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Canadian Government ready to offer aid to ensure Trans Mountain pipeline capacity is expanded

16 April 2018

On April 15, Canadian Prime Minister Justin Trudeau said his government has the authority to ensure the new Trans Mountain oil pipeline is built and will take the financial and legislative actions needed to make it happen. This follows pipeline operator Kinder Morgan saying it would pull out of the project unless it received concrete assurances before May 31 that the expanded line would get built.

Pipeline route - Image: Trans Mountain
Pipeline route - Image: Trans Mountain

"I have instructed the minister of finance to initiate formal financial discussions with the result of which will be to remove the uncertainty overhanging the Trans Mountain pipeline expansion project," Trudeau said after meeting with Alberta Premier Rachel Notley and British Columbia Premier John Horgan in Ottawa.

The existing Trans Mountain pipeline links Edmonton in Alberta to Burnaby in British Columbia and has a capacity of 300,000 barrels a day. The new project envisages a second pipeline running parallel to the first, transporting diluted bitumen from the Albertan tar sands with a capacity of 600,000 barrels a day. The 980 kilometre pipeline would require an investment of C$7.4bn ($5.9 bn).

Trudeau told reporters the new line was a vital strategic interest to Canada.

Kinder Morgan said it would not comment on Trudeau’s remarks “until we’ve reached a sufficiently definitive agreement on or before May 31 that satisfies our objectives.”

Many in the energy industry are concerned about whether quarrels over jurisdiction and increasingly vehement protests mean any new pipelines can be built in Canada, which sits on the world’s third-largest proven reserves of crude and is the single largest exporter of energy to the United States.

Although Alberta wants to see the expansion take place, there is much opposition in British Columbia where environmentalists and First Nation activists frequently demonstrate at Trans Mountain facilities. BC police have arrested about 200 people since mid-March.

The BC Government says ocean protection measures are inadequate, and opposes the new project for this reason. After the meeting in Ottawa, Horgan said he had not changed his position that the risks of a spill from the pipeline were too great.

Horgan also said he would ask the courts in British Columbia to make clear how much powers the province had to protect the provincial environment. Federal officials complain this is a time-wasting tactic.

Prime Minister Trudeau said that his government had spent $1.5 billion to increase responsiveness and resilience along the West Coast but suggested Horgan has been less than cooperative in the past in this area.

"Unfortunately over the course of almost a year they have not specifically put forward proposals on how they would like to see us improve the oceans protection plan," Trudeau said, adding that, "it's something we very much are open to doing." 

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