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Ottawa, May 29, (Canadian-Media): Federal Finance Minister Bill Morneau announced this morning at a news conference, following an agreement between Kinder Morgan and Natural Resources Minister Jim Carr, that Canada Liberal Government would purchase the Trans Mountain pipeline and related infrastructure for $4.5 billion and also spend billions more to build the expansion, media reports said.
This announcement came just two days before a deadline of May 31 set by Kinder Morgan.
Morneau suggested that some addition costs would be covered by toll paid by oil companies.
Steve Kean, chairman and CEO of Kinder Morgan had stated that the deal represented the best way forward for shareholders and Canadians to “realize the great national economic benefits promised by that project.”
Kinder Morgan had estimated approximate the cost of $7.4 billion for building the expansion.
But Morneau said the government did not plan to own it for a long time and at the opportune moment will negotiate with investors to transfer the project and related assets to a new owner or owners.
He added that investors such as Indigenous groups and pension funds have already expressed interest, he said.
Until then, it would owned by Crown corporation .
The agreement, which needed to be approved by Kinder Morgan's shareholders, is expected to close in August.
This project had faced intense opposition from the B.C. government, environmental activists and Indigenous groups.
Carr assured that the plan would not sacrifice the environment for the economic benefits.
"Canadians want both and we can have both," he said and added,
Alberta Premier Rachel Notley called it "a major step forward for all Canadians."
Prime Minister Justin Trudeau also took to Twitter and said,
"Today, we've taken action to create and protect jobs in Alberta and B.C., and restart construction on the TMX pipeline expansion, a vital project in the national interest," his post read.
The expansion would link to the existing 1,150-kilometre pipeline between Strathcona County (near Edmonton), Alberta and Burnaby, BC.