Kinder Morgan CEO ‘appreciates’ feds’ offer to backstop higher pipeline cost

CALGARY — The CEO of Kinder Morgan Canada Ltd. says he “appreciates” an announcement by Finance Minister Bill Morneau that the government will compensate investors in the proposed Trans Mountain pipeline expansion if “unnecessary delays” cause costs to rise.

Morneau says the government is willing to “provide indemnity” to any investors, be they the project’s original architects or otherwise, to ensure the controversial Alberta-B.C. project is able to proceed.

Kinder Morgan chief executive Steven Kean offered no further comment during his remarks and declined to talk to reporters after his company’s first annual general meeting since being spun off by U.S.-based Kinder Morgan Inc. to hold most of its Canadian assets a year ago.

Last month, the company said it would stop all non-essential spending on the expansion project to triple the amount of oil flowing from Alberta to the West Coast, which Alberta says is critical to reduce discounts on its product due mainly to pipeline bottlenecks.

Kean reiterated that construction won’t be restarted unless there are sufficient assurances by the end of this month that it can proceed.

Outside the meeting in downtown Calgary, about 50 vocal pipeline supporters armed with signs and slogans assembled on the sidewalk, chanting as passing cars honked their horns.

Picketers Mike Owens and Derek B. Cooper say they were unimpressed with Morneau’s announcement, adding it offers further proof that the Liberal government has done too little to make sure the pipeline wins approval.

Picket organizer James Robson of the Canada Action Coalition says the government shouldn’t have to offer money to make sure an approved pipeline will be built.

Companies mentioned in this story: (TSX:KML)