The federal government’s plan to buy a controversial pipeline project and related assets for $4.5 billion has generated local and national reactions ranging from disappointment to betrayal, according Kootenay Columbia MP Wayne Stetski.
The regional Member of Parliament spoke to the Townsman about Tuesday’s announcement from the federal Liberals, who reached an agreement with Kinder Morgan to take over the expansion of the Trans Mountain pipeline project, which involves twinning an existing pipeline that runs between Edmonton, AB, and Burnaby, B.C.
The agreement between the federal government and Kinder Morgan, which includes the existing pipeline and related infrastructure, will be finalized this summer.
Stetski accused the Liberals of walking back on their election promises to end fossil fuel subsidies and raised concerns that the overall price tag could climb much higher than $4.5 billion.
“It’s important that people realize that [the] $4.5 billion was for the 65-year-old existing pipeline,” Stetski said. “That does not have anything to do with building the new pipeline and the estimates on that are anywhere from $7 [billion] to $14 billion, assuming it proceeds.
“Of course, there are still a number of court cases pending, but in total, we’re looking at $15 —and could be as high as $20 in some cases — billion going into the old pipeline and the new pipeline.”
While the federal government is purchasing the pipeline, it does not intend to be a long-term owner and hopes to sell the project and assets to a new owner or owners in the future, according to a news release.
Kinder Morgan had issued a May 31 ultimatum for clarification on the status of the project, which is currently mired in legal challenges raised by B.C. Premier John Horgan and also facing Lower Mainland opposition with protests in Burnaby and Vancouver.
Federal cabinet ministers defended the purchase in a government press release.
“Our government believes that the commercial agreement we have reached with Kinder Morgan is the best way to protect thousands of good, well-paying jobs while delivering a solid return on investment for Canadians,” said Minister of Finance Bill Morneau. “This is an investment in Canada’s future.”
Jim Carr, the Minister of Natural Resources, echoed his colleague’s comments.
“Today’s agreement will help advance Canada as an energy leader, as a place where good projects get built,” Carr said. “This is yet another step in building an energy future with Canadians where the environment and economy go hand-in-hand.”
While the federal government has green-lit the pipeline, there has been opposition from Premier Horgan, who has taken the issue to the B.C. Court of Appeal with a constitutional reference case to argue that the province has jurisdiction to limit the flow of bitumen from Alberta into B.C.
Even though the federal Liberals are hoping to sell the pipeline project in the future, Stetski questioned the government’s role in buying it in the first place and whether it will gain a future financial return.
“So was it a wise economic and business investment? It kind of appeared that Kinder Morgan might not have thought this was such a good deal for a variety of reasons and those same concerns that Kinder Morgan had have not gone away,” Stetski said.
“The Indigenous rights concerns, the concerns over who has jurisdiction provincially or federally, so all of the concerns that were in place that Kinder Morgan was looking at…the federal government now has taken on all of that as well as spending $4.5 billion for the old pipeline, let alone the new one.”
Given the amount of money involved, Stetski said there were a number of other spending priorities the federal government should be focused on.
“Even just looking at $4.5 billion, when you look at what that money could have been used for, and everything from universal pharmacare to universal daycare…” he said.
“The auditor general just said the Liberals are $3.2 billion short in funding clean drinking water on reserves around Canada.
“You just have to shake your head, quite frankly. And when you look at where they might get the money to pay for that, and we don’t know yet exactly whether they’re just going to add to the deficit?”
Stetski also said the money could have been spent on green energy projects, or the construction of a refinery in Canada so that raw bitumen doesn’t need to be shipped overseas and jobs could be created in the country.
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