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Promises, promises on TMX; Trudeau makes third commitment
Gary Park for Petroleum News
Heard this one before?
Canadian Prime Minister Justin Trudeau says he wants the Trans Mountain pipeline expansion, TMX, completed as “quickly as possible,” though the project has no chance of coming online before mid-2022.
It’s the third time he has made the pledge, but his circumstances have been drastically altered since the first two promises, with the federal election on Oct. 21 removing his ability to control TMX, despite the government being the outright owner of the facility.
Trudeau is now dependent on the socialist New Democrats and Greens to provide enough votes to ensure the passage of any related legislation through the House of Commons, although analysts doubt that either of those parties would be eager to topple the Liberal administration and force another election at a time when neither has the money, or desire to run an early campaign.
He said it will “take all Canadians sticking together (to solve economic challenges such as TMX), helping out folks who are struggling in places like Alberta and Saskatchewan.”
What bolsters the Liberals confidence is the likelihood that the major opposition Conservatives would vote with them to ensure that TMX proceeds.
TMX piece of puzzle While that shuffling of the political cards continues, Finance Minister Bill Morneau has taken an unusually bold stand by insisting the Liberals will not allow TMX to become fodder for negotiating trade-off deals with the minority parties.
Instead he said TMX is a crucial piece of the puzzle to finance Canada’s transition to a clean energy economy and could contribute up to C$500 million a year on efforts to lower greenhouse gas emissions.
“We purchased (the existing Trans Mountain and the expansion) for a reason,” Morneau said. “We think it is the best way we can move forward (on energy transition).”
The Liberals paid C$4.5 billion for the Trans Mountain pipeline of 300,000 barrels per day which came into service in the 1950s and is faced with providing another C$10 billion or more for the 590,000 bpd expansion.
Morneau said the Liberals have “much common ground” with the other parties that have been elected to the next Parliament and are now ready to seek consensus on a range of issues.
Opposition from Greens That view isn’t shared by Green leader Elizabeth May, who had only three of its members elected to the House of Commons, which has 338 elected members.
She urged NDP leader Jagmeet Singh, whose 25 Members of Parliament give Trudeau a clear majority to make TMX a condition for cooperating with the Liberals, despite Morneau’s comments.
May said that if Singh works deals with the Trudeau administration he would be exposed as “insincere” in his opposition to upgrading the pipeline and his call for Canada to accelerate the elimination of fossil fuel development.
Since the election Singh has only hinted it is probably too late to use TMX to draw a line in the sand.
May said the Greens will not support the Liberals in confidence votes unless Trudeau does more to curb greenhouse gas emissions, arguing those levels should be cut by 60% over the next decade - double the current goal - as part of a move to net zero emissions by 2050.
Preliminary work Construction of TMX was halted in September 2018 when the Federal Court of Appeal overturned government approval of the expansion, citing insufficient consultations on environmental and indigenous issues.
The Trudeau cabinet undertook new rounds of talks and approved the expansion for a second time in June.
Preliminary work resumed in August, starting with stockpiling sections of pipeline along the route and groundbreaking for marine terminals in British Columbia and pumping stations in Alberta, while the first 30 miles of laying pipeline will soon start in the Edmonton area after 2,200 workers were hired.
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