Pipes for the Trans Mountain Pipeline Project are visible at a storage facility near Hope, British Columbia, on September 1, 2020. JONATHAN HAYWARD / The Canadian Press
The federal government has approved a new loan guarantee of approximately $ 10 billion for the Trans Mountain gas pipeline project.
The guarantee was approved by the cabinet on April 29 through the Canadian account with Crown Corporation Export Development Canada, which provides support for loan guarantees for Canadian businesses.
The EDC website says the Canadian account is used to support projects that are in Canada’s national interest but that are subject to significant risks, including project size, borrower risk or market risk.
The Trans Mountain Pipeline is Canada’s only oil pipeline system from Alberta to the West Coast. The ongoing construction project will essentially double the existing pipeline, increasing daily output to 890,000 barrels.
In February, Trans Mountain Corp. announced that the estimated cost of the project has risen to $ 21.4 billion, compared to an earlier estimate of $ 12.6 billion due to newly discovered budget overruns.
Finance Minister Christia Freeland then said there would be no additional public funding for the pipeline. She said Trans Mountain would have to secure funding from third countries to complete the project, either through banks or through public debt markets.
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