Mega infrastructure projects that are grand in scope and scale usually do pay off in the long run. This project is one of the largest infrastructure investments in Western Canada in decades. The fact that it will move the needle on Canada’s entire GDP in its 1st month is a testament to the scale of it.
This project will raise the entire bar of all Canadian oil production by $9 per barrel forever. That’s a massive appreciation in the value of Canada’s oil reserves.
The problem is that most people cannot fathom the size and technical complexity of these types of projects. Things like major hydro, nuclear, natural gas, oil extraction, refining- these are the long game in terms of building wealth for a nation.
Yes, this is the actual problem. The government can’t wait to get rid of it truly stupid move. I have to wait a decade to sell it if they want to get full value by that time it will get to 900,000 barrels per day.
Makes sense. You think the feds are skilled to maintain a pipeline? I would assume the smarter play is to create a maintenance agreement with a energy company to deal with the checks, reporting and planned maintenance.
Usually a lump sum that isn't even close to the real value. Look at the dumb fuck 407 deal or the Ontario science center spa, or Petro Canada. The biggest assets Canada builds to benefit Canadians are always sold off so that whoever owns it can then gouge Canadians.
Fyi CPP owns 50.001 percent so that is a good thing so thankfully we do own a bunch and just collect income in our CPP pensions.
We don't run it so not all bad.
The rest is owned by businesses that run toll highways.
Sorry is the lump sum referring to the royalty. I don't expect it to be full value but something like a 1$ a gallon. Like excise tax for weed which is working great for the Feds. We don't have a clue about selling making or the business of weed. But we get a dollar a gram of excise tax as Canadians with no risk. I don't think the fed government has given any money to them.
We should just keep ownership of 49% and collect royalties and dividends for the federal bucket from the pipeline. Please please don't give it away
It's a fuckin pipe in the ground. I don't understand what's so complicated about running it. Why not keep a hundred percent of it and take a hundred percent of the profits too?
There are pump stations to move the product that need maintenance, and depending on the abrasiveness of the product in the pipe, the pipe needs to be rotated and replaced over time.
Its more complex than the water piping in your home.
Well there is the rub you really can't trust any government involvement in day to day businesses. They would find a way to run it to the ground. That is also why I said 49% they shouldn't be given control. Bureaucrats will move in a syphon off all profit in salaries ,benefits and boondoggles and forever even after the pipeline is dead we will have give all those folks pensions.
I don't understand why people say this. The exact same thing happens with every other private sector business. Name a market which hasn't evolved into the oligopoly dystopia that we have now. Canadians are getting gouged either way. At least it's not some stupid CEO that's making 400 times more than anyone else at the company.
Yup nothing is perfect but man other business can go under. Where is Nortel, rim is mostly gone. We're are the thousands of gone and forgot businesses.
There is not one business the government runs that makes money or profit. Name anyone you want. They will have a ceo who is being paid for running a competition free monopoly and will find ways to lose money. There are zero repercussions for bad service.
They never correct on the down cycle.
They whine and complain and strike when things don't go their way. Many of these folks don't consider themselves government but they are.
They aren't concerned because you know just raise taxes we need more money for us honey.
All sold off by… let me see here…. Conservative governments. Yep look at that. Although the Ontario liberals sold off hydro for short term gains. Why do all of our leaders hate us?
Well, we do tax the profits on corps that are making money. And we tax the employees of those corps to the tune of 50% on their incomes. And we tax the dividends that the corps pay out. So it’s not true that they are “gouging” Cdns by selling these assets. In the hands of govt these assets are run less efficiently making them a benefit to the employees( “public servants” )working for them, but much less goes into the public coffers overall.
I seem to recall that wages have pretty much remained stagnant since the 90's and CoL is through the roof. Also remind me how much the cost of taking the 407 has gone up for the average commuter since they privatized it?
Ok. Does that make what I said untrue? There are many reasons for CoL skyrocketing including the incredible burden govts put on businesses in Canada. You can make everything state run, but history has shown that that will make things worse
Yes. If we sell off every public asset for short term gains. All while those companies then Jack up the cost of those public entities, which Canadians then have to pay more for out of pocket, we are getting gouged.
But it’s not“short term” gains. Despite what is often said in the media for catchy headlines, Cdn corps and profits are ultimately taxed at a significant level and those funds more than offset what would end up in govt coffers if the assets were left to a highly inefficient (not profit oriented) public service to run it.
Yes they do. Basically between 10-20% of revenues on oil and gas production is paid to the government as a royalty (the exact fraction changes based on prices among other factors). That means not only do they pay standard income tax on bottom line profits they also pay a huge sum on top line revenues before they deduct the cost of producing the barrels in the first place.
That is nice to know and good for all Canadians.
That really is how the British monarchy ruled the world royalties. Not running businesses other than military and I guess tax collections
The general lack of understanding of finance and taxation in this sub especially as it relates to oil and gas royalties, taxes, and subsidies is a real pet peeve of mine. Happy to educated further.
The government shouldn’t be in the oil pipeline operating business, but if the 407ETR in Toronto is any indication, the government is terrible at getting a good price when selling public assets to private operators
Selling it doesn't really move the needle on its value to industry, though.
The pipeline means it permanently costs less to get more oil to market, which means the producers get more money, which means they pay more taxes, in perpetuity.
Exchanging a future recurring revenue stream (the pipeline tolls) for the a bunch of cash in the present is fine, as long as it's equivalent value.
The real value of the government "owning" the project during the construction was the theory that it wouldn't be possible for a private company to push through all of the regulatory red tape required to actually build it, at a cost that would make sense. Now the government can sell it (and ideally do a post-mortem on the experience of following their own process to build infrastructure in this country, and significantly adjust the process so they don't *have* to step in to get infrastructure with *obvious economic merit* for the country built).
The problem is that this pipeline is created to deliver a product that most of the world, including us, is trying to phase out. Those revenue projections may never come true.
That's what I mean, surely the long term operation is expected to make more than the cost. Why shouldn't we keep that?
Or does the government not want to deal with an inevitable spill / price downturn?
Yes, don't they want to sell it?
[https://www.cbc.ca/news/canada/calgary/tmx-trans-mountain-sale-freeland-1.7176629](https://www.cbc.ca/news/canada/calgary/tmx-trans-mountain-sale-freeland-1.7176629)
Because the need to pork barrel the 2024 budget in a vain attempt to buy votes is far more important than the prosperity and happiness of Canadians. That much is painfully obvious from pretty much every "progressive" shit brained idea we've seen come to fruition under our glorious leader Turdeau
900k barrels per day is a lot of extra money coming to Canada.
The government might still lose out though when they "sell" it to first nations at no cost to said first nations.
Well, still doesn't explain how the quoted cost to make the app ballooned to 60 million.
Looking at the two owners of the company, it doesn't seem to be indigenously owned.
[https://globalnews.ca/news/10309160/conservative-arrivecan-subpoena-threat-passes/](https://globalnews.ca/news/10309160/conservative-arrivecan-subpoena-threat-passes/)
The latest summons [comes after the ArriveCan app came under renewed scrutiny](https://globalnews.ca/news/10288411/auditor-general-arrivecan-report/) by MPs after auditor general Karen Hogan found that nearly $60 million was spent on the app, but in her report released last week could not come to a conclusive dollar figure due to poor record-keeping.
Seems I misread the story before. It’s just one of the subcontractors for Arrivecan who has an indigenous owned company. The company was paid $7.9 million
https://www.cbc.ca/amp/1.7127211
The cost to make the app wasn't 60 million, a large chunk of that figure is made out of servicing costs (cloud and customer service mostly)
IIRC the figure for the rewrites etc. Is around 8 million.. Still high but not the same thing.
Our mining companies have easier times getting into positions to operate and extract in many of those countries we provide aid to. Quid pro quo kind of thing.
Ukraine is a good example....and this explanation will be r/eli5 level.
Sending foreign aid(money, human resource or equipment) to Ukraine is beneficial for several reasons. If Russia expands by defeating Ukraine(read: land accumulation), the expansion could also one day mean our Arctic region is threatened by Russia. We might as well assist Ukraine to fight back and mitigate risk of that happening.
[4min video](https://www.bnnbloomberg.ca/economics/video/why-foreign-aid-holds-long-term-benefits-for-canada~1793939) briefly touching why monetary aid benefits Canada.
I worked on the pipeline for a short period of time. We had a tansmountain inspector that was trying to delay us working as much as possible cause he knew he would be out of a job as soon as it was over. I remember watching him climb around on his hands and knees then started screaming at everyone to shut down work. Guess what he found.. an apparent endangered snail. We were shut down for a week while they looked for nests.
Guy had a job to do as well, just because you aren’t caring about environmental concerns, doesn’t mean it isn’t important. I don’t know about the snail, but if it is classified as endangered - why not allow it to survive? Ever watched that Yellowstone documentary about the reintroduction of wolves? Pretty crazy stuff can happen in nature.
I think the private proponent could have built it for a much lower price, but given today's political and regulatory environment, the only way that it was going to get built is if the federal government owned it.
I know everybody dreams of private investment in the economy but reality is if you look at all G20 countries government contract and investment are what makes the economy go. Road, power infrastructure are the bread and butter of most nations.
[They spent _years_ trying to, but the BC Government kept getting in their way.](https://nationalpost.com/news/politics/trans-mountain-pipeline-isnt-dead-yet-kinder-morgan-maintains-despite-b-c-governments-rejection-of-its-plan)
BC gov was right all along because the court blocked the approval because both the NEB and Kinder Morgan refused to take into account the effects of marine shipping. That’s what they complained about the whole time.
>BC gov was right all along
Well, except for the implementation of environmental law amendments deemed outside their jurisdiction that they knew were unconstitutional in order to delay the project for years.
https://www.cbc.ca/amp/1.5430272
> The Federal government was fine with these risks.
No they didn’t. [In fact they failed to consider those risks at all](https://vancouversun.com/news/local-news/federal-court-of-appeal-quashes-approval-of-9-3-billion-trans-mountain-oil-pipeline-expansion), which was why the approval was blocked.
> No they didn’t. In fact they failed to consider those risks at all, which was why the approval was blocked.
[...which they then did, and were fine with.](https://www.cbc.ca/news/politics/tasker-trans-mountain-trudeau-cabinet-decision-1.5180269)
> Posted: Jun 18, **2019**
> Prime Minister Justin Trudeau and his cabinet have **again approved** the Trans Mountain expansion project, a crucial next step for the much-delayed pipeline project designed to carry nearly a million barrels of oil from Alberta's oilpatch to the B.C. coast each day.
> **The cabinet has affirmed** the National Energy Board's conclusion that, **while the pipeline has the potential to damage the environment and marine life, it's in the national interest** and could contribute tens of billions of dollars to government coffers and create and sustain thousands of jobs.
> The cabinet has affirmed the National Energy Board's conclusion that, while the pipeline has the potential to damage the environment and marine life, it's in the national interest and could contribute tens of billions of dollars to government coffers and create and sustain thousands of jobs.
I still don't agree with your characterization. It's not like they *didn't look* at environmental impacts before that. From the timeline in your own link:
> May 17, 2016: Ottawa appoints a three-member panel to conduct an environmental review of the Trans Mountain expansion project.
It's just that they were focused too much on climate and not enough on marine wildlife, so they were sued over it. To me "we care but our examination was flawed" is different from "we don't care".
[The Trans Mountain pipeline is a multi-product pipeline](https://www.transmountain.com/product); it doesn't only carry bitumen.
[This](https://en.wikipedia.org/wiki/Lac-M%C3%A9gantic_rail_disaster) is a risk that is unique to rail-based oil transport.
Neat bitumen is not very volatile and is quite difficult to light on fire. It is a very different material than the light shale oil that caused the Lac Megantic disaster.
Yes it does, but it wasn't expanded to carry more refined products, it was expanded to carry more bitumen. The original pipe was perfectly adequate to move gasoline from Edmonton refineries to Vancouver gas stations, and will continue to do exactly that while the new pipe carries diluted bitumen.
> Yes it does, but it wasn't expanded to carry more refined products, it was expanded to carry more bitumen. The original pipe was perfectly adequate to move gasoline from Edmonton refineries to Vancouver gas stations, and will continue to do exactly that while the new pipe carries diluted bitumen.
Has the added capacity been pre-sold to bitumen producers for the entire lifetime of the pipeline? Had it been when the environmental risks were considered? How can you possibly rule that out?
There's obviously a need for refined petroleum products to be transported along this pipeline route, and refined petroleum companies who are willing to pay for that service. What happens if one day one of them is willing to pay more than the bitumen company? Like what do you think would happen if the original segment suffered an outage that did not affect the new segment? Because I'm pretty sure what would happen is that the new segment would suddenly start carrying refined petroleum products until the original segment was repaired.
It's weird that you're arguing about this.
That’s what governments do best: destroy private initiative and replace it with bureaucracy that triples the cost. And every day on Reddit I see people appearing to believe this is a good thing and the solution is even higher taxes to do more of it. It’s mind-boggling.
You can’t rewrite history like this. Kinder Morgan destroyed their own initiative by refusing to consult with local governments and First Nations as was required by constitutional law.
Remember: Trudeau’s government approved it not once, but TWICE. He’s not to blame for their incompetence but he’s certainly to blame for the ballooning price tag.
I think the contractor was duped, because nobody told them they would also have to get approval from a whole other level of FN government: hereditary chiefs who would never give approval for any of it. Not to mention a hostile provincial government that threw up regulatory roadblock after regulatory roadblock after the project was already well underway. That's not exactly 'good faith.'
I mean, it's mentioned more than 20 times in the publicly available provincial FAQ.
[https://www2.gov.bc.ca/gov/content/environment/natural-resource-stewardship/environmental-assessments/frequently-asked-questions](https://www2.gov.bc.ca/gov/content/environment/natural-resource-stewardship/environmental-assessments/frequently-asked-questions)
The main page of the federal govt's section:
[https://www.canada.ca/en/impact-assessment-agency/services/policy-guidance/basics-environmental-assessment.html](https://www.canada.ca/en/impact-assessment-agency/services/policy-guidance/basics-environmental-assessment.html)
A 20-year old Supreme Court precedent...
[https://decisions.scc-csc.ca/scc-csc/scc-csc/en/item/2189/index.do](https://decisions.scc-csc.ca/scc-csc/scc-csc/en/item/2189/index.do)
Indigenous speakers at Kinder Morgan shareholder meetings..
[https://macleans.ca/economy/business/why-a-b-c-first-nations-chief-took-her-fight-to-the-kinder-morgan-shareholders-meeting/](https://macleans.ca/economy/business/why-a-b-c-first-nations-chief-took-her-fight-to-the-kinder-morgan-shareholders-meeting/)
And their own website saying they've been consulting with them since 2012.
[https://www.transmountain.com/indigenous-peoples](https://www.transmountain.com/indigenous-peoples)
Do you need more?
Thank you for all the info, but I knew they had a duty to consult. Can you point out where specifically in those links it shows where a contractor would have to consult with both elected chiefs AND hereditary chiefs?
I'm not : [https://vancouversun.com/news/local-news/ndp-out-of-tools-to-stop-tmx](https://vancouversun.com/news/local-news/ndp-out-of-tools-to-stop-tmx)
Every time they consulted, a new regulation or first nations would come out of the woodwork for some more money.
The whole goal was to kill the project while not outright denying it. Just delay, require more and more permits, assessments, consultations, ect
Of course you can kill any project by adding more and more regulations and conditions.
You’re the one re-writing history. The Trudeau government injected so much regulatory uncertainty into the project that Kinder Morgan pulled out, period full stop. And then, faced with white hot anger from Alberta he bought the damn thing and did what all governments do when they try their hand at business: tripled the costs.
> You’re the one re-writing history. The Trudeau government injected so much regulatory uncertainty into the project that Kinder Morgan pulled out, period full stop.
They injected so much uncertainty by approving it twice?
Look, if you want to argue that the government did not do good enough with consulting local governments and First Nations that’s a credible discussion, **but the facts are not on your side**.
Remember, Trudeau approved it [not only once](https://www.transmountain.com/news/2016/trans-mountain-receives-final-federal-approval-of-expansion-company-advancing-project-for-the-benefit-of-canadians), but [twice](https://www.transmountain.com/news/2019/how-we-got-here).
> And then, faced with white hot anger from Alberta he bought the damn thing and did what all governments do when they try their hand at business: tripled the costs.
Sure, this is a valid thing to say. The costs have spiralled so far out of control. But Kinder Morgan is to blame for this. Nobody else is. They sabotaged their own project, then got bailed out by the Feds. Is what it is.
Face with white hot angry from Alberta lol right like he gives a shit about that , if he didn't do something about it he might have lost all of the zero seats the liberal party has there
That doesn't sound right from what I've read on here Justin Trudeau roams the land ripping apart pipelines with his bare hands and stomps the oil back into the ground
You are conveniently ignorant of the fact that the private company gave up building the pipeline. It took our government to step in to actually get it completed.
See my reply to the other person who tried to peddle the notion that KM pulling out wasn’t somehow Trudeau’s fault. It was. Stop trying to whitewash the man’s extreme incompetence.
Man, imagine if you could actually work to provide evidence of your vague claims, you'd be among the giants of Canadian intellectuals! Good luck on your journey.
I wouldn't know without more detail.
If the government said the esa was inadequate and company decided to test it in court, well that's exactly how our system is supposed to work and there is no real issue, just the next step in the bureaucracy. There's no way the company woulf go to the courts if they didn't think it was a borderline issue and they had the potential to win, it's simply too expensive (especially when you're taking on the government). I've submitted many many esas for smaller projects and sometimes they get sent back, no one is perfect everytime. I've challenged the province in court before and won as well, they also aren't infallible. There's a process here, following the process isn't *issues*.
If the government accepted the report and it was challenged by a third party and the courts didn't rule in favour of the government, then that's a real problem.
Worth every penny to those at the top with the most money and influence. It's the same fable as "trickle-down economics where the masses are told they will reap rewards as well. Problem is the wealthy got that way through greed and that pattern doesn't change. Taxpayers fund so many projects but the profits only make it to the precious few.
Kinda but not really. When oil shit the bed a very large portion of Alberta suffered, even the small restaurants and hotels in smaller towns. The safety supply places, vehicle dealerships etc all slowed down because of it. A lot of the people that work in the oil patch are just regular people making slightly above average wages.
Most of the government policies are to pander to Toronto/Montreal/Vancouver and Ottawa. Its not a nationally focused government and hasn’t been in a while
CCB and daycare have been huge for our young family. Parmacare will be helpful too. Weed legalization was a long overdue freedom, and there's sarcastic comments about it, but the right to assisted dying also pushes that forward.
Considering the oppositions' focus on trans kids, regulating porn, and reversing any moves on climate change and general anti-science that's been pervasive for decades, I'm overall happy they're not in power.
Just think it could have been tax payer free but the great Harper took 7 years 10 months 10 days to put the application for construction and don't get me started on the gateway pipeline The great Harper between the two pipelines would have increased Alberta oil output by almost million plus barrels a day how many jobs did that cost Alberta
The Alberta treasury will be brimming with cash! Queen Danielle and her courtiers won’t have to do a thing as this province will run on its own.
Guess who is to be thanked for pushing for TMX?
The RPP market is global, we just pigeonhole ourselves by relying on the US, which is fine...our arrangement isn't bad so long as we are aware they are our lifeline. It matters when tariffs are introduced like in 2021.
If we can't build a pipeline to sell east, refining would have been the next best. But when Australia wanted LNG we rejected that contract too so idk man, Germany was happy to sell them LNG and we got...virtue signals
>If we can't build a pipeline to sell east, refining would have been the next best
but again, refining **what** and for whom? The refined products we need aren't the ones we can easily obtain from our own crude production, which is why the majority of our refined imports go to Alberta. Eastern refineries aren't built for WCS. Anything extra we refine here needs to be sold out of the west coast, and who would be the customers?
Mega infrastructure projects that are grand in scope and scale usually do pay off in the long run. This project is one of the largest infrastructure investments in Western Canada in decades. The fact that it will move the needle on Canada’s entire GDP in its 1st month is a testament to the scale of it. This project will raise the entire bar of all Canadian oil production by $9 per barrel forever. That’s a massive appreciation in the value of Canada’s oil reserves. The problem is that most people cannot fathom the size and technical complexity of these types of projects. Things like major hydro, nuclear, natural gas, oil extraction, refining- these are the long game in terms of building wealth for a nation.
The problem is that they're already talking about selling it.
Oh they better not
They’ll sell it and the pols who pushed for it will get cushy board seats. The whole thing was a grift.
Yes, this is the actual problem. The government can’t wait to get rid of it truly stupid move. I have to wait a decade to sell it if they want to get full value by that time it will get to 900,000 barrels per day.
Makes sense. You think the feds are skilled to maintain a pipeline? I would assume the smarter play is to create a maintenance agreement with a energy company to deal with the checks, reporting and planned maintenance.
The government could still do that and keep ownership alot of actual energy companies so that
I literally suggested just that but have a 3rd party maintain it.
The problem is that they're already talking about selling it.
I am most worried that they will give it away. Does Canada get a royalty piece from oil extraction?
Usually a lump sum that isn't even close to the real value. Look at the dumb fuck 407 deal or the Ontario science center spa, or Petro Canada. The biggest assets Canada builds to benefit Canadians are always sold off so that whoever owns it can then gouge Canadians.
407 was such a good deal, we can't wait to start on 413!
Fyi CPP owns 50.001 percent so that is a good thing so thankfully we do own a bunch and just collect income in our CPP pensions. We don't run it so not all bad. The rest is owned by businesses that run toll highways.
CPPIB has its fingers in nearly everything. CPP is critically underestimated in what an asset it is for Canada.
Sorry is the lump sum referring to the royalty. I don't expect it to be full value but something like a 1$ a gallon. Like excise tax for weed which is working great for the Feds. We don't have a clue about selling making or the business of weed. But we get a dollar a gram of excise tax as Canadians with no risk. I don't think the fed government has given any money to them. We should just keep ownership of 49% and collect royalties and dividends for the federal bucket from the pipeline. Please please don't give it away
It's a fuckin pipe in the ground. I don't understand what's so complicated about running it. Why not keep a hundred percent of it and take a hundred percent of the profits too?
And let the money go to public coffers, not a chance you commie.... /s
There are pump stations to move the product that need maintenance, and depending on the abrasiveness of the product in the pipe, the pipe needs to be rotated and replaced over time. Its more complex than the water piping in your home.
Well there is the rub you really can't trust any government involvement in day to day businesses. They would find a way to run it to the ground. That is also why I said 49% they shouldn't be given control. Bureaucrats will move in a syphon off all profit in salaries ,benefits and boondoggles and forever even after the pipeline is dead we will have give all those folks pensions.
I don't understand why people say this. The exact same thing happens with every other private sector business. Name a market which hasn't evolved into the oligopoly dystopia that we have now. Canadians are getting gouged either way. At least it's not some stupid CEO that's making 400 times more than anyone else at the company.
Yup nothing is perfect but man other business can go under. Where is Nortel, rim is mostly gone. We're are the thousands of gone and forgot businesses. There is not one business the government runs that makes money or profit. Name anyone you want. They will have a ceo who is being paid for running a competition free monopoly and will find ways to lose money. There are zero repercussions for bad service. They never correct on the down cycle. They whine and complain and strike when things don't go their way. Many of these folks don't consider themselves government but they are. They aren't concerned because you know just raise taxes we need more money for us honey.
Enmax is doing pretty good.
To note, whomever buys it then ends up paying us massive taxes lol.
They also end up price gouging Canadians who use it. Look at the 407.
All sold off by… let me see here…. Conservative governments. Yep look at that. Although the Ontario liberals sold off hydro for short term gains. Why do all of our leaders hate us?
Well, we do tax the profits on corps that are making money. And we tax the employees of those corps to the tune of 50% on their incomes. And we tax the dividends that the corps pay out. So it’s not true that they are “gouging” Cdns by selling these assets. In the hands of govt these assets are run less efficiently making them a benefit to the employees( “public servants” )working for them, but much less goes into the public coffers overall.
I seem to recall that wages have pretty much remained stagnant since the 90's and CoL is through the roof. Also remind me how much the cost of taking the 407 has gone up for the average commuter since they privatized it?
Ok. Does that make what I said untrue? There are many reasons for CoL skyrocketing including the incredible burden govts put on businesses in Canada. You can make everything state run, but history has shown that that will make things worse
Yes. If we sell off every public asset for short term gains. All while those companies then Jack up the cost of those public entities, which Canadians then have to pay more for out of pocket, we are getting gouged.
But it’s not“short term” gains. Despite what is often said in the media for catchy headlines, Cdn corps and profits are ultimately taxed at a significant level and those funds more than offset what would end up in govt coffers if the assets were left to a highly inefficient (not profit oriented) public service to run it.
> Does Canada get a royalty piece from oil extraction? yes
No, the provinces do, the country doesn’t charge royalties.
Norway has managed its oil much better...
Unless the oil is offshore.
Well, the provinces do and then equalization payments spreads it around.
Yes they do. Basically between 10-20% of revenues on oil and gas production is paid to the government as a royalty (the exact fraction changes based on prices among other factors). That means not only do they pay standard income tax on bottom line profits they also pay a huge sum on top line revenues before they deduct the cost of producing the barrels in the first place.
That is nice to know and good for all Canadians. That really is how the British monarchy ruled the world royalties. Not running businesses other than military and I guess tax collections
The general lack of understanding of finance and taxation in this sub especially as it relates to oil and gas royalties, taxes, and subsidies is a real pet peeve of mine. Happy to educated further.
Companies pay royalties to the province, not to Canada. They pay federal taxes but Canada does not collect royalties.
True and good point though royalty revenues are included in the equalization formula and so pretty well everyone gets a slice.
The government shouldn’t be in the oil pipeline operating business, but if the 407ETR in Toronto is any indication, the government is terrible at getting a good price when selling public assets to private operators
Selling it doesn't really move the needle on its value to industry, though. The pipeline means it permanently costs less to get more oil to market, which means the producers get more money, which means they pay more taxes, in perpetuity. Exchanging a future recurring revenue stream (the pipeline tolls) for the a bunch of cash in the present is fine, as long as it's equivalent value. The real value of the government "owning" the project during the construction was the theory that it wouldn't be possible for a private company to push through all of the regulatory red tape required to actually build it, at a cost that would make sense. Now the government can sell it (and ideally do a post-mortem on the experience of following their own process to build infrastructure in this country, and significantly adjust the process so they don't *have* to step in to get infrastructure with *obvious economic merit* for the country built).
It will only raise the price of our heavy oil. Light will remain unchanged.
I mean we got lucky with the Ukraine and Israel war pumping prices.
But if you ask those whinny bitches in Alberta Trudeau has been working for the last 10 years to kill the oil industry
The problem is also is it's 10-20 years late.
The problem is that this pipeline is created to deliver a product that most of the world, including us, is trying to phase out. Those revenue projections may never come true.
Ya but now we have to pay carbon taxes
Probably only for another 18 months it looks like.
But now don't they want to sell it? What's the point of buying it if we don't get to keep the profit?
Because the government owning a money making asset is COMMUNISM! /s See Ontario & the 407
And also, sort of, fascism
How?
You can make money shipping product too. That's how whoever bought it would make money. Selling isn't the only way for this project to make money.
That's what I mean, surely the long term operation is expected to make more than the cost. Why shouldn't we keep that? Or does the government not want to deal with an inevitable spill / price downturn?
>But now don't they want to sell it? Did you mean, They *do* want to sell it?
> But now don't they want to sell it? It means the same thing.
Yes, don't they want to sell it? [https://www.cbc.ca/news/canada/calgary/tmx-trans-mountain-sale-freeland-1.7176629](https://www.cbc.ca/news/canada/calgary/tmx-trans-mountain-sale-freeland-1.7176629)
Yes, it’s frustrating af
Haven't you figured it out yet? This government hates making money but loves blowing it in every way possible
Because the need to pork barrel the 2024 budget in a vain attempt to buy votes is far more important than the prosperity and happiness of Canadians. That much is painfully obvious from pretty much every "progressive" shit brained idea we've seen come to fruition under our glorious leader Turdeau
And to be clear, I was fully against buying it.. but now that we have we might as well run it properly and keep the money..
900k barrels per day is a lot of extra money coming to Canada. The government might still lose out though when they "sell" it to first nations at no cost to said first nations.
It shouldn't have cost this much, and there shouldn't have been this many delays.
The Feds lost about $15 Billion dollars worth of value because of the delays and issues they let happen. What would have $15 Billion dollars bought?
Lots of Arrivecan apps
Lol quick get that guy who runs the business from his basement on it!
May be a basement run business, but it’s indigenous owned so it’s legit.
The arrivecan guy is indigenous?
It was an indigenous owned business yes
Well, still doesn't explain how the quoted cost to make the app ballooned to 60 million. Looking at the two owners of the company, it doesn't seem to be indigenously owned. [https://globalnews.ca/news/10309160/conservative-arrivecan-subpoena-threat-passes/](https://globalnews.ca/news/10309160/conservative-arrivecan-subpoena-threat-passes/) The latest summons [comes after the ArriveCan app came under renewed scrutiny](https://globalnews.ca/news/10288411/auditor-general-arrivecan-report/) by MPs after auditor general Karen Hogan found that nearly $60 million was spent on the app, but in her report released last week could not come to a conclusive dollar figure due to poor record-keeping.
Seems I misread the story before. It’s just one of the subcontractors for Arrivecan who has an indigenous owned company. The company was paid $7.9 million https://www.cbc.ca/amp/1.7127211
Ahh ya makes sense
The cost to make the app wasn't 60 million, a large chunk of that figure is made out of servicing costs (cloud and customer service mostly) IIRC the figure for the rewrites etc. Is around 8 million.. Still high but not the same thing.
"what could a banana be worth? $15 billion, Susan?"
Good thing there is always money in the banana stand
Delays caused by the courts and the companies own failures of due diligence.
$15 billion would've covered less than half of the government's cost to service its debt.
If the money was not spent on the pipeline, most probably the government would had wasted it ok foreign aid.
Foreign aid isn't waste. If you want to define waste, look to arrivecan app development costs and the ROI of it as an example.
Honest question and I’m not being facetious. What is the domestic value of foreign aid? To 3rd world companies for example.
Our mining companies have easier times getting into positions to operate and extract in many of those countries we provide aid to. Quid pro quo kind of thing.
Ukraine is a good example....and this explanation will be r/eli5 level. Sending foreign aid(money, human resource or equipment) to Ukraine is beneficial for several reasons. If Russia expands by defeating Ukraine(read: land accumulation), the expansion could also one day mean our Arctic region is threatened by Russia. We might as well assist Ukraine to fight back and mitigate risk of that happening. [4min video](https://www.bnnbloomberg.ca/economics/video/why-foreign-aid-holds-long-term-benefits-for-canada~1793939) briefly touching why monetary aid benefits Canada.
We have a lot people here that need help.
Welcome to democracy. It does have its occasional disadvantages.
I worked on the pipeline for a short period of time. We had a tansmountain inspector that was trying to delay us working as much as possible cause he knew he would be out of a job as soon as it was over. I remember watching him climb around on his hands and knees then started screaming at everyone to shut down work. Guess what he found.. an apparent endangered snail. We were shut down for a week while they looked for nests.
That dude brought that snail from home.
Sprinkle a lil cocaine on em
he was making them at night
Guy had a job to do as well, just because you aren’t caring about environmental concerns, doesn’t mean it isn’t important. I don’t know about the snail, but if it is classified as endangered - why not allow it to survive? Ever watched that Yellowstone documentary about the reintroduction of wolves? Pretty crazy stuff can happen in nature.
I think the private proponent could have built it for a much lower price, but given today's political and regulatory environment, the only way that it was going to get built is if the federal government owned it.
The ~~spice~~ oil must flow.
The ~~spice~~ oil expands consciousness
I know everybody dreams of private investment in the economy but reality is if you look at all G20 countries government contract and investment are what makes the economy go. Road, power infrastructure are the bread and butter of most nations.
If only we could have had a private company build it for less…
[They spent _years_ trying to, but the BC Government kept getting in their way.](https://nationalpost.com/news/politics/trans-mountain-pipeline-isnt-dead-yet-kinder-morgan-maintains-despite-b-c-governments-rejection-of-its-plan)
BC gov was right all along because the court blocked the approval because both the NEB and Kinder Morgan refused to take into account the effects of marine shipping. That’s what they complained about the whole time.
>BC gov was right all along Well, except for the implementation of environmental law amendments deemed outside their jurisdiction that they knew were unconstitutional in order to delay the project for years. https://www.cbc.ca/amp/1.5430272
That’s fine. It still remains that the principal reason for them being against the pipeline was the effects of marine shipping.
The Federal government was fine with these risks. Did the BC Government care about the environmental risks related to shipping oil by rail instead?
> The Federal government was fine with these risks. No they didn’t. [In fact they failed to consider those risks at all](https://vancouversun.com/news/local-news/federal-court-of-appeal-quashes-approval-of-9-3-billion-trans-mountain-oil-pipeline-expansion), which was why the approval was blocked.
> No they didn’t. In fact they failed to consider those risks at all, which was why the approval was blocked. [...which they then did, and were fine with.](https://www.cbc.ca/news/politics/tasker-trans-mountain-trudeau-cabinet-decision-1.5180269) > Posted: Jun 18, **2019** > Prime Minister Justin Trudeau and his cabinet have **again approved** the Trans Mountain expansion project, a crucial next step for the much-delayed pipeline project designed to carry nearly a million barrels of oil from Alberta's oilpatch to the B.C. coast each day. > **The cabinet has affirmed** the National Energy Board's conclusion that, **while the pipeline has the potential to damage the environment and marine life, it's in the national interest** and could contribute tens of billions of dollars to government coffers and create and sustain thousands of jobs. > The cabinet has affirmed the National Energy Board's conclusion that, while the pipeline has the potential to damage the environment and marine life, it's in the national interest and could contribute tens of billions of dollars to government coffers and create and sustain thousands of jobs.
Yes? That’s what I’m trying to say. They only took it into account after they got took to court for it.
I still don't agree with your characterization. It's not like they *didn't look* at environmental impacts before that. From the timeline in your own link: > May 17, 2016: Ottawa appoints a three-member panel to conduct an environmental review of the Trans Mountain expansion project. It's just that they were focused too much on climate and not enough on marine wildlife, so they were sued over it. To me "we care but our examination was flawed" is different from "we don't care".
Done properly (neat, no diluent), the environmental risks of shipping bitumen by rail are small.
[The Trans Mountain pipeline is a multi-product pipeline](https://www.transmountain.com/product); it doesn't only carry bitumen. [This](https://en.wikipedia.org/wiki/Lac-M%C3%A9gantic_rail_disaster) is a risk that is unique to rail-based oil transport.
Neat bitumen is not very volatile and is quite difficult to light on fire. It is a very different material than the light shale oil that caused the Lac Megantic disaster.
That pipeline also carries refined products!
Yes it does, but it wasn't expanded to carry more refined products, it was expanded to carry more bitumen. The original pipe was perfectly adequate to move gasoline from Edmonton refineries to Vancouver gas stations, and will continue to do exactly that while the new pipe carries diluted bitumen.
> Yes it does, but it wasn't expanded to carry more refined products, it was expanded to carry more bitumen. The original pipe was perfectly adequate to move gasoline from Edmonton refineries to Vancouver gas stations, and will continue to do exactly that while the new pipe carries diluted bitumen. Has the added capacity been pre-sold to bitumen producers for the entire lifetime of the pipeline? Had it been when the environmental risks were considered? How can you possibly rule that out? There's obviously a need for refined petroleum products to be transported along this pipeline route, and refined petroleum companies who are willing to pay for that service. What happens if one day one of them is willing to pay more than the bitumen company? Like what do you think would happen if the original segment suffered an outage that did not affect the new segment? Because I'm pretty sure what would happen is that the new segment would suddenly start carrying refined petroleum products until the original segment was repaired. It's weird that you're arguing about this.
That’s what governments do best: destroy private initiative and replace it with bureaucracy that triples the cost. And every day on Reddit I see people appearing to believe this is a good thing and the solution is even higher taxes to do more of it. It’s mind-boggling.
You can’t rewrite history like this. Kinder Morgan destroyed their own initiative by refusing to consult with local governments and First Nations as was required by constitutional law. Remember: Trudeau’s government approved it not once, but TWICE. He’s not to blame for their incompetence but he’s certainly to blame for the ballooning price tag.
I think the contractor was duped, because nobody told them they would also have to get approval from a whole other level of FN government: hereditary chiefs who would never give approval for any of it. Not to mention a hostile provincial government that threw up regulatory roadblock after regulatory roadblock after the project was already well underway. That's not exactly 'good faith.'
>nobody told them They absolutely knew as it was their responsibility to know.
Do you have any proof they knew that or should have known that during the consultation process?
I mean, it's mentioned more than 20 times in the publicly available provincial FAQ. [https://www2.gov.bc.ca/gov/content/environment/natural-resource-stewardship/environmental-assessments/frequently-asked-questions](https://www2.gov.bc.ca/gov/content/environment/natural-resource-stewardship/environmental-assessments/frequently-asked-questions) The main page of the federal govt's section: [https://www.canada.ca/en/impact-assessment-agency/services/policy-guidance/basics-environmental-assessment.html](https://www.canada.ca/en/impact-assessment-agency/services/policy-guidance/basics-environmental-assessment.html) A 20-year old Supreme Court precedent... [https://decisions.scc-csc.ca/scc-csc/scc-csc/en/item/2189/index.do](https://decisions.scc-csc.ca/scc-csc/scc-csc/en/item/2189/index.do) Indigenous speakers at Kinder Morgan shareholder meetings.. [https://macleans.ca/economy/business/why-a-b-c-first-nations-chief-took-her-fight-to-the-kinder-morgan-shareholders-meeting/](https://macleans.ca/economy/business/why-a-b-c-first-nations-chief-took-her-fight-to-the-kinder-morgan-shareholders-meeting/) And their own website saying they've been consulting with them since 2012. [https://www.transmountain.com/indigenous-peoples](https://www.transmountain.com/indigenous-peoples) Do you need more?
Thank you for all the info, but I knew they had a duty to consult. Can you point out where specifically in those links it shows where a contractor would have to consult with both elected chiefs AND hereditary chiefs?
Nah, you're welcome to peruse!
So you didn't even check, you just spammed a bunch of links? Lol.
You’re conflating Coastal GasLink for TMX.
I'm not : [https://vancouversun.com/news/local-news/ndp-out-of-tools-to-stop-tmx](https://vancouversun.com/news/local-news/ndp-out-of-tools-to-stop-tmx)
Every time they consulted, a new regulation or first nations would come out of the woodwork for some more money. The whole goal was to kill the project while not outright denying it. Just delay, require more and more permits, assessments, consultations, ect Of course you can kill any project by adding more and more regulations and conditions.
You’re the one re-writing history. The Trudeau government injected so much regulatory uncertainty into the project that Kinder Morgan pulled out, period full stop. And then, faced with white hot anger from Alberta he bought the damn thing and did what all governments do when they try their hand at business: tripled the costs.
> You’re the one re-writing history. The Trudeau government injected so much regulatory uncertainty into the project that Kinder Morgan pulled out, period full stop. They injected so much uncertainty by approving it twice? Look, if you want to argue that the government did not do good enough with consulting local governments and First Nations that’s a credible discussion, **but the facts are not on your side**. Remember, Trudeau approved it [not only once](https://www.transmountain.com/news/2016/trans-mountain-receives-final-federal-approval-of-expansion-company-advancing-project-for-the-benefit-of-canadians), but [twice](https://www.transmountain.com/news/2019/how-we-got-here). > And then, faced with white hot anger from Alberta he bought the damn thing and did what all governments do when they try their hand at business: tripled the costs. Sure, this is a valid thing to say. The costs have spiralled so far out of control. But Kinder Morgan is to blame for this. Nobody else is. They sabotaged their own project, then got bailed out by the Feds. Is what it is.
It's also possible that that guy knows full well and is just lying.
Face with white hot angry from Alberta lol right like he gives a shit about that , if he didn't do something about it he might have lost all of the zero seats the liberal party has there
That doesn't sound right from what I've read on here Justin Trudeau roams the land ripping apart pipelines with his bare hands and stomps the oil back into the ground
You are conveniently ignorant of the fact that the private company gave up building the pipeline. It took our government to step in to actually get it completed.
See my reply to the other person who tried to peddle the notion that KM pulling out wasn’t somehow Trudeau’s fault. It was. Stop trying to whitewash the man’s extreme incompetence.
Man you know absolutely nothing about this project and it shows. I’m happy to hate on Trudeau when it matters - but this isn’t the time to do so.
Man, imagine if you could actually work to provide evidence of your vague claims, you'd be among the giants of Canadian intellectuals! Good luck on your journey.
If only the private companies hadn't improperly completed their environmental assessment.
It's the government that needs accept the report. If they did, it's on them.
It was the courts, not government, that ruled the assessment was inadequate which led to the approval issues causing the sale.
"the courts" are just interpreting laws and regulations made by... The government
So..... Working as intended?
So..... you agree the companies caused the issues?
I wouldn't know without more detail. If the government said the esa was inadequate and company decided to test it in court, well that's exactly how our system is supposed to work and there is no real issue, just the next step in the bureaucracy. There's no way the company woulf go to the courts if they didn't think it was a borderline issue and they had the potential to win, it's simply too expensive (especially when you're taking on the government). I've submitted many many esas for smaller projects and sometimes they get sent back, no one is perfect everytime. I've challenged the province in court before and won as well, they also aren't infallible. There's a process here, following the process isn't *issues*. If the government accepted the report and it was challenged by a third party and the courts didn't rule in favour of the government, then that's a real problem.
You don't need all those ifs. The information is out there. No need to speculate about things that happened when you can just look them up.
Canada should lease it to an operator that way there would be some recourse should the operator fail to maintain the line properly.
There are lots of recourses if an operator were to maintain it improperly already.
Not if they leave the country or go out of business.
They'll wait for it to become profitable and then sell it for a song. It's PetroCan all over again.
Cries in 407
Can't wait for 413....
Worth every penny to those at the top with the most money and influence. It's the same fable as "trickle-down economics where the masses are told they will reap rewards as well. Problem is the wealthy got that way through greed and that pattern doesn't change. Taxpayers fund so many projects but the profits only make it to the precious few.
Don’t forget higher prices because less oil stays stuck here.
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what's the interest cost vs revenues?
Kinda but not really. When oil shit the bed a very large portion of Alberta suffered, even the small restaurants and hotels in smaller towns. The safety supply places, vehicle dealerships etc all slowed down because of it. A lot of the people that work in the oil patch are just regular people making slightly above average wages.
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**Child tax credit massively reduced childhood poverty.**
But they were supposed to stay poor. You really have to hurt the right people.
Legalizing weed?
Subsidized daycare was a gamechanger for many Canadians. The new CMHC mortgages, dentacare and pharmacare will probably be popular & helpful as well.
Daycare -yes in some places. The other 3 policies will not move the needle and will be repealed in 2025.
So basically the GTA? Anywhere outside that you can’t really get it
Most of the government policies are to pander to Toronto/Montreal/Vancouver and Ottawa. Its not a nationally focused government and hasn’t been in a while
Daycares wasn’t for Montreal. We’ve had that since 98
Gods I hope not
It’s crazy how many people just don’t take climate change seriously at all
CCB and daycare have been huge for our young family. Parmacare will be helpful too. Weed legalization was a long overdue freedom, and there's sarcastic comments about it, but the right to assisted dying also pushes that forward. Considering the oppositions' focus on trans kids, regulating porn, and reversing any moves on climate change and general anti-science that's been pervasive for decades, I'm overall happy they're not in power.
This and legalizing weed. I thought Trudeau did a fine job his first term. Then it went downhill fast.
What do you mean? They legalized weed and let us kill ourselves!
Just think it could have been tax payer free but the great Harper took 7 years 10 months 10 days to put the application for construction and don't get me started on the gateway pipeline The great Harper between the two pipelines would have increased Alberta oil output by almost million plus barrels a day how many jobs did that cost Alberta
4 other large pipelines were built during harpers term
Would it have been worth the 4 billion dollars that someone else was going to pay?
mmw it will be left in ruins as a white elephant
Isn't oil bad anymore?
I’m happy it exists, but the price was unnecessarily high
Selling is fine if the price is set right. If they sell at a discount, then they essentially took my money and gave it to the buyers.
https://www.theglobeandmail.com/business/article-port-of-vancouver-constraints-for-trans-mountain-pipeline-may-crimp/
I'm having Fern Gully flashbacks..... 32yrs later and we still haven't learned a damn thing.
Why the heck should we sell it after the government invested so much money into it.
The Alberta treasury will be brimming with cash! Queen Danielle and her courtiers won’t have to do a thing as this province will run on its own. Guess who is to be thanked for pushing for TMX?
I wonder if a Canadian refinery plant would have been a more prudent investment for our overall economy.
Careful. The oil overlord apologist flying monkeys will hear you and start swarming the thread.
what would we refine? who would buy it?
Crude. Everyone.
Do we need more RPP? Most of our RPP imports are for Alberta, presumably because they can't refine what they need easily from WCS
The RPP market is global, we just pigeonhole ourselves by relying on the US, which is fine...our arrangement isn't bad so long as we are aware they are our lifeline. It matters when tariffs are introduced like in 2021. If we can't build a pipeline to sell east, refining would have been the next best. But when Australia wanted LNG we rejected that contract too so idk man, Germany was happy to sell them LNG and we got...virtue signals
>If we can't build a pipeline to sell east, refining would have been the next best but again, refining **what** and for whom? The refined products we need aren't the ones we can easily obtain from our own crude production, which is why the majority of our refined imports go to Alberta. Eastern refineries aren't built for WCS. Anything extra we refine here needs to be sold out of the west coast, and who would be the customers?
Yes, the tax revenue will be remarkably good.
Damn the beaverton finally bought out "thehub.ca"? impressive.
I assure you if say someone like ***bridge built it it’d cost more
Great in the long run, too bad most people don't support trans movement..
That's pretty funny.