Liberal government to buy Trans Mountain pipeline for $4.5B
UpdatedLiberal government to buy Trans Mountain pipeline for $4.5BThe Liberal government will buy the Trans Mountain pipeline and infrastructure related to the expansion project for $4.5 billion. Finance Minister Bill Morneau is announcing details of the plan at a news conference with Natural Resources Minister Jim Carr at the National Press Theatre, and CBCNews.ca is carrying it live now.
Finance Minister Bill Morneau announces plans to ensure pipeline expansion in Canada proceedsFinance Minister Bill Morneau announced today the government is buying the Trans Mountain pipeline for $4.5 billion. (Chris Wattie/Reuters)
The Liberal government will buy the Trans Mountain pipeline and infrastructure related to the expansion project for $4.5 billion.
Fina nce Minister Bill Morneau is announcing details of the agreement reached with Kinder Morgan at a news conference with Natural Resources Minister Jim Carr at the National Press Theatre in Ottawa, and CBCNews.ca is carrying it live now.
"Make no mistake, this is an investment in Canada's future," Morneau said.
He said the government does not intend to be a long-term owner, and at the appropriate time, the government will work with investors to transfer the project and related assets to a new owner or owners. Investors such as Indigenous groups and pension funds have already expressed interest, he said.
Until then, it will proceed under the ownership of a Crown corporation. The agreement is expected to close in August.
Morneau said the project is in the national interest, and proceeding will preserve jobs, reassure investors and get resources to world markets.
Carr said the plan does not sacrifice the environment for the economic benefits.
"Canadians want both and we can have both," he said.
Kinder Morgan issued a statement that says the deal represents the best way forward for shareholders and Canadians.
"The outcome we have reached represents the best opportunity to complete Trans Mountain Expansion Project and thereby realize the great national economic benefits promised by that project," said chairman and CEO Steve Kean.
"Our Canadian employees and contractors have worked very hard to advance the project to this critical stage, and they will now resume work in executing this important Canadian project."
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Alberta Premier Rachel Notley called it "a major step forward for all Canadians."
"This project has more certainty than ever bef ore. We won't stop until the job is done!" she tweeted.
Prime Minister Justin Trudeau also took to Twitter to praise the deal.
"Today, we've taken action to create and protect jobs in Alberta and B.C., and restart construction on the TMX pipeline expansion, a vital project in the national interest," his post says.
This morning, the Investment Industry Regulatory Organization of Canada announced a trading halt for Kinder Morgan Canada Limited because of "pending news." The IIROC can impose a temporary suspension of trading in a security of a publicly listed company to ensure "a fair and orderly market."
- Elizabeth May gets $1,500 fine after guilty plea in Kinder Morgan protest
- Crews cleaning up oil spill at Kinder Morgan station north of Kamloops, B.C.
The government had looked at three options for moving the project forward:
- Compensating Kinder Morgan â" or any other c ompany â" for financial losses caused by British Columbia's attempts to block the project.
- The federal government buys, builds and then sells the expansion once the work is complete.
- The federal government buys the project from Kinder Morgan, then puts it on the market for investors willing to pick up the project and build it themselves.
Morneau's Tuesday announcement comes just two days before a deadline set by Kinder Morgan, which had said it needed clarity on a path forward for the $7.4-billion project by May 31 or it would walk away from construction.The twinning of the 1,150 kilometre-long Trans Mountain pipeline will nearly triple its capacity to an estimated 890,000 barrels a day and increase traffic off B.C.s coast from approximately five tankers to 34 tankers a month. (CBC News)< p>The original Trans Mountain pipeline was built in 1953. The expansion would be a twinning of the existing 1,150-kilometre pipeline between Strathcona County (near Edmonton), Alberta and Burnaby, BC. It would add 980 kilometres of new pipeline and increase capacity from 300,000 barrels a day to 890,000 barrels a day.
According to the company's website, the construction and the first 20 years of expanded operations would mean a combined government revenue of $46.7 billion, with $5.7 billion for B.C., $19.4 billion for Alberta and $21.6 billion for the rest of Canada.
With files from David CochraneReport Typo or Error|Send Feedback
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