Sovereign Wealth & Reconciliation Fund key to making 'Pipeline to Reconciliation' real

VANCOUVER, May 30, 2019 /CNW/ - If Project Reconciliation succeeds in purchasing a significant interest in the Trans Mountain pipeline and expansion project (TMX) on behalf of participating Indigenous community partners, revenue can begin to flow to an innovative Sovereign Wealth & Reconciliation Fund.

Project Reconciliation is positioned to buy a 51-per cent stake in TMX. Indigenous communities in Alberta, B.C. and Saskatchewan are eligible and have been invited to participate.

The Fund reflects one of Project Reconciliation's underlying principles, which is to create a base of generational wealth for Indigenous communities in Western Canada.

"Selling a majority stake in TMX to Indigenous community partners is the best way for Ottawa to turn its words about reconciliation into action," said Delbert Wapass, Project Reconciliation's Executive Chair & Founder. "The income derived from Project Reconciliation's interest in TMX along with the yield from the Sovereign Wealth & Reconciliation Fund will provide the basis for economic sovereignty for generations to come."

TMX ownership would be a game changer for the participating Indigenous community partners. A 51-per cent ownership stake would yield an estimated $12.5 billion in earnings (before interest, taxes, depreciation and amortization) over the next 50 years. Of this amount, 80 per cent (approximately $200 million per year) would be re-invested under the Fund into infrastructure-based assets that could include environmentally sustainable initiatives. The remaining 20 per cent would be distributed to the participating Indigenous community partners.

 "TMX can be a pipeline to reconciliation if we seize this moment. It's time we begin managing wealth and not poverty," said Shane Gottfriedson, the project's B.C. Regional Director. "It makes sense the owners of the traditional lands found above oil reserves should benefit when those resources are sent to market."

The federal government has already signaled its interest in proposals that include Indigenous involvement. Wallace Fox, the Alberta Director, said the Fund makes Project Reconciliation an ideal owner. "Indigenous involvement in energy infrastructure is a win-win. Our Sovereign Wealth & Reconciliation Fund will improve lives. And majority Indigenous ownership will ensure environmental stewardship over land and waters," he said.

Wapass, Gottfriedson, and Fox are all former chiefs. When established, the Fund would align fully with the principles outlined by the Truth and Reconciliation Commission.

Project Reconciliation

Project Reconciliation is a non-partisan, First Nations-led initiative that has invited Indigenous communities in B.C., Alberta and Saskatchewan to buy a majority stake (51 per cent) in the Trans Mountain pipeline and expansion project (TMX).

The project is headed up by Delbert Wapass, Executive Chair & Founder and former Chief of Thunderchild First Nation in Saskatchewan; Shane Gottfriedson, Regional Director, B.C., and former Chief of Tk'emlúps te Secwepemc First Nation; and Wallace Fox, Regional Director, Alberta, and former Chief of the Onion Lake Cree Nation; and is supported by a team of industry and business professionals that includes Stephen Mason, Managing Director & Founder of Project Reconciliation; and Pat Whelan, Managing Director & Founder, both who provide extensive experience and expertise in finance, business management and governance.

There is a pipeline to reconciliation. Here's why we should take it:

With a majority stake in TMX, participating Indigenous community partners would have direct input into how land, water, animals and fish are protected. They would have a seat at the table regarding how TMX is operated and constructed, and the authority to ensure that these activities meet high standards for environmental and marine protection and safety.

Participating Indigenous community partners would receive long-term revenue that could be used to achieve economic independence. The revenue would come both from earnings from the initial TMX investment, and from earnings from re-investments made under a Sovereign Wealth & Reconciliation Fund.

The Sovereign Wealth & Reconciliation Fund could facilitate a bridge to future technologies. It would be re-invested into infrastructure-based assets that could include environmentally sustainable initiatives.

Participating Indigenous community partners would not require upfront cash to invest. Project Reconciliation's financing plan would involve buying a 51-per cent interest in the existing pipeline, and obtaining funding for 51 per cent of the cost to construct the expansion project. Upon completion of the expansion project, Project Reconciliation's entire purchase and financing costs (i.e., 51 per cent of the cost of buying the original pipeline and 51 per cent of the cost of financing the construction of the expanded pipeline) would be refinanced through a syndicated, 20-year bond issue totalling approximately $7.6 billion.  No part of the financing would require public funding.  

Participating Indigenous community partners would not be exposed to any financial or liability risk.
As is the case with any other pipeline, TMX carries—and would continue to carry—insurance that would cover the costs of an incident, should one occur. Participating Indigenous community partners would not be held financially responsible or liable.

SOURCE Project Reconciliation

Sarah Del Giallo, Enterprise Canada, 416.586.1474 ext. 2255; MaryAnn Kenney, Project Reconciliation, 403.606.9998