Is Trans Mountain’s Profitability an Accounting Illusion? | The Tyee

On a sunny afternoon in August, Trans Mountain CEO Mark Maki donned a black jumpsuit to stroll atop a giant loading dock in Burnaby. Below, his company’s new pipeline pumped oil into tankers bound for the open ocean.

“We’re returning money now to the owner,” Maki said in a Global News segment. “Canadian taxpayers who are the shareholders of the system are reaping those benefits.”

What Maki didn’t mention was that the operating pipeline’s profit streak was relatively new, appearing after a sudden change had turned its months-long losses into gains.

Little had changed on the ground. The amount of oil travelling through the pipe had remained mostly stable, as had its fees. Instead, the boon came on the company’s balance sheets, where millions in monthly interest payments vanished overnight.

“The only reason Trans Mountain looks like it’s making a profit is that most of the debt has been moved off their books,” said Thomas Gunton, a professor and director in resource and environmental planning at Simon Fraser University.

“It’s a misrepresentation of finances on this project.”