Kinder Morgan’s (KMI +3.3%) Trans Mountain oil pipeline, now approved by Canadian Prime Minister Trudeau, will continue to face hurdles before it can be built, as the country sorts out the rights and roles of indigenous people in major energy projects.
Analysts say delays are possible as KMI and Enbridge (ENB +0.1%) - whose Line 3 expansion was approved while the Northern Gateway project was rejected - work to satisfy the conditions placed on their approvals, which "will take some time and may also be met with a variety of legal challenges," says Credit Suisse's Andrew Kuske.
“It’s not happening. We’ll do what it takes to stop it,” says a member of the Vancouver-area Tsleil-Waututh indigenous community, adding that there’s a “strong possibility” the community will file a legal challenge against Trans Mountain.
KMI says it will now seek all necessary permits, review cost estimates and make its final investment decision; it expects construction to begin in September 2017 and for the pipeline to enter service in late 2019.
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