Kinder Morgan has announced a deal that would see Regina’s Evraz steel mill supply more than 75 per cent of the pipe needed to expand the Trans Mountain pipeline between Alberta and B.C.
The agreement to supply about 250,000 metric tonnes, or 800 kilometres, of pipe is contingent upon Kinder Morgan’s final investment decision, the company said in a news release Tuesday.
Material will be sourced from Evraz’s recycled metal operations in Alberta, Saskatchewan, Manitoba and Ontario, and the pipe will be manufactured by Canadian members of the United Steelworkers Union.
“It has been our commitment from day one to deliver benefits from this Project to Canadians, and we are pleased to announce the single largest potential procurement contract to a Canadian plant and Canadian workers,” Kinder Morgan Canada president Ian Anderson said in the release.
Evraz North America is the only producer of 100 per cent made-in-Canada pipe and currently employs more than 1,000 workers at its Regina plant
“We look forward to working with Kinder Morgan on this Project. Our collective expertise will make this one of the most technically advanced and environmentally safe pipelines in the world,” Evraz North America president and CEO Conrad Winkler said in the release.
According to Kinder Morgan, the $7.4-billion expansion project will result in 15,000 jobs per year during construction.
“The men and women of the United Steelworkers 5890 in Regina will be proud to produce the vast majority of the pipe for the Trans Mountain Expansion in Canada, for Canada,” Stephen Hunt, the union’s director for Western Canada, said in the release.
“With decades of experience making high quality steel and pipe, we will make this the safest and most environmentally sound pipeline possible. Making this pipe means preserving and creating highly skilled, well-paying, middle class Canadian jobs.”
Overall, the Conference Board of Canada estimates the project will generate $46.7 billion in government revenues and 802,000 person years of employment, the equivalent of 37,000 jobs per year during operations.
Kinder Morgan says the remainder of the pipe needed, as well as other procurement contracts, will be announced as project planning proceeds.
Next steps for the project include arranging financing and a final investment decision by Kinder Morgan. Construction is set to begin in fall 2017 and the project is expected to be in service in late 2019.
