The controversial Trans Mountain pipeline system in western Canada will not be profitable for the Canadian government, according to a new report on the financial value of the project, released Wednesday by the Parliamentary Budget Officer (DPB).
“The government's 2018 decision to acquire, expand, operate and then divest the assets of the Trans Mountain Pipeline System will result in a net loss to the federal government,” concluded the PBO, whose mandate is to provide independent economic and financial analysis for Canadian parliamentarians.
Long called for by Alberta's oil industry but decried by environmentalists and Indigenous communities in neighboring British Columbia, the Trans Mountain pipeline expansion has caused an uproar in recent years.
The project involves doubling the line of the pipeline to triple the capacity to transport oil between the Alberta oil sands and the Pacific coast for export purposes, in order to serve Asian markets in particular.
Convinced of the “national interest” of this project first proposed by the private sector, the government of Justin Trudeau had bought it four years ago, for 4.4 billion Canadian dollars, provoking an outcry at environmental groups.
But due to “increased construction costs and a delayed in-service date” of the pipeline, Trans Mountain now has an estimated value of $3.9 billion. dollars, according to this new PBO report.
As early as February, state-owned Trans Mountain announced that the costs of expanding the pipeline, which will cross the Rocky Mountains, had skyrocketed by 70%, from 12.6 to 21.4 billion Canadian dollars (15.64 billion euros).
In his report, the Parliamentary Budget Officer evokes the hypothesis of a cancellation of the project, whose work has already started.
“In such a scenario, the government would have to write off assets worth more than 14 billion dollars”, can we read there, which “would entail considerable financial losses” for the Canadian government.
Katrine Johns has been a reporter on the news desk since 2013. Before that she wrote about young adolescence and family dynamics for Styles and was the legal affairs correspondent for the Metro desk. Before joining The Gal Post, Katrine Johns worked as a staff writer at the Village Voice and a freelancer for Newsday, The Wall Street Journal, GQ and Mirabella. To get in touch, contact me through my email@example.com 1-800-268-7128