Oil Change International

Exposing the true costs of fossil fuels

Canadian Gov “Deliberately Withheld” Info on Spiralling Cost of Trans Mountain

C: Zack Embree

C: Zack Embree

The Canadian government’s controversial decision to invest in the climate-munching Trans Mountain pipeline, will cost nearly two billion Canadian dollars more and take much longer than previously expected, new documents reveal.

The new documents, filed by Kinder Morgan this week with US regulators, reveal that the cost of the pipeline could be up to C$1.9 billion ($1.5 billion) more and face a further year’s delay.

This is all bad news for Justin Trudeau, whose Government announced in March to buy the Trans Mountain assets for C$4.5 billion in order to stop the controversial project, which will triple the amount of tar sands being transported from Alberta to British Columbia, from collapsing.

This means the total costs of the project are at least $9.3 billion, with some estimates it could be much higher. It is also the third time that construction costs have been revised upward since 2013, when Kinder Morgan first estimated the cost at $5.4 billion.

It seems that Canadians are being kept in the dark by their Government over the spiralling costs, with the only disclosure coming from investor laws in the United States and Canada that require Kinder Morgan to file documents outlining the specifics of the deal.

It is not surprising that the Government’s critics are annoyed. Tzeporah Berman, Deputy Director, Stand.earth said the news about “increased construction costs and construction delays for the Trans Mountain Pipeline is another warning that the Trudeau government is willing to waste billions of taxpayer dollars on a political pipe dream. This risky project — one that even Kinder Morgan itself wouldn’t commit to building — continues to be riddled with bad news.”

And it seems that Trudeau’s Government did not make a snap decision to buy the pipeline, either. The Government secretly negotiated with Kinder Morgan for far longer than anyone thought.

According to a new report in the National Observer, “The Trudeau government made financial overtures to Texas energy giant Kinder Morgan more than a month before the pipeline operator issued an ultimatum that drove Ottawa to offer”.

The paper continues: “The secret meetings between Trudeau’s office, federal officials & Kinder Morgan took place several weeks before the prime minister publicly announced he had ‘instructed’ the finance minister to ‘initiate’ formal financial talks.”

Robyn Allan, an independent economist and expert on the pipeline, says these new revelations show that the Trudeau government kept Canadians “in the dark about the true nature of its negotiations with the Texas multinational and what it knew about the company’s Trans Mountain expansion project’s escalating costs.”

Allan believes that the estimated the pipeline and tanker expansion could wind up costing up to $20 billion to complete.

In an interview with the National Observer, Allen said: “It appears as though (the federal government) deliberately withheld information about the costs because it would have shocked Canadians at the time. If they didn’t know, they should have known.”

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