Government floating risk assurance measures as solution to Trans Mountain feud

The federal government is prepared to consider assuming some of the financial risks as a solution to the Trans Mountain pipeline expansion feud.

Kinder Morgan issued an ultimatum saying it would cease all non-essential spending on the project

Minister of Natural Resources Jim Carr speaks about the recent status of the Kinder Morgan pipeline expansion in Ottawa on Sunday, April 8, 2018. (Patrick Doyle/Canadian Press)
Listen9:25

The federal government is prepared to consider assuming some of the financial risks as a solution to the Trans Mountain pipeline expansion feud.

Kinder Morgan issued an ultimatum on Sunday, saying the company would cease all non-essential spending on the project until it gets more clarity from the provinces and federal government.

The company cited the province's stalling tactics for the uncertainty that has shrouded the progress of the $7.4- billion expansion.

The company also gave a deadline of May 31, saying it couldn't see a way forward for the project if clarity isn't reached by then.  

"I think that we're prepared to look at all reasonable options," Natural Resources Minister Jim Carr told The House on Friday.

"The government of Canada is saying, 'We'll look at de-risking the project so there's more certainty.'"

We explore the issues surrounding the Trans Mountain pipeline expansion with Natural Resources Minister Jim Carr. 9:25

An emergency cabinet meeting was held earlier this week, as ministers and Prime Minister Justin Trudeau have vowed for months that this project would be built — though no one has answered exactly how that would happen.

Providing a guarantee that Ottawa would cover for some potential losses could be one of the tactics on the table, according to Carr.

Earlier this week, the minister said that a federal investment in the Trans Mountain pipeline was one of the other possibilities.

Those two options aren't guaranteed actions, however, but are two tactics being considered along with other legal and regulatory manoeuvres.

Carr said investor confidence is key to Canada's economy, and channels need to remain open to U.S. and Asian markets.

"Delay means cost and cost means uncertainty."

Compromise may not please all stakeholders

The opposition from the B.C. government has been focused on protecting the coast and looking at the potential environmental impacts of the project.

Carr cited as a preventative measure the federal government's new Oceans Protection Plan, which earmarks $1.5 billion for defending Canada's ocean coastlines to protect killer whales, guard against oil spills and enable trade.

But Premier Horgan has remained immovable — despite the fact that the federal government holds ultimate constitutional authority over the pipeline.

"There are those out there who are, at this point, calling this moment we are in a constitutional crisis for the country," Notley said. "And I don't know really if that's too far off."

She has also said her province is willing to shoulder some or all of the financial risk, and is considering investing in the pipeline project. She said the federal government should think about doing the same.

"With good will and a genuine search for common ground, I guess we should be somewhat hopeful something good will happen, but it depends on how entrenched and how dug in people are and to what extent they're prepared to move," Carr said.

A compromise could be reached Sunday but universal satisfaction seems unlikely.

The results of the meeting could face staunch opposition from the B.C. Green Party, which supported Horgan on his road to the premiership.

Andrew Weaver, B.C.'s Green Party leader, told The House that if Horgan agrees to a compromise that allows the pipeline to go ahead, he'll fight that decision.

"We can never support any measures or any government that would allow diluted bitumen to flow in our coastal waters. Period," he said.

"Everyone has a line in the sand. Diluted bitumen is ours."

We explore the issues surrounding the Trans Mountain pipeline expansion with B.C. Green Party leader Andrew Weaver 7:28

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