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Kinder Morgan approaches pension funds to finance its $6.8 billion Trans Mountain pipeline

Vancouver-based Council of Canadians organizer AJ Klein at the mobilization against the Trans Mountain pipeline on Burnaby Mountain, November 2014.

Texas-based Kinder Morgan has reportedly approached the Canada Pension Plan (CPP), the Ontario Teachers Pension Plan (OTPP), and the Caisse de dépôt et placement du Québec (CDPQ) to help finance its $6.8 billion Trans Mountain tar sands pipeline.

Reuters reports, “Kinder Morgan Inc. has begun talks with institutional investors including major Canadian pension funds and private equity firms to raise capital for the $6.8 billion expansion of its Trans Mountain pipeline project, according to people familiar with the process. Kinder Morgan has held discussions with Canada Pension Plan Investment Board, the Caisse de dépôt et placement du Québec and Ontario Teachers’ Pension Plan Board, three of the biggest Canadian pension funds, the people added. It was unclear whether talks with the three pension funds were still ongoing.”

The article adds, “Kinder Morgan has hired Toronto Dominion Bank as an adviser to help arrange financing for the project and the bank is expected to run a so-called ‘dual-track’ process. Apart from a potential IPO, Kinder Morgan is also considering a sale of a 50 per cent stake in Trans Mountain by creating a joint venture. The formal process to attract joint venture partners is getting underway, the people said.”

The Trudeau government approved the proposed expansion of the 1,150 kilometre Alberta-British Columbia pipeline on November 29, 2016. The expansion would create a twinned pipeline increasing the nominal capacity of the system from 300,000 barrels per day to 890,000 barrels per day.

The pipeline would carry diluted bitumen from the tar sands through the iconic Jasper National Park in Alberta, into the Lower Mainland of British Columbia, across the Vedder Fan aquifer and the municipality of Chilliwack’s protected groundwater zone, then across the Fraser River and to the Westridge Marine Terminal at Burrard Inlet for export on 400 supertankers a year.

It has recently been confirmed that the pipeline has spilled six times along its 158 kilometre route through Jasper National Park since 1954, including one spill about 140 metres from the Athabasca River in 1973.

Overall, the pipeline would cross 1309 water courses in Alberta and British Columbia. It would also enable a continued expansion of the tar sands in northern Alberta and produce between 20 to 26 megatonnes of carbon pollution a year.

Two-thirds of the 120 First Nations along the pipeline route have not given their free, prior and informed consent for the pipeline.

One of those First Nations is the Coldwater Indian Band, which is situated about 90 kilometres south of Kamloops. They have filed a judicial review challenge of the Trudeau government’s approval of the pipeline. Metro News has reported, “The First Nation raised its concerns about the proximity of the Trans Mountain route to its aquifer, upon which 90 per cent of the nearly 800 residents depend for drinking water.”

The Council of Canadians has been opposing the Trans Mountain pipeline since August 2011 by participating in marches, protests and civil disobedience actions, supporting chapter activism, petitions and a court action, writing blogs, and organizing numerous public events and a six-community speaking tour.

Kinder Morgan says it will start construction on the pipeline this September.