There is no guarantee that Houston-based Kinder Morgan will agree to continue work on its controversial Trans Mountain pipeline expansion, even after Ottawa offered a taxpayer bailout for the project, Natural Resources Minister Jim Carr told CBC’s The House on Friday.
“There’s no certainty in these things,” Carr said. “Pipeline politics, as you know, are not straight.”
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Finance Minister Bill Morneau recently offered to compensate Kinder or any other pipeline backer for financial losses due to delays in completing the project. “We will make the case that the risk has been dealt with,” Carr said, but “I believe that the British Columbia government has added layers of uncertainty to the project.”
With the deadline on Kinder Morgan’s ultimatum coming up this Thursday, May 31, SumOfUs was out with a sign-on aimed at members of the Canadian Pension Plan Investment Board. After Morneau said Canadian pension funds might stand in as alternate investors if Kinder abandons the C$7.4-billion project, CPPIB Chair Mark Machin said he’d consider it.
“As with any responsible investment, it is imperative that you do your due diligence and thoroughly interrogate this investment from a financial and business perspective, and make that analysis public so Canadians know their retirement savings are responsibly and safely invested,” SumOfUs counters in its open letter. Given that Machin has also “pledged to step up the assessment of global climate change risks to make better investment decisions,” the organization adds, “it seems not in the CPP’s interest—or the interest of Canadians—to invest in this project.”
Morneau was scheduled to address the Calgary Chamber of Commerce May 30, federal NDP leader Jagmeet Singh called on the Trudeau government to put an end to fossil fuel subsidies, and Greenpeace Co-Executive Director Jennifer Morgan said it’s “irresponsible” of Trudeau to try to protect Kinder from the financial consequences of its project investments.
“We’re here for the long haul, we’re working with allies, and we’re not going to go away,” Morgan told National Observer. “I think you will see continued peaceful, civil disobedience. You will see continued educating, not only of people in Canada but people around the world, of what is at stake, and the opportunity for the prime minister to do the right thing, particularly before the G7 arrives here in Canada.”
Meanwhile, Moody’s Investor Services warned the Alberta economy will take a hit if the pipeline project fails.
“Overall, the dispute is credit negative for the Province of Alberta,” stated a Moody’s report issued Thursday. “The project’s cancellation would represent a potentially significant loss in revenue, increase its energy transportation costs, and diminish future energy infrastructure investment and oil development at a time when the province is already forecasting a prolonged period of deficits and rapidly rising debt.”
Moody’s noted that Alberta is counting on $10.5 billion in royalties from Trans Mountain and Enbridge’s Line 3 pipeline over the next five years, and speculated that a cancellation could affect investors’ view of the proposed Keystone XL pipeline.
“It would be the third major pipeline project failure in Alberta following the cancellation of Enbridge’s Northern Gateway project in 2016 (following federal objection) and TransCanada’s Energy East pipeline project in 2017 (following regulatory hurdles and political pressure),” Moody’s analysts wrote. “In our view, a lack of successfully completed cross-border pipeline projects could ultimately impact TransCanada’s decision whether to proceed with the Keystone XL project.”
In related news Thursday, Fisheries Minister Dominic LeBlanc and Environment Minister Catherine McKenna released a finding under the federal Species At Risk Act (SARA) that the Southern Resident killer whales off the British Columbia coast “face an imminent threat to both survival and recovery”. Pointing to a lack of prey as one factor, LeBlanc announced eight projects worth $9.5 million to restore Chinook salmon habitats and rehabilitate vulnerable coastlines.
“Southern Resident killer whales need our help in order to survive and recover,” LeBlanc said. “Our government is taking immediate steps today to protect Southern Resident Killer Whales and their prey, and we will take additional and ongoing action as needed to support their long-term recovery,” McKenna added.
In 2017, the Raincoast Conservation Foundation and Living Oceans Society went to court against the Kinder Morgan pipeline, arguing that the project was more than 50% likely to put the Southern Resident whales on a path to extinction in the next century. “We have repeatedly said that Cabinet based its approval of this project on an unlawful National Energy Board report that failed to apply the Species at Risk Act and mitigate impacts on Southern Resident killer whales,” Ecojustice lawyer Dyna Tuytel said at the time. “This chain of flawed decision-making almost guarantees the extinction of this already endangered population. We need the court to send this unlawful approval back to Cabinet with instructions that it must meet all of the legal requirements, which includes addressing the risks to Southern Resident killer whales.”
Late last week, Tuytel took a victory lap in an email asking supporters to thank LeBlanc and McKenna for their announcement and urge them to issue an emergency order under SARA to protect the whales.