After two years of what critics call benign neglect, the federal government in Ottawa is finally confronting a serious threat to its ambitious plan to double Canada's non-United States exports. The danger stems from a complex and escalating legal dispute at the Port of Prince Rupert in British Columbia, which is now poisoning billions of dollars in export opportunities.
The Root of the Conflict: Broken Promises and Exclusivity Deals
The heart of the matter involves claims by the Lax Kw’alaams and Metlakatla First Nations, collectively known as the Coast Tsimshian. They allege the Crown misled and lied to them when they agreed to developments on their traditional lands. This has resulted in seven separate lawsuits, with threats of further action.
The initial conflict revolves around a future propane export facility. According to a statement of claim filed with the B.C. Supreme Court by the Metlakatla, the First Nations agreed to the 2019 divestiture of Ridley Terminals, a bulk commodity terminal. As part of the deal, they were offered accommodation measures, including a 10 per cent equity stake in the new ownership, and were advised the terminal was well-positioned to capitalize on Asia's liquified petroleum gas market.
However, a critical piece of information was allegedly withheld. The Coast Tsimshian claim they were not told that the Port of Prince Rupert had already signed an exclusivity deal with the Dutch company Royal Vopak for the storage and loading of bulk liquids, including propane. They only discovered this in November 2023, when their own company, Trigon, sought consent to handle propane and was blocked by the Port Authority due to the pre-existing Vopak agreement.
Escalation and National Consequences
The dispute is no longer confined to the propane terminal. The fallout has spread, creating a significant roadblock for other major national resource projects. The two First Nations have launched lawsuits against the Ksi Lisims LNG project, a major initiative recently announced by the Liberal government.
Furthermore, the conflict casts a dark shadow over any potential plans by Ottawa and Alberta to build an oil pipeline to the coast. One source close to the situation described the propane dispute as "a root poisoning the whole tree," emphasizing that the First Nations feel their rights have been fundamentally violated and they are prepared to fight back.
The core legal argument is that the Port Authority, as a Crown corporation, failed in its duty. The Metlakatla's claim states, "As a result, Canada did not meaningfully or adequately consult the Metlakatla, breaching its fiduciary duty." To date, no statement of defence has been filed. The Port Authority maintains it will not comment on matters before the courts, while the Department of Transport has distanced itself, stating the port operates independently under the Marine Act.
A Clash of Economic Visions
This situation creates a stark contradiction in Canada's economic policy. On one side, the private sector and First Nations are ready and willing to sell Canadian resources to Asian markets. On the other, they are being blocked by a government that has publicly committed to a national strategy of export diversification.
The ongoing legal battles at the Port of Prince Rupert highlight the critical need for transparent and honourable consultation with Indigenous partners. Without a resolution, Canada risks seeing its key economic ambitions and its relationship with First Nations suffer irreparable harm, putting billions in export revenue in jeopardy.
