Northwest Territories Premier R.J. Simpson is actively lobbying the federal government to lift Canada’s Arctic offshore oil and gas moratorium before its scheduled 2028 expiration, arguing the restrictions hinder economic development and weaken the country’s energy security.
Simpson told the media in late November that removing the moratorium could spur significant investment in the territory. “By lifting that moratorium, I think we could see some real investment in the territory,” he said, noting that the offshore ban also hinders onshore development.
The Trudeau government imposed the indefinite moratorium on new oil and gas rights in Canada’s Arctic waters in December 2016 and extended it until December 31, 2028. The ban also suspends 11 existing exploration licenses.
Simpson emphasized that Indigenous groups in the territory already produce natural gas and may want to expand operations. He pointed to the Inuvialuit Energy Security Project, owned by the Inuvialuit Regional Corporation, which received federal approval in March 2024 to develop the M-18 well. The project aims to provide sustainable energy for 50 years and will convert natural gas into compressed natural gas, propane, and synthetic diesel for heating and power in communities across the Inuvialuit Settlement Region.
At the 2025 Yellowknife Geoscience Forum, Simpson argued the moratorium “means missed opportunities for northern jobs and territorial revenues, and it weakens Canada’s ability to position itself as a global energy superpower.”
The territory’s opposition to the moratorium dates back to 2016, when then-Premier Bob McLeod called the federal decision “patronizing” and “colonial” for bypassing local government consultation. McLeod issued a “red alert” in response to Ottawa’s unilateral decision.
In August 2023, the federal government, Inuvialuit Regional Corporation, and the governments of the Northwest Territories and Yukon signed the Western Arctic – Tariuq (Offshore) Accord, which establishes a framework for shared management of oil and gas rights and ensures northerners would be the primary beneficiaries of any future economic activity in the region.
Natural gas production in the Northwest Territories remains minimal, representing less than 0.1% of total Canadian production. Oil and gas production in the territory continues to decline, and the sector no longer serves as a major economic driver for the region.
Simpson said the territory needs federal support for infrastructure development, including the Mackenzie Valley Highway, the Arctic Economic and Security Corridor, and road access to the mineral-rich Slave Geological Province. “It’s an expensive place to build, and we’re talking about some major projects,” he said.
The push for oil and gas development comes as the Northwest Territories pursues its 2030 Energy Strategy, which aims to transition to a sustainable energy system less dependent on fossil fuels. The government recently committed to a net-zero greenhouse gas emissions goal by 2050.
Ottawa plans to review the moratorium with northern partners before making decisions on its future beyond 2028. The federal government has not provided a timeline for potential policy changes ahead of the 2028 expiration date.
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