A day after making the blockbuster announcement that the federal government would purchase the Trans Mountain pipeline and expansion project, Canada's finance minister touched down in the heart of the energy sector to tout the move.
In its IPO documents from May 2017, Kinder Morgan Canada said it expected that when the expansion was operational in 2020 it would be able to collect tolls of between $5 to $7 per barrel (US$4 to $6 per barrel) sending oil from Edmonton to various delivery points.
All of that made Kinder Morgan more than willing to walk away, putting intense pressure on the Canadian government to resolve the dispute.
Speaking to reporters in Vancouver, Premier John Horgan said the federal government's offer to take over the pipeline from Kinder Morgan doesn't change his government's position and it will proceed with its reference case to the B.C. Court of Appeal.
Leo de Bever, former chief executive of Alberta Investment Management Corp. and now chairman of Nauticol Energy, told BNN Bloomberg on Tuesday that governments all over the world are involved in infrastructure projects and Canada's purchase is no different.
Around $6.2 billion of the roughly $7.4 billion total construction costs (increased from $6.8 billion a year ago after the federal approval of the pipeline with 157 conditions imposed by the government) were still remaining to be spent as of March 31, 2017. "There is more work to do, but we will not stop until the job is done". The move ended weeks of speculation sparked by Kinder Morgan's threat to abandon a project facing "unquantifiable risk" as the British Columbia government vowed to use every tool to block it.
"We'll be listened to potential bidders in the near term to ascertain whether that will provide us with financial certainty. and a financial deal that's appropriate for Canadians".
"This is a bad day for British Columbia, because John Horgan has chose to kick the feds in the shins and now they're coming back with our tax dollars to fix the problem", he said. "We get value out from money in and that's why we think this is a good opportunity".
"We think that today's announcement is based on extraordinary circumstances", Tim McMillan, CEO of the Canadian Association of Petroleum Producers, said in a press conference Tuesday.
Premier Scott Moe has been a vocal backer of the project.
"Instead, the Liberals want to buy a 65-year old pipeline for $4.5 billion that endangers the future of Victoria and the south coast of B.C".
"We expect that we'll have other groups that will emerge, I'm not in a position right now to talk about who those groups are or who they might be", he said.
This is why attacks like this from the Conservative party are so important moving forward. That is not who we are, â said Carr. "But, this is an attempt to say, look, this thing has to be built, it's in the national interest for it to be built", de Bever said.
"The Trans Mountain Expansion faces even steeper obstacles and will soon become the third, and Trudeau just put the public on the hook for the costs", Hudema said.
Canada approved the project in November 2016, following an expanded environmental review process that included additional consultations with Indigenous communities and assessing the amount of additional emissions likely to result from additional production.