Ontario's Secret Payout to SpaceX Over Cancelled Starlink Deal Revealed
The amount Ontario paid to Elon Musk's SpaceX as a kill fee for a cancelled Starlink contract will remain confidential under a secret settlement agreement, The Canadian Press has confirmed. The province had originally entered into a $100-million deal with SpaceX to deliver high-speed internet to 15,000 households and businesses in northern and rural Ontario.
Confidential Settlement Details
While the exact payout figure is undisclosed, provincial officials stated the kill fee is significantly less than the full contract value. The settlement was negotiated between the two parties, with the amount forming part of a confidential agreement. When questioned earlier this week, Ontario Premier Doug Ford admitted he did not know the specific sum but promised to verify it. His office later clarified that the amount could not be publicly released.
Ford defended his decision to terminate the deal before implementation, stating, "I believe that was the right decision, protecting Canadians, not supporting a U.S.-led owner that was pretty aggressive towards Canada." SpaceX has not responded to requests for comment on the matter.
Political Context and Deal Origins
The Starlink agreement was announced by Infrastructure Minister Kinga Surma days after Donald Trump won the 2024 U.S. presidential election. Ford publicly endorsed the deal on X, Musk's social media platform, with Musk replying "cool." Two senior Ontario government sources revealed in November 2024 that the deal was partly viewed as a gesture to appease Trump's inner circle, as Musk actively supported Trump's campaign.
Ford initially expressed satisfaction with Trump's election victory but later grew critical after Trump threatened economic measures against Canada. The premier was recorded at a campaign event stating his changed stance, citing Trump's aggressive posturing.
Technological and Operational Aspects
SpaceX won the competitive bid for the project, dubbed ONSAT (Ontario Satellite Internet), with plans to become operational by June 2025. The system was the only option capable of deployment within months, having proven its technology during a 2020 trial in Pikangikum First Nation. The program would have covered equipment and installation costs while guaranteeing priority internet coverage over regular Starlink customers.
Remote First Nations in northern Ontario were expected to benefit significantly. Currently, many First Nations and mining exploration companies in the region use Starlink at their own expense. The province is also deploying fibre-optic cable in remote areas, including around the Ring of Fire in communities like Neskantaga and Webequie First Nations, though internet service is not yet active.
Broader Implications and Criticism
The Starlink deal was part of Ontario's $4-billion initiative to provide high-speed internet across the province. Following Trump's inauguration, Musk—who holds Canadian citizenship through his Regina-born mother—began echoing Trump's criticisms of Canada, including a February 2025 post claiming "Canada is not a real country."
After Trump imposed tariffs on Canada in March 2025, Ford retaliated with measures such as removing U.S. alcohol from LCBO shelves, imposing a surcharge on power exports to Michigan, Minnesota, and New York, and cancelling the Starlink contract. Ford's office is now seeking an alternative partner for the internet project.
Liberal parliamentary Leader John Fraser criticized the secrecy surrounding the cancellation fee, arguing taxpayers deserve transparency. "We should have been looking at a Canadian company like Telesat that was doing the same work and that would have protected jobs here in Ontario," Fraser said. "It blew up in his face and now we're all paying the price. Just tell us how much we gave over to this billionaire."
