NationTalk: Union of BC Indian Chiefs – Recent announcements that the new cost of the Trans Mountain Pipeline Expansion (TMX) has ballooned to $21.4 billion, and that the federal government will not invest further public funds into the project should be a major red flag for anyone considering economic participation or ownership of the controversial pipeline, which is also delayed by at least one year.
Because of this massive cost increase – 4 times the original cost estimate – any illusion of the commercial viability of TMX has collapsed and the pipeline is destined to become a stranded asset. The unique structure of TMX’s tolls means that only 25% of cost overruns can be recovered from customers, meaning that the company and its owners will have to absorb $10 billion (and counting) of the cost overruns. Furthermore, the toll structure limits the ability for Trans Mountain to fully recover operating cost such as integrity and safety costs.
UBCIC supports Indigenous self-determination and economic self-sufficiency. However, this cannot come at any cost nor in a way that undermines other Nations’ title and sovereignty.
We are concerned that the government is using TMX as another divide and conquer project and is not providing a full and accurate account of the financial future of the project. Your due diligence must include an assessment of the commercial viability of TMX under its unique toll structure, and also include an analysis of future liability related to maintenance and spills. Otherwise TMX could be modern-day economic version of a small-pox blanket.
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