Technology: Trans Mountain received $320M in government subsidies in first half 2019: report - - PressFrom - Canada
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Technology Trans Mountain received $320M in government subsidies in first half 2019: report

12:07  20 november  2019
12:07  20 november  2019 Source:   msn.com

Pipeline blues: Liberal TMX pipeline purchase does little for voters in Edson, Alta.

  Pipeline blues: Liberal TMX pipeline purchase does little for voters in Edson, Alta. There are stacks of giant steel pipes in an Edson industrial yard to be used for the Trans Mountain pipeline expansion. But there's been no significant project work in the area and that's weighing on residents' minds in this election.The pipes were delivered to this town 200 kilometres west of Edmonton to be used in the construction of the Trans Mountain pipeline. But months after that delivery — and more than a year after the federal Liberals bought the line for $4.5 billion — there's been no significant project work in the area and that's weighing on the minds of residents in this election.

VANCOUVER - The Trans Mountain pipeline received $ 320 million in subsidies from the Canadian and Alberta governments in the first half of 2019 , says a new report by an economic institute that analyzes environmental issues.

VANCOUVER — The Trans Mountain pipeline received $ 320 million in subsidies from the Canadian and Alberta governments in the first half of 2019 , says a new report by an economic institute that analyzes environmental issues.The money included 5.8 million in direct subsidies and 3.8

  Trans Mountain received $320M in government subsidies in first half 2019: report © Provided by Canadian Press Enterprises Inc

VANCOUVER — The Trans Mountain pipeline received $320 million in subsidies from the Canadian and Alberta governments in the first half of 2019, says a new report by an economic institute that analyzes environmental issues.

The money included $135.8 million in direct subsidies and $183.8 million in indirect subsidies that were not clearly disclosed to taxpayers, says the report by the Institute for Energy Economics and Financial Analysis.

"This is a very large subsidy. It really does require more public discussion and public disclosure," says Tom Sanzillo, the group's director of finance and a former deputy comptroller of the state of New York.

Emergency response at Trans Mountain’s Burnaby tank farm could take 6 hours: Report

  Emergency response at Trans Mountain’s Burnaby tank farm could take 6 hours: Report The 2016 was not made public, and only came to light through a freedom of information request by Burnaby election candidate Svend Robinson.The report estimates Trans Mountain's planned response time to a major event, such as a serious fire, at six hours.

VANCOUVER — The Trans Mountain pipeline received $ 320 million in subsidies from the Canadian and Alberta governments in the first half of 2019 , says a new report by an economic institute that analyzes environmental issues. The money included 5.8 million in direct subsidies and

VANCOUVER — The Trans Mountain pipeline received $ 320 million in subsidies from the Canadian and Alberta governments in the first half of 2019 , says a new report by an economic institute that analyzes environmental issues. The money included 5.8 million in direct subsidies and

Sanzillo and the report's co-author, institute financial analyst Kathy Hipple, analyzed the second-quarter report of the Canada Development Investment Corp., a Crown corporation meant to further the country's economic development that counts Trans Mountain Corp. among its subsidiaries.

The document is public but presents a consolidated picture of the development corporation's finances, including revenues from the Canada Hibernia Holding Corp., which operates the Crown's interest in oil reserves off Newfoundland and Labrador.

This accounting treatment obscures the real financial state of Trans Mountain, Sanzillo says.

"It's a good form of accounting. I'm not criticizing it. It just shouldn't be the only mechanism for showing the public how much money is being spent on this," he says.

Even after election, Trans Mountain may still loom large in Burnaby and beyond

  Even after election, Trans Mountain may still loom large in Burnaby and beyond In the riding of Burnaby North-Seymour, the Trans Mountain pipeline was a major issue in the tight contest. Incumbent Terry Beech held onto his seat but a political scientist says the pipeline could remain a political point of contention in a minority Parliament.Every one of those interviews, the returning Liberal MP for Burnaby North-Seymour said, meant answering questions about the Trans Mountain pipeline.

VANCOUVER - The Trans Mountain pipeline received $ 320 million in subsidies from the Canadian and Alberta governments in the first half of 2019 , says a new report by an economic institute that analyzes environmental issues. The money included 5.8 million in direct subsidies and

VANCOUVER -- The Trans Mountain pipeline received $ 320 million in subsidies from the Canadian and Alberta governments in the first half of 2019 , says a new report by an economic institute that analyzes environmental issues. The money included 5.8 million in direct subsidies and 3.8

The Canadian government gave the development corporation just over $5 billion to finance the acquisition of Trans Mountain, the report says. Trans Mountain Corp. must make regular interest payments to the Canadian government at a rate of 4.7 per cent.

The cash was provided to Trans Mountain in two sections: a $2.8 billion loan and a $2.3 billion equity investment. The interest on the loan must be paid from the pipeline's business activity, while the interest on the equity investment can be paid from a third-party subsidy, the report says.

Trans Mountain adds thousands of new positions for pipeline expansion project

  Trans Mountain adds thousands of new positions for pipeline expansion project Prime Minister Justin Trudeau has promised the project will go ahead.In a news release, the company says 2,200 new positions have been added since Sept. 30 for the expansion project, with a focus on Indigenous, regional and local workers.

The Trans Mountain pipeline received $ 320 million in subsidies from the Canadian and Alberta governments in the first half of 2019 , says a new report by an economic institute that analyzes environmental issues. The money included 5.8 million in direct subsidies and

VANCOUVER — The Trans Mountain pipeline received $ 320 million in subsidies from the Canadian and Alberta governments in the first half of 2019 , says a new report by an economic institute that analyzes environmental issues.

The Canada Hibernia Holding Corp. covered the interest on the equity investment for the first half of 2019, representing a direct subsidy of $46.3 million, the report says.

Trans Mountain posted a $10.9 million loss in this reporting period prior to taxes, the report says.

However, the loss is subsidized in the consolidated financial report by the Hibernia corporation's earnings, amounting to another $10.9-million direct subsidy, the report says.

Saskatchewan to intervene on Ottawa's side in Trans Mountain case

  Saskatchewan to intervene on Ottawa's side in Trans Mountain case Saskatchewan has gotten the green light to intervene on the side of the federal government and defend the Trans Mountain pipeline expansion from another attempt to block it in court.  Six Indigenous groups and nations are set to go before the Federal Court of Appeal to seek a judicial review of the federal cabinet’s second approval of the project, which will triple the capacity of an existing pipeline that sends Alberta oil to the west coast.

The Trans Mountain Pipeline System, or simply the Trans Mountain Pipeline, is a pipeline that carries crude and refined oil from Alberta to the coast of British Columbia, Canada.

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Sanzillo also says the development corporation uses an "accounting gimmick" to obscure Trans Mountain's pension liability of $24.4 million. This is one more direct subsidy, he says.

Finally, the Alberta government reduced corporate taxes through a tax credit starting in January 2019. This policy action allowed Trans Mountain to save $54.1 million in taxes, yet another direct subsidy that the development corporation uses to turn the corporation's pre-tax loss into a post-tax gain, according to the report.

A representative for Trans Mountain referred all questions about the report to the Department of Finance, which says that the government does not consider any part of its investment in the pipeline to be a subsidy.

The department says in a statement late Tuesday that Trans Mountain Corp. is undertaking a major expansion and incurring associated expenses without any related revenues, which is "normal" during the development phase of any big project.

It also says the government extended loans using commercial-level rates and it still considers the expansion project to be economically viable.

Trans Mountain received $320M in government subsidies in first half 2019: report

  Trans Mountain received $320M in government subsidies in first half 2019: report VANCOUVER — The Trans Mountain pipeline received $320 million in subsidies from the Canadian and Alberta governments in the first half of 2019, says a new report by an economic institute that analyzes environmental issues. The money included $135.8 million in direct subsidies and $183.8 million in indirect subsidies that were not clearly disclosed to taxpayers, says the report by the Institute for Energy Economics and Financial Analysis. "ThisThe money included $135.8 million in direct subsidies and $183.8 million in indirect subsidies that were not clearly disclosed to taxpayers, says the report by the Institute for Energy Economics and Financial Analysis.

Read More: PG&E CEO Sees Government Takeover as a Tall Order for California. “Most of northern and central California has not received any significant precipitation this fall and fire potential is Trans Mountain received $ 320 M in government subsidies in first half 2019 : report . The Canadian Press.

Other projects that received subsidies included engineering works on self-elevating drilling rig, ultra-large iron ore carrier, robotics and China State Shipbuilding Corp (CSSC) shared that it has received approximately RMB117.59m (.71 m ) in government subsidies over the first six months of this

"The government expects to realize a positive financial return on its investment," the statement says.

Sanzillo, however, identifies what he calls an indirect subsidy — the difference between the interest a private company would have charged Trans Mountain versus the rate charged by the Canadian government.

Canada's 4.7 per cent interest rate stands in contrast with the 12 to 15 per cent rate of return used by its former owner, Kinder Morgan, the report says.

Sanzillo used the lower figure, 12 per cent, to calculate that a private company would have charged Trans Mountain $302.1 million in interest in the first half of 2019. The Canadian government, meanwhile, charged it $118.3 million.

That amounts to an indirect subsidy of $183.8 million for the first six months of the year, according to the report.

The report authors acknowledge that the Canadian government does not have to adhere to commercial standards.

"(The report) is about transparency and not meant to be a legal challenge to the right of the Canadian government to subsidize the pipeline project. It is a matter of dollars at risk that the Canadian taxpayer might absorb," it says.

When the authors added the $46.3-million interest payment and the $24.4-million pension expense back to Trans Mountain's financials, they concluded the pipeline corporation had a $67.1-million pre-tax loss and a $12.9 million loss after taxes.

The Canadian government plans to ultimately sell the pipeline. If it does so for a lower price than it paid for the infrastructure, it can legally forgive any debt that is left over, Sanzillo adds.

This report by The Canadian Press was first published Nov. 19, 2019.

Laura Kane, The Canadian Press

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