Canada To Buy Kinder Morgan's Trans Mountain Expansion Project

3:17pm


Image Credit CFJC Today

3:17pm Image Credit CFJC Today

The price tag for the Trans Mountain expansion has been pegged at $7.4 billion but Carr would not say whether that figure was accurate or if there has been cost overruns.

"We've always reckoned that the Trans Mountain expansion was logical in terms of, if you build the pipeline, the volumes will flow through it".

Construction will continue through the 2018 season and the federal government will sell it to one or more new owners when "appropriate".

Steve Kean, chairman and chief executive of Kinder Morgan Canada Ltd., said the deal represents the best opportunity to complete the expansion project. "If the Federal Court Of Appeal rules that the permits were granted illegally, they were granted illegally to Kinder Morgan or the federal government".

Kinder Morgan will continue to manage a portfolio of strategic infrastructure across Western Canada.

Alberta's premier says the Trans Mountain pipeline expansion "has more certainty", after the federal finance minister announced plans to buy the project Tuesday morning.

The purchase includes the pipeline, pumping stations, and rights of way along the route.

Although the federal government has taken stakes in struggling energy projects, Tuesday's announcement marked the first time Ottawa has bought an entire pipeline.

"It does change it from a federally approved project to a federally undertaken project". He said there have been expressions of interest from "multiple investors" in buying the project, and that the federal government has no intention of being the long-term owner.

Access to new oil markets was also key to Canada meeting its Paris climate target because Alberta, the nation's singled largest pollution emitter, agreed to take action against carbon emissions, if it gained access to new markets for its oil.

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The first indications of the result are expected mid-morning on Saturday after the count begins at 08.00 GMT. It's looking like we will make history tomorrow".

"This allows us to get rid of the political risk around [the pipeline] because we [are imposing] federal jurisdiction over the project", he said.

The deal brings some certainty to an expansion project that has been on the rocks since B.C. went to court in hopes of blocking it, fearing the impact of a spill of diluted bitumen, the raw output from Alberta's oilsands.

Morneau said the government's purchase of the project "will ensure that we're able to safely get Canadian oil resources to world markets where we can get a fair price for them".

Facing stiff environmental opposition from British Columbia's provincial government and activists, Houston-based Kinder Morgan earlier halted essential spending on the project and said it would cancel it altogether if the national and provincial governments could not guarantee it.

The government was immediately slammed from all sides for its stunning move. "Many investors have already expressed interest in the project, including Indigenous groups, Canadian pension funds, and others", the finance minister said.

Canadian Association of Petroleum Producers president Tim McMillan said it was "great news" that Ottawa was prepared to "step up to clear the path to construction" and ensure Trans Mountain had full political and financial support.

Canada's oil sector has been stung in the past year as foreign energy companies retreated amid concerns about the environmental toll, high production costs and a risky regulatory regime.

"In a single mandate, Justin Trudeau transformed from a climate champion into a Big Oil CEO", said Aurore Fauret, a campaigner with 350.org.

"While we are going to save the vital pipeline and the thousands of jobs that come with it, today's decision highlights how much damage has been done to our worldwide reputation".

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