Trans Mountain 3.0 Revives Indigenous Pipeline Ownership Push

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(Bloomberg) — Canada’s announcement last week that Trans Mountain Corp. will build a 1 million-barrel-a-day oil pipeline along the government-owned company’s existing Alberta-to-British Columbia route is rekindling Indigenous interest in acquiring a stake in the company.

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Groups including the Western Indigenous Pipeline Group and Project Reconciliation are preparing for a new opportunity to acquire an equity stake on behalf of Indigenous communities. The groups formed after the federal government purchased the only oil pipeline linking Alberta’s oil sands to Canada’s Pacific coast eight years ago.

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WIPG plans to meet with Pembina Pipeline Corp. in the coming week to discuss the company’s decision to help build the new line, Joe Dion, chief executive officer, said by phone on Sunday. Pembina and WIPG formed a 50-50 partnership five years ago to acquire an ownership stake in Trans Mountain. The Calgary-based midstream company said Thursday that it signed an initial agreement to help build the new line for an initial 10% stake, with an option to raise the holding to 20%. An email to Pembina for comment on its partnership with WIPG hasn’t been returned.

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Steve Mason, Project Reconciliation’s CEO, said by phone that he’s meeting with his team about reviving the group’s effort to invest in Trans Mountain. Project Reconciliation had earlier sought 100% ownership of the company. 

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The renewed push is emerging after Prime Minister Mark Carney and Alberta Premier Danielle Smith said last week that a third pipeline will be added to Trans Mountain’s existing two pipelines. The new system will run to a new deep-water export terminal able to handle the world’s largest oil tankers. According to the project’s description, “meaningful Indigenous equity ownership” is foundational to the plan, which is estimated to cost between C$35.2 billion ($24.8 billion) and C$43.7 billion if investment is greenlit in the next three years.

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The Indigenous groups said they hope the new pipeline announcement will revive the federal government’s stalled plan to sell part of the Trans Mountain system to First Nation communities. The idea first surfaced after Canada, then led by Prime Minister Justin Trudeau, bought the system in 2018 for C$4.5 billion after the existing owner, Kinder Morgan Inc., threatened to pull the plug on the project amid fierce opposition in British Columbia.  

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The government initiated a process to sell a stake in Trans Mountain in 2023, with more than 120 Indigenous communities participating. The process stalled before the expanded pipeline system started operating in May 2024. Ultimately, the project was completed years behind schedule at a final cost of about C$34 billion, about six times more than what was originally proposed. Trans Mountain’s expanded system is now running and providing dividends to the federal government. 

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“We don’t know how it’s all going to work out,” Dion said. “But, right now, we want Canada to fulfill their promise that First Nations will have equity.”