Canadian government to buy pipeline project from Kinder Morgan for $4.5bn

30 May, 2018, 11:32 | Author: Tara Reeves
  • A 'No Trespassing' sign is on a fence outside of a Kinder Morgan Inc. facility in Burnaby.					Ben Nelms  Bloomberg

In return, Kinder Morgan will proceed with its original plan to twin the pipeline this summer while the sale is finalized, which likely won't happen until August, Morneau told a news conference in Ottawa. "They are getting a very good value", said Paul Bloom at Bloom Investment Counsel Inc, which owns about 300,000 shares in Kinder Morgan Canada.

"The federal government has reached an agreement with Kinder Morgan to buy the Trans Mountain pipeline and the infrastructure related to the project,"said Morneau".

John Horgan, British Columbia's premier, has asked a court to determine whether the province has jurisdiction over the pipeline, vowing to block the expansion if the court says yes.

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

Morneau said more spending would be needed to complete the expansion, but gave no precise financial details, and stressed he felt the project should be returned to the private sector.

"One who not only respects the rule of law, but who understands the challenges you are up against and will work with you to find solutions that work for everyone".

Reaction to the deal is certainly mixed and coming from all parts of the country, including from British Columbia's two leading men and Rachel Notley, the premier of Alberta.

"The deal announced today puts people to work building the pipeline right away", said Notley, who called the deal a major step forward for all Canadians. "We met the deadline".

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"We're still looking at what I would say are commercially sensitive touch points".

The federal Liberal government and its new Crown corporation are on track to be taught the same lesson.

"If the province of British Columbia tries to get an injunction to stop the federal government from going ahead with the pipeline, it is highly unlikely it will get very far in a Canadian court", Austin added. 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.

"The previous government spent 10 years pitting the environment and the economy against each other; they pitted us against each other".

Presumably, the cost to the new owners - us - will be about the same. The majority of Canadians understand that we are in a transition to a clean-growth century, and we will not get there overnight. "Why would we agree to a project that went through the worst environmental review in the history of time, which Bill Morneau referred to as the 'most rigorous process in our history, ' " said May.

Canada is buying a pipeline expansion project rather than risk it being derailed by protests and delays.

Prime Minister Justin Trudeau emphasized those differences in his first public comment since his government's announcement.

Once the sale is final, Canada will continue construction on its own in hopes of selling the pipeline down the road. If Alberta simply upgraded what it sent through the Trans Mountain pipeline into oil, the existing pipeline's capacity, as well as that of all other pipelines that service the oil sands, could be boosted by a third.

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