Canada open to taking a big stake in pipeline
Kinder Morgan halted most of its work amid British Columbia opposition
Canada will consider using all of its tools for seeing the Trans Mountain pipeline expansion through to completion, Finance Minister Bill Morneau said Wednesday, indicating the federal government wouldn’t rule out taking a stake in the project.
The government has spoken with Houstonbased Kinder Morgan since it said on Sunday that it was halting most work on the pipeline amid opposition from British Columbia, Morneau said. The government isn’t ruling out any option — legal, regulatory or financial — because the project is vital to attracting investment to Canada, he told reporters in Toronto in a response to questions about a potential stake purchase.
“We know that showing that Canada is a place where important projects can get done, showing Canada is a place where you can make business investments that actually help our economy — that’s critically important,” Morneau said after a meeting with Alberta Premier Rachel Notley to discuss responses to Kinder Morgan’s announcement.
Earlier this week, Notley said Alberta, a landlocked province, would be willing to buy out Kinder Morgan’s pipeline if that’s the only way to salvage the critical export route.
“We are considering a number of financial options to ensure that the Trans Mountain expansion is built, up to and including purchasing the pipeline outright,” Notley said in a statement.
Warning from Houston
Kinder Morgan threatened to abandon the $5.7 billion project, which would triple the pipeline’s capacity, unless obstacles are resolved by May 31. The warning came amid strident opposition and legal challenges from British Columbia, the Pacific coast province it traverses.
The expansion would allow the system to move an additional 590,000 barrels a day of crude from the oil sands to a terminal near Vancouver, where it could be sent to Asia and reduce Canada’s dependence on American buyers.
The company’s ultimatum has stirred concerns across the nation as government officials and business leaders decried the risks to a project that was already approved federally in 2016 and that the energy industry is counting on to carry more crude to refiners abroad. ‘Dial up a crisis’
Meanwhile, British Columbia Premier John Horgan accused Kinder Morgan this week of “deliberately trying to dial up a crisis within our Canadian federation.”
“I’m surprised that a press release from Texas could evoke such consternation across the country,” he told reporters at a press conference in Victoria. The issue should be left to the courts to decide whether federal or provincial jurisdiction prevails, he said. “That’s the reasonable way for reasonable people to resolve disputes.”
Kinder Morgan and Trans Mountain declined to comment on Alberta’s proposition.
“A company cannot resolve differences between governments,” Steve Kean, president and chief executive officer of Kinder Morgan, said earlier. “A company cannot litigate its way to an in-service pipeline amidst jurisdictional differences between governments.” Anger in Alberta
Politicians in Alberta have called for the federal government to withhold transfers to British Columbia if the province continues to block the pipeline. Notley has also threatened to cut off oil exports to its neighbor.
Prime Minister Justin Trudeau has repeatedly voiced his support for the project, and some of his cabinet ministers echoed that this week.
“The government is 100 percent behind this pipeline,” Natural Resources Minister Jim Carr said in Ottawa following a cabinet meeting. It’s a question of how, not whether, to support the project, Environment Minister Catherine McKenna told reporters.