More than 3,000 kilometers north of Ottawa, in an expanse where ice and rock meet the sky, Canada’s Armed Forces gathered this week for Operation Nanook—a military exercise with stakes higher than ever before. Set against the backdrop of shifting geopolitics and a rapidly changing Arctic, the operation posed a sobering question: How would Canada respond if a foreign vessel, intent on avoiding detection, approached sensitive northern military sites?
This year’s exercise, observed exclusively by CBC News, unfolded as the Arctic’s strategic value takes center stage. China’s growing ambitions in the region, Prime Minister Mark Carney’s pledges to expand military capabilities, and the newfound importance of critical northern minerals have all converged to make the 2025 edition of Operation Nanook especially significant.
“That would be Russia and, increasingly, China,” said Stephanie Carvin, a former national security official and now an academic at Carleton University, when asked about nations eyeing the Arctic’s riches. “China has an ambitious plan to basically control a lot of the rare-earth elements and mining and wants to invest in the Canadian Arctic.” The North, after all, is home to some of the world’s richest deposits of copper, nickel, lithium, graphite, and cobalt—minerals crucial to modern technology and energy transitions.
But the challenges aren’t just about minerals. As climate change unlocks new, shorter shipping routes through the Northwest Passage, the region is seeing more vessels—many of them small, often without transponders, and largely invisible to satellites and surveillance systems. These so-called “ghost” or “shadow” vessels, used by both China and Russia, can masquerade as merchant ships while conducting espionage or other covert activities, according to Rob Huebert at the Centre for Military and Strategic Studies at the University of Calgary. “They’re not warships per se, but they are capable of taking all sorts of ... information that of course then can ultimately be utilized by warships in the future,” Huebert warned.
Canada’s military and coast guard have been keeping a close eye on these developments. Earlier this summer, the Chinese research vessel Xue Long 2 was tracked by a Canadian CP-140 surveillance plane as it exited the Bering Strait, according to data compiled by ship tracker Steffan Watkins. The icebreaker CCGS Sir Wilfrid Laurier paralleled its path from Japan to Alaska, a move that underscored the vessel’s dual-use capabilities—gathering research data that could just as easily serve military objectives. In 2024, the frigate HMCS Regina was deployed on short notice to shadow the predecessor of Xue Long 2 in international waters, highlighting the Canadian military’s vigilance.
The scenario is not entirely hypothetical. The predecessor of Xue Long 2 made a port call in Tuktoyaktuk, Northwest Territories, back in 1999—a visit that, while approved by the federal government, sparked unease among national security officials. The concern: China may now possess detailed maps that could allow its submarines to navigate Canadian waters undetected.
The stakes for Canada’s sovereignty and security are further heightened by the human dimension. “There’s really been a renewed interest in the Arctic, not only for its abundance of resources, but the incredible people that call this place home,” said P.J. Akeeagok, the outgoing premier of Nunavut. Akeeagok has been a vocal advocate for investing in northern communities, arguing that economic opportunity and basic infrastructure—like hydropower and adequate housing—are essential to maintaining healthy communities and, by extension, asserting Canadian sovereignty in the region. “You have to really go right to the importance of investing in the backbones of our communities, whether it’s hydropower or whether it is [enough] homes for people,” he told CBC News.
Recognizing the urgency, the federal government this week designated an Arctic economic and security corridor as a project of national significance, a move that could unlock substantial funding and streamline regulatory approvals for northern development.
Operation Nanook itself was a showcase of Canada’s evolving capabilities. In the exercise, a coast guard helicopter and the navy’s HMCS William Hall—one of the newest Arctic offshore patrol vessels—quickly located a suspect vessel hiding in a cove. Because the event took place in domestic waters, the navy could interdict the vessel, but law enforcement was needed for any arrests. RCMP officers, stationed aboard the navy ship, were dispatched by fast boat to a rocky, seal-covered beach. There, they apprehended two individuals—role players in the exercise—carrying a simulated handgun and fake Russian military intelligence identification. The scenario, though staged, was a clear signal of the real-world threats Canada’s military is preparing to counter.
“The first step is to observe … with the new technology that we have,” said Brigadier-General Dan Riviere, commander of Joint Task Force-North. He expressed confidence that no vessel could enter Canadian waters undetected, but acknowledged the immense challenge of patrolling a region that makes up 40% of Canada’s landmass. “It takes air support, ships, planes, people and other resources to do anything here,” Riviere explained.
To meet these challenges, Canada is investing in a raft of new defense technologies. The aging CP-140 surveillance planes, some dating to the 1980s, are set to be replaced by the larger, more advanced P-8 Orion aircraft, which will allow for greater detail and longer-range surveillance. Canada is also partnering with Australia to develop a new Arctic over-the-horizon radar system, replacing the Cold War–era technology currently used to detect missile and maritime threats.
Yet, even as Canada shores up its northern defenses, another front in the country’s economic and strategic ambitions is opening up—this time in the global competition for talent. On Saturday, September 27, 2025, Prime Minister Mark Carney announced in London that Canada intends to attract technology sector employees affected by the United States’ new H-1B visa fees. President Donald Trump’s executive order, effective September 21, 2025, imposes a $100,000 fee per new H-1B visa—a move expected to hit tech companies hard, especially those hiring from India and China, who together account for more than 70% of H-1B holders.
“What is clear is that the opportunity to attract people who previously would’ve got so-called H-1B visas,” Carney told Bloomberg. He emphasized Canada’s willingness to absorb talent now facing barriers in the US, promising a “clear offering on that.” The new visa regime has left many young Indian tech professionals anxious about their future in America, while Germany and the UK are also positioning themselves as alternative destinations for skilled workers.
US Commerce Secretary Howard Lutnick defended the fee, saying it was designed to prevent companies from “training” foreign workers and “bringing them in” to “take jobs” from Americans. But for Canada, the move represents a strategic opening. As Carney’s government reviews immigration policy, the aim is to capitalize on the moment and bring in the world’s best and brightest, further strengthening the nation’s technology sector.
From the icy waters of the Arctic to the heated battle for global talent, Canada finds itself at a crossroads—one where sovereignty, security, and economic opportunity are all in play. The coming years will test the country’s resolve and resourcefulness, but as Operation Nanook and Carney’s bold overtures suggest, Canada is determined not to be caught off guard.