By Natalie Obiko Pearson (Bloomberg) — Kinder Morgan Inc.’s setbacks in Canada just got more complicated.
British Columbia’s New Democratic and Green parties on Tuesday signed a power-sharing agreement that will allow them to oust Premier Christy Clark as early as next month. A top pledge: Block Kinder’s C$7.4 billion ($5.5 billion) Trans Mountain pipeline expansion in the Pacific Coast province.
“The idea that somehow a pipeline for a market — which doesn’t exist — is going to create jobs in British Columbia is nothing more than a myth,” Green Party leader Andrew Weaver, 55, said of sales of Canadian crude to Asia as nations seek to meet climate commitments. At a news conference with his NDP counterpart John Horgan, 57, Weaver also mocked projects like Petroliam Nasional Bhd’s proposed $27 billion gas export terminal as “unicorns in all our backyards”
The Greens, with just three seats, hold the balance of power in the province — both the birthplace of Greenpeace and the terminus of the Trans Mountain line from Alberta’s oil sands. In exchange for support to form a government, the NDP agreed to push ahead on about a dozen issues dear to the Greens, ranging from electoral reform to public transit.
Just hours earlier, the Canadian unit of Houston-based Kinder Morgan had raised C$1.75 billion to help pay for the expansion in one of the nation’s largest initial public offerings. It fell 4.5 percent in its trading debut as the new political alliance vowed to “employ every tool available to the new government to stop the expansion of the Kinder Morgan pipeline.”
Kinder’s Canadian representatives didn’t immediately respond to an email and voice message seeking comment.
It’s not clear what the parties can do once in power to thwart a project already approved by Prime Minister Justin Trudeau. Under Canadian law, the federal government has jurisdiction over pipelines extending across provinces. Trudeau said earlier Tuesday the federal approval was based on fact and evidence and, “regardless of a change in government in British Columbia, or anywhere, the facts and evidence do not change.”
Provinces, however, can impose conditions on pipelines to protect their communities and environment. Weaver, a climate scientist who scoured thousands of pages of documentation as an intervener in Trans Mountain’s federal review, has indicated that B.C. should conduct its own environmental assessment of the project — a move that could potentially lead to onerous delays and new conditions.
The new alliance stops short of forming a coalition. While the Greens have pledged support over four years to the NDP to maintain a government and pass budgets, they plan to vote independently. The agreement lays out certain conditions, including the opposition to Trans Mountain, raising B.C.’s C$30-per-ton carbon tax by C$5 annually starting 2018, scrutinizing a controversial hydropower dam project also approved by Trudeau, and making housing more affordable in the nation’s priciest real-estate market.
Horgan said the alliance plans to reopen a review of the Site C dam in northeastern B.C. that’s being built to supply a forecasted surge in electricity demand. That surge would come in part from the development of the LNG industry backed by the Liberals that has failed to transpire amid a global supply glut. Horgan said work won’t be stopped on the project while the review is ongoing, which is expected to take three months.
The NDP and Greens both support the introduction of a housing speculator tax. “We agreed that speculation and money laundering are issues that we need to address quickly,” Horgan said Tuesday. The NDP’s election platform had called for a “2 percent absentee speculator’s tax.”
The Greens ran on a campaign to double the tax on foreign buyers to 30 percent and extend it beyond the Vancouver region to across the province, but Horgan said the parties “disagreed” on that.
Meanwhile, Clark, 51, a scrappy former radio host known as a political fighter, appeared resigned to accept defeat — for now.
“If there is going to be a transfer of power in this province, and it certainly seems like there will be, it shouldn’t be done behind closed doors,” Clark said, pledging to test the house as early as the beginning of June. The Liberals have also agreed she would become the leader of the opposition. “I’m more than ready and willing to take that job.”
© 2017 Bloomberg L.P