Final price tag on Trans Mountain pipeline expansion could creep up to $34.5 billion
“When the time is right, Canada can sell and the outcome that they should expect is a recovery of the taxpayer’s capital, and that’s the only thing the Trans Mountain leadership team is interested in: the taxpayer gets back their value,” he said to a parliamentary committee on Monday.
Questioned about the contentious project’s ballooning price tag, he acknowledged the forecasted price to complete the pipeline expansion could increase by between $200 and $500 million on top of the $34 billion forecasted earlier this year as remediation work continues.
“This project was worth the cost and it will continue to demonstrate its benefits to Canadians for decades to come,” he said.
This project was worth the cost and it will continue to demonstrate its benefits to Canadians for decades to come
Mark Maki
Maki said taxpayers should expect to recover their investment as long as Ottawa does not rush to sell while a number of issues remain unresolved, including a potential Indigenous stake in the project and an ongoing dispute over tolling, also known as the rates producers agree to pay to ship on the line.
Canadian oil producers have complained about the expensive tolls on Trans Mountain compared to other pipeline routes. The producers have argued that the interim rates, set last year by the Canada Energy Regulator (CER), are almost twice the amount that was floated in 2017.
Trans Mountain, however, has indicated it would like to further boost the pipeline’s fixed toll in order to cover the project’s substantial cost overruns. At Monday’s committee meeting, Maki said Trans Mountain is seeking to hike tolls by about 50 cents per barrel.
All these issues, he said, must be resolved before Ottawa can hope to find a buyer offering a good price for Trans Mountain.
“What the government needs to be here is a disciplined seller. You do not act in a hurry. You take your time. There are a number of uncertainties around the business that we need to clarify for the capital markets,” he said.
“There is a rate case ongoing that has to be behind us. There is the concept of Indigenous equity participation or economic participation in Trans Mountain. For a buyer, that’ll be important to understand how that works.”
The CER is set to hold a hearing on the matter of tolling on May 14, 2025.