'I hope this works,' Sask. premier says of Trans Mountain deal

Wednesday, 30 May, 2018

Kinder Morgan set the deadline in part due to frustrations with delays caused by the British Columbia government, which is concerned about possible oil spills. She also invoked other pipeline projects that have faced opposition, such as TransCanada's Energy East pipeline project that was cancelled past year.

The federal government can in theory step in and disallow any provincial laws that British Columbia might use to block the pipeline, but this provision in the Canadian constitution has not been used since the 1940s. It does not intend to own the project for long.

Until now, Trudeau's government has used a soft tone to try to convince British Columbia to abandon its opposition to the pipeline, hoping not to alienate voters in the province before next year's general election.

Under the agreement between the federal government and Kinder Morgan, the company would resume construction on the project, which was put on hold in April.

"It's a mess out there", said a Calgary industry source not authorized to speak publicly.

But for Justin Trudeau's Liberal government, the Trans Mountain expansion represented a historic compromise: Alberta would sign onto Ottawa's climate change agenda; in return the federal government would guarantee the province a new pipeline to get tar-sands bitumen to market.

"To investors considering Canada as a place to build big, important, transformative projects like the Trans Mountain expansion, we want you to know that you have a partner in Ottawa", Morneau said. If Alberta simply upgraded what it sent through the Trans Mountain pipeline into oil, the existing pipeline's capacity, as well as that of all other pipelines that service the oil sands, could be boosted by a third. "Why would we agree to a project that went through the worst environmental review in the history of time, which Bill Morneau referred to as the 'most rigorous process in our history, ' " said May.

Kean did not say why he chose to sell rather than absorb the risk of further delays. "We're now dealing with our own government". "I think that is what has happened here". It's actually better for Kinder Morgan than it is for Canada.

Access to new oil markets was also key to Canada meeting its Paris climate target because Alberta, the nation's singled largest pollution emitter, agreed to take action against carbon emissions, if it gained access to new markets for its oil.

Canada's federal government said Tuesday it is buying a controversial pipeline from the Alberta oil sands to the Pacific Coast to ensure it gets built.

But he said the situation should never have reached a point where nationalization was required and it is critical that Trans Mountain ultimately ends up back in the hands of a private company.

Alberta Premier Rachel Notley, who's been locked in an escalating battle with Horgan over his opposition and has passed a bill threatening to cut off oil and gas shipments to British Columbia, struck a triumphant tone at a press conference in Edmonton. The contribution will convert into equity in the pipeline.

On Tuesday, B.C. Premier John Horgan vowed to continue to fight the pipeline in court.