Canada paid a high price for oil pipeline: budget watchdog
A watchdog said Thursday Canadian Prime Minister Justin Trudeau paid more than he needed to for a controversial oil pipeline to the Pacific -- which could come back to haunt him in October elections. The federal government stepped in to buy and effectively nationalize the Trans Mountain pipeline to get a key Canadian resource to new overseas markets after mounting legal challenges and environmental protests stalled the project.
In a report, the Parliamentary Budget Officer (PBO) estimated the current value of the pipeline was between Can$3.6 billion (US$2.7 billion) and Can$4.6 billion. “From our analysis, the government of Canada’s purchase price of Can$4.4 billion does put it at the higher end of the pipeline’s valuation range,” said PBO Yves Giroux.
“Our financial assessment assumes of course that the pipeline is built on time and on budget,” he said in a statement. Canada is the world’s fourth largest oil producer and exporter, but almost all of it goes to the United States.
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