Home News and Politics Shocking Bombshell: Pembina Pipeline CEO’s Stunning Demand Amidst Trans Mountain Chaos!

Shocking Bombshell: Pembina Pipeline CEO’s Stunning Demand Amidst Trans Mountain Chaos!

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Shocking Bombshell: Pembina Pipeline CEO’s Stunning Demand Amidst Trans Mountain Chaos!

CEO of Pembina Pipeline Corp. Demands Certainty Before Considering Equity Stake in Trans Mountain Expansion Project

The CEO of Pembina Pipeline Corp. has stated that the company requires more certainty regarding timing, regulations, and costs related to the Trans Mountain expansion project before making a decision about acquiring an equity stake in the pipeline. The Calgary-based pipeline company recently formed a partnership called Chinook Pathways with the Western Indigenous Pipeline Group to pursue an Indigenous-led equity stake in Trans Mountain. However, neither Pembina nor Chinook Pathways are currently eligible to participate in the first phase of the federal government’s pipeline divestment process, which involves discussions with Indigenous nations along the pipeline route.

The federal government purchased Trans Mountain in 2018 to ensure the completion of a planned expansion. However, the government has consistently expressed its intention not to be the long-term owner of the pipeline and has initiated a divestment process. The timing of the second phase of this process, which involves considering commercial offers for the remaining stake in the pipeline, remains uncertain.

According to Pembina Pipeline CEO Scott Burrows, numerous unknown factors still surround the Trans Mountain expansion project, including outstanding regulatory, construction, and tolling issues. As a prudent commercial purchaser, Pembina requires these issues to be resolved before assessing the opportunity and determining its next steps. Burrows noted that the earliest the divestment of the asset could likely occur is the end of 2024, but there are additional uncertainties that may impact the schedule, costs, and timing.

Uncertainty Surrounding Trans Mountain Pipeline Sale

The sale of Trans Mountain is expected to be one of the largest commercial transactions in Canadian history. However, there is uncertainty regarding the present value of the pipeline, as the capital costs for its expansion project have significantly increased from the initial purchase price of $4.5 billion to over $30 billion. The tolls negotiated with oil companies will also impact the pipeline’s revenue and the potential sale price.

Furthermore, it remains unclear how large an equity stake will be sold to Indigenous communities during Phase 1 of the divestment process. While Trans Mountain Corp., the Crown corporation behind the project, gained regulatory permission for a route deviation to address construction challenges, the project continues to face hurdles in its final stages. Most recently, the Canada Energy Regulator issued a temporary stop-work order due to Trans Mountain’s environmental non-compliance near Abbotsford, B.C., which could further impact the project’s timeline.

Pembina Pipeline Reports Record Earnings

Pembina Pipeline Corp. announced record adjusted earnings of $1.02 million for the third quarter of 2023. Based on these results, the company has raised its full-year earnings guidance range for 2023. The updated estimate is between $3.75 billion and $3.85 billion, up from the previous range of $3.55 billion to $3.75 billion.

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