Bank of China (Canada) contributes $40 million CAD to $5.5 billion CAD revolving credit facility Kinder Moran Cochin for the development of the Trans Mountain Pipeline Expansion Project and working capital purposes in 2017 (Linked to Record ID#110452, #110454, #110455)

Project narrative

On June 16, 2017, financial close was reached on a deal in which a syndicate of 24 banks — including China Construction Bank (Toronto Branch), Bank of China (Canada), Bank of China (Toronto Branch), and ICBC — entered into a $5.5 billion USD syndicated loan agreement with Kinder Morgan Cochin ULC, a Canada-based special purpose vehicle created for the development of the Trans Mountain Pipeline Expansion Project. This loan was divided into three tranches: a CAD 4 billion construction facility, a CAD 1 billion contingent credit facility, and a CAD 500 million working capital facility. The maturity of the loan is 5 years, and the interest rate is LIBOR plus an applicable margin. The proceeds were used by the borrower to finance the Trans Mountain Pipeline Expansion Project (TMEP), which involves constructing a 980-km pipeline parallel to the existing Trans Mountain pipeline between Strathcona County, Alberta and Burnaby, British Columbia. The expansion will increase the pipeline’s capacity from 300,000 barrels per day to 890,000 barrels per day. Long-term shipper commitments cover 708,000 barrels per day, with the remainder reserved for spot volumes. The project also includes reactivating inactive segments, building 12 new pump stations, adding 19 storage tanks across multiple terminals, and constructing new berths at the Westridge Marine Terminal. While China Construction Bank (Toronto Branch) contributed $250 million CAD to this loan (Record ID#110452), Bank of China (Canada) contributed $40million CAD (Record ID#110453), Bank of China (Toronto Branch) contributed $40 million CAD (Record ID#110454), and ICBC contributed $50 million CAD (Record ID#110455), the following lenders also participated: Royal Bank of Canada ($415 million CAD), Canadian Imperial Bank of Commerce ($415 million CAD), Bank of Nova Scotia ($415 million CAD), Toronto-Dominion Bank ($415 million CAD), National Bank of Canada ($315 million CAD), Bank of Montreal ($315 million CAD), JPMorgan Chase Bank ($315 million CAD), Bank of America, N.A. ($315 million CAD), Mizuho Bank, Ltd. ($315 million CAD), Barclays Bank PLC ($315 million CAD), Bank of Tokyo-Mitsubishi UFJ, Ltd. Canada Branch ($250 million CAD), Sumitomo Mitsui Banking Corporation Canada Branch ($200 million CAD), HSBC Bank Canada ($200 million CAD), SunTrust Bank ($200 million CAD), FIPPGV/PX (Investments) Ltd. ($150 million CAD), Alberta Treasury Branches ($150 million CAD), Fédération des caisses Desjardins du Québec ($145 million CAD), Siemens Financial Limited ($80 million CAD), United Overseas Bank Ltd., Vancouver Branch ($80 million CAD), and Canadian Western Bank ($200 million CAD). The construction of the project was divided among several contractors selected by Trans Mountain in September 2017. Midwest Pipelines was awarded the Yellowhead segment between Edmonton and Jasper National Park. SA Energy Group received contracts for segments in Greater Edmonton, the North Thompson region, and the Fraser Valley. Ledcor Sicim Limited Partnership was assigned a major portion in the North Thompson area, while Surerus Murphy Joint Venture (SMJV) was responsible for the stretch between Black Pines and the Coquihalla Summit. Kiewit-Ledcor Trans Mountain Partnership was tasked with constructing a 35-km section between Langley and Burnaby, including the Burnaby Mountain Tunnel, Westridge Marine Terminal, Burnaby Terminal, and Sumas Terminal. Macro Spiecapag Joint Venture (MSJV) was contracted for an 85-km segment between the Coquihalla Summit and the Wahleach pump station. WorleyParsonsCord received the engineering, procurement, and construction (EPC) contract for the Edmonton Terminal and 12 pump stations. In May 2017, Trans Mountain signed an agreement with Evraz North America to supply 246,050 tonnes of pipe for roughly 800 km of the route. The project's regulatory timeline began with the National Energy Board (NEB) recommending approval to the Governor in Council after a 29-month review in May 2016. The Government of Canada approved the project in November 2016, and the British Columbia Environmental Assessment Office issued its environmental certificate in January 2017. Construction began in Central Alberta in August 2018. However, later that month, the Federal Court of Appeal overturned the NEB’s original approval, citing deficiencies in the environmental review — particularly regarding marine shipping impacts. The NEB launched a reconsideration process expected to conclude by February 2019. Despite legal and procedural setbacks, the project was scheduled for completion by 2020. On August 31, 2018, the Government of Canada purchased the pipeline for $4.5 billion from Kinder Morgan through the creation of the Trans Mountain Corporation (TMC), in order to "keep the project alive". TMC is a Crown corporation, a subsidiary of the Canada Development Investment Corporation (CDEV). On August 31, 2018, as per the Share and Unit Purchase Agreement dated May 29, 2018, Trans Mountain Corporation, which was set up to acquire the operating entities of the Trans Mountain Pipeline System (“TMPS”), purchased these entities from Kinder Morgan Cochin ULC.