A flurry of activity this month has only heightened the suspense surrounding the construction, or not, of the Trans Mountain pipeline extension that was given approval by the provincial and federal government last year.
On May 10, Kinder Morgan made a regulatory filing, stating the company plans to offer shares in Kinder Morgan Canada Ltd. at C$19 to C$22 a share. The company also did away with plans for offering joint minority-partnership stakes in the project, according to Bloomberg.
The Houston, Texas-based company will issue 79.5 million to 92.1 million shares to finance the pipeline extension project. It has been estimated that if shares sell as expected, Kinder Morgan Canada would be one of the largest initial public offerings (IPOs) in Canadian history.
Storm clouds in the forecast for Kinder Morgan
But hovering over Kinder Morgan’s IPO and the pipeline was the B.C. election held one day before. With the official election count due out this coming week, CBC Canada is reporting the final results rest in the hands of the communities of Courtenay and Comox, along the Strait of Georgia on Vancouver Island.
Right now, based on the initial election results from May 9, Christy Clark’s Liberals hold 43 seats, one short of the needed majority in the 87-seat assembly. So the final tally, which should be announced by late Tuesday or Wednesday, is going to be interesting. Keep in mind that Clark is for the pipeline, but if the Greens can manage a majority, the picture may change.
But even more surprising is the fact that by issuing shares on the Toronto Stock Market, Kinder Morgan has shown they may not be doing so well at raising the needed funds for their project, according to Goldman Sachs analyst Theodore Durbin, reports CTV News Canada.
Adam Scott, a senior campaigner with the environmental group Oil Change International, suggested the IPO could mean the company was “struggling” to raise funds. And like the Standing Rock Sioux in their fight against the Dakota Access Pipeline, where they went after financial institutions, getting many to divest from that project, The Treaty Alliance Against Tar Sands Expansion is doing the same thing.
The divestment campaign started earlier this month, targeting the 17 banks that fund oilsands projects, including CIBC, BMO, Scotiabank, TD Bank, and RBC. Most financial experts are looking at the divestment campaign as more of a “nuisance” or a totally futile effort that will end up doing nothing to stop the pipeline.
The consensus of just about everyone, from politicians to financial analysts is this: We will just have to wait and see.
