Pipeline Gamble

Canada's most violent political storm in two decades blew itself out last week. Three weeks of bitter debate, marked by some of the wildest scenes ever witnessed in the staid Canadian Parliament, ended with the passage of the government's natural-gas pipeline bill (TIME, May 21) just six hours before the deadline for starting work on the project this year.

Under the bill's terms, the Canadian government will lend up to $80 million to the U.S.-controlled Trans-Canada Pipe Lines Ltd. to launch one of the biggest and riskiest construction projects ever undertaken in Canada. The company will begin building the world's longest gas pipeline, costing more than $350 million, to bring Alberta gas some 2,000 miles to industrial Eastern Canada. Trans-Canada must complete the first 574-mile leg to Winnipeg before next Dec. 31 and must repay the loan, with 5% interest, by next April. If it fails, the company will lose all its assets in government loan foreclosure.

Staked on the pipeline, along with Trans-Canada's financial future, is the political fate of Canada's long-ruling Liberal government. Opposition parties and most of the Canadian press bitterly opposed the lending of public funds to Trans-Canada, a firm originally set up by Texas Oilman Clint Murchison and still 83% owned by U.S. gas and oil interests. Some of the opponents of the loan held out for a public-owned pipeline; others demanded that the money be lent to a Canadian company. The government stuck to its argument that Trans-Canada was the only builder with the equipment and know-how to begin the pipeline this year. Four times during the angry debate, the Liberals invoked the detested, rarely used closure rule to ram the measure through.

Their use of the gag technique in Parliament will weigh against the Liberals in the next election campaign. The opposition parties, sounding off at a steadily rising pitch against U.S. financial control of Canadian industry, will belabor the government for its support of Trans-Canada. But if Alberta gas is gushing through to Winnipeg this year, the government will be able to point to a notable industrial asset gained, and to argue that the end justified the means.

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