Kinder Morgan halts Trans Mountain pipeline expansion amid B.C. opposition
Kinder Morgan Canada Limited (KML) has suspended all “non-essential activities and related spending” on the expansion of its Trans Mountain pipeline, the company said in a Sunday news release.
The release said that the company will “not commit additional shareholder resources” to the project in light of “continued actions in opposition to the project” by B.C.’s provincial government.
Kinder Morgan said it would consult with stakeholders with a view to reaching agreements by May 31 that “may allow the project to proceed.”
WATCH: B.C. Premier John Horgan responds to Kinder Morgan’s decision
It’s looking for clarity on the ability of the expansion to be built through B.C., and for protection of shareholders.
Speaking to reporters on Sunday, B.C. Premier John Horgan said he spoke with both Prime Minister Justin Trudeau and KML president Ian Anderson.
“Mr. Anderson told me he believes that the project Kinder Morgan has been undertaking has been unnecessarily harassed by British Columbia, and I told him that I disagreed,” Horgan said.
“We were consistent from the time the campaign started until it completed, right up to this day, that our job, we believe, of the Government of British Columbia is to defend our water, our lands and, most importantly, our coast.”
Coverage of the Trans Mountain pipeline on Globalnews.ca:
In a statement, Kinder Morgan chairman and CEO Steve Kean said the company wants to be “judicious in our use of shareholder funds.”
“In keeping with that commitment, we have determined that in the current environment, we will not put KML shareholders at risk on the remaining project spend,” he said.
“A company cannot resolve differences between governments. While we have succeeded in all legal challenges to date, a company cannot litigate its way to an in-service pipeline amidst jurisdictional differences between governments.”
WATCH: B.C.’s delays on Trans Mountain harm Canada’s economy: Notley
In the release, Kinder Morgan said the project is facing “unquantifiable risk” as B.C. has asserted “broad jurisdiction” and indicated that it would use its jurisdiction to stop the expansion.
“B.C.’s intention in that regard has been neither validated nor quashed, and the province has continued to threaten unspecified additional actions to prevent project success.”
Kean said if an agreement can’t be reached by May 31, then “it is difficult to conceive of any scenario in which we would proceed with the project.”
In a statement, federal Natural Resource Minister Jim Carr to “end all threats of delay to the Trans Mountain expansion.”
“His government’s actions stand to harm the entire Canadian economy,” Carr said.
“At a time of great global trade uncertainty, the importance of Canada’s role in the global energy market is bigger than individual projects and provinces.”
Carr went on to say that the federal government has a responsibility to ensure that the Canadian economy grows and remains stable, and that B.C. shares in the responsibility to ensure Canada’s resources reach the market.
Alberta Premier Rachel Notley had strong words for B.C. — and for Canada — in a news conference on Sunday afternoon.
“Federal approval of this project must be worth more than the paper it is printed on,” she said.
Notley went on to say, “Premier [John] Horgan believes he can harass this project without economic consequences for B.C.
“There, he is wrong.”
Notley said her government would bring forward legislation that would give Alberta the tools it needs to “impose economic consequence on British Columbia if the government continues on its present course.”
She did not get into specifics.
Notley also accused Horgan of believing he can harass the managers and investors behind the pipeline expansion.
“There, he is wrong as well.
“Maybe the government of B.C. thinks they can mess with Texas. Let me be absolutely clear: they cannot mess with Alberta.”
“If we have to, Alberta is prepared to do whatever it takes to get this pipeline built, including taking a public position in this pipeline,” she said. “To put another way, Alberta is prepared to be an investor in the pipeline.”
Watch: ‘They cannot mess with Alberta’: Notley on BC delays on pipeline
Alberta opposition leader Jason Kenney called Kinder Morgan’s decision “devastating but predictable.”
“If we can’t get this pipeline built, it proves that Canada is broken,” he said.
Kenney accused the federal government of standing by “passively” as the BC NDP has “kept true to their promise to do everything in their power to stop this project.”
Even after the project was approved according to the “highest environmental standards,” he said.
Watch: Jason Kenney supports Alberta taking an equity position in pipeline
Supporters of the pipeline expansion say some tough talks could be coming.
“Canada loses in so many ways if this project isn’t finished,” said Stewart Muir, executive director of Resource Works Canada.
Naysayers feel they’ve been proven right by the latest news.
“This looks like recognition by Kinder Morgan that the legal, scientific and social backing is not there,” said Jay Ritchlin, director general of B.C. and the western region at the David Suzuki Foundation.
WATCH: Kinder Morgan slams the breaks on spending
In a statement, Greenpeace spokesperson Mike Hudema said:
“The writing is on the wall and even Kinder Morgan can read it.
“Investors should note that the opposition to this project is strong, deep and gets bigger by the day.
“We encourage Kinder Morgan to shelve this project before the litany of lawsuits, crumbling economics, and the growing resistance does it for them.”
The Independent Contractors and Businesses Association of B.C. says the Canadian economy hangs on the future of the pipeline.
Association President Chris Gardner is calling on the federal government to step in.
“They’ve approved it, the responsibility is on them to sit down with B.C. and make sure this project moves forward,” he said.
“If this project is cancelled, the message is you can’t build a major pipeline in this country. That would be a very sorry state of affairs, it would be tragic for our economy.”
“If you’re an investor looking at B.C. and Canada as a place to do business, and invest in energy projects, you’re probably going to give that [a] second thought and say ‘it’s not worth it, there are other countries open for business, there are other countries that would welcome this investment,'” said Gardner.
With files from Janet Brown
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