The federal government’s big move to buy the Trans Mountain pipeline for $4.5 billion may be facing intense backlash from opponents, but it was probably the only way to break the political deadlock that crippled the project, says the former CEO of one of Canada’s biggest pension funds.
Leo de Bever, former chief executive of Alberta Investment Management Corp. and now chairman of Nauticol Energy, told BNN Bloomberg on Tuesday that governments all over the world are involved in infrastructure projects and Canada’s purchase is no different.
“I think sometimes Canada is its own worst enemy, I agree with that. But, this is an attempt to say, look, this thing has to be built, it’s in the national interest for it to be built,” de Bever said. “Let’s get on with it and I think that’s the positive we have to take out of it.”
Coming right down to the wire before Kinder Morgan’s May 31 deadline for assurances on the future of the controversial Edmonton to Burnaby, B.C. pipeline expansion, Finance Minister Bill Morneau announced that the federal government will buy the project from the U.S. energy infrastructure giant.
The move has prompted criticism on the cost that Canadian taxpayers could face.
However, de Bever said that sometimes Canadians are “too hard” on themselves and the Trudeau government’s move could help speed up construction of the pipeline.
“When you look at the west coast of the U.S., when you look at infrastructure in general in the U.S., it’s a difficult sector to get anything done,” he said. “What this should do is cut down on the delay by asserting the federal jurisdiction into interprovincial trade and I think that’s the reason it has to be done.”
‘REAL WORK’ BEGINS
The big question now, according to de Bever, is whether the federal government can pull off building the pipeline expansion without more delays and cost overruns.
“Having been involved in something like this before, I would suggest Mr. Morneau find the smartest civil servant he has, a guy who really understands what’s at stake, and then run like hell to put together a management team probably from a lot of people that have the black and blue from past projects,” de Bever said.
The management team needed to run the crown corporation project will have to be very motivated, focused and accountable to avoid further problems with the pipeline, he added.
“Typically in an infrastructure project you have one government involved, but here you got Alberta, B.C., you got the feds,” de Bever said. “Now the real work begins.”