Kinder Morgan to sell shares to fund Trans Mountain pipeline project
Kinder Morgan Canada has announced that it will be selling $200mn worth of shares to raise the necessary funds to continue the construction of its Trans Mountain pipeline expansion.
This will see a total of 8mn shares old at $25 per share, with all proceeds to go directly to funding the completion of the pipeline project and Base Line Terminal project that has an expected total cost of $7.4bn.
The shares will be purchased by a syndicate of companies that includes CIBC Capital Markets, Scotiabank and TD Securities.
The project has suffered several setbacks in recent times, with Kinder Morgan most recently having revealed that delays could extend beyond September 2020.
Further, the company is still currently waiting on regulatory approval from the National Energy Board – something that is preventing the company from continuing with full scale production.
"We're not going to do that unless we're clear that we can finish what we start,” said Steve Kean, Chairman and CEO of Kinder Morgan, said at an investor conference held in New York.
The pipeline currently acts as the lone outlet for Canada’s pacific oil markets. With a current capacity of 300,000 barrels per day (bpd), the project expansion should see this almost double to 590,000bpd once complete.