Troubled Canada pipeline no longer profitable: budget watchdog

Publish June 23, 2022
oil and gas

Ottawa – The controversial Trans Mountain pipeline expansion project, now under construction in western Canada after being nationalized, is no longer profitable as costs have spiralled, Parliament’s budget watchdog said Wednesday.

In a report, the office of the Parliamentary Budget Officer said a review of the project’s finances found “that the government’s 2018 decision to acquire, expand, operate, and eventually divest of the Trans Mountain assets will result in a net loss for the federal government.”

Ottawa purchased the pipeline for Can$4.4 billion (US$3.4 billion) from Kinder Morgan four years ago to salvage the troubled expansion project.

But its current value, the PBO estimated, is only Can$3.9 billion, after construction costs soared to $21.4 billion and its completion was pushed one year to late 2023.

The negative valuation is based on the pipeline’s future cash flows over 40 years, minus construction costs.

The project is to replace an aging conduit built in 1953 to deliver 890,000 barrels of oil a day from landlocked Alberta to the Pacific coast for shipping to new markets in Asia and elsewhere.

Prior to the government taking over the project, it had been stalled by legal challenges and protests by Indigenous groups and environmental activists.

iraqinews

Latest Stories

President Al-Mashat visits first conference for development of public finances

2021-09-20 06:00:00

SANA'A, Sep. 19 (Saba) – President of the Supreme Political Council Mahdi Al-Mashat visited on Sunday the first conference"...
Read More

Hospital in Sana'a launches free medical week

2021-09-12 03:00:00

SANA'A, Sep. 11 (Saba) - September 26 Hospital Authority in Bani Matar dstrict of Sana'a province launched on Saturday a"...
Read More

Yemeni restaurant opening in Newport: What you need to know

2021-09-09 06:00:00

NEWPORT is set to be home to what is calling itself the city’s “first Yemeni restaurant.”

Located"...
Read More

Yemen Socio-Economic Update, Issue 59 - April 2021

2021-08-09 04:00:00
The impact of War.. The role of Women in Building Peace.. Required Interventions The Editorial Since the escalation of conflict and war, women in Yemen can said to be the most affected group in the society. These conditions have imposed a new reality on women and re-determined their roles and lifestyles,......
Read More