Trudeau ready to offer financial backing to Trans Mountain Pipeline
Canadian Prime Minister Justin Trudeau has pledged financial support to Kinder Morgan to ensure that the construction of its Trans Mountain Pipeline project continues.
The project has been significantly delayed, with the government of British Columbia most recently having impeded the pipeline expansion on environmental grounds.
In the wake of this, Kinder Morgan threatened to pack in the project altogether, with the Canadian government and Justin Trudeau having stepped in to ensure its continuation.
“I have instructed the Minister of Finance [Bill Morneau] to initiate formal financial discussions with Kinder Morgan, the result of which will be to remove the uncertainty overhanging the Trans Mountain pipeline expansion project,” Trudeau said.
“The Trans Mountain expansion is a vital strategic interest to Canada. It will be built.”
The financial backing has been offered for a number of reasons, namely to reinvoke investor confidence in the success of the project, as well as the material benefits that the project will offer with the pipeline expansion expected to triple capacity from Alberta to British Columbia.
The Canadian energy industry has seen an increasing level of uncertainty in recent times, with the opposition facing Kinder Morgan’s Trans Mountain Pipeline not being an isolated incident.
In October of last year, TransMountain abandoned plans to create its Energy East Pipeline, largely due to a stricter review process having been implemented by the National Energy Board for such projects.
TransCanada took a $1bn financial hit as a result of the abandoned project.