The Government of Canada has reached a commercial agreement with Kinder Morgan in order to secure the timely completion of the Trans Mountain Expansion Project.
Federal loan guarantees will ensure that construction continues through the summer construction season.
In addition, the Government of Canada has reached an agreement with Kinder Morgan to purchase the company’s Trans Mountain Expansion Project and related pipeline and terminal assets for $4.5 billion. The transaction is expected to close in August 2018.
According to the federal government and a statement by Kinder Morgan, this investment represents a fair price for Canadians and for shareholders of the company.
The federal government will allow the project to proceed under the ownership of a Crown corporation.
It is not, however, the intention of the Government of Canada to be a long-term owner of this project. At the appropriate time, Canada will work with investors to transfer the project and related assets to a new owner or owners.
The Government will extend federal indemnity to protect any prospective new owner from costs associated with politically motivated delays.
The province of Alberta will also contribute to get the project built. Alberta’s contribution would act as an emergency fund and would only come into play if required due to unforeseen circumstances. In return, Alberta will receive value commensurate to their contribution, through equity or profit-sharing.
- The Trans Mountain Expansion Project involves building a new pipeline along the existing Trans Mountain Pipeline running from Edmonton, Alberta to Burnaby, British Columbia, and expanding the capacity of the terminal in Burnaby.
- This expansion will increase daily capacity from 300,000 to 890,000 barrels, while improving market access to the US Pacific Coast and Northeast Asia.
- In the course of the federal review of the project, the Government consulted 117 potentially affected Indigenous rights holders for four additional months, marking the deepest federal consultations ever done on a major project.
- Backgrounder: Details of Agreement for the Completion of the Trans Mountain Expansion Project
- Kinder Morgan statement
- Read the full government release here.
- Read the speech by the Honourable Bill Morneau, Minister of Finance.
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