On Tuesday, Federal Finance Minister Bill Morneau announced the $4.5-billion purchase of the Kinder Morgan assets at the Trans Mountain pipeline project.
Kinder Morgan Canada Ltd. CEO Steve Kean said the deal is "a great day for Canada" and why wouldn't he?
Finance Minister Bill Morneau has proposed sacrificing Canadian taxpayers to bail out an uneconomic US pipeline owned by former Enron executives.
"We would desperately hope this is not the model of how future projects get done", Chris Bloomer, president and chief executive officer of the Canadian Energy Pipeline Association, said in a phone interview, adding that he is nonetheless pleased that the project can now go ahead. But if one isn't found by July 22, Kinder Morgan's stake in the pipeline would be bought out by the Canadian government, which would proceed with the expansion, whose cost has been estimated at about $5.7 billion.
Although he said the deal is to ensure the pipeline is built, Finance Minister Bill Morneau says Ottawa doesn't intend to be the pipeline's long-term owner, with plans to sell the project once it's done.
The pipeline connects oil sands facilities near Edmonton, Alberta, to tanks in Burnaby, near Vancouver on Canada's west coast.
"Pipeline capacity issues are cooling oil producers' appetite for new investment and drilling was also slightly down in the last winter season", the report continued. He says he would have liked to see them exhaust all other options first. It is expected to close in August 2018, with Kinder Morgan retaining control of the pipeline and its assets until then.
"It's an outrageous and reckless decision by the Canadian government". Kinder Morgan makes about $200 million a year from selling space in the existing pipeline to oil companies to ship their product.
There are parties interested in the pipeline, including Indigenous communities and pension funds, Morneau said, but his officials acknowledged it may be hard to find a buyer amid lingering uncertainty until after the pipeline is actually built. We will do our part to support this happening.
Calgary-based pollster Janet Brown said the premier should be careful not to be seen celebrating prematurely on a file - and a provincial economy - that has been bedevilled by swings and setbacks. To do so, Canada will pay the pipeline's current owner, Kinder Morgan, $4.5 billion in Canadian dollars - about $3.5 billion in USA currency.
"Today symbolizes the end of Canada being held hostage by environmental terrorists and finally we can have confidence that shovels will be getting into the ground soon and that our oil will be exposed to worldwide prices".
The pipeline has faced a number of legal and regulatory challenges from the BC government that has delayed construction of the project, which was approved by the federal government in 2016.
According to Hudema, the movement opposing the project " will not back down" following the government's purchase.
Eric Nuttall, senior portfolio manager at Ninepoint Partners, reacts to the federal government's announcement that it will be buying the controversial Trans Mountain pipeline from Kinder Morgan Canada.
The main opposition Conservative party is becoming more competitive in polls, and even took the lead in one Nanos Research survey released on Tuesday, which showed Conservatives at 36 percent public support and the Liberals at 33 percent.