Caisse de dépôt reveals stake in Kinder Morgan: Reuters

Canada’s second biggest public pension fund, Caisse de dépôt et placement du Québec, held a 7.8 percent stake in Kinder Morgan Canada Ltd at the end of last year, according to its annual report, making it the largest independent shareholder of the pipeline company at the centre of a contentious expansion project.

The Caisse, which discloses its shareholdings in Canadian companies once a year, said it acquired the stake in the period following Kinder Morgan Canada’s initial public offering last May and before it announced plans to reduce its carbon footprint by 25 percent per dollar invested last October.

Kinder Morgan, a unit of Kinder Morgan Inc, is at the centre of an escalating crisis over a planned $7.4 billion (US$5.9 billion) Trans Mountain oil pipeline project that will almost triple the capacity of its line from Alberta to British Columbia.

The company has threatened to pull out of the project unless all hurdles are cleared by May 31. In a post-earnings call on Wednesday, Kinder Morgan said recent events confirmed an investment in the Trans Mountain pipeline expansion may be “untenable.” It added that Ottawa’s pledge of financial support did not resolve political risk related to British Columbia’s opposition.

The project, which has the support of Canada’s federal government, is opposed by the province of British Columbia.

Caisse spokesman Maxime Chagnon declined to say what the fund’s current shareholding in Kinder Morgan is, or whether it planned to keep a stake in light of its carbon footprint commitment.

“The Kinder Morgan investment was before we adopted our new strategy regarding climate change,” he said. “We’re looking at the portfolio and all of our assets on an overall basis to see how we can reach our objective.”

Update: Kinder Morgan had held talks with Canadian pension funds and private equity firms about raising funds for the Trans Mountain pipeline project, Reuters reported in early 2017.

(Reporting by Matt Scuffham; Editing by Tom Brown)

(This story has been edited by Kirk Falconer, editor of PE Hub Canada)

Photo courtesy of Reuters/Ben Nelms