'Rhetoric and hyperbole': Horgan fires back at finance minister over feds' Trans Mountain backing

The federal finance minister singled out B.C. Premier John Horgan's efforts to thwart the Trans Mountain pipeline expansion Wednesday, as he outlined measures Ottawa is taking to remove "politically motivated" investment risks.

Speaking in Ottawa, Bill Morneau said his government is willing to compensate Kinder Morgan — or any other company interested in building the pipeline — against any financial loss due to the actions of the B.C. government.

"We're prepared to indemnify the project against any financial loss that derives from Premier Horgan's attempts to delay or obstruct the project," Morneau said.

Speaking to reporters following an event in Vancouver, Horgan fired back at Morneau's characterization of the dispute.

"I think that is rhetoric and hyperbole on his part. There are fundamental challenges to that project that he well knows," Horgan said.

"For a Toronto-based finance minister to single out British Columbia as a problem here, he should look at the failure of Energy East, he should look at the failure of Keystone and a whole host of other projects."

Morneau declined to say how much Ottawa would be willing to spend to back the pipeline expansion.

Notley 'ready and willing to turn off the taps'

Alberta Premier Rachel Notley responded to the comments from Ottawa by declaring her government's intention to immediately pass Bill 12.

The Preserving Canada's Economic Prosperity Act gives Alberta's energy minister the power to restrict shipments of oil and gas leaving that province.

Any restriction in supply could send already high gas prices in B.C. even higher.

"As of the end of the day today, Alberta will be equipped with new tools to assert our rights to control the flow of our resources to British Columbia," Notley said.

"If the path forward for the pipeline through B.C. is not settled soon, I am ready and prepared to turn off the taps."

The B.C. government has said it believes the bill is unconstitutional and it plans to challenge it in court, should Alberta pass it and attempt to use it.

Legal challenges

Kinder Morgan has set a deadline of May 31 to decide whether it will continue with the Trans Mountain project, which has federal approval. 

The pipeline expansion is facing uncertainty due to court action by the B.C. government over environmental concerns.

B.C. has filed a reference case with the province's top court to determine if it has jurisdiction to limit expanded shipments of heavy oil through the province.

Horgan has said clarity is needed to ensure the B.C. government protects its coastline, but critics say the move is a tactic to delay or block the project by creating uncertainty.

And taking the matter to the courts only serves to put taxpayers on the hook, said B.C. Liberals Leader Andrew Wilkinson.

"Instead of the private sector paying to build this pipeline, taxpayers will now be responsible for cleaning up Horgan's mess," Wilkinson said in a statement.

"The results of his actions are being felt all across the province, including the shattering of investor confidence. The hike in gas prices we are seeing now is only the beginning."

Meanwhile, an environmental law group in B.C. is expressing concerns about the federal government's plan to provide financial support for the pipeline expansion.

In focusing on the actions of the B.C. government, Ottawa is ignoring other legal risks the project faces, said Eugene Kung, a staff lawyer at West Coast Environmental Law.

"No matter how much money the government pours into this project, it still faces significant risks," Kung said. "Particularly the legal risks associated with the ongoing court challenges that could derail the project completely."

Seven First Nations are among more than a dozen groups challenging the approval of the pipeline expansion in Federal Appeal Court.

The challenge is based on principles of Aboriginal title and the Crown's constitutional duty to meaningful consultation with First Nations.

Shareholders meet in Calgary

Morneau's comments on financial backing for Trans Mountain ​come as Kinder Morgan Canada's stakeholders meet in Calgary on Wednesday.

Ottawa says the twinned pipeline would create 15,000 jobs, 9,000 of which would be in B.C.

Discussions with the company on how large a cheque Ottawa may be willing to write to move the project forward continue in Calgary, Morneau said.

In a statement, Kinder Morgan Canada chairman and CEO Steve Kean said Morneau's comments were appreciated and he confirmed that talks are continuing.

"While discussions are ongoing, we are not yet in alignment and will not negotiate in public," he said.