VANCOUVER/Musqueam, Squamish & Tsleil-Waututh Territories - Today, the Parliamentary Budget Officer (PBO) released a report confirming what West Coast Environmental Law has been stating for years: that the Trans Mountain Expansion Project (TMX) will lose money for its owners, the Canadian public. In the PBO’s own words, “Trans Mountain no longer continues to be a profitable undertaking.”
“The PBO’s conservative approach likely understates the losses facing the Trans Mountain Expansion. In reality, the losses will likely be higher as delays and cost overruns continue,” said Eugene Kung, staff lawyer at West Coast Environmental Law.
The newest PBO report considers additional factors since their analysis in 2020: the construction budget ballooned to $21.4 billion, construction is delayed into late 2023, and the federal government provided a $10 billion loan guarantee to incentivize the private sector to participate.
“The federal government’s reckless handling of TMX has resulted in massive losses for the Canadian public. Continuing to double down in the hopes of reducing those losses is a literal and figurative pipe dream.”
“The supposed economic benefits were meant to justify the negative impacts of TMX, such as threatening endangered species, locking in emissions related to expanding oil and gas infrastructure, and infringing Indigenous rights. With that economic justification now evaporated, it appears Canada is just doing those bad things out of muscle memory. The government needs to cut their losses now, not gamble more public dollars into this failing project.”
West Coast Environmental Law has long argued that TMX is not an economically sound project. We broke down the myth of tidewater access. We discussed the risk and reward in the context of Kinder Morgan Canada’s Initial Public Offering. We analyzed Kinder Morgan’s decision to abandon the project (and Canada’s bail out) in 2018. We analyzed the construction delays and predicted a $20B+ budget months before Trans Mountain admitted it publicly. And we did a deep dive explainer on the structural tolling issues related to TMX. Stay tuned for more analysis of what could become Prime Minister Trudeau’s costliest mistake.
For more information contact:
Eugene Kung, Staff Lawyer