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The government of British Columbia says it will not support construction of Enbridge's (ENB)...
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Monday, July 23, 2012, 5:37 PM ETThe government of British Columbia says it will not support construction of Enbridge's (ENB) Northern Gateway project unless it receives a bigger slice of ~C$81B in overall tax revenue the pipeline expects to generate in its first 30 years of operation. The demands would apply to any company hoping to build heavy oil pipelines through B.C., including KMP’s plan to expand its Trans Mountain pipeline.
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This news story has 9 comments:
Deny the jobs, deny the capital investment, deny the ancillary economic effects, deny the sales taxes, deny the value-added taxes. Just hold the project hostage unless the government hacks can exact their direct pound of flesh.
Now, of course, any sane country, like the U.S. should be, but isn't, would immediately invite Enbridge to build their pipeline through Washington and to the port of Seattle, and Enbridge could tell BC to whistle Dixie. But, of course, liberal ideologues all think and act alike, so there's no respite.
Dumb and dumber.
B.C. knows that the project needs to go through their territory...well it'll cost the company X dollars to use their land if the price becomes too high than they can move the pipeline to an area that's willing to accept the project for less money.
The ancillary economic affect should have no bearing on the actual negotiation of the project. Like the negotiation of a trade in of a vehicle should have no bearing on the negotiation of a new car purchase.
We'll just have to disagree.
There's no reason whatsoever for a government to have to stand in the way of what otherwise would be normal commerce. I can only assume that there are existing specific laws applying to permits and taxation, and the government should be entitled to whatever that says, not a penny more or less. Their actions smack of blackmail, trying to torpedo the project, if their "tribute" isn't paid.
Frankly, I find it disgusting. I only wish there was some other province or state that would make them pay for their hubris.
1) You forget that governments reflect the will of their people. What if the majority of BC'ers don't want the pipeline? So what about "states" rights?
2) If anyone had read the article there is a concern about setting aside enough money to make sure that the taxpayer is not on the hook for any spills.
So I would say with BC exercising their state rights and protecting the taxpayer, they are exercising the proper conservative attitude.
Ancillary effects are all theoretical until they occur, and should not be counted on the balance sheet of a deal. That is part of the problem with our (Canada and the US) finances of late. Counting too many line-items as revenue when it really doesn't exist. These companies want to make money, and happily they will. They have to pay for their problems, though.
Disclosure, I am long pipelines in Alberta, though not ENB in particular.