Pembina Pipeline Downplays Investment in Trans Mountain Expansion Due to Toll Uncertainty

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Pembina Pipeline Downplays Investment in Trans Mountain Expansion Due to Toll Uncertainty

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Pembina logo on the website (© Shutterstock/Pavel Kapysh)
Pembina logo on the website (© Shutterstock/Pavel Kapysh)

Canadian pipeline company Pembina Pipeline Corp. is hesitant to invest in the newly expanded Trans Mountain oil pipeline (TMX) due to uncertainty surrounding shipping tolls, Reuters reported on Friday, May 10, citing a company executive.

The Calgary-based company partnered with Western Indigenous Pipeline Group in 2021 to explore acquiring a stake in the government-owned pipeline. 

However, Pembina's chief financial officer, Cameron Goldade, downplayed the possibility during an earnings call, citing "a tremendous amount of uncertainty around that asset."

"As an investment opportunity, it's not something we're spending a great deal of time on right now," Goldade said.

Following its launch of commercial operations last week, the federal government plans to launch a divestment process for Trans Mountain later this year.

Industry analysts are skeptical of the government recouping its investment due to high construction costs that ballooned to C$34 billion ($24.88 billion) – more than four times the original budget.

Shippers argue that the proposed tolls are too high, with Canadian regulators scheduled to hold hearings this year to determine final tolls.

Despite Pembina's hesitance, TMX is expected to significantly increase oil transport capacity, shipping an additional 590,000 barrels per day of crude from Alberta's oil sands to Canada's west coast, improving access to markets in Asia and the U.S. West Coast. 

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