Trudeau government will compensate Kinder Morgan for Trans Mountain pipeline delays

This is the strongest signal yet that the government is determined to get the pipeline built

The federal government is vowing to compensate Kinder Morgan for any kind of financial losses suffered from ongoing delays in the construction of the controversial Trans Mountain pipeline, if it decides to proceed with the project.

This is the strongest signal yet that the federal government will pull no stops in ensuring that the Trans Mountain Expansion project gets built.

Finance Minister Bill Morneau announced Wednesday that the government will not hesitate to “indemnify the Trans Mountain expansion against unnecessary delays that are politically motivated”, taking specific aim at B.C. Premier John Horgan’s opposition to getting the pipeline built.

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“A project that has been federally approved is being thwarted by the unconstitutional actions of the B.C. government,” Morneau said at a press conference. “We see this as a commercially viable project and that’s why we have been working with Kinder Morgan to remove any uncertainty that the project will get done.”

Morneau also made it clear that if Kinder Morgan made the decision to not go ahead with the Trans Mountain expansion, the indemnity would cover “any other party” interested in taking over the project.

In early April, Kinder Morgan declared that it would halt all “non-essential work” on the pipeline due to “uncertainty” created by opposition from the B.C. government, environmental and First Nations groups. The Houston-based pipeline builder said if it could not reach an agreement with various stakeholders invested in the project by May 31, it would pull out of the project entirely.

To date, the company has spent $1.1 billion on the project, that is set to cost close to $7.4 billion.

Morneau refused to elaborate on just how much the federal government was prepared to pay Kinder Morgan to go ahead with the pipeline project, and if the indemnity would continue throughout the construction of the pipeline in the scenario that ongoing protests cause more delays.

“Kinder Morgan cannot resolve differences between governments, that’s our role, and we believe it is in the best interest of Canadians to get this project built,” Morneau told reporters.

The Trudeau government approved the Trans Mountain pipeline expansion project in 2016, after an environmental assessment that ensured the project would not violate Canada’s renewed climate change and oceans protection plans. But that was under the governance of former Premier Christy Clark and B.C. Liberals who were vehemently in favour of the pipeline.

Delays in construction started to ramp up upon the election of NDP Premier John Horgan who formed a minority government with the Green Party in 2017. Anti-pipeline protests are still ongoing at Kinder Morgan’s Burnaby Terminal.