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Kinder Morgan suspending all non-essential spending on Trans Mountain pipeline expansion

Last Updated Apr 9, 2018 at 7:28 am PDT

(iStock Photo)

Kinder Morgan blaming BC government opposition for suspension

Horgan says he will continue to protect BC

Alberta, Feds urging BC to back down and let the project proceed

CALGARY (NEWS 1130) – Kinder Morgan says it is suspending all non-essential activities and related spending on the Trans Mountain pipeline expansion project.

In a Sunday news release, the company said under current circumstances, specifically the actions being taken by the BC Government, it will not commit additional shareholder resources to the project.

“As KML has repeatedly stated, we will 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,” Chairman and Chief Executive Officer Steve Kean said in the release.

“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,” added Kean.

The company says it will consult with various stakeholders in an effort to reach agreements by May 31st that may allow the project to proceed.

“Today, KML is a very good midstream energy company, with limited debt. The uncertainty as to whether we will be able to finish what we start leads us to the conclusion that we should protect the value that KML has, rather than risking billions of dollars on an outcome that is outside of our control,” Kean said.

“To date, we have spent considerable resources bringing the Project to this point and recognize the vital economic importance of the Project to Canada. Therefore, in the coming weeks we will work with stakeholders on potential ways to continue advancing the Project consistent with the two principles previously stated.”

‘Opposition on the ground’

Those who have been protesting the Trans Mountain pipeline expansion are putting this announcement in the win column.

NDP MP for Burnaby-South, Kennedy Stewart, is celebrating the decision, adding the power of the people made it happen, not the BC government.

“They’ve got it all wrong here,” says Stewart. “It’s really not the province of British Columbia, although they’ve stated their opposition and they have joined in a couple of court cases. It really has been the community opposition on the ground.”

The project isn’t dead in the water–Kinder Morgan will be consulting with various stakeholders by May 31st, to come up with a way for it to proceed. Still, Stewart is optimistic.

“I’ve been trying to tell the company for years and years that there is so much opposition to this on the ground that they will really never get it built,” he says.

“The company really did not have community consent to build this pipeline and no matter what negotiations happen over the next few weeks that consent is not going to come.”

WATCH: Premier John Horgan reacting to Kinder Morgan Canada’s decision to suspend some spending and activities on Trans Mountain pipeline expansion

Premier John Horgan says he hasn’t talked with Alberta Premier Rachel Notley — yet — but says he did speak with the CEO of Kinder Morgan.

“Ian Anderson told me that he believes that the project Kinder Morgan has been undertaking has been unnecesarily harrased by British Columbia and I told him that I disagreed.”

Horgan says he continues to disagree with the federal government and he’s well within his ability to work to defend BC’s coast.

“We were consistent from the time that the campaign started until it completed and right up to this day that our job we believe as the Government of British Columbia is to defend our water our land and most importantly our coast.”

Alberta reacts

Alberta’s Premier Rachel Notley is threatening new sanctions against BC, if the Horgan government doesn’t back down from its attempts to stop the Trans Mountain expansion.

“We will bringing forward legislation in coming days giving our government the powers it needs to impose serious economic consequences on British Columbia if its government continues on its present course.”

Notley also suggests Alberta could become directly involved in the project.

“If we have to, Alberta is prepared to whatever it takes to get this pipeline built, including taking a public position in the pipeline. Put another way, Alberta is prepared to be an investor in the pipeline.”

Notley says she spoke to Prime Minister Justin Trudeau today, but while work is happening behind the scenes, that process needs to be sped up.

Federal Liberals say there’s a lot riding on the project

Natural Resources Minster Jim Carr stood in front of Parliament Hill to send a message to the BC government to stop trying to delay the pipeline project.

“We are strongly encouraging the Government of BC to stop these indirect threats,” he says. “This is no time for any provincial government to be reckless with the financial well being of Canadians and for the fabric of the federation itself.”

Carr points “courts, including the Supreme Court of Canada have said that [the project] is federal jurisdiction”. He says they’re looking at what the options are moving forward. He wouldn’t say, however, what those options are or if they could involve the courts.

“We’re not ruling anything out,” says Carr, adding there’s a lot riding on the project.

“Because of the jobs it creates, because of the of the better prices we’ll get for our resources, because of the expansion of our exoprts markets.”

The federal government approved the pipeline in 2016 and had been trying to work with the BC and Alberta governments to end the impasse.