Coastal GasLink pipe segments stored at the port in Stewart. Company expects sections to start arriving at Houston site later this month. (File photo)

Coastal GasLink pipeline investor committed to closing deal despite protests

Developer TC Energy Corp. — formerly TransCanada Corp. — is to remain the operator of the $6.6-billion pipeline

An investment firm buying a stake in the Coastal GasLink pipeline says it remains “committed” to the deal despite protester blockades that have shut down railway lines in parts of Canada and threaten to inflict damage to the Canadian economy.

Alberta Investment Management Corp., which looks after more than $115 billion in public sector pension funds for the province, agreed with American partner KKR in December to form a consortium to buy a 65 per cent interest in the project.

Developer TC Energy Corp. — formerly TransCanada Corp. — is to remain the operator of the $6.6-billion pipeline with a 35 per cent interest if the deal closes as expected in the first half of this year.

“AIMCo remains committed to our investment in the Coastal GasLink pipeline,” said spokesman Denes Nemeth in an email on Tuesday.

“We have confidence in TC Energy’s ability to deal with the situation appropriately to ensure the successful build of this project.”

A spokeswoman for KKR declined comment. It has said its investment is being made primarily through a separately managed infrastructure account in partnership with the National Pension Service of Korea.

Financial details of the deal and ownership percentages within the consortium have not been revealed.

READ MORE: Three protesters arrested after blocking driveway at premier’s home

The contract with TC Energy is also confidential, which makes it difficult to speculate whether AIMCo and KKR would be able to extricate themselves from the pipeline pact if they wanted to, said Matthew Taylor, an analyst for Tudor Pickering Holt & Co., who covers TC Energy.

“I’d imagine there are standard provisions in it with respect to regulatory risk and scope changes should the project’s route need to be adjusted to accommodate the First Nations’ requests,” he said.

“We need to see the outcome of the government negotiations before having an idea of the impact to the project or potential delay. The project currently has court injunctions to proceed with construction so technically it has the green light by virtue of the rule of law.”

Analyst Jennifer Rowland of Edward Jones says she thinks the deal will go through.

“We’ve seen similar protests on other projects that didn’t end up derailing a sale…. At this point, pipeline protests are a known risk for any potential buyer,” she said.

The 670-kilometre pipeline from northeastern B.C. to the West Coast is intended to deliver natural gas to the $40-billion LNG Canada export project that’s under construction at Kitimat.

Protesters say they are supporting Wet’suwet’in hereditary chiefs who are opposed to the pipeline running through their territory in B.C.

The pipeline has support from 20 elected band councils along the route who have signed benefit agreements.

Once the partnership deal is done, TC Energy says Coastal GasLink will secure financing with a syndicate of banks to cover up to 80 per cent of project costs during construction.

Coastal GasLink is backed by 25-year transportation agreements with the five LNG Canada owners.

LNG Canada says the project is expected to reduce global greenhouse gas emissions by up to 90 million tonnes per year by displacing coal- and diesel-fuelled generation with cleaner burning natural gas.

Dan Healing, The Canadian Press

Like us on Facebook and follow us on Twitter.

Coastal GasLinkPipeline

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Port Hardy’s annual summer festival FILOMI Days cancelled due to COVID-19 pandemic

Port Hardy’s biggest community celebration happens every year from July 17 to 19.

Reflecting on life during a pandemic

‘This is really a once in a lifetime moment where everything has come to a grinding halt’

B.C. firefighters only responding to most life-threatening calls during COVID-19 pandemic

The directive comes after province spoke with paramedics, fire services, according to top doctor

‘An extra $220 every 90 days’: B.C. patients pay more dispensing fees due to prescription limits

Kelowna woman says it’s outrageous to charge for refills every 30 days

As 240K apply for emergency benefit, Trudeau says aid coming for Canadians left behind

Canada Emergency Response Benefit provides $2,000 per month

Introverted and extroverted kids likely to react differently to COVID-19 restrictions

B.C. child psychologist says your parenting approach can’t be one-size fits all in social isolation

B.C. begins taking submissions for $2M COVID-19 research fund

Rural health, impact of shifting hospital resources among priorities

Wearing non-medical masks can stop spread of COVID-19 before symptoms start: Tam

Health officials had previously not recommended wearing them

COVID-19 world update: 1,000 cases hit U.S. military; Good news in Spain, Portugal

Comprehensive collection of coronavirus news from around the world

Vancouver Island teen singer advances to American Idol top 20

Lauren Spencer-Smith performs Respect at outdoor concert in Hawaii

Businesses advised to prepare for federal, B.C. COVID-19 assistance

Canada Revenue Agency portal expected to open this week

Bars, cannabis sector eligible for $40B credit program from government bank

Applicants must go through their own banks to access the program

Immunocompromised community call for more options to get groceries during COVID-19

One woman has decided to build a greenhouse to ensure she is able to access food throughout pandemic

Most Read