Government will push for pipeline, says Trudeau
Prime Minister Justin Trudeau on Sunday took his firmest stance yet in support of the Trans Mountain pipeline, saying after an emergency meeting with the B.C. and Alberta premiers that his government would introduce financial and legislative backing to ensure the project goes ahead.
“We are going to get the pipeline built. It is a project in the national interest,” Trudeau said. “We will not have the discussions in public, but this project will go ahead.”
Trudeau did not specify what form those moves would take, but said Ottawa would be “exerting its constitutional authority” to get the pipeline built. Finance Minister Bill Morneau will begin private talks with Kinder Morgan Canada Ltd., the project proponent, to determine what financial supports could be provided, Trudeau said.
His comments come as part of a desperate push by Ottawa in recent weeks to tamp down political
TRUDEAU VOWS FINANCIAL, LEGISLATIVE BACKING, SETS UP TALKS WITH KINDER MORGAN
upheaval over the pipeline, which has called into question Canada’s ability to build major infrastructure projects and even led Alberta Premier Rachel Notley to threaten to halt oil shipments to its western neighbour through the existing Trans Mountain pipeline.
The two premiers met the prime minister, who interrupted a 10-day trip abroad to be in Ottawa, in a bid to settle the dispute.
Sunday marked Ottawa’s starkest opposition yet to B.C. Premier John Horgan, whose government has vehemently opposed the pipeline at every turn, drawing ire from Alberta and the federal government.
“Ideally, we wouldn’t be in this situation right now,” Trudeau said. “Ideally, the rhetoric and actions by the B.C. government would not have led to the concerns of the company, that got approval to move forward on a project that is in the national interest,” he said.
“We are responding to this situation. We are demonstrating not just that we are exerting and understanding the responsibilities that come with the federal government, but demonstrating as well what we have long held — and what Canadians understand: that the environment and the economy must go together.”
Last weekend, Kinder Morgan announced it would halt all nonessential spending on Trans Mountain until it could be assured B.C. would stop actively opposing the project. The company set a firm deadline of May 31 to have that request fulfilled.
Horgan’s government has delayed the project through legal objections, and said it would use “every tool in the tool box” to obstruct development. In January, the province considered halting any shipments of bitumen from Alberta until it could study the effects of heavy oil spills in vital waterways.
The Trudeau government officially approved the project in November 2016, subject to 157 conditions.
It is not clear whether Ottawa’s financial and legislative backstops would ensure the pipeline gets built. Analysts have suggested a federal equity position in the company would do little to placate investor concerns, and Kinder Morgan was neutral on the notion of financial backing.
Some observers suggest, however, that Ottawa could step in with an insurance guarantee that would effectively repay Kinder Morgan any financial losses it incurs due to delayed construction — or if the project is scrapped outright. Ottawa could buttress that support by enacting emergency legislation that would force the project to move ahead.
Opposition members of Parliament said Ottawa’s supports are too little, too late.
“We’ve been calling for this for months,” Conservative leader Andrew Scheer told reporters Sunday.
The opposition has claimed that new policies introduced by the Trudeau Liberals, including a carbon tax and hefty new legislation aimed at altering environmental assessments for major projects, has already caused foreign capital to flee Canada.
Horgan emerged from the meeting Sunday showing no intention of letting off on his opposition to the pipeline.
“My obligation is to the people of B.C. and I’m going to defend that until I’m no longer premier,” he said.
Notley has expressed exasperation over delays, saying the pipeline has already been through a rigorous regulatory process to be approved.
“It has gone through the hoops and, quite frankly, if co-operative federalism means we never, ever, ever make a decision, well I don’t think that’s a co-operative federalism that Canadians think is in their best interests,” she said.
On Monday, Alberta is expected to move ahead with emergency legislation aimed at exacting economic pain on B.C., potentially including restrictions of crude shipments into British Columbia, the province has said.
A failure to build pipelines over the last decade has had material economic impacts on the broader economy, analysts suggest. Canadian oil producers have long suffered from a lack of available pipeline capacity to get their product to market, causing the value of Canadian oil to fall compared to producers in the U.S. and elsewhere.
Trudeau said Sunday that steep discounts for Canadian crude is “not something we can accept.” Analysts at Scotiabank estimated in a recent report that discounts for Canadian crude would cost Canada $15.6 billion in 2018 in forgone revenues.
Prime Minister Justin Trudeau meets with B.C. Premier John Horgan and Alberta Premier Rachel Notley in his office Sunday in a bid to settle the deadlock over the Kinder Morgan Trans Mountain pipeline expansion. Trudeau said his government will be “exerting its constitutional authority” to get the pipeline built.