Trans Mountain construction to proceed pending successful completion of IPO next week

Trans Mountain construction to proceed pending successful completion of IPO next week

By Deborah Jaremko

May 25, 2017, 6:01 p.m.

Kinder Morgan pipe

Image: Kinder Morgan Canada

Kinder Morgan has issued its final investment decision for the Trans Mountain Pipeline Expansion, and it’s a yes—contingent on successful completion of the closing of its Canadian subsidiary’s initial public offering, which is expected on May 31.

The company expects to raise C$1.75 billion in the IPO, which prices 102.9 million shares in Kinder Morgan Canada at a price to the public of C$17 per share. It is one of the largest offerings in Canadian history.

Kinder Morgan says that while the political climate is not ideal, the process proceeded at this time because the Trans Mountain Expansion Project financing contingency period, as specified in shipper agreements, concludes at the end of May.

The recent B.C. election leaves the Trans Mountain-supporting Liberal party with a minority government against the province’s NDP and Greens, which both campaigned against the project.

Nevertheless, the project has the federal green light to proceed, as well as approval from B.C.

“Our execution planning is complete, our approvals are in hand, and we are now ready to commence construction activities this fall generating thousands of direct jobs for Canadians, including significant benefits to Indigenous communities in Alberta and British Columbia,” said Ian Anderson, president of Kinder Morgan Canada, in a statement on Thursday.

Kinder Morgan CEO Steve Kean added that, “Upon the completion of the IPO, we will have secured satisfactory financing for the Trans Mountain Expansion Project. We are excited to be moving forward on this tremendous project which is expected to benefit KMI and KML as well as our Trans Mountain shippers and Canada.”

Construction of the C$7.4 billion project to transport an additional 590,000 bbls/d on the Trans Mountain system to tidewater markets is now expected to begin in September 2017 with completion expected in December 2019.




About prosperitysaskatchewan

Consultant on Saskatchewan's natural resources.

Posted on May 26, 2017, in economic impact, oil, political. Bookmark the permalink. Leave a comment.

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