Strathcona and CN Plot C$3.5 Billion Crude-by-Rail Link to Prince Rupert

Strathcona Resources and Canadian National Railway are partnering on a C$2.5 billion to C$3.5 billion crude-by-rail project that would move 250,000 barrels a day to a yet-to-be-built tanker terminal at Prince Rupert, British Columbia, according to a company statement.

The project, branded Northern Express, could be operational within two years of receiving regulatory approval. That timeline positions it as a bridge for Canadian oil exports to Asia before the government-backed Pacific Link pipeline — a C$43.7 billion, million-barrel-a-day line to southern British Columbia — enters service in roughly eight years.

Who is behind Northern Express?

Strathcona Executive Chairman Adam Waterous is steering the plan, fresh from engineering the Nov. 8 acquisition of Greenfire Resources. That deal made Strathcona Canada's fourth-largest oil producer, slightly larger than ExxonMobil's Imperial Oil by produced volumes, according to Alberta and Saskatchewan production data on the Petrinex website.

"One of the reasons we are doing this is we are trying to get economies of scale," Waterous said. "One of the attractions for combining Strathcona and Greenfire is that, as we build scale, the capital investments become quite large. The Northern Express is a multibillion dollar capital investment, which we think is compelling."

Waterous also chairs private equity firm Waterous Energy Fund and is looking to raise another $1 billion to invest in Canada's oil sector.

Strathcona is no stranger to rail. It already ships as much as 80,000 barrels a day of its own and third-party crude south to the U.S. Gulf Coast, making it a major crude-by-rail shipper already.

What's the commercial logic?

Northern Express runs parallel to Prime Minister Mark Carney's push to diversify Canadian oil exports away from the United States. Pacific Link, backed by the Canadian and Alberta governments, anchors that strategy. But an eight-year wait for pipeline capacity leaves a gap — and Waterous pitches rail as a fast, cost-effective way to fill it, loading tankers bound for Asian markets off the northern B.C. coast.

CN, for its part, sees upside in hauling the barrels. "CN supports projects that help bring Canadian natural resources to market and diversify our trade opportunities," a spokesperson said in a statement. "We look forward to working with Strathcona to advance their project in collaboration with stakeholders and rightsholders."

What stands in the way?

Plenty. A federal ban on oil tankers off the northern British Columbia coast, in place since 2019, blocks the export leg — and Carney has maintained it. Many Indigenous coastal communities have strongly opposed crude exports off the northern coast.

Strathcona and CN are asking the government to classify the project as one of national interest, Waterous said. He argues Carney's own suggestion last year that the tanker ban could be adjusted once planning started on a new Pacific pipeline could apply equally to the rail project.

His team has met federal representatives multiple times in recent weeks. "They wouldn't take multiple meetings if there wasn't some chance of this obviously happening, of course," Waterous said.

Ottawa confirms the contact but stops well short of backing the plan. "Strathcona Resources has raised ideas to this effect at a high level," said Charlotte Power, spokeswoman for the minister of energy and natural resources. The meetings should "not be interpreted as an endorsement of any project proposal," she said.

On the Indigenous opposition question, Waterous said the project would eventually be open to First Nation equity ownership, plus participation through procurement and employment.

For shippers and producers, Northern Express offers early Pacific-basin access years before Pacific Link flows. For CN, it promises a high-volume crude franchise on a corridor it already serves. Everything now hinges on Ottawa's willingness to bend a six-year-old tanker ban — and on coastal First Nations whose opposition has sunk northern B.C. export schemes before.