In 2024, five major Canadian banks financed some of the country’s most significant fossil fuel projects, in clear contrast with the environmental goals they had long endorsed.
In 2024, Canada’s leading banks allocated billions of dollars to new fossil fuel projects, while continuing to publicly affirm their commitment to environmental, social and governance (ESG) standards. Recent data show a sharp increase in funding for infrastructure dedicated to the production and export of liquefied natural gas (LNG) and shale gas in British Columbia, a region that in recent years has become one of the main arenas of national debate over the energy transition and indigenous rights.
Three projects stand out for their scale and visibility: the Cedar LNG terminal in Kitimat, the Woodfibre LNG plant near Squamish, and the Coastal GasLink pipeline, which connects inland gas fields to the Pacific coast. All three have faced strong criticism from environmental groups and First Nations representatives, particularly due to their location on unceded traditional territories. These are lands that were never subject to treaties with the Canadian government, and which indigenous peoples continue to claim as part of their traditional jurisdiction. In many cases, these areas—central to the cultural identity and practices of the communities living there—do not coincide with officially recognised reserves.
From Climate Pledges to the “Great Exodus”
In 2021, under the impetus of the UN’s sustainable finance initiative, dozens of major international banks joined the Net-Zero Banking Alliance (NZBA), a voluntary programme aimed at committing financial institutions to bringing their “financed emissions” to net zero by 2050. Among the initial signatories was the Royal Bank of Canada, later followed by the other four major Canadian banks. At the outset, the banks committed to publishing detailed emission reduction plans within 18 months and aligning their lending and investment policies with the goals of the Paris Agreement.
However, over the course of 2024 and in the early months of 2025, the situation shifted: by the end of January 2025, all of Canada’s leading banks had left the alliance, stating that they felt ready to develop their climate strategies independently, without relying on the NZBA’s framework. CIBC, in particular, declared it was “well-positioned to further this work outside of the formal structure of the NZBA.” The exodus, as it has been called, took place just as a number of major U.S. banks—including Goldman Sachs, JPMorgan and Bank of America—were also withdrawing from the alliance, amid growing opposition to ESG initiatives, especially from U.S. conservative circles that accused such frameworks of undermining market competition.
What Is The “Big Five”?
The scale of these investments is significant. According to the Banking on Climate Chaos 2025 report, five major Canadian institutions—Royal Bank of Canada (RBC), Toronto-Dominion Bank (TD), Bank of Montreal (BMO), Bank of Nova Scotia (Scotiabank) and Canadian Imperial Bank of Commerce (CIBC)—collectively channelled more than 131 billion U.S. dollars into the fossil fuel sector in 2024 alone.
This flow of capital towards LNG highlights a clear contradiction. The same banks that publicly affirm their commitment to the ecological transition continue to finance some of the country’s most controversial fossil fuel infrastructure. Meanwhile, indigenous communities affected by these projects remain, once again, excluded from decisions that directly impact their land and future.
The five banks in question form the core of Canada’s financial system. Together, they control a substantial share of the national banking market, and all five consistently rank among the world’s 100 largest banks by total assets.
RBC is Canada’s largest bank by market capitalisation, with a strong presence in the United States and Europe. TD, the second largest, has an extensive retail banking network across the northeastern United States, particularly in East Coast states. Scotiabank is notable for its international reach, especially in Latin America and the Caribbean. BMO and CIBC, by contrast, are more focused on the North American market, though both maintain significant activity in the investment sector. All five are publicly listed on the Toronto Stock Exchange and are considered pillars of the Canadian economy, both in terms of employment and their influence over public and private credit.
To fully grasp the meaning and scale of these investments, it is worth taking a closer look at the main infrastructure projects currently receiving this financial support.
Infrastructure Projects: Between Controversy And Greenwashing
The Cedar LNG project involves the construction of a floating LNG export facility in the industrial zone of Kitimat, on the northern coast of British Columbia. The facility will be supplied via the Coastal GasLink pipeline and is expected to have an annual export capacity of over three million tonnes of LNG. It is one of the few energy projects in Canada developed in partnership with a First Nation: the Haisla Nation holds a 50.1 per cent ownership stake, alongside the U.S.-based company Pembina Pipeline.
The terminal will be powered by hydroelectricity, but the gas it will receive is extracted using hydraulic fracturing or fracking, a method that has raised concerns for years due to its potential impacts on groundwater, geological stability and natural habitats.
Located near Squamish, north of Vancouver, Woodfibre LNG is a small-scale export terminal with clearly defined objectives: to supply Asian markets, particularly China, with liquefied gas extracted from inland Canada. The project is promoted by Pacific Energy Corporation, a company owned by the Singapore-based multinational RGE Group, and has repeatedly attracted controversy due to its location on a sensitive marine area close to residential areas. Unlike Cedar LNG, Woodfibre does not involve direct indigenous ownership, although it has signed cooperation agreements with the Squamish Nation.
The Coastal GasLink pipeline is the key infrastructure that makes the other two projects possible. Spanning 670 kilometres, it runs from the Dawson Creek area in the eastern part of the province to Kitimat, the planned site of Cedar LNG. The pipeline’s construction has faced strong opposition from the outset, particularly from the hereditary chiefs of the Wet’suwet’en Nation. The protests have drawn national and international attention, turning Coastal GasLink into a symbol of the broader conflict between industrial development and indigenous self-determination.
The promoters of these projects speak of a possible balance between economic growth and ecological transition. They argue that gas exports can help reduce coal consumption in Asian markets while generating positive outcomes for the Canadian economy, often highlighting the presence of agreements with indigenous groups as a source of legitimacy. But the reality is more complex. Not all communities involved have a say in the decision-making process, and the forms of participation on offer often appear limited to financial compensation or protocols signed only after key decisions have already been made.
From a financial perspective as well, the choices made by Canada’s major banks do not appear aligned with the environmental commitments they have been promoting for years. Fossil fuel investments are not decreasing. On the contrary, they are being directed towards infrastructure with long-term consequences. The language of “sustainability” is increasingly present in public communications, but it does not translate into binding criteria for the provision of credit.
It is along this divide between public declarations and actual outcomes, between industrial planning and indigenous self-determination that some of the most complex struggles in contemporary Canada are unfolding. Those centred in particular on the Coastal GasLink project will be the focus of the second part of this investigation.
AUTHORTommaso Bontempi
Journalist
Osservatorio Artico