Federal government will purchase Trans Mountain pipeline for $4.5B

Federal government will purchase Trans Mountain pipeline for $4.5B

Federal government will purchase Trans Mountain pipeline for $4.5B

The federal government seeks to buy Texas-based Kinder Morgan's Trans Mountain pipeline for C$4.5bn in order to develop the controversial Trans Mountain expansion, which would connect oil reserves in BC to Alberta, the home base of Canada's oil industry.

Kinder Morgan Canada Ltd. CEO Steve Kean said the deal is "a great day for Canada" and why wouldn't he?

Morneau presented the options during an early-morning cabinet meeting today before ministers made a decision to approve the project.

"My expectation is that the outrage is going to grow and we're not just going it see it here in British Columbia but we're going to see it nationally and internationally", she said, adding social media makes it possible for activists to connect in ways that didn't exist at the height of anti-logging protests in 1993.

Morneau criticized the New Democratic Party (NDP) government in British Columbia for creating "political uncertainty" and making it hard for Kinder Morgan to proceed with the project.

Kinder Morgan had investors and earnings calls and a stock price to watch as well as limited funds and tight timelines.

Several First Nations have alleged in court that Trudeau's approval of the project was not legal since the government failed in its constitutional duty to consult them.

Gwyn Morgan, former CEO of Encana, joins BNN Bloomberg to provide perspective on Ottawa's decision to buy Trans Mountain. "We must put in place the environment where people can come in, in a very clear, stable political environment that they're willing to invest in provinces like Newfoundland and Labrador", said Ball.

"We continue to engage in financial discussions on the way we are going to do that", he said.

In April, Kinder Morgan suspended non-essential spending on the project. "We support improving market access to ensure Canada achieves fair recognition and full value for its energy resources".

Next, taxpayers are on the hook for the cost of twinning the project - an estimated $7.4 billion and climbing.

The $4.5-billion purchase price does not cover the construction costs of building the new pipeline, however; Morneau refused to say what that cost may be. He says the government is showing leadership and sending a signal to the worldwide community that "it can rely on Canada to get things done".

Kinder Morgan had set a Thursday deadline to gain certainty over the project or abandon it altogether.

This given the court challenges to stop the pipeline by B.C. Premier John Horgan's NDP government and Indigenous opponents, along with protests by environmental radicals who want to kill it at all costs.

Canada approved the project in November 2016, following an expanded environmental review process that included additional consultations with Indigenous communities and assessing the amount of additional emissions likely to result from additional production.

While Prime Minister Justin Trudeau and Alberta Premier Rachel Notley have been adamant that the project is good for the entire country, B.C. Premier Joe Horgan and indigenous groups in B.C. have been opposed to the project for months.

Every time Canada ships 400,000 barrels of raw bitumen overseas, it exports approximately 19,000 refining and upgrading jobs - every year - to other nations.

The company will continue to hold an integrated network of crude tank storage and rail terminals in Alberta.

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