Alberta premier says willing to buy Trans Mountain pipeline

By Julie Gordon

VANCOUVER (Reuters) – The Canadian province of Alberta is willing to purchase the Trans Mountain pipeline outright should Kinder Morgan (NYSE:) Canada Ltd walk away from its planned expansion of the line, Premier Rachel Notley said on Tuesday.

Texas-based Kinder Morgan said on Sunday it would scrap plans to nearly triple the capacity of its existing Trans Mountain pipeline, which extends from Alberta to British Columbia’s coast, unless various legal and jurisdictional challenges could be resolved by May 31.

“We are considering a number of financial options to ensure that the Trans Mountain expansion is built, up to and including purchasing the pipeline outright if it was to come to that,” Premier Rachel Notley said in a statement provided to Reuters.

Notley was not immediately available to clarify whether she was referring to both the existing pipeline operations and the C$7.4 billion ($5.9 billion) expansion project or just the expansion.

She had previously said the province would consider taking an equity stake in the expansion, and that her government was examining all options to provide financial support to ensure the project gets built.

The Trans Mountain expansion project is desperately needed by the oil-rich province of Alberta, where crude prices are sharply discounted compared with the U.S. benchmark due to transportation bottlenecks on existing pipelines and by rail.

But it is fiercely opposed by neighboring British Columbia, along with some Vancouver-area municipalities and aboriginal groups, who have taken Kinder Morgan to court, causing expensive construction delays.

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