The Trans Mountain Pipeline construction project is going to need more taxpayer cash, says Blacklock’s Reporter..According to documents, more cash is needed despite the project being less than half finished..Cabinet to date has not detailed the total costs of the pipeline bought by the Liberals three years ago for $4.5 billion..“Further financing sources will be required by Trans Mountain,” said a first quarter report by the Canada Development Investment Corporation, the Crown agency overseeing pipeline management..The report said Trans Mountain “is in discussion with the Department of Finance in this regard.”.Costs of expanding the pipeline from Edmonton to Burnaby, B.C. were originally estimated at $7.5 billion, but expenses “increased significantly,” said the report..“Work is underway in various phases along the majority of the route and the project construction is approximately 25% complete..“Trans Mountain Corporation is targeting a mechanical completion date for a majority of the project by the end of 2022.”.Tolls from oil shippers using the existing line declined in the first quarter of the year..“We recorded a loss before income taxes for the three-month period ending March 31 of $17 million compared to profit before tax of $18 million in the comparative period, primarily due to a $30 million decrease in operating income of Trans Mountain Corporation due to lower transportation revenue and higher pipeline operating costs, and higher net interest expense of Trans Mountain Pipeline finance by $3 million in the period,” said the report..The Development Corporation in an earlier memo said there “continues to be a risk of cost escalation” with Trans Mountain..An Access To Information report by analysts with Anderson & Associates warned of “significant risks” associated with the project..“The majority of the residual risk is associated with social risk, that is, public acceptance of the project,” it said..Cabinet has dismissed repeated requests from MPs for a detailed accounting of what the entire project will cost taxpayers..“It didn’t have to be an investment in Canadian taxpayer dollars,” Conservative MP Jamie Schmale (Haliburton-Kawartha Lakes, Ont.) told a 2019 hearing of the Commons natural resources committee..“It could have been private sector dollars that didn’t cost taxpayers a cent.”.“What is the limit the federal government is willing to put out?” New Democrat MP Peter Julian (New Westminster-Burnaby, B.C.) told a 2020 hearing of the Commons finance committee..“Is it $20 billion? Is it $25 billion? Or is the sky the limit?”.The Department of Finance in a Feb. 3, 2020 submission to the finance committee acknowledged cost overruns were unavoidable..“Costs tend to go up over time,” testified Evelyn Dancey, associate assistant deputy minister of finance..“I would not be surprised if that’s the direction.”
