CALGARY — Opposition politicians hit the Liberal government with pointed questions Monday over news that two Kinder Morgan Canada executives will each be given $1.5-million bonuses to ensure they stay on as its Trans Mountain pipeline system is sold to the federal government.
The retention bonuses for president Ian Anderson and David Safari, the vice-president overseeing the Trans Mountain pipeline expansion, are detailed in a company regulatory filing dated Tuesday, May 29, the day the government announced its deal to buy the pipeline assets for $4.5 billion.
The government should immediately table details of the “Kinder Morgan bailout,” B.C. New Democrat MP Nathan Cullen said in the House of Commons, complaining it is paying too much.
“Adding insult to injury to this public bailout, it includes a $3-million bonus to Kinder Morgan executives,” he charged.
The company is being richly rewarded for not having to pay for its $7.4-billion Trans Mountain expansion project, added Shannon Stubbs, an Alberta Conservative MP and natural resources critic.
“Apparently, the gift of tax dollars will also pay $1.5 million bonuses each to two Kinder Morgan executives, which is good news for the rich executives, bad news for Canadian energy workers,” she said.
The deal was defended by Prime Minister Justin Trudeau and Finance Minister Bill Morneau, who reiterated the government’s position that the pipeline will create jobs while helping to alleviate steep discounts in prices for Canadian oil that amount to the annual loss of $15 billion in potential value.
The bonuses for Anderson and Safari are to be paid in equal parts in July 2019 and July 2020 and are conditional on their continued employment through each date, the filing states.
“The arrangements were reviewed and approved by the Kinder Morgan Canada board of directors and are consistent with industry practice for a project and transaction of this size,” the company said in an email Monday.
The government has said it is counting on the continued employment of key pipeline staff to ensure completion of the project to triple capacity of the pipeline from Edmonton to Burnaby, B.C.
The filing goes on to note that Kinder Morgan Canada has terminated and repaid a $5.5-billion revolving credit facility with the Royal Bank of Canada.
Ottawa is to provide loan guarantees for any money the company spends on the endeavour between now and when the pipeline’s ownership changes.
Kinder Morgan is to ask shareholders to vote on the deal before the end of July. If shareholders approve the sale, the paperwork is to be completed sometime in August or September.
Construction is expected to be finished in about two and a half years.
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Companies in this article: (TSX:KML)
Dan Healing, The Canadian Press