Kinder Morgan Inc (NYSE:KMI) has won several municipal permits for expansion of its Trans Mountain Pipeline project which amounts to $5.8 billion. The ruling was made recently when Canada’s energy regulator considered offsetting some of the construction delays that have affected the operations of the company. However, the battle for Kinder Morgan is not yet over since the federal approval of the project is still facing opposition from several forces including the environmentalists, aboriginal groups, some municipal governments, and the province British Columbia.
Despite that, the ruling indicates some ‘measure of visibility’ that Kinder Morgan could overcome the disputes even before complying with certain bylaws set by different groups of stakeholders, according to Robert Kwan the analyst at Royal Bank of Canada.
Canada’s National Energy Board (NEB) stated that Kinder Morgan could possibly proceed with the project even when they have not met all the necessary requirements especially from the city of Burnaby in British Columbia where the piping is expected to pass through.
Ian Anderson the president at Kinder Morgan stated that they are pleased with the ruling and they are waiting for the regulator to make the final decision on their request and come up with a process that would consider similar cases in the future.
The company filed a motion with the energy regulator in October after it failed to receive permits from Burnaby city whose mayor is publicly against the project. Kinder Morgan intends to expand its pipeline from Alberta’s energy hub to a port located near Vancouver which would triple the firm’s capacity to 890,000 barrels every single day.
Though the company’s efforts to expand its Trans Mountain terminals into British Columbia continue facing legal hurdles, the recent ruling has shown the events could turn out in the firm’s favor. Canadian oil producers complain of high commodity prices since they rely on the landlocked product trades whose prices are determined by the West Texas Intermediate. They have welcomed the project stating that it would increase the pipeline capacity for competitive prices.
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