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Calling a controversial pipeline expansion "a vital project in the national interest", Canadian Prime Minister Justin Trudeau says his government is buying the Trans Mountain pipeline to ensure that the expansion is built, despite protests from environmentalists and other groups.

Pressed about why the federal government's $4.5-billion price tag was so much lower than Kinder Morgan's stated $7.4-billion project value, Morneau said Ottawa was purchasing all the relevant assets - but he avoided saying whether construction would increase costs.

Kinder Morgan last month gave Ottawa an ultimatum: Chairman Steve Kean said the company would suspend all work on the expansion project entirely if the legal issues surrounding it can not be resolved by May 31, adding that it would not continue risking shareholder funds on the project unless the clouds over it clear.

"We invested in Hibernia, for example", he said.

"B.C.is doing all the right things" said May.

Morneau said more spending would be needed to complete the expansion, but gave no precise financial details, and stressed he felt the project should be returned to the private sector.

The deal ensures construction that was suspended April 8 by Kinder Morgan's jittery investors will now begin immediately under the ownership of a Crown corporation, with plans for the federal government to seek other investors to soon take it over.

The pipeline purchase would also transfer to the federal government all of the people involved in building the expansion, including project managers and construction workers. "Every year they have to spend more on maintenance to keep it running", added Allan.

Morneau presented the purchase options during an early-morning cabinet meeting Tuesday before ministers signed off on the chosen option, which comes just days before the company's self-imposed May 31 deadline and is still subject to the approval of Kinder Morgan shareholders.

It takes a third of a barrel of imported light oil to move one barrel of bitumen through a pipeline.

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Wall now serves as a special advisor for Osler, Hoskin & Harcourt LLP, which represented Kinder Morgan in its initial National Energy Board application to expand Trans Mountain.

Trudeau also spoke with BC Premier John Horgan following today's pipeline decision.

The project, which is expected to cost $7.4 billion to build, would triple capacity of a pipeline traveling from the oilsands of Alberta to the coast of British Columbia but has been beset by political and environmental opposition.

The purchase will be financed by Export Development Canada and includes; the pipeline, pumping stations, the marine terminal in Burnaby, B.C. and rights of way along the pipeline between Edmonton and Vancouver.

"A decision has not yet been made on the best way to make use of the cash from the transaction", Kinder Morgan CEO Steve Kean said on a conference call announcing the sale.

Moe wants to know how the federal government, in partnership with Alberta, owning the project will change the B.C. government's continued opposition to the project.

"Our government is determined to defend British Columbia's interests within the rule of law and in the courts", said Horgan.

Currently, 99 percent of Canada's oil is sold to the United States at a discount, and access to the Pacific coast is seen as key to diversifying the world's sixth-largest oil producer's energy exports.

The only studies that say the Trans Mountain pipeline will make money for the Canadian economy are reports paid for by Kinder Morgan.

"Canada stands to sacrifice its worldwide reputation, irreplaceable iconic species like the Southern resident Killer Whales, and its commitments to meet its Paris Climate targets and to reconcile with Indigenous people - all while putting enormous risk on Canadian taxpayers".


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