If Kin­der Mor­gan bails, feds would back new in­vestors: Morneau

Fi­nance min­is­ter says gov­ern­ment will ‘pro­vide in­dem­nity’

The Welland Tribune - - Canada & World -

OT­TAWA — If Kin­der Mor­gan wants to aban­don plans to ex­pand the Trans Moun­tain pipeline, there are plenty of other in­vestors will­ing to take up the cause — and the fed­eral gov­ern­ment will back them, Fi­nance Min­is­ter Bill Morneau says.

The gov­ern­ment is will­ing to “pro­vide in­dem­nity” to any in­vestors, be they the project’s orig­i­nal ar­chi­tects or oth­er­wise, to en­sure the con­tro­ver­sial Al­berta-B.C. project is able to pro­ceed, Morneau told a news con­fer­ence Wed­nes­day.

The an­nounce­ment, com­ing on the very day when the com­pany’s Cal­gary-based Cana­dian op­er­a­tion is sched­uled to hold its an­nual meet­ing, bore the hall­marks of an ef­fort to ratchet up the pres­sure in ad­vance of Kin­der Mor­gan’s May 31 dead­line.

Amid mount­ing op­po­si­tion from the B.C. gov­ern­ment, en­vi­ron­men­tal groups and pro­test­ers, not to men­tion skit­tish in­vestors, the com­pany last month halted all non-es­sen­tial spend­ing on its $7.4-bil­lion plan to dou­ble an ex­ist­ing pipeline be­tween Edmonton and Burn­aby, B.C.

“We are will­ing to in­dem­nify the Trans Moun­tain ex­pan­sion against un­nec­es­sary de­lays that are po­lit­i­cally mo­ti­vated,” Morneau said — a ref­er­ence to B.C. Pre­mier John Hor­gan’s on­go­ing re­fusal to al­low the project to pro­ceed, de­spite fed­eral ju­ris­dic­tion.

“If Kin­der Mor­gan is not in­ter­ested in build­ing the project — we think plenty of in­vestors would be in­ter­ested in tak­ing on this project, es­pe­cially know­ing that the fed­eral gov­ern­ment be­lieves it is in the best in­ter­est of Cana­di­ans and is will­ing to in­dem­nify to make sure it gets built.”

He said in­vestors need cer­tainty in or­der to back a project that the gov­ern­ment has re­peat­edly in­sisted is in the na­tional in­ter­est, but stead­fastly re­fused to say what sort of dol­lar fig­ures are cur­rently on the ta­ble.

Morneau did not di­rectly an­swer when he was asked how other in­vestors or com­pa­nies might take over a project to ex­pand an ex­ist­ing pipeline that al­ready has an owner.

“This pipeline that Kin­der Mor­gan cur­rently has, the Trans Moun­tain pipeline, has been there since 1953, so we see that the twin­ning of that pipeline is one of the most ef­fec­tive ways to get our re­sources to mar­ket re­spon­si­bly,” he said.

“We see a path to an out­come that will as­sure that we can get the ad­van­tage that we’re seek­ing; that’s why those dis­cus­sions are on­go­ing. We do know that in or­der to make sure that we have that path, we need to deal with the ex­traor­di­nary risks that have been pre­sented by Pre­mier Hor­gan.”

Steve Kean, Kin­der Mor­gan Canada’s chair and CEO, re­it­er­ated the com­pany’s po­si­tion.

“We re­main stead­fast in our pre­vi­ously stated prin­ci­ples: clar­ity on the path for­ward, par­tic­u­larly with re­spect to the abil­ity to con­struct through Bri­tish Columbia, and en­sur­ing ad­e­quate pro­tec­tion of our KML share­hold­ers,” Kean said.

“While dis­cus­sions are on­go­ing, we are not yet in align­ment and will not ne­go­ti­ate in pub­lic.”

Morneau’s talks with Kin­der Mor­gan had their ge­n­e­sis a month ago, when Trudeau promised to de­ploy both fi­nan­cial and leg­isla­tive tools to en­sure the ex­pan­sion is able to pro­ceed.

Trudeau con­vened a sum­mit in Ot­tawa last month with B.C.’s John Hor­gan, who has staked his gov­ern­ment’s sur­vival on op­pos­ing the pipeline, and Al­berta Pre­mier Rachel Not­ley, whose province’s eco­nomic health de­pends on it.

Trudeau in­structed Morneau to sit down with Kin­der Mor­gan to find a fi­nan­cial so­lu­tion that would soothe their in­vestors. He also promised leg­is­la­tion that would reaf­firm Ot­tawa’s au­thor­ity to press ahead with a de­vel­op­ment deemed to be in Canada’s na­tional in­ter­est.

PA­TRICK DOYLE THE CANA­DIAN PRESS

Fi­nance Min­is­ter Bill Morneau leaves a press con­fer­ence af­ter speak­ing about the Trans Moun­tain Ex­pan­sion project in Ot­tawa on Wed­nes­day.

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