Feds paid on high end for Trans Mountain pipeline, spending watchdog says
Posted January 31, 2019 7:25 am.
This article is more than 5 years old.
OTTAWA — Canada’s parliamentary budget watchdog says the Liberal government paid the “sticker price” when it bought the Trans Mountain pipeline from Kinder Morgan for $4.5 billion.
Parliamentary Budget Officer Yves Giroux estimates the Trans Mountain pipeline and planned expansion project are worth between $3.6 billion and $4.6 billion.
This means government’s purchase price of $4.5 billion was on the high end of the project’s total calculated value.
Giroux also estimates expanding the pipeline’s capacity will cost $9.3 billion if the project is completed by Dec. 31, 2021.
He warns any construction delays or increases in costs would reduce the value of the project and its resale value, meaning the government could have overpaid for the pipeline.
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The government bought the pipeline from Kinder Morgan in August after political opposition to expanding the pipeline between Alberta and the B.C. coast gave the company and its investors cold feet.
Meanwhile, Conservative Leader Andrew Scheer says he’s not surprised by the report.
“Once again taxpayers are paying for Trudeau’s mistakes,” he says. “He still doesn’t have a plan to get the pipeline actually built.”
Scheer adds Trudeau proved himself to be a terrible negotiator when dealing with U.S. President Donald Trump.
He says that despite the purchase, the expansion project is still uncertain.
“So here we are, at the beginning of the new year, and still there is no certainty, no finality as to a path forward.”
