A MAJOR STEP FOR PIPELINE BUT B.C. VOWS TO FIGHT ON
A government cheering section happily applauded Premier Rachel Notley on Tuesday at a news conference after Ottawa’s pipeline announcement.
Those were hopeful hosannas; New Democrats feel Notley now stands a serious chance of winning the 2019 election.
Praise is far from universal, of course. But if this remarkable federal buyout is good news for any Canadian politician, it’s Notley.
Even UCP Leader Jason Kenney, while blasting both Liberals and New Democrats for making this so difficult, gave the deal his tentative approval pending a review of details.
There are precious few of those. Kinder Morgan shareholders still have to vote on the offer. The Alberta government promises more information soon.
Notley did say the province agrees to put up to $2 billion into the deal, and maybe nothing at all. It depends on undefined emergency needs.
Anything spent by Alberta can later be turned into equity, which could bring a substantial profit.
Some day, shares in a Trans Mountain money machine could even be spun off to the Alberta public.
The province gets off quite lightly here, especially after Notley vowed Alberta would buy the whole project if Ottawa failed to step in.
Now the Trudeau government gets to spend $4.5 billion to buy both the existing pipeline and the expansion project.
On top of that, Ottawa immediately starts paying the construction bills. Those appear to total $6.3 billion, and probably more.
By now we’re up to nearly $11 billion, making this purchase a strong challenger to the $13.7-billion auto industry bailout by the Harper government after the 2008 financial collapse.
Ottawa eventually recouped $10 billion of that, but the autosector rescue remains a financial loser.
The Trudeau Liberals virtually promise that their pipeline ownership, when they can sell it to a private interest, will be a massive net gainer that produces constant revenue both for governments and the private economy.
Kinder Morgan’s entire pipeline management and engineering team is now employed by the Government of Canada.
These people would have been unemployed if the project collapsed and Kinder Morgan pulled out. Now their only fear is being paid by the Phoenix system.
The oversight and management by this team will continue even after the deal with Kinder Morgan closes in August.
Relations between Ottawa and Alberta have been mostly cordial and collegial through all this. They needed each other.
But now that everybody’s signed on, the unnatural Liberal-NDP alliance may be starting to shred.
In a noticeable change of tone, federal Finance Minister Bill Morneau suggested the whole mess was caused by a pair of squabbling provinces.
Calling it a “tricky situation,” Morneau said, “The dispute that’s arisen between Alberta and British Columbia cannot be allowed to fester in this country, especially when the resulting impasse threatens both the livelihood of thousands of workers and Canada’s solid reputation as a good place to invest.”
Really? Alberta shares responsibility with B.C. for stalling the pipeline and threatening jobs?
That’s absurd. Alberta got tough with the wine ban and Bill 12 because, as Notley always said, the feds weren’t being aggressive in asserting their own federal rights.
INTERPROVINCIAL BATTLE
By any sane reading of the facts, it was B.C. Premier John Horgan’s anti-pipeline words and actions, and resulting federal indecision, that prompted Western Canada’s nastiest interprovincial battle.
Now Ottawa is spending most of the money, and means to have all the credit. There may be none to spare for any species of New Democrat.
Horgan, meanwhile, sounds as tough as ever about winning provincial control of bitumen shipments.
The province’s court reference will proceed, he said. Once again, Horgan did not promise that if B.C. loses, he will finally admit this pipeline will be built and operated.
He asked protesters to act “within the rule of law” — while definitely encouraging them to act.
Asked if federal ownership of the pipeline confers immunity from provincial action, Horgan said it doesn’t matter because his problem is with a substance, bitumen, not with a pipeline or company.
Most Albertans and many other Canadians are heartily sick of these pipeline semantics. It’s now the federal Liberals’ challenge — and maybe their whole future — to get the pipeline built smoothly.
At least the new owner won’t threaten to pull out. That’s progress of sorts. But the rest won’t be easy.