Economy

Trans Mountain pipeline purchase puts economy before environment, observers say

Trans Mountain pipeline purchase puts economy before environment, observers say

Bill Morneau, finance minister, announced on Tuesday the government will pay Kinder Morgan 4.5 billion Canadian dollars (US$3.5bn) for the Trans Mountain pipeline.

A local environmental group is expressing concern about the recent deal reached between the federal government and Kinder Morgan to buy the controvesial Trans Mountain Pipeline.

The plan, similar to how Canada financed and managed shares in General Motors and Chrysler in 2009 during the financial crisis, will also include a new Crown corporation to manage the project.

"Any climate change plan that ignores the needs of working people is doomed to fail", Alberta Premier Rachel Notley said after the deal was announced.

"Pipeline capacity issues are cooling oil producers' appetite for new investment and drilling was also slightly down in the last winter season", the report continued. It is subject to approval by Kinder Morgan's shareholders.

The company's announcement ramped up the fight over the contentious project, which has pit the federal government and the landlocked province of Alberta against BC. Kinder Morgan will help Ottawa find other investors, as Morneau said the government was not interested in holding on to the asset.

Kinder Morgan has agreed to take part in marketing the project; Ottawa wants to avoid becoming a pipeline owner if at all possible.

When the sale is finished, Canada will continue construction on its own, with plans to eventually sell it all in the future once market conditions improve.

Notley said Tuesday she sees no need to turn off the oil taps to B.C. for the moment, but said she still has the law in her back pocket.

"There's $4.5 billion to purchase the assets, then you have construction costs on top of that, indemnity costs", McLeod said.

More news: BMO, Simplii Financial Report Possible Data Breaches

"The Trans Mountain Expansion faces even steeper obstacles and will soon become the third, and Trudeau just put the public on the hook for the costs", Hudema said.

Once the sale is finalized, Ottawa plans to take on remaining construction of the addition to the pipeline.

The pipeline connects oil sands facilities near Edmonton, Alberta, to tanks in Burnaby, near Vancouver on Canada's west coast.

Alberta's economy continues to do well, but growth will be weaker this year according to a report released by the Conference Board of Canada Tuesday.

Canada approved the project in November 2016, following an expanded environmental review process that included additional consultations with Indigenous communities and assessing the amount of additional emissions likely to result from additional production.

In British Columbia, Premier John Horgan said, "Tens of thousands of B.C.jobs depend on pristine coastal and inland waters".

"We will look for prospective buyers, but. there will be construction throughout the summer and I think that may be the most important signal of all", Natural Resources Minister Jim Carr said in an interview.

That decision prompted the Alberta government to call an emergency cabinet meeting to come up with a response.

The Chilliwack-area chief has been vocal on social media and in the mainstream press for several months trying to shoot down the notion that B.C. First Nations were united in lockstep in opposition to the expansion.

Now the Canadian government is stepping in to make sure the pipeline is completed over the objections of environmentalists, especially those in the Vancouver area who are anxious about increased shipping traffic and the possibility of spills along the coast.


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