Let's say you're trying to sell your old car, a real beater. You hope you can get some sucker to give you five grand for it. And then along comes this young guy and, before your head can stop spinning, you're $32,000 richer.
Only you're not a guy with an old car. You're a sketchy Texas company with a beat up old pipeline, some rights of way and a few other assets. The young guy is none other than the Dauphin himself, Justin Trudeau. And Justin makes you an offer for your 60+ year old pipeline that's about 637% of what the damned thing is really worth. And then you do your Happy Dance.
HuffPost reports on a study that found Kinder Morgan made a 637% return on the sale of the TransMoutain pipeline to Deep Pockets Trudeau.
Texas-based Kinder Morgan made a seven-fold return on the sale of its Trans Mountain pipeline system to Canada's federal government, according to a new report that also warns the federal budget deficit could jump by 36 per cent because of the purchase.
The report comes from the Institute for Energy Economics and Financial Analysis (IEEFA), which is funded by a variety of philanthropic groups dedicated to climate and energy issues, including the Rockefeller Family Fund.Morneau, of course, called it a $4.5 billion "investment for Canadians" and even said it was a "fair price."
Morneau has said that the Liberal government plans to quickly flip the pipeline to a new owner, Alberta perhaps or the private sector. The only problem is it's going to be what's called a "distress sale." Nobody is going to pay the crazy money that Trudeau lavished on Kinder Morgan. It's highly unlikely that anyone will pay anything approaching whatever the real fair market value of TransMountain might be.
What is the fair market value of the J. Trudeau Memorial Pipeline today? What is a mega-bitumen pipeline worth when the Sword of Damocles, the Carbon Bubble, hangs over its head? When you're buying a pipeline you're paying for a 60-year asset. That's a pretty big risk when you look at the volatile state of world oil markets and the inevitable transition to alternative clean energy options. You're going to need to get your money back fast and that means you won't be paying multiple billions of dollars.
I won't be surprised if they have to pay someone to take it.
I sure hope it won't be that grim, Cap. Maybe it can eventually be repurposed for transmitting surplus BC rainwater to drought parched Alberta and Saskatchewan at "world" water prices.
How many women, who are living way below the poverty line,could the government increase their pensions for that amount of money in this country? How many issues are on the books where either the government is not collecting taxes it is owed or, spending the taxes of the poor people of this country bailing out obscenely wealthy people who live in foreign countries? Nauseating!! Anyong
Your anger is well founded, Anyong.
Mound, there are few industries more corrupt than the arms, construction, and oil and gas industries. So let's look at how those industries might sell your beater. I'll call our hypothetical seller "KM," and our hypothetical buyer "JM."
KM: Look at this creampuff! Have I got a deal for you!
JM: The neighbours hate it, the tires are bald, the floor's rusted through, it leaks oil, belches black smoke, and isn't even certified. No thanks!
KM: Wait, you haven't heard the best part! I say it's worth $5,000. But why don't you get your company, Canada Inc., to buy it from me for $15,000? Then I'll see that you, JM, get $5,000 out of the deal. What do you say?
JM: Hmmm... I'm starting to see the charms of your old hooptie. But the boss will want a cut and our charity, the LPC, could sure use a donation. Then what if the regulators and courts start looking into the deal?
KM: Well, you control the regulators, pal. And if you say it's a matter of national security or in the national interest, the courts won't want to interfere. So, why don't we call it an even $32,000, and I'll see that the boss and your charity end up real happy. What do you say?
JM: You've got a deal! I think we've found a "fair price for Canadians."
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