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Alberta government will spend $1.5 billion in KXL pipeline to kickstart construction

Western Canada Select (WCS) has been trading at historic lows of less than $5/bbl in March.

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The $1.5 billion investment in TC Energy’s Keystone XL pipeline will be made this year and will backstop the project with a $6 billion loan guarantee in 2021.

“The government is backstopping the project to enable TC Energy to begin immediate construction on the Alberta portion of the pipeline,” the early morning press release stated.

“This will ensure the earliest possible date of completion (of 2023).”

TC Energy will repay the Alberta government once oil is flowing, according to the release.

“We cannot wait for the end of the pandemic and the global recession to act,” Alberta Premier Jason Kenney said.

“There are steps we must make now to build our future focussed [sic] on jobs, the economy, and pipelines.”

TC Energy said the project will “lead to thousands of new jobs, billions in economic stimulus and enhanced North American energy security.”

The project will result in approximately US$8 billion investment into the North American economy according to the release from TC Energy.

“We appreciate the ongoing backing of landowners, customers, Indigenous group and numerous partners in the U.S. and Canada who helped us secure project support and key regulatory approvals as this important energy infrastructure project is poised to put thousands of people to work, generate substantial economic benefits and strengthen the continent’s energy security,” said Russ Girling, TC Energy’s president and chief executive officer.

“In addition, we thank U.S. President Donald Trump and Alberta Premier Jason Kenney as well as many government officials across North America for their advocacy without which, individually and collectively, this Project could not have advanced.”

Girling added that TC Energy would continue to “take guidance from all levels of government and health authorities” to ensure the safety of staff and communities during the current pandemic.

“Construction will advance only after every consideration for the health and safety of our people, their families, and of those in the surrounding communities has been taken into account,” Girling said.

The KXL project has previously secured transportation agreements for 575,000 Bbl/day for 20 years but has been delayed multiple times over opposition and court battles, mostly in the U.S. President Trump has approved the project by special declaration twice over the past four years.

The project will move product from Hardisty, in east central Alberta, to Steele City, Nebraska, where it will then move through TC Energy’s existing lines to be transported to the Gulf Coast refineries.

“As part of the funding plan, the Government of Alberta has agreed to invest approximately US$1.1 billion as equity in the Project, which substantially covers planned construction costs through the end of 2020,” TC Energy’s release said.

“The remaining capital investment of approximately US$6.9 billion is expected to be largely made in 2021 and 2022 and funded through the combination of a US$4.2 billion project level credit facility to be fully guaranteed by the Government of Alberta and a US$2.7 billion investment by TC Energy.”

Premier Jason Kenney had promised additional government spending in Alberta’s oil and gas sector in the lead up to the release of Alberta’s budget.

Kenney recently demanded more money from the federal government to prop up the sector which was sidelined by increased production from Saudi Arabia and Russia in mid-March.

“Today we are moving forward with a project that is essential to our future prosperity,” Kenney said.

“This investment in Keystone XL is a bold move to retake control of our province’s economic destiny and put it firmly back in the hands of the owners of our natural resources, the people of Alberta.”

Kenney said his government is confident in the investment and believes the province will be able to sell its shares “at profit.”

Western Canada Select (WCS) has been trading at historic lows of less than US$5/bbl in March and West Texas Intermediate (WTI) has been battered down to US$20/bbl amid the “predatory dumping” of oil by Saudi Arabia.

On March 28 the Alberta Premier said he is trying to broker a deal with U.S. officials that will effectively close the borders to Saudi and Russian oil. The U.S. became the world’s number one exporter of oil in 2017, which caused OPEC to strike a deal with Russia to voluntarily decrease production to maintain oil prices.

That deal was set to expire at the end of March this year.

Deirdre Mitchell-MacLean is a Senior Reporter with Western Standard
dmaclean@westernstandardonline.com
Twitter @Mitchell_AB

News

POLL: UCP 40, NDP, 34, WIP 10

New polling suggests that Alberta’s political landscape may be undergoing a shift.

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According to the second part of a Northwest Research Poll commissioned by the Western Standard, Alberta’s political landscape appears to be undergoing a shift.

The governing United Conservative Party (UCP) has seen its big lead shrink from 55 per cent in the 2019 election down to 40 per cent of decided voters. While the NDP remains virtually unchanged at 34 per cent, the upstart Wildrose Independence Party (WIP) comes onto the scene in its first major poll in third place at 10 per cent.

The Alberta Party garnered 8 per cent, the Liberals 7, and the Greens 1.

Undecided voters made up 23 per cent of the total, coming mostly at the expense of Albertans who voted UCP in last year’s election.

The poll surveyed 1,100 people in Alberta, was weighted for regional population, age, and gender, and contains a margin of error of 3.02 per cent. 

“These numbers line up with other polls tracing declining support for the UCP government and the premier, but suggest a new liability that is directly related to Kenney’s strategy of tapping into anger and anti-federalist sentiments,” said Mount Royal University political scientist Lori Williams.

“Some of us warned of the dangers of stoking such inclinations in the lead up to the 2019 election. Such anger can turn against leaders/governments who fail to meet the expectations raised. And indeed, the new Wildrose Independence Party appears to be capitalizing on the growing legitimacy of anti-federalist [and pro] independence rhetoric.”

“I would not be surprised to see the highest support [for the WIP] in former Wildrose and Social Credit strongholds [i.e. central and southern Alberta]. As the poll also seems to suggest, there may be enduring challenges for opponents of the UCP and Kenney, splitting their vote for alternatives.”

Poll conducted by Northwest Research Group, all rights reserved by Western Standard (Wildrose Media Corp.)

Regional breakdown

The regional breakdowns also tell an interesting story.

The Tories remain dominant in Calgary with 47 per cent support, well ahead of the NDP at 27, the Alberta Party at 9, the Wildrose Independence Party at 8, and the Liberals at 7.

The NDP maintain their stronghold on Edmonton with 48 per cent, with the UCP at 31, the Alberta Party and Liberals both at 8, and the Wildrose at 5.

Outside of the two big cities, the UCP remains ahead, but its domination has been shaken with support down to 43 per cent. The NDP stand at 27, the Wildrose Independence Party at 16, Alberta at 8, Liberals at 4, and Greens at 2.

Independence question becoming Alberta’s third rail

Earlier this week, the Western Standard released a poll from the same respondents on support for Alberta independence. With support ranging from 45 to 48 per cent of decided respondents, independence could become the third-rail of Alberta politics.

The poll found that independence support was 82 per cent with Wildrose Independence Party voters, 52 per cent with UCP voters, 50 per cent with Alberta Party voters, 41 per cent of current undecided voters, and just 11 per cent of NDP voters.

Earlier this week, the Western Standard released a poll from the same respondents on support for Alberta independence. With support ranging from 45 to 48 per cent of decided respondents, independence could become the third-rail of Alberta politics.

This is likely fuelling early support for the Wildrose Independence Party, which will be formed in late June if members of the Freedom Conservative Party and Wexit Alberta vote to approve a merger deal.

Divided left, centre-left

Changes in the political landscape aren’t just happening on the right-end of the spectrum. While the NDP remains the dominant force on the left, it’s two centre-left competitors continue to sap potential strength.

The Alberta Party continues to tread water from its 2019 election results at 8 per cent, and the Liberals have made somewhat of a comeback to 7 per cent, up from the 1 per cent they received during the election.

The Liberal numbers show that the NDP still has discontented progressive voters not yet under its tent, and that the Alberta Party has yet to starve the Liberals out as the sole “goldilocks” option between the NDP and UCP.

Dave Naylor is the News Editor of the Western Standard
dnaylor@westernstandardonline.com
Twitter.com/nobby7694

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News

Torstar sold for only $ 52 million

Once valued in the billions, Torstar Corp. says it has agreed to be sold to NordStar Capital LP, a firm run by businessmen Paul Rivett and Jordan Bitove.

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The company that runs Canada’s largest newspaper – the 128-year-old Toronto Star – has been bought for only $52 million.

Once valued in the billions, Torstar Corp. says it has agreed to be sold to NordStar Capital LP, a firm run by Toronto businessmen Paul Rivett and Jordan Bitove.

Torstar’s shares closed at 40 cents at the end of trading Tuesday, but the company says the 63 cents per share it agreed to represents a nearly 67 per cent premium.

“We believe in news. With this transaction we can ensure a future for world-class journalists and world-class journalism befitting the paper’s storied history,” Bitove told the Star.

Former Ontario Liberal premier David Peterson will be vice chair of the company, which they intend to take private.

“The harsh realities of the news media business are ill-suited to the quarter-bound short-term focus of shareholders. A private structure is needed and we have the patience and willingness to invest in Torstar’s long-term transformation,” Rivett and Bitove said in a statement.

John Honderich, chair of Torstar’s board of directors, said in a press release: “While we have loved the company and are immensely proud of it, the time has come to pass the torch.

“We hope the sale will benefit Torstar in the years ahead and believe that this is the beginning of an exciting new chapter for the company. We are delighted to know that the new owners have pledged to build on Torstar’s legacy of quality journalism.”

Torstar had a net loss of $23.5 million (29 cents per share) in the first quarter, up from a net loss of $7.4 million (9 cents per share) in the same period last year.

Torstar owns six other daily newspaper in Ontario including the Hamilton Spectator and Waterloo Region Record, some 70 community newspapers and numerous news sites and digital properties.

In recent newspaper sales:

• In 1998, Quebecor buys Sun Media Corp for $983 million cash, outbidding Torstar’s offer of $900 million in cash and stocks.

• In 2014, Quebecor sells Sun Media to Postmedia for $313 million.

• In 2020, NordStar Capital buys Torstar/Toronto Star for $52 million.

Dave Naylor is the News Editor of the Western Standard

dnaylor@westernstandardonline.com

Twitter.com/nobby7694

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Taxpayers’ group demands UCP pay back wage subsidy

The CTF say at least 20 different political parties across the country have turned down the subsidy, but the UCP isn’t one of them.

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The Canadian Taxpayers Federation is demanding Alberta’s UCP party pay back coronavirus wage subsidies they have received from the federal government.

The CTF say at least 20 different political parties across the country have turned down the subsidy, but the UCP isn’t one of them.

“The United Conservative Party ran on being the party that would look out for taxpayers, but now the UCP is helping itself to tax dollars meant to support struggling Albertans,” said Franco Terrazzano, the CTF’s Alberta Director.

“Premiers John Horgan, Scott Moe, Brian Pallister, Doug Ford and François Legault all know that taking the wage subsidy is wrong and it’s time for Premier Jason Kenney to pay back the subsidy.”

The subsidy provides employers affected by COVID-19 with a 75 per cent wage subsidy to keep workers on staff.

The CTF said in terms of governing parties the British Columbia New Democratic Party, the Saskatchewan Party, the Progressive Conservative Party of Manitoba, the Progressive Conservative Party of Ontario and Coalition Avenir Québec did not apply for the subsidy.

Only two other provincial parties, the B.C Liberal Party and B.C. Green Party, have confirmed applying for the federal wage subsidy, the CTF said.

“The federal wage subsidy is supposed to be helping struggling families and businesses, not paying for political attacks ads,” said Terrazzano., adding the CTF doesn’t accept the wage subsidy.

“It’s time for the UCP and Premier Kenney to pay that money back.”

Federally, the two top Tory leadership candidates have criticized their own party for accepting federal wage subsidies during the coronavirus pandemic.

Both Peter Mackay and Erin O’Toole said the federal Conservative party should not have applied for the subsidies.

Over the weekend it was revealed the federal Liberal, Tory and NDP parties are all accepting the packages on behalf of their paid staff due to a steep drop in political donations.

The Bloc Quebecois did not apply for the subsidy.

Leader Yves-François Blanchet mocked the Tories and Liberals for using the program despite having already raised millions of dollars this year.

“The money is not a gift provided to the people by the government because they are nice people. It is reserved for businesses, the companies and the people who really need it. And the Liberals don’t need it and the Conservatives don’t need it. Maybe the NDP needs it. Maybe the Greens need it. We do not,” Blanchet told reporters.

Dave Naylor is the News Editor of the Western Standard

dnaylor@westernstandardonline.com

Twitter.com/nobby7694

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