Invest in Canada, or Don't

On August 30^th the happiest person in Canada was the Prime Minister because the courts shot down the Trans Mountain Pipeline (TMP).  We wrote in the 225^th issue that he and four of the provinces have been trying everything possible to close the whole energy sector.  They have continually told investors to take their money elsewhere.  And, they have.  Data shows that in 2017, Foreign Direct Investment (FDI) into Canada was lower than in any other year since 2005, other than 2009.  In fact, FDI jumped off a cliff as soon as Justin grabbed the reigns in 2015 and is expected to fall almost 15% in 2018.

Have you noticed before the Liberals took power there were no problems in expanding the energy sector?  Then Trudeau arrives and changes the rules.  TMP would in operation today if he had not interfered. Things will only get worse under T2.  Specifically, he has laws before the House of Commons giving the right for any person, group or local government to object to any major project via Bill C-69.  Before Ottawa had the right to issue every needed permit, but under this new bill it will give the power to the protesters.   

If TMP is to go ahead it will basically have to restart the process which will easily take 5 to 10 years, thanks to Bill C-69.  The TMP decision, while relative to this case, can now be used as evidence for all major developments like the building of dams, more pipelines, new mines and major infrastructure.  No business is going to waste years and millions of dollars to get approved maybe within a decade. 
In the meantime, Ottawa will go through the motions wasting taxpayer’s money trying to get the project restarted.  TMP did everything the courts required to avoid a Gateway Pipeline type rejection.  This time this same judge added a bunch of new regulations in rejecting TMP. 

The Greens are happy because now more oil will be shipped by safer means, like trucks and rail tanker (even though they are not). Not surprising, there has not been one protest about all the rail tanker cars that travel a few feet from many fast-moving rivers throughout Canada.  If one of these trains would ever have an accident and slip into the one of these rivers it would destroy the river for years to come plus cause chaos downstream.  But the Greens do not care. Soon one-mile long tanker rail cars will be the norm.  Most will be going to the West coast of the U.S. to be shipped elsewhere.  Americans will get thousands of jobs and Canada might get a few hundred.  

Protesters have told us that all oil tankers in the waters of B.C. are a threat to whales and are too noisy for marine life.  The TMP was going to add just over 1 extra tanker per week on average when the new pipeline was completed.  Why is it that container ships and cruise ships are not a threat to the whales, only oil tankers are? Plus, all the international boat traffic going up and down our coast are not viewed as threat to marine life.    During the summer months it is possible to see up to four cruise ships a day enter the Vancouver harbour, and not one of these is a threat to whales. 

We noticed that immediately after the announcement that pipeline shares, which should have jumped in value due to being full for years to come, resulting in higher profits and future dividends, but they were flat to down slightly.  This is a perfect sign that the markets believe Ottawa and Trudeau will continue to do everything in their power to close all pipelines and the energy sector.  Of course, it will never happen due to the energy sector being the biggest tax generator in Canada.  Afterall, politicians love to spend.

Prediction:  Trudeau until election day will show us he “is going to get TMP built.”  If he wins the election he will cancel the TMP.  It will be a victory for Trudeau and a major loss for all of Canada.