After all the talk, deadline date for Trans Mountain nears without clear picture of the future

Decision day is looming for the Trans Mountain pipeline expansion, one of the most polarizing energy projects in years, but there's no clear signof an outcome despite weeks of politicsand closed-door talks.

"This is really the make-or-break week for this particular project," said Warren Mabee,director ofthe Queen's Institute for Energy and Environmental Policy.

• Indigenous chiefs, activists attend Kinder Morgan protest in Montreal
• Pro-pipeline supporters rally for Kinder Morgan project in Langley, B.C.

Last month, Kinder Morgan Canada, facing protests and legal challenges in British Columbia,issued an ultimatum, saying it needed clarity on a path forward for the $7.4-billion projectby May 31 or it would walk away from construction.

This touched off private talksbetween the Alberta and federal governments and Kinder Morgan, and spurred Finance Minister Bill Morneau'spromise to backstop the projectagainstfinancial losses caused by British Columbia's efforts to thwart it.

Feud between Alberta and B.C.

The deadlinealso poured fuel on thefeud between Alberta and B.C.,and brought into focus issues around the environment, Canada's reputation as a place to do business, and the federal government's role in protecting both.

But while politicians have had much to say about Trans Mountain, Kinder Morgan has had little to offerin recent weeks, leaving experts tospeculateon what will ultimately happen with the project, which could triple the amount ofproduct shipped from Alberta's oilsands to the company'sfacilities in Burnaby, B.C., where it can be exported.

• Court throws out Trans Mountain pipeline challenge from City of Vancouver and Squamish Nation

While analysts have said Kinder Morgan could simply walk from the project despite investing more than $1 billion so far, Mabeedoesn't think that's how things will play out.

Rather, Mabeebelieves that the federal government will invest perhaps heavily to encourage the line's construction.

"I suspect that what's going to happen is that the government of Canada will make a sizeable investment," he said.

"I don't know what the number will be and I've heard lots of different numbers. I thinkKinder Morgan will probably stay associated with the project because ultimately they'll see benefit and they've sunk a lot of effort into it.

"An investment would go a long way to offsetting their own financial risk."

Project may need to change

Mabeebelieves the project will be built in the end.

"But I think that there could be many concessions between now and then," he said. "And ... what ultimately gets put into the ground, and what ultimately operates, may not look the same as what they're talking about today."

British Columbia is concerned about the threat of an oil spill, both by tankers plying its coasts and along the pipeline route. Environmentalists disagree with a project that will lead to burning of more fossil fuels, that will conflict with Canada's climate change goals. These concerns will have to be addressed for the project to be viable in the eyes of many British Columbians.

Zachary Rogers, a research analyst at Wood Mackenzie, also expects the expansion to be built and has even speculated on a construction date. However, this is not based on what the company has said.

"The reason thatin Wood MacKenzie's viewthat it's likely going to go in in 2021 is it comes down to the Canadian federal government's willingness to assert its authority over a project that they've deemed in the national interest," Rogerssaid."Nothing is certain, but we do believe that the pipeline will end up going in inthe early 2020s."

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In recent weeks, critics have raised questions about the viability of the project.

All the existing pipelines filled

But Rogers says clearly the Alberta and federal governments are convinced of the commercial need.Alberta and the energy sector contend that the pipeline is necessary for the health of the oilpatch by easing transportation constraints and helping Canadian oil to reach more marketsthan just the U.S.

"Production growth in Western Canada has filled up all the existing pipelines. As a consequence, the producers have had to ship out some crude on rail which has obviously hurt their netback price in the basin," he said.

"From that perspective, we don't feel that Kinder Morgan needs to really convince the Alberta or Canadian government of the need of the pipeline."

Thus therealquestion becomes, Rogers said,will the Canadian government back this pipeline all the way through?

Richard Massonspeculates thatOttawa might be willing to go a very long way.

Masson, the former CEO ofthe Alberta Petroleum Marketing Commission andexecutive fellow of the University of Calgary's School of Public Policy, said the government could make a play for Kinder Morgan Canada.

"My view is that one or both of the Alberta and federal governments are going to make a proposal to buy Kinder Morgan Canada and effectively buy the Trans Mountain expansion," Masson said.

Massondoesn't believe any private sector companies are willing to step into the shoes of Kinder Morgan, nor is he convinced that Ottawa's indemnity pledgeis enough to convince Kinder Morgan to proceed.

Could Ottawa buy Kinder Morgan?

If government decides the only way to get the line built is to step up and do it itself, then Masson suggests it couldmake sense to buy all of the company's assets, including the existing Trans Mountain pipelineand terminal facilities.

Kinder Morgan Canada has a market cap of nearly $6 billion.

• Morneau says government willing to compensate Kinder Morgan against political delays

"If you're just trying to do the expansion you would have to put in place your own team, you wouldn't get the synergies of having the two lines operating as a system," Massonsaid.

"The ideal way would be for somebody to buy the whole company and manage the two lines together."

But even if government decided to buy into the pipeline business, the Trans Mountain expansion would still face the same challenges with protests and the courts it does today. The government would also have to figure out how and who to manage such an enterprise.

Morneau may have some answers for Canadians on Wednesday, when he gives a speech to a sold-out event at the Calgary Chamber of Commerce, one day ahead of Kinder Morgan's deadline.

It's certain the audience will bebigger than those in attendance.