the country, including the Supreme Court of Canada, issued numerous decisions that both affirmed the government’s duty to consult and clarified what that consultation process should look like. Within this landscape, many proponents became more proactive about reaching out to Indigenous groups to offset potential pushback against their projects.
“Early on in the 80s, the consultation and involvement of First Nations was mostly through the environmental review process, which gave them a voice in what was going on,” Hudec says. “But the bigger project proponents decided to offer benefits agreements with First Nations, rather than take the risk and delay of an environmental process that had a concentrated right for the First Nations.”
These benefits agreements were “fundamentally different” than the equity arrangements that have become common over the last few years, Hudec says. While benefits agreements gave Indigenous parties a contractual right to certain information about a project, equity agreements give those parties the right to actively participate in the decision-making process and to receive greater financial rewards.
Still, benefits agreements were standard up until several years ago. Adkins says Indigenous ownership of projects is not a new concept; in Canada, there have been several examples of this ownership structure. What’s changed is their frequency.
“We’re seeing, over the last five years or so, just an increased pace of Indigenous equity deals,” Adkins says. “And there’s quite a number of reasons for it.”
Adkins says these include the federal government’s recent commitment to addressing s. 35 rights and complying with the United Nations’ 2021 Declaration on the Rights of Indigenous Peoples (UNDRIP), which outlines a framework for reconciliation. Such commitments, combined with a desire to push through major infrastructure and resource projects such as pipelines, have prompted federal and provincial governments to introduce mechanisms to help First Nations and other Indigenous groups access capital to invest in projects.
“Almost every province has some type of program now that allows Indigenous groups to effectively borrow money on more favourable terms, because there’s a government backstop available to be able to facilitate access and capital,” Adkins says. “We’ve also seen … [government] agencies that provide financing to First Nations.” He points to the Canada Infrastructure Bank, which “has a number of different programs and lending vehicles that are specific to providing capital to Indigenous groups.”
Christine Milliken, a corporate partner in Blake’s energy group in Calgary, agrees that government initiatives have played a major role in spurring the uptick in Indigenous equity deals. For example, several provincial governments have issued requests for proposals over the past few years to add renewable energy to their power grids.
“All of these RFPs, they have … encouraged First Nations equity as part of the transactions,” Milliken says. “So, when you’re bidding a project into these RFPs, if you have a high degree of participation, from an equity perspective, from a First Nations partner, those projects win more points within the procurement bid. Because of this, there’s been a huge uptake in companies wanting to have an Indigenous partner in these projects that they’re bidding into these RFPs.”
Macpherson meanwhile points to a series of landmark court decisions that clarified the parameters of Aboriginal title, and recognized that title to substantial pieces of land. These include the SCC’s 1997 decision in Delgamuukw v. British Columbia and the 2014 Tsilhqot’in Nation v. British Columbia decision, as well as the BC Supreme Court’s 2025 ruling in Cowichan Tribes v. Canada (Attorney General).
Together, the expansion of government incentives, Indigenous access to capital, and case law recognizing what Macpherson calls the “co-ownership and co-jurisdiction of Indigenous territories and … resources” have given proponents compelling reasons to pursue deals involving Indigenous equity. Milliken says many proponents want to pursue such deals even in the absence of government incentives, because they believe that building a solid relationship with their Indigenous partners can help “weave your way through the regulatory process in Canada to get major projects approved faster.”
At the other end, Indigenous parties have become more proactive about proposing these deals themselves. Increasingly, Indigenous communities are thinking, “If non-Indigenous Canadians can develop resources, why can’t we as First Nations?” says Macpherson. “Where it starts out of the gate now is … 51 percent ownership … and not waiting for others to come to the table to hand over those opportunities.”
But majority Indigenous ownership has become appealing for proponents, too. Milliken says many of the renewable power RFPs she’s encountered, for example, do not necessarily require majority Indigenous ownership but reward such a structure. This effectively flips the power dynamic that was previously typical of such projects, where proponents with project expertise had majority decision-making authority. Fifty-one percent Indigenous ownership attempts to strike a balance between “a developer maintaining control over the day-to-day operations of a project to ensure that with their expertise a project can be built on time and on schedule and on budget,” and also “a requirement to have true consultations and a true voice at the table by your First Nations partner,” Milliken says.
She adds that the balance also satisfies many lenders that require project developers to maintain “a certain level of control over the day-to-day management of the project.”
Macpherson, too, refers to 51 percent as a “magic number.” But he also warns that the number may not reflect how profits are actually shared; depending on how a deal is structured, Indigenous owners can end up making much less than a 51 percent ownership interest in the net proceeds.
“The 51 percent – there’s a nuance there,” he says.