Federal government commits up to $3 billion for new George Massey Tunnel | Daily Hive

Federal government commits up to $3 billion for new replacement George Massey Tunnel

2024 revised concept of the new replacement George Massey Tunnel. (Government of BC)

Embedded in a broad joint economic and infrastructure investment strategy for British Columbia by the provincial and federal governments, it was announced today that the Government of Canada will provide up to $3 billion in direct funding to build the new replacement George Massey Tunnel in Metro Vancouver.

This falls under the new Canada-British Columbia Cooperative Prosperity Agreement, with the federal government offering to cover up to one-third of the cost of building the new tunnel.

In addition to this direct funding, there could also be low-interest federal loans and other borrowing capacities to help cover the provincial government’s total cost of building the project.

As part of today’s announcement, there will also be direct federal funding for the first two phases of the new North Coast Transmission Line — which will result in a $3.9 billion net benefit for BC Hydro customers — and the Red Chris Mine Extension.

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This prosperity agreement also spans strategies and policies for steel manufacturing, softwood lumber, support for B.C.’s Liquefied Natural Gas (LNG) exports, skills training and talent development, flood mitigation, the establishment of a National Carbon Credit Framework, and the further expansion of new clean electricity projects. It also includes enhancing the capacity and efficiency of Port of Vancouver facilities, including the new Roberts Bank container terminal.

As well, the B.C. government will now acknowledge the plan by the federal and Alberta governments to build a new oil pipeline to the West Coast, with the B.C. government requesting a meaningful share of the revenue and economic benefits of the project, including an annual royalty payment.

“This agreement is about building B.C.’s future — not just for this year, but for generations to come. It means more good jobs for workers and more opportunities to train for better pay, all while protecting the beautiful places that make our province so remarkable. This deal will deliver faster commutes as we build critical infrastructure, less pollution as we power growth with clean electricity, and the kind of shared prosperity that funds strong public services,” said Premier David Eby in a statement today.

Prime Minister Mark Carney added, “Today’s historic agreement creates the conditions to transform the B.C. and Canadian economies to become more resilient, sustainable, and independent. Canada and British Columbia are broadening and accelerating major energy projects and trade corridors, protecting our land, wildlife, and waters, giving workers the support and opportunities they need to help build Canada strong, and creating extensive, large-scale opportunities for true partnerships with First Nations. Together, we’re turning British Columbia’s enormous economic potential into lasting shared prosperity. We’re building British Columbia strong to build Canada strong for all.”

Today’s announcement follows the controversy last month when the provincial government announced that it had fired the European-led private consortium selected two years ago to design and build the new eight-lane immersed tube tunnel immediately east of the existing George Massey Tunnel below the Fraser River.

Provincial officials had also indicated in that announcement, and in subsequent press conferences and media statements, that the tunnel would carry a greater cost than the $4.15 billion figure first established more than five years ago, before a period of immense inflation in market construction costs induced by the pandemic.

There have also been mounting concerns and criticism expressed by opposition party leaders and municipal officials — especially those from the City of Delta — that the project faces great uncertainty and implementation delays. Some have suggested the new cost of the project could be in the range of $9 billion and $12 billion, but the provincial government has denied this.

new george massey tunnel preliminary construction work may 21 2026

Site preparation and preliminary construction work for the new George Massey Tunnel, next to the south end of the existing tunnel as seen on May 21, 2026. (Government of B.C.)

Concept of the new replacement George Massey Tunnel. (Government of B.C.)

george massey tunnel new immersed tunnel f

Concept of the new replacement George Massey Tunnel. (Government of B.C.)

Today’s announcement on funding for the new crossing between Richmond and Delta follows several years of direct funding requests from the provincial government — dating back to the era of the previous administration led by Prime Minister Justin Trudeau — for the federal government to meaningfully financially support six infrastructure projects deemed to be B.C. priorities, with the new George Massey Tunnel at the top of the list.

In that 2024 request to Trudeau, other major projects included the new North Coast Transmission Line and the Metro Vancouver Regional District’s new Iona Island Wastewater Treatment Plant, with the federal government announcing in 2025 that it will cover $250 million — one-third of the cost of the first phase of the multibillion-dollar facility.

Trudeau had reportedly also offered hundreds of millions of dollars for the new George Massey Tunnel, but Premier Eby turned it down, as it would have been a drop in the bucket against the total project cost. At the time, Eby was reportedly seeking a federal contribution of at least 50 per cent of the cost.

Following the termination of the original European-led contractor, the provincial government is now going back to the bidding stage to seek new contractors under a revised procurement model that splits the overall project work into smaller contracts. According to the Ministry last month, the previous contractor had made significant progress toward advancing the detailed design and engineering of the project.

In a statement to Daily Hive Urbanized today upon inquiry, B.C. Minister of Transportation and Transit Mike Farnworth says he welcomes the federal government’s direct funding contribution, with the level of the commitment reflecting “the national significance of the project and its role in supporting trade, economic growth, and the movement of people and goods throughout British Columbia and Canada.”

Farnworth also shared that further details about the new tunnel’s budget and timelines will be released early next week.

Site preparation and preliminary construction work at the site began in early 2026, but major construction activity is now expected to begin in 2027 instead of this year. The project entering this major construction phase also depends on the timely approval of the provincial government’s environmental assessment process, which first began in 2021 and was supposed to finish by late 2024 or 2025. The environmental assessment is now expected to conclude in late 2026.

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