Published: Wed, May 30, 2018
Research | By Jennifer Evans

'I hope this works,' Sask. premier says of Trans Mountain deal

The purchase remains subject to the approval of Kinder Morgan shareholders.

Finance Minister Bill Morneau unveiled the government's long-awaited, big-budget strategy on Tuesday to save the plan to expand the oilsands pipeline.

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.

This decision comes days before Kinder Morgan's May 31 deadline to get reassurance that the pipeline can go ahead. The purchase will see Canada buy the existing pipeline, the Westridge marine terminal in Burnaby, B.C., as well as pumping stations and rights of way along the routes.

Under the proposed federal plan, the Trans Mountain pipeline will be placed under the stewardship of a new Crown corporation and Ottawa will divest itself of the project at a later date.

"It does not change the course that the government of British Columbia has been on since we were sworn in in July of 2017", Horgan said.

But for Justin Trudeau's Liberal government, the Trans Mountain expansion represented a historic compromise: Alberta would sign onto Ottawa's climate change agenda; in return the federal government would guarantee the province a new pipeline to get tar-sands bitumen to market.

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 Trans Mountain project is created to increase capacity of the 65-year-old pipeline from Edmonton, Alberta, to Burnaby, B.C., from 300,000 to 890,000 barrels per day.

The federal government can in theory step in and disallow any provincial laws that British Columbia might use to block the pipeline, but this provision in the Canadian constitution has not been used since the 1940s.

"I feel betrayed", one woman said, adding that she wasn't sure how it was anyone in Ottawa's business what happens in B.C. on our coastline.

Morneau said Indigenous groups, pension funds, and others have expressed interest in the project. 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 is making up to $2 billion available if needed to keep the project going, but Notley said it's "very possible" the province will never pay a cent of it. A lack of capacity in pipelines or in rail cars to ship oil produced in Alberta is also hurting Canada's energy sector.

Presumably, the cost to the new owners - us - will be about the same.

Until now, Trudeau's government has used a soft tone to try to convince British Columbia to abandon its opposition to the pipeline, hoping not to alienate voters in the province before next year's general election.

Canada is buying a pipeline expansion project rather than risk it being derailed by protests and delays. Canada will continue to need major pipeline projects to deliver responsibly-produced Canadian energy to markets around the world while ensuring a fair price for our resources.

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