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Canadian Government to Buy Contested Oil Sands Pipeline

Quebecers gathered to protest the Kinder Morgan Trans Mountain pipeline in Montreal on Sunday

Alberta premier Rachel Notley, whose government recently passed legislation allowing the province to restrict oil shipments, said on Twitter that the deal "puts people to work building the pipeline right away and it will help us build up the things that matter to working families, such as our schools and our hospitals".

The government's move effectively nationalises the project in a bid to quash dozens of legal challenges and protests at construction sites.

"To guarantee the summer construction season for the workers who are counting on it, and to ensure the project is built to completion in a timely fashion, the federal government has reached an agreement with Kinder Morgan to purchase the existing Trans Mountain pipeline, and the infrastructure related to the Trans Mountain expansion project", Morneau told reporters in Ottawa.

What all this shows is the abject failure of Trudeau's and Notley's superficial and absurd belief that imposing a national carbon price on Canadians would give them the "social licence" to build the Trans Mountain pipeline, with the blessings of B.C.'s anti-oil government, Indigenous objectors and radical environmentalists.

The deal for the bulk of the Canadian subsidiary of Texas-based Kinder Morgan Sale proceeds are about $12 per share after capital gains taxes, he said.

But before Tuesday's announcement, Ottawa has done little to advance the project.

Canada's oil sector has been stung in the past year as foreign energy companies retreated amid concerns about the environmental toll, high production costs and a risky regulatory regime.

The Alberta government will provide funding for any unexpected costs that arise during construction. The pipeline's expansion had been facing a May 31 deadline - imposed by Kinder Morgan - to solve the impasse between Alberta and British Columbia hampering the project's progress.

Amid the feud, the pipeline has become a barometer for foreign investments in Canada, with some warning of a spillover into other sectors of the economy. "Though it is an unequivocal statement of support to getting oil to tidewater and for the pipeline". "They want to see this pipeline completed". They are led by British Columbia, which is trying to stop the pipeline development in the courts on environmental grounds.

"We invested in Hibernia, for example", he said.

His Liberals face a hard balancing act in trying to champion climate action while supporting growth in Canada's oil sector.

What's more, a poll in April found that a growing number and a majority of British Columbians actually support the pipeline project.

"This move sets a awful precedent and signals to other prospective investors that large projects such as pipelines can not be built by private industry in Canada", said Aaron Wudrick, federal director of the Canadian Taxpayers Federation, a right-leaning group that advocates for lower taxes.

"This is a betrayal by a government who ran on a hopeful vision for a better future", said Andrew Weaver, the B.C. Green Party Leader. Two new pipelines were built to the United States under former prime minister Stephen Harper: TransCanada's Keystone pipeline to Nebraska (not to be confused with Keystone XL), and Enbridge's Alberta Clipper to Wisconsin.

Vancouver Mayor Gregor Robertson called the pipeline an "unacceptable risk" that threatens 10,000 jobs in the harbour.

Pressed about why the federal government's $4.5-billion price tag was so much lower than Kinder Morgan's stated $7.4-billion project value, Morneau said Ottawa was purchasing all the relevant assets - but he avoided saying whether construction would increase costs.