Canada didn't hand out a critical minerals subsidy — it bought a stake

The Canada Growth Fund invested about C$140 million in the Marathon copper-palladium project in Ontario, through common shares and convertible notes — not a grant or a non-repayable loan. The investment closed a C$1.3 billion construction financing package and should unlock construction.

On September 15, 2026, the Canada Growth Fund (CGF) — a C$15 billion investment vehicle created by the Canadian federal government to attract private capital to strategic projects — announced an investment of approximately C$140 million in Generation Mining, the company that owns the Marathon project, a copper-palladium deposit in northwestern Ontario, near the town of Marathon. The investment has two legs: about C$90 million in common shares, within a C$200 million equity round, and C$50 million in convertible notes, within a C$100 million offering. The Canada Infrastructure Bank added another C$50 million. Together, these pieces closed the project's construction financing package, totaling roughly C$1.3 billion — the full amount needed to start construction. The mine, 100% owned by Generation Mining, already has complete environmental and operating permits; only the capital was missing. According to the Canadian government, the project will create more than 800 construction jobs and over 400 direct permanent operating positions, with projected average annual production of 42 million pounds of copper, 168,000 ounces of palladium and 38,000 ounces of platinum, over a mine life of at least 13 years.

The part of this story that usually goes unnoticed is the structure of the investment, not the amount. The CGF didn't give Marathon a grant, nor a subsidized loan with no expectation of return — it bought common shares and convertible notes, the same instruments a private equity fund would use. That changes the government's role in the equation: instead of covering the risk and disappearing from the cap table, Canada becomes a relevant shareholder in a copper and palladium mine, with direct exposure to the price of those metals and to the project's operating performance for years to come. It's a bet, not a subsidy. That choice solves a specific problem that a lot of people get wrong: assuming the critical minerals bottleneck is always the permit. Marathon already had that solved — it is, in the Canadian government's own words, 'fully permitted and shovel-ready.' What was missing was the last piece of construction capital, exactly the stage where commercial banks hesitate the most, because the project doesn't generate revenue yet and execution risk is high. By coming in as an anchor investor — taking on a slice of the risk no bank wants to carry alone — the CGF acted as a credibility signal that unlocked the rest of the C$1.3 billion package, including the Canada Infrastructure Bank's share. The model isn't exclusive to Canada: it's the same logic behind sovereign funds and development banks in other countries that are shifting from subsidized credit to direct equity stakes in critical minerals, from the United States to the European Union. The difference for anyone tracking the sector is that this financial structure makes the state accountable for the asset's performance: if copper prices fall or the project runs late, the government loses money like any other shareholder — which also creates a stronger public incentive to make sure the project actually gets built on schedule.

For anyone assessing financing risk in mining projects, the Marathon case separates two bottlenecks that are often treated as one: getting a permit and getting capital. A project can be technically ready to operate and still sit idle for years waiting for someone to fund the last piece of construction — and that's exactly where sovereign critical minerals funds have been concentrating effort, not in the exploration or permitting phase. For managers and investors, understanding that public capital today comes in as a partner, with real risk and return, changes how you should read any announcement of 'government investment' in mining: it isn't public spending, it's a portfolio position.