Trans Mountain pipeline project purchase ‘major step forward’: Rachel Notley

30 May, 2018, 11:19 | Author: Regina Lloyd
  • VOTE: Do you think Canada should pay for the Kinder Morgan pipeline?

Finance Minister Bill Morneau said the government would acquire the troubled pipeline expansion project on Tuesday.

It is subject to approval by Kinder Morgan's shareholders.

Federal Finance Minister Bill Morneau made the announcement from Ottawa and says the deal represents a sound investment.

Kinder Morgan Canada gave Ottawa until May 31 to come up with reassurances it could press ahead with plans to more than double the capacity of the existing pipeline amid efforts by British Columbia to block construction.

"It's not the intention of the government of Canada to be a long-term owner of the project", Morneau said, adding that pension funds and indigenous groups have already expressed an interest in buying stakes in the project. The purchase includes the pipeline, pumping stations, and rights of way along the route.

The Export Development Bank of Canada will finance the plan and create a Crown corporation to run and manage the pipeline during Canada's ownership period.

Notley held a jubilant news conference in front of the legislature in Edmonton after the federal government announced it is buying the 65-year-old oil pipeline from Alberta to the B.C. coast. "We will not stop until the job is done", Notley said.

Because instead of having the private sector do it, Canadian taxpayers are now the owners of the Trans Mountain, for an initial outlay of $4.5 billion, with the final cost likely to be around $7.5 billion. Steven J. Kean, the president of Kinder Morgan, called it a "great day for Canada, for our customers and for our employees".

Even the Canadian Energy Research Institute recognizes that this new regulation will have a dramatic impact on bitumen by lowering both the demand for and price of Canada's heavy crude oil. The federal government and the Houston company were in talks for over a month about saving the project, which Kinder Morgan threatened to abandon as of Thursday unless federal officials remove political.




Alberta has also agreed to provide funding for any unexpected costs that arise during construction.

Monica Gattinger, director of the University of Ottawa's Institute for Science, Society and Policy, said her polling research shows strong national support for federal intervention to support the pipeline. And he's right about that - under Article 92.10 (a) of the Constitution Act, the federal government controls interprovincial and global transportation, including transportation by pipe.

"We'll get that pipeline built", Prime Minister Justin Trudeau told reporters as he headed into a cabinet meeting.

Mr. Horgan said Mr. Trudeau's commitments to reconciliation with Indigenous peoples are coming to an unavoidable conflict with this pipeline.

Morneau couldn't say what additional costs, if any, would be incurred by Canadians in building the pipeline.

Clayton Thomas-Muller, a campaigner with 350.org, argued that Trudeau's move demonstrates that he "still hasn't learned two simple lessons: you can't be a climate leader and build massive fossil fuel projects and you can't ignore Indigenous rights and preach reconciliation". "This project has more certainty than ever before".

His Liberals face a hard balancing act in trying to champion climate action while supporting growth in Canada's oil sector.

Currently, 99 percent of Canada's oil is sold to the United States at a discount, and access to the Pacific coast is seen as key to diversifying the world's sixth-largest oil producer's energy exports.

The company also faced opposition from environmentalists and aboriginal groups who anxious about the pipeline spilling its tar-like heavy oil.

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