Keystone seen as bigger for oil sands producers than builder TransCanada

The U.S. decision on the Keystone XL pipeline is becoming more critical for oil sands producers such as Canadian Natural Resources (CNQ) and Suncor (SU) than pipeline builder TransCanada (TRP); for producers, Keystone is the earliest export line scheduled to ease bottlenecks which have helped push Canadian heavy crude $27/bbl below the U.S. benchmark.

CNQ, with 120K bbl/day of capacity booked on Keystone XL, may gain 5% while other producers such as SU, Cenovus (CVE), Husky Energy (HUSKF) and Imperial Oil (IMO) may rise if the State Department’s review is positive, Cormark predicts, while a negative report could spur a 3% drop for CNQ.

On the other hand, Keystone XL is only worth C$1.50 to TRP shares whether or not the project is approved, as the company has invested in other projects, according to some analysts.

John Podesta’s return to the White House places a Keystone opponent within Pres. Obama's inner circle, although he supposedly is recusing himself from issues surrounding the controversial project.

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Comments (15)
  • gchaput
    , contributor
    Comments (139) | Send Message
    If Keystone is turned down, Canada should immediately announce the building of two new mega refineries, one in Eastern Canada (for consumption in Eastern Canada & USA) and one in BC (for export). We need these types of huge projects to spur our economy. The financing and ownership could come from a consortium including pension funds (Teachers, CPPIB, Omers), producers (CNQ, SU, Cenovus), and sale of stock to Canadians.
    11 Dec 2013, 03:52 PM Reply Like
  • Ruffdog
    , contributor
    Comments (3769) | Send Message
    Great idea, but how are the Canadians going to get the oil to the new refineries. The US greenies will be in Canada protesting any pipeline being built there.
    12 Dec 2013, 10:16 AM Reply Like
  • Uncle Pie
    , contributor
    Comments (4321) | Send Message
    If Keystone is turned down, America will continue to rely on the friendly folks in Venezuela, Nigeria and the middle east. (the Gulf coast refineries imported about 980,000 barrels of heavy oil per day from Venezuela in 2012. Which is the oil Keystone could replace). America will continue to be obliged to build more air craft carriers and bombers to patrol the Straits of Hormuz and defend Saudi Arabia.
    11 Dec 2013, 04:02 PM Reply Like
  • rjj1960
    , contributor
    Comments (1481) | Send Message
    That oil if you throw in the defense budget only costs 225.00 per barrel. Why take in Canadian oil when Washington can pay top dollar. The Saudi family has to eat also.....
    11 Dec 2013, 04:17 PM Reply Like
  • Ruffdog
    , contributor
    Comments (3769) | Send Message
    Why can't the already built part of the Keystone pipeline carry North Dakota crude to the gulf rather than Canadian?
    12 Dec 2013, 10:18 AM Reply Like
  • bobby44
    , contributor
    Comments (505) | Send Message
    The line that is going in service right now runs from Cushing ok. It will take any oil that can get to Cushing.


    What we are talking about is getting oil to Cushing! KXL is not an express line. It will fill with Canadian oil then have an on ramp or 2 in ND to take the Bakken oil.


    Kill KXL - kill pipeline transport of ND. oil.
    15 Dec 2013, 04:30 PM Reply Like
  • rvshaw
    , contributor
    Comments (117) | Send Message
    And if Keystone is turned down, those two refineries should be placed on the border, so the U.S. can share in the emmissions.
    11 Dec 2013, 04:08 PM Reply Like
  • bobby44
    , contributor
    Comments (505) | Send Message
    I do not expect any new refineries in Canada although there could be big expansions if the crude stays in Canada. A $30.00 differential could be a big driver for expansions but building new to compete with existing refineries is a poor business. The new diesel project in Alberta will not use enough to be significant. Energy East could be a winner and drive expansions in eastern Canada for the export market.


    There are alternatives including rail, ship, truck and cross border terminals that accept Canadian crude into pipelines that do not cross the border. Lets all hope Canadian oil is not refused export permits to the USA after there are Canadian solutions put in place.
    11 Dec 2013, 05:56 PM Reply Like
  • 3619ches
    , contributor
    Comments (25) | Send Message
    I agree with both of you. As an US citizen who lives in North Dakota, I have no respect for the current administration holding back on the Keystone Pipeline. I believe that the US and Canada should be working together on energy independance.
    11 Dec 2013, 06:00 PM Reply Like
  • 6.5 swede
    , contributor
    Comments (100) | Send Message
    Keystone would be beneficial to both the US and Canada.
    Pres Obama is a fool. This is a missed opportunity.
    12 Dec 2013, 12:34 AM Reply Like
  • Energex
    , contributor
    Comments (1002) | Send Message
    I wonder if someone has calculated how many heavy oil tankers should be heading for the gulf, versus daily capacity of K-XL...


    Not sure about the impact on oil consumption but among other things, Canada should consider building a refinery in Alberta, mainly producing jet fuel. Then expand an airport to become a major hub and re-fuelling station for large plains flying from North American east coast to Japan, China, etc.
    I think, one of the reasons airlines like Etihad and Emirates exist, is less expensive fuel.
    12 Dec 2013, 06:04 AM Reply Like
  • DonSimon
    , contributor
    Comments (156) | Send Message
    The oil the USA will receive from the pipeline will not increase oil consumption in the USA. It will replace oil we receive from "friends" like Venezuela. The "greenies" who are against the pipeline naively believe that blocking it will assure the oil will not be PRODUCED . How stupid. Canada will produce it and sell it to others like the Chinese. Sadly Obama has nothing to lose politically himself if he keeps blocking it. All we Americans can do us vote out the bums who keep voting against it in congress.
    12 Dec 2013, 06:40 AM Reply Like
  • Hardy4
    , contributor
    Comment (1) | Send Message
    To reply to "Uncle Pie": That is the idea of rejecting Keystone so US continue rely on middle east and have to build aircraft carrier, attack plane, rockets, etc at enormous cost because all those industries are own by republicans who needs all the profit they can get. Then US also will be hated by everybody and so US citizens to be kidnapped and killed.
    16 Dec 2013, 11:40 AM Reply Like
  • bobby44
    , contributor
    Comments (505) | Send Message
    HUH?? Why would a democratic president support a republican enterprise? (BTW public companies are owned by shareholders of all political stripes)


    But you may be on to something. Obama is not a dove. Keeping things like they are gives him a common enemy to point to when things are not going well on the home front.
    22 Dec 2013, 11:17 AM Reply Like
  • Energex
    , contributor
    Comments (1002) | Send Message
    Texas-based Kinder Morgan has filed an application for a $5.4 billion pipeline expansion west to Vancouver.
    The pipeline would have capacity to transport up to 890,000 barrels per day
    If successful, the Chinese will be getting Canadian oil, a very reliable source, while the gulf will keep getting a lot of it's oil from the middle east and other unstable places.
    17 Dec 2013, 08:23 AM Reply Like
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