Bill Morneau, who remains Minister of Finance, arrives for a swearing in ceremony at Rideau Hall in Ottawa, on Wednesday, Nov. 20, 2019. THE CANADIAN PRESS/Justin Tang

Bill Morneau, who remains Minister of Finance, arrives for a swearing in ceremony at Rideau Hall in Ottawa, on Wednesday, Nov. 20, 2019. THE CANADIAN PRESS/Justin Tang

Feds won’t explain claim pipeline expansion will raise $500M in tax revenue

Ottawa bought the pipeline for $4.5 billion in 2018

The federal government says the Trans Mountain pipeline expansion will bring another $500 million a year in corporate tax revenue to be spent on fighting climate change, but the Liberals won’t say where they got that number.

The figure was cited by the government when it approved the project a second time last June and was also included in the Liberals’ campaign platform.

In 2018, the government stepped in to buy the existing pipeline between Alberta and the B.C. coast from Kinder Morgan Canada for $4.5 billion. The company and its investors got cold feet about proceeding as political opposition to the pipeline threatened unending delays, so Ottawa bought it. The government intends to see through the expansion and then sell it back to the private sector.

Under heavy criticism from environmentalists for pushing a major pipeline project at the same time as they’ve insisted on the need to slash greenhouse-gas emissions, the Liberals promised any new revenue from the expansion project, including corporate taxes, will be spent only on climate-change mitigation. That includes natural solutions like tree planting and clean technology projects.

Matthew Barnes, a spokesperson for Finance Minister Bill Morneau, said in an email Monday the $500-million figure was a “Finance Canada estimate based on the additional corporate tax revenue that the federal government could receive from the successful completion and operation of TMX.”

British Columbia-based economist Robyn Allan, who is skeptical about the benefits of the expansion project, said she has not been able to get the government to explain the figure for months and is accusing the government of obstructing the information because the analysis won’t hold up to scrutiny.

“If they can’t tell you how it was derived it really begs the question if there is any substance to it at all,” she said.

She is also demanding the government tell Canadians what the expansion is going to cost to build. The last estimate was $7.4 billion but that figure is now several years old and hasn’t been updated since the federal government bought the pipeline.

The existing Trans Mountain pipeline carries about 300,000 barrels a day of crude oil and related products from Edmonton to a terminal in Burnaby, B.C. The expansion project is to build a second, roughly parallel, pipeline to nearly triple the system’s total capacity. The expanded pipeline is primarily to carry diluted bitumen to be loaded on oil tankers for export.

The government’s hope is if Canada can get more oil to coastal ports, new buyers in Asia will step in, reducing Canada’s reliance on the United States as an oil customer and increasing the price Canadian producers can get.

It is the linchpin in Prime Minister Justin Trudeau’s attempt to continue to benefit from Canadian natural resources while fighting climate change. Alberta is angry the pipeline hasn’t yet been built, and blames Trudeau’s regulations and climate policies for the delays on Trans Mountain and the lack of other new pipelines as well.

Climate activists argue the pipeline works against Canada’s promised reductions in greenhouse-gas emissions.

READ MORE: B.C. First Nations drop out of court challenge, sign deals with Trans Mountain

READ MORE: Trans Mountain received $320M in government subsidies in first half 2019: report

Mia Rabson, The Canadian Press


Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

FILE – British Columbia provincial health officer Dr. Bonnie Henry wears a face mask as she views the Murals of Gratitude exhibition in Vancouver, on Friday, July 3, 2020. THE CANADIAN PRESS/Darryl Dyck
Masks now mandatory in all public indoor and retail spaces in B.C.

Many retailers and businesses had voiced their frustration with a lack of mask mandate before

Island Health’s acting medical health officer for the central Island says schools are very safe, even after COVID-19 exposure at five schools in Nanaimo-Ladysmith this month. (File photo)
Nanaimo-Ladysmith and Qualicum superintendents ask Island Health about COVID-19 safety at schools

Central Island medical health officer answers questions parents have been asking

North Cowichan/Duncan RCMP have ruled out fouled play in the death of a woman in Chemainus. (Black Press file photo)
No foul play in death of woman in Chemainus

Police officers make determination after an investigation

Divers gear up at Kin Beach for venture to extract large industrial tires from the waters of Chemainus Bay. (Photo by Kathleen Fenner)
CFB Esquimalt’s Fleet Diving Unit members remove large tires submerged in Chemainus Bay for years

Environmental concerns and deadly hazard for crabs finally alleviated

Kyle Charles poses for a photo in Edmonton on Friday, Nov. 20, 2020. Marvel Entertainment, the biggest comic book publisher in the world, hired the 34-year-old First Nations illustrator as one of the artists involved in Marvel Voice: Indigenous Voices #1 in August. THE CANADIAN PRESS/Jason Franson
VIDEO: Indigenous illustrator of new Marvel comic hopes Aboriginal women feel inspired

Kyle Charles says Indigenous women around the world have reached out

Bank of Montreal, located on Burrard Street in downtown Vancouver. (Google Maps)
Heiltsuk man files human rights complaint against Vancouver police, BMO after bank arrest

Pair remains distraught after employee falsely reports fraud in progress leading to their arrest

RCMP Cpl. Cory Lepine pictured at BC Livestock Producers Co. in Kamloops, Nov. 16. (Phil McLachlan - Black Press Media)
Meet B.C.’s only cowboy cop; a voice for the livestock industry

Cpl. Cory Lepine serves as a bridge between the law and those who make a living off the land

BCHL
BCHL pushes back season start due to provincial health orders

The delay is minimal, just six days, for now. But the league is open to starting up after Christmas

Prime Minister Justin Trudeau speak to the media about the COVID-19 virus outside Rideau Cottage in Ottawa, Friday, Nov. 20, 2020. THE CANADIAN PRESS/Adrian Wyld
Long-awaited federal rent subsidy program for businesses hurt by COVID-19 opens today

The new program will cover up to 65 per cent of rent or commercial mortgage interest

Join Black Press Media and Do Some Good
Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

An Oceana Canada audit of Canadian fish stocks reveals a growing number with critical populations, calling on Fisheries and Oceans Canada to enact existing commitments. (File photo)
B.C.’s declining fisheries the result of poor DFO management: audit

Oceana Canada calls for follow through on government commitments

Most Read