$34 billion Trans Mountain pipeline expansion starts pumping oil

By Barry Ellsworth

TRENTON, Canada (AA) – The long-awaited and expanded CAN$34 billion ($24.7 billion) Trans Mountain pipeline began pumping crude oil Wednesday to the Pacific coast for eventual shipment to countries like Japan, China and India.

Four years in construction, and plagued with ballooning costs so much so it had to be purchased by the Canadian government to keep it alive, the expanded pipeline is now capable of handling 890,000 barrels per day, up from 300,000.

The government paid $4.5 billion for the partially-constructed pipeline in an effort to get the project functional when the original owners, Kinder Morgan, bowed out due to legal challenges and frustration about protests by environmental groups.

The pipeline will now be marketed worldwide to buyers including a consortium of Canada’s Indigenous tribes, but no price tag has yet been mentioned.

In any case, the oil is now flowing 1,000 kilometers (621 miles) to Burnaby, British Columbia, on the Pacific coast from Edmonton, Alberta for transport overseas. That brought resounding cheers in a joint statement from Alberta Premier Danielle Smith and Minister of Energy and Minerals Brian Jean.

“We are excited that Canada’s biggest and newest oil pipeline in more than a decade can now bring oil from Edmonton to tidewater in B.C.,” said a statement Wednesday reported by Global News. “This will allow us to get our energy resources to Pacific markets, including Washington State and California, and Asian markets like Japan, South Korea, China and India. Alberta now has new energy customers, and tankers with Alberta oil will be unloading in China and India in the next few months.”

When and if the pipeline sells, the cheers are likely to be muted, said experts. The cost when the project began in 2018 was estimated at $10 billion, but six years later the final cost was a staggering $34 billion.​​​​​​​

The Canadian government will likely get no more than $15 billion for the sale, Chicago-based Morningstar Inc. investment research firm analyst Stephen Ellis told the Financial Post in March 2023.