Author Topic: Federal Goverment's Kinder Morgan pipeline purchase  (Read 21109 times)

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Offline SeaKingTacco

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #25 on: May 29, 2018, 23:26:58 »
Notwithstanding your thinly disguised and all too predictable personal attack on the PM, what do you think the Government should have done?

How about not vilifying the oil industry for the past two years?

How about not squibbing two other pipeline projects (Energy East and Northern Gateway)?

How about not walking around babbling about "social license" and instead, upholding the rule of law?

Most (but not all) First Nations on the Transmountain route are onboard. Want make it politically unpalatable for the pipeline opponents to oppose the project? Make the First Nations in question equity partners in the deal.

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #26 on: May 30, 2018, 01:22:19 »
There's a widely held belief in BC that environmentalists have been a driving force in FN poverty. The irony of having FN on board the KM project would be epic!
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Offline daftandbarmy

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #27 on: May 30, 2018, 08:54:16 »
There's a widely held belief in BC that environmentalists have been a driving force in FN poverty. The irony of having FN on board the KM project would be epic!

Fortunately, we don't hear too much about this First Nations led effort to save BC & Canada from itself:

First Nations pipeline has a plan to get around B.C. oil tanker ban — an old gold-rush town in Alaska
http://business.financialpost.com/commodities/energy/first-nations-pipeline-has-a-plan-to-get-around-b-c-oil-tanker-ban-an-old-gold-rush-town-in-alaska
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Offline Oldgateboatdriver

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #28 on: May 30, 2018, 09:08:10 »

In fact this is, arguably, the least bad course of action open ... but this government ended up in a corner because of their own ill considered political choices in 2015, 2016 and 2017 as they tried to appease too many constituencies at the expense of the national interest.

Sort of doing the right (at least not terribly wrong) for all the wrong reasons ...

Quite right, E.R.C.

For me, this is just the Federal Liberals yet again using billions of taxpayer dollars to get themselves out of a corner into which they willfully painted themselves to start with. If it ever manages to pay for itself and make us money, I'll gladly eat my words - but nothing in the way Governments have run what are basically business interests in the past gives me the warm and fuzzier at this point.


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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #29 on: May 30, 2018, 10:04:06 »
Just so I understand the situation... we bought a pipeline at the same time as we have a tanker ban before parliament?
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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #30 on: May 30, 2018, 10:38:38 »
Both sides could have done better, the CPC made massive changes to legislation with little consultations and not a lot of thought into the wording, making the decisions based on them, worthy of court challenges. Had they done a bit less and consulted more, there would have been less ground for opponents to stand on. The Liberals campaigned on how they were going to "protect the environment" and reverse those legislative changes, yet are fully supporting a project reviewed and approved under those changes, so massive hypocrite be them. Beyond the protests, thee are some legit concerns, mainly getting tankers through the 2 narrows and under the rail lift span, which is already a problem area for intermodel conflicts, soon to be made worse by Saudi owned G3 grain terminals. The current pipeline provides 40% of the feedstock for the main refinery, hopefully they can push through more feedstock and refined product, reducing our dependency on the US refineries.     

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Offline Brad Sallows

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #32 on: May 30, 2018, 19:26:39 »
The BC NDP also painted themselves into a corner.  Opposing the pipeline is the "win" they are trying to preserve for the no-compromise environmentalists in general and the Greens in particular, after having given over some "losses" - site C dam go-ahead, bridge toll removals, support for natural gas infrastructure.

At both levels (fed and prov), purely political concerns drove the early moves which positioned the parties where they are now.  Not much "rational", "evidence-driven", "reality-based" technocracy at work.  Just "what-must-I-do-today-to-drift-with-the-wind".

Conservatives are having their cake and eating it on this one.  Support for the government undertaking to get the pipeline built; criticism for the government reducing its options to nationalization.

The government can turn a profit on this, but only if it operates the pipeline as a crown corporation for long enough.  I can't see any other party stepping up to buy it until all the legal uncertainties have been removed, and I can't believe that will be true until well after the deal is complete and construction is continuing.
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Offline Altair

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #33 on: May 30, 2018, 20:31:09 »
Before this week it has been "protect our jobs! "

This week "not like that! "
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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #34 on: May 30, 2018, 20:49:10 »
Before this week it has been "protect our jobs! "

This week "not like that! "

What protected jobs? Last I saw the pipeline is still under legal challenge and locked down by protesters flaunting court orders. The only way to truly get the pipeline built was invoking Sect 92(10) of the British North America Act. The Liberal government has failed to do that, and has now saddled us with a $4.5B CAD project in which the government should only have a hand in approving, not running.

Nobody is buying the spin, this is a bad deal for Canada. Its the Gas Plant scandal times at least 4.5.

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #35 on: May 30, 2018, 20:59:26 »
But it is a no-Wyn situation.

Offline Jarnhamar

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #36 on: May 30, 2018, 21:00:17 »
Why don't they deploy a bunch of cops in riot gear and arrest the law breakers?
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Offline Altair

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #37 on: May 30, 2018, 21:11:06 »
What protected jobs? Last I saw the pipeline is still under legal challenge and locked down by protesters flaunting court orders. The only way to truly get the pipeline built was invoking Sect 92(10) of the British North America Act. The Liberal government has failed to do that, and has now saddled us with a $4.5B CAD project in which the government should only have a hand in approving, not running.

Nobody is buying the spin, this is a bad deal for Canada. Its the Gas Plant scandal times at least 4.5.
Spin. Heh.

Everyone would have been up in arms had this pipeline died,  people accused the liberal government of wanting it to die,  the government outright buys the the darn thing,  and now they are doing a bad deal.

Its amazing.  They will never win,  its amazing that they try.
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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #38 on: May 30, 2018, 21:18:01 »
Spin. Heh.

Everyone would have been up in arms had this pipeline died,  people accused the liberal government of wanting it to die,  the government outright buys the the darn thing,  and now they are doing a bad deal.

Its amazing.  They will never win,  its amazing that they try.

I think your judgement is clouded. In what world is a government owned pipeline good? How's all that government owned oil working for Venezuela? You even said months ago the easy solution was for 92(10) to be used and it would solve all these problems. Instead, the federal government now owns a political and financially risky billion dollar pipeline with legislation from their own party pushing for an oil tanker ban on the area for the outlet of said pipeline.

If Trudeau had used 92(10) months ago, I would have told you that it was a good call and we could move on with our day. In buying the pipeline, he tried to straddle the perfect middle road: delaying conflict with the environmentalists he courts for votes, and placating the party faithful that will claim he's moving an important economic project forward. I just can't wait for the Question Period where this whole mess is somehow the Harper government's fault.

Offline Altair

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #39 on: May 30, 2018, 21:40:40 »
Is it good?  No.

Is it the disaster people are making it out to be?  No.
Someday I'll care about milpoints.

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #40 on: May 30, 2018, 21:46:46 »
Is it good?  No.

Is it the disaster people are making it out to be?  No.

Not yet.  Maybe never, maybe it will be.  Too soon to call, not that it really matters as we've bought the cow now.

Offline Altair

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #41 on: May 30, 2018, 21:52:35 »
Not yet.  Maybe never, maybe it will be.  Too soon to call, not that it really matters as we've bought the cow now.
exactly. Nobody knows how this will turn out.

Could be the a great investment,  could be a multi billion dollar boondoggle,  I said that in my first post.

A lot seem to be taking the latter position.  I really didn't expect anything else. At least people can't say they are trying their best to kill it. They own it.
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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #42 on: May 30, 2018, 22:13:36 »
exactly. Nobody knows how this will turn out.

Could be the a great investment,  could be a multi billion dollar boondoggle,  I said that in my first post.

A lot seem to be taking the latter position.  I really didn't expect anything else. At least people can't say they are trying their best to kill it. They own it.

I would have wished it hadn't been nationalised as these affairs rarely come out well for the taxpayer.  But we've bought the cow now, hopfully her udders won't be dry or the milk sour.

Offline Remius

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #43 on: May 31, 2018, 07:47:12 »
I would have wished it hadn't been nationalised as these affairs rarely come out well for the taxpayer.  But we've bought the cow now, hopfully her udders won't be dry or the milk sour.

The national post shows a few of these types of things. 

http://nationalpost.com/news/politics/a-short-look-at-the-governments-long-history-of-investing-in-troubled-projects

Most of these actually turned out ok.

If the goal is to make sure it gets up and running and the government plans to let it go after then fine, let it happen. Just glad to see some sort of action on this.


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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #44 on: May 31, 2018, 08:32:16 »
There is a fairly long and, generally, favourable history of the sorts of public private partnerships (PPPs) that involve the public paying the up front capital costs to build, just for example, the Hong Kong and Singapore mass transit railway systems (subways) which are, arguably, the best in the world and infinitely superior in quality of service and profitability* to anything I have seen anywhere in Europe or America.

There is no way that the Hong Kong MTR could have been financed and built by the private sector ~ the land use issues alone would have made that impossible: public money and government power was needed (and used) to build the first lines. Once the system was up and running it was "sold" (at a fairly modest public offering) to a new, publicly traded company which, immediately sold shares on the HKX. Today the MTR Corp is one of the most important "widows and orphans" (safe) stocks and forms part of the base of almost every HK pension plan investment portfolio because it is well managed and consistently profitable.

As a general rule large infrastructure projects can be built by anyone, including governments, but managing an "enterprise" is, almost without fail, done 'better' by a private firm than by a government. The general rules of management and accounting that apply to public sector are designed, in large part, to ensure efficient, effective, transparent (to shareholders) operations; the same rules are not used, for very good reasons, by government where other drivers ~ beyond efficiency and productivity ~ are often most important.

If, and it's a HUGE IF, the feds can find suitable Canadian buyers for 'our' pipeline, ideally before they have to spend the $4.5 Billion that they're giving to KM ($1.2 B over appraised value I think I read somewhere?) and the guesstimated $7.5 Billion needed for the expansion, then we might see both a much needed pipeline expansion and a bit of a financial surplus ... if.

There are no economic reasons why this cannot work ... but there may be good reasons for Canadian entrepreneurs and investors to want nothing to do with this: fear of government actions. Look at Energy East, look at the fact that we are, simultaneously, expanding a pipeline to get (mostly) Alberta oil to tidewater and restricting tanker traffic in and out of Vancouver; why would a Canadian investor trust this government to make things work? Would you?

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #45 on: May 31, 2018, 08:44:36 »
So, if I have this right, the taxpayer builds the pipeline. Then, this government can sell it to recoup their costs.

Ì wonder if the PM has any friends that want to expand their oil business and then play monopoly with our supplies.

Ì wonder, if some opec country will buy it and shut off the taps in their own interest.

Why does this smell like the governments foray into PetroCan?
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Offline daftandbarmy

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #46 on: May 31, 2018, 09:09:58 »

Why does this smell like the governments foray into PetroCan?

Because his Dad created PetroCan?
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Offline Chris Pook

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #47 on: May 31, 2018, 10:11:13 »
Because his Dad created PetroCan?

From Petro Fina - which engaged his Grandad and in which his Grandma held shares?
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Offline Colin P

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #48 on: May 31, 2018, 10:29:22 »
I think your judgement is clouded. In what world is a government owned pipeline good? How's all that government owned oil working for Venezuela? You even said months ago the easy solution was for 92(10) to be used and it would solve all these problems. Instead, the federal government now owns a political and financially risky billion dollar pipeline with legislation from their own party pushing for an oil tanker ban on the area for the outlet of said pipeline.

If Trudeau had used 92(10) months ago, I would have told you that it was a good call and we could move on with our day. In buying the pipeline, he tried to straddle the perfect middle road: delaying conflict with the environmentalists he courts for votes, and placating the party faithful that will claim he's moving an important economic project forward. I just can't wait for the Question Period where this whole mess is somehow the Harper government's fault.

Not the same, Venezuela nationalized with little payout for the infrastructure and started milking the industry for every dime to pay off their friends, eventually it collapsed. Owning a pipeline, does not meaning owning the product moving through it, the product owners pay the pipeline owner to move product through the pipe. It's unclear why Canada proposes to buy the existing pipe, unless Kinder Morgan sensed an opportunity to squeeze the government by saying "both or nothing" which I am guessing is what happened. The Libs are in such a pickle they took the offer instead of walking. It's also not clear how Canada intends to manage the existing pipe or oversee the construction of the new one. I suspect they have to form a Crown Corporation in a hurry to run it. All the contracts KM had, now need to be renegotiated and if Canada runs the pipeline directly, then a whole hosts of federal regulations kick in. Plus Canada will have to try to take over the existing IBA's with the FN's who may want to tack on more demands. Plus it means if there is a spill, Canada is on the hook for the cleanup and to pay out the losses of the product owners and since we are "self-insured" that means you and me.     

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Re: Federal Goverment's Kinder Morgan pipeline purchase
« Reply #49 on: May 31, 2018, 11:01:21 »
Fortunately, we don't hear too much about this First Nations led effort to save BC & Canada from itself:

First Nations pipeline has a plan to get around B.C. oil tanker ban — an old gold-rush town in Alaska
http://business.financialpost.com/commodities/energy/first-nations-pipeline-has-a-plan-to-get-around-b-c-oil-tanker-ban-an-old-gold-rush-town-in-alaska

Going "right flanking".   

Over, under, around or through. 
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