Seeking Alpha

Keystone approval could be "light bulb moment" for investing in Canada

  • It's been nearly three years since the Obama administration started stalling and deferring its decision on the Keystone XL (TRP) pipeline, but the prevailing view is that the project will go ahead - and when it does, an approval could be "a light bulb moment" for investing in Canadian energy, says analyst Sonny Mottahed of Calgary-based Black Spruce Capital.
  • The Keystone debacle has resulted in negative investor sentiment toward Canadian energy stocks, depressing their values relative to U.S. counterparts, Mottahed says; approval would remove much of the negative psychology, with investors saying Canada is in the game again.
  • Many investors also feel that Keystone delays are constraining the development of Canada's energy sector, "so if that roadblock is removed, it would be a big positive," says Nomura's Charles St. Arnaud.
  • The uncertainty has resulted in “an overhang on market access against Canadians” that has pushed capital to the U.S. energy industry, Canadian Natural Resources (CNQ) CFO Corey Bieber says.
Comments (47)
  • Bear Bait
    , contributor
    Comments (664) | Send Message
     
    I have always said reroute it away from the Aquifer and then build it. My question here is; why should we the US put our environment at risk to the benefit of Canadian energy companies. It has been documented quite heavily that the oil isn't coming to benefit the US consumer but is headed to the Gulf for export to higher paying/profit markets.
    4 Apr, 11:30 AM Reply Like
  • DevilDog85
    , contributor
    Comments (266) | Send Message
     
    The Aquifer is not at risk. Do you not read?
    4 Apr, 11:44 AM Reply Like
  • Bear Bait
    , contributor
    Comments (664) | Send Message
     
    please explain to me why the Aquifer is not at risk.
    4 Apr, 11:47 AM Reply Like
  • DevilDog85
    , contributor
    Comments (266) | Send Message
     
    No, you made the statement so do your own research. That is not the cause of the delay.
    4 Apr, 12:06 PM Reply Like
  • marpy
    , contributor
    Comments (682) | Send Message
     
    Because all the reputable scientific studies that have looked at this have said that it is not at risk. The aquifer in the area that the pipeline is running in and most of aquifers in general are hundreds of feet underground while the pipeline is at most 10 feet underground. A leak means you get a blob of oil sitting on the ground and in the case of heavy oil, diluent s that tend to evaporate or can be collected. As such the far bigger risk is the impact a leak near surface water ways would have. And even here there are precautions that have been put in place to minimize this as much as possible. There are thousands and thousands of pipelines that cross America and most of them are far more of a risk than keystone due to age and old technology and they do cross many aquifers. You would be far better focusing on them and getting improvements to then than being led around by your nose by the ideologically driven and wasting your time on what will be the safest pipeline ever built to date. Hate to be blunt but sometimes you have to!!!
    4 Apr, 12:14 PM Reply Like
  • DevilDog85
    , contributor
    Comments (266) | Send Message
     
    Excellent post!
    4 Apr, 12:23 PM Reply Like
  • Bear Bait
    , contributor
    Comments (664) | Send Message
     
    In other words you don't have the slightest idea of what you are talking about. I will say it differently. put up or shut up. Unless the route has been moved the route of the pipeline cuts across the Ogallala aquifer in Nebraska. Just look at the two maps. The proposed route goes through Nebraska and the Ogallala has a very large presence in Nebraska. The first sentence says the the Ogallala is a shallow aquifer. Now why is the Ogalla not in danger from a spill that despite the best laid plans of mice and men will happen.
    4 Apr, 12:32 PM Reply Like
  • DevilDog85
    , contributor
    Comments (266) | Send Message
     
    Not for YOU!
    4 Apr, 12:34 PM Reply Like
  • DevilDog85
    , contributor
    Comments (266) | Send Message
     
    I have read your previous posts. You support pot smoking for tax revenue, hate successful wealthy people and oil companies. Enough said!
    4 Apr, 12:39 PM Reply Like
  • badbernanke
    , contributor
    Comments (231) | Send Message
     
    Actually, until the route was changed the aquifer was at risk, although there is probably not 100% certainty that all risks are eliminated. Even the GOP governor of one of the affected states was opposed on environmental grounds until the route was changed. The route change necessitated an additional review and additional environmental reports that had to go through the approval process.

     

    It is interesting to note that British Columbia residents and First Nations peoples have opposed an alternate route to the Canadian West coast for very similar environmental concerns as well as opposition to tearing up virgin forests.

     

    These dirty projects are hard sells in most of the developed world.
    4 Apr, 01:10 PM Reply Like
  • JANFA
    , contributor
    Comments (59) | Send Message
     
    I am a hydrogeologist by training. The crude oil from Canada has high visquosity and in case of pipeline leak would hardly leak all way through the sandstone into ground water. If it reached the ground water which is highly unlikely the contamination could be easily treated.
    4 Apr, 01:40 PM Reply Like
  • marpy
    , contributor
    Comments (682) | Send Message
     
    Well their you go bear bate -Janfa has some expertise and is spelling out for you. As for put up or shut up - you are the one not putting anything up! But then I suppose it does not matter how much evidence gets posted - your type does not believe anything that does not agree with your thinking.
    4 Apr, 02:25 PM Reply Like
  • DevilDog85
    , contributor
    Comments (266) | Send Message
     
    INDEED!!!!!
    4 Apr, 02:32 PM Reply Like
  • Ruffdog
    , contributor
    Comments (1219) | Send Message
     
    Please explain to me why the aquifer is at risk?
    4 Apr, 03:40 PM Reply Like
  • Ruffdog
    , contributor
    Comments (1219) | Send Message
     
    I agree Marpy, I would rather have oil in a new keystone than the other older pipelines that are out there.
    4 Apr, 03:42 PM Reply Like
  • badbernanke
    , contributor
    Comments (231) | Send Message
     
    The Sand Hills region of the aquifer isn't as protected as you may think. And petroleum in water (or the chemicals used to transport bitumen) are not easily removed from an aquifer. Perhaps you can filter drinking water, but how about the thousands of acre feet used for irrigation?
    5 Apr, 08:09 PM Reply Like
  • SoldHigh
    , contributor
    Comments (995) | Send Message
     
    Obama prefers an energy policy of 'Arab Oil' instead of domestically produced energy. He hates the idea of the US dominating in anything other than apologetics.
    4 Apr, 11:31 AM Reply Like
  • 2839298249
    , contributor
    Comments (209) | Send Message
     
    Obama is not a leader. He simply follows polls and left-leaning opinion. Not sure the guy ever had an original thought in his life.

     

    Obama makes Jimmy Carter look like a brilliant statesmen.
    4 Apr, 11:41 AM Reply Like
  • DevilDog85
    , contributor
    Comments (266) | Send Message
     
    Obumbles is a disaster of the highest order.
    4 Apr, 11:46 AM Reply Like
  • dunnhaupt
    , contributor
    Comments (387) | Send Message
     
    The Keystone delay has certainly supported the shaky communist government of Maduro in Venezuela.
    4 Apr, 11:41 AM Reply Like
  • monmon
    , contributor
    Comments (13) | Send Message
     
    either yes or no.good or bad answer it anyway.no stalling ,it just plain games.
    4 Apr, 11:44 AM Reply Like
  • DAVE22Q
    , contributor
    Comments (217) | Send Message
     
    those who attribute stock prices to factors like "The Keystone debacle has resulted in negative investor sentiment toward Canadian energy stocks, depressing their values relative to U.S. counterparts" is an obvious idiot. I still think our nut case population percentage dwarfs the Canadian's.
    I'm fine with Keystone the day the Canadian government pledges its full faith and credit to guarantee full cleanup and fair compensation for all damages caused by a pipeline incident. As for the jobs argument, is anyone really dumb enough to believe refining dirty tar sands oil for shipment to China is a labor intensive business?
    Let the Canadians refine it on site, eat the toxic waste and sell the processed fuels wherever they like. I don't even their shipping the crude by rail across our country but accept that the potential result of an incident is manageable.
    4 Apr, 11:48 AM Reply Like
  • Fo6
    , contributor
    Comment (1) | Send Message
     
    It is always a bad idea to have only one customer. If Obama does not approve Keystone, this Pipeline should be moved westward to ship it's product to Asia where Canadian oil producers could broaden their's customer base.
    4 Apr, 11:48 AM Reply Like
  • Ruffdog
    , contributor
    Comments (1219) | Send Message
     
    The pipeline does not have to be moved. Kinder Morgan's expansion of the TransMountain pipeline will increase the capacity by about 700,000 bpd. And there is no way Obama can stop it!
    4 Apr, 03:49 PM Reply Like
  • 2839298249
    , contributor
    Comments (209) | Send Message
     
    The Canadian oil will be produced and it will get shipped. Whether it goes to Asia, the US or through an Eastern Pipeline towards Europe. It's just an enviro pipe dream that delaying Keystone somehow delays the production of this source of crude.

     

    I do think producers would get a better price, with lower logistics costs, by shipping it south, but they will still get a decent ROI by shipping it elsewhere.
    4 Apr, 11:55 AM Reply Like
  • jeepnsam
    , contributor
    Comments (49) | Send Message
     
    THOUGHTS!

     

    The lack of KeyStone has many many benefactors. Who's making money moving oil by rail???? Think Rockefeller and Vanderbilt working together aka Rockerbilt. LOL!! Watch for large investors in Canadian oil during the next presidential election. BOOOM!! Keystone approved and Canadian oil stock pop.
    4 Apr, 11:58 AM Reply Like
  • DevilDog85
    , contributor
    Comments (266) | Send Message
     
    Funny you never spoke on the subject of oil until now....I sense an alias!
    4 Apr, 12:50 PM Reply Like
  • wontiod47
    , contributor
    Comments (2) | Send Message
     
    The obvious benefits of the Keystone Pipeline XL are plentiful. The pipeline has been designed to the highest safety and environmental standards in North America exceeding all current legislated requirements. Many of the oil companies currently exploiting the Athabasca Tar Sand region are American owned and will earn direct profits. State annual ptaxes and landowner payments are not insignificant. Construction employment and the domino effect will have a very positive impact to populations along the proposed route. And lastly, sustained energy supplies from Americas best friend rather than oil supplied from anti American countries.
    4 Apr, 12:44 PM Reply Like
  • wontiod47
    , contributor
    Comments (2) | Send Message
     
    The obvious benefits of the Keystone Pipeline XL are plentiful. The pipeline has been designed to the highest safety and environmental standards in North America exceeding all current legislated requirements. Many of the oil companies currently exploiting the Athabasca Tar Sand region are American owned and will earn direct profits. State annual taxes and landowner payments are not insignificant. Construction employment and the domino effect will have a very positive impact to populations along the proposed route. And lastly, sustained energy supplies from Americas best friend rather than oil supplied from anti American countries.
    4 Apr, 12:44 PM Reply Like
  • 101457
    , contributor
    Comments (2) | Send Message
     
    The only reason the Keystone Pipeline is not getting built today is because it is 100% political. I believe that before the midterm elections this fall, the democrats will need all the help they can get. They are not looking good in the polls and it looks like the republicans are going to take over the senate. In order to make the democrats look good, the weakest ones are going to start showing up all over the media and it will be them that supposedly convinces the president to give the go ahead on the pipeline. I do not believe it has anything to do with enviromentalists or anything else but it will be used as a ploy to make the democrats look good. The president already knows he is going to give the go ahead before the elections, watch and see.
    4 Apr, 12:44 PM Reply Like
  • marpy
    , contributor
    Comments (682) | Send Message
     
    Does Obama really then have a choice? If he losses the senate then between the two houses that will have Republican majorities, they will ram that pipeline through regardless of what Obama may want. If he passes the pipeline then it should help him out in the mid terms but he will have to eat some crow. Well as they say - crow gets tougher with age so better chow down now! ;-)
    4 Apr, 04:53 PM Reply Like
  • fossilfree
    , contributor
    Comments (24) | Send Message
     
    On February 19th, Lancaster County District Judge Stephanie Stacy ruled Nebraska’s pipeline siting law “unconstitutional and void.” This case, Thompson v Heineman, was a huge win for Nebraska landowners and for everyone involved in this campaign to protect property owner’s rights and our land and water. The result leaves TransCanada with no legal route to build its proposed pipeline across the...

     

    http://bit.ly/1jKKhz7
    4 Apr, 12:48 PM Reply Like
  • marpy
    , contributor
    Comments (682) | Send Message
     
    If that was really anything more than a bump on the road, the markets would have and still be acting on it but they have not.
    4 Apr, 04:54 PM Reply Like
  • bobby44
    , contributor
    Comments (181) | Send Message
     
    The method used to obtain the siting approval was the issue. NOT the siting.

     

    What has to happen is the legislature to enact a statute saying exactly the same thing as the original. Then the court ruling is mute. They will hold this for the moment in order to extract as much political leverage as possible. (good move because the legislature is non partisan)

     

    I doubt the legislature will bother to try and find out what items the court will veto. In Nebraska only the court or the governor can veto legislative directive. I doubt it will happen again.
    4 Apr, 07:02 PM Reply Like
  • badbernanke
    , contributor
    Comments (231) | Send Message
     
    Ad hominem attacks on the sitting President really don't advance the discussion.

     

    I was opposed due to the aquifer issues (along with the GOP governor of Nebraska) until the pipeline route was changed. Since the likely outcome is transhipping the bitumen overseas, the net gain for the US will not be all that great. I would prefer to see the bitumen refined in the US -- Texas is already filthy from oil refineries, who cares about another one there -- so that the US would get additional jobs, additional refining capacity which means property taxes, value added to the product which means more refining-related income to be taxed.

     

    Not much gain to ship the gunk out and then potentially import it as refined product so that all the profits and related taxes and jobs go offshore.
    4 Apr, 01:17 PM Reply Like
  • DevilDog85
    , contributor
    Comments (266) | Send Message
     
    'Ad hominem attacks on a sitting President don't advance the discussion.' Were you alive when Bush was POTUS? I have no doubt you standards are self-serving.
    4 Apr, 02:36 PM Reply Like
  • marpy
    , contributor
    Comments (682) | Send Message
     
    his selected information is self serving as well - that oil would displace Venezuelan oil and not be shipped over seas. Texas refineries are configured to handle the heavy crude and are actually refining it now as rail shipments from Alberta are reaching Texas.
    4 Apr, 04:57 PM Reply Like
  • badbernanke
    , contributor
    Comments (231) | Send Message
     
    Yes, I was alive when Bush was POTUS. How is that relevant to this discussion?
    5 Apr, 08:11 PM Reply Like
  • Jack Hutchison
    , contributor
    Comments (338) | Send Message
     
    Hey Bad Boy!

     

    Excuse me, but Texas is only as filthy as sex. We'll take all we can get, along with more refineries and petrochem plants, the high-paying jobs, and great looking women who wear heels to work.

     

    You must be from California, smoke pot, and probably voted for Obama and Gov Moonbeam.

     

    PS: A substantial quantity of bitumen is refined in Canada. Some of it is called "Syncrude", a water white liquid like #3 fuel oil.

     

    PPS: Obama will continue to sandbag Keystone, but the next White House resident will approve it. It is a no-brainer. Hence Obama's failure to execute.
    4 Apr, 02:25 PM Reply Like
  • bobby44
    , contributor
    Comments (181) | Send Message
     
    Right on Jack.

     

    Remember when Texas product was shipped all over the world. When a friend was in need, they got oil. An enemy or baiter got reduced allotments.

     

    In those days Texas was in grand shape and the USA was #1. Now is something different - jealous others bad mouth Texas (and those who would move more energy through Texas). The USA has fallen in prestige and value to #2, maybe even lower.

     

    Now is the time it will be an easy climb back if someone gets on it NOW.
    4 Apr, 06:32 PM Reply Like
  • badbernanke
    , contributor
    Comments (231) | Send Message
     
    Hutch. you should reread my comments and think before responding..
    5 Apr, 08:12 PM Reply Like
  • Blue22
    , contributor
    Comments (127) | Send Message
     
    The reason the pipeline route was moved where it was is that the new location avoids 85% of the aquifer. Nebraska's real problem is that they are running out of water as parts of the aquifer have failed or have been absorbed over time! Nebraskans are going to need a huge source of cash to deal with a water problem, which is there now!

     

    Nebraska used to be considered part of an American desert as the aquifer was unknown. Technology made modern farming and ranching possible in the area. TRP brings with it a means of saving the environment and economy. Listen to the experts who have dedicated their lives to studying Nebraska, not to tree huggers, who apparently don't need food, water, crops, livestock or even plastic made from oil!
    4 Apr, 03:06 PM Reply Like
  • Matsebula
    , contributor
    Comments (52) | Send Message
     
    @Blue22 is right. Maybe if the US is concerned about the aquifer it should stop subsidizing corn crops for the purpose of making ethanol. I am amazed at the misinformation some people are trying to pass off. All the filings are public, so go read them. The supplemental EIS is public, go read it. For those who wonder why the US would take Canadian oil for export, rethink your position. A TransCanada media guy described it like this:

     

    "CALGARY, Alb. — I would like to respond to several of Jude Isabella’s factually inaccurate remarks about TransCanada and the Keystone XL Pipeline project (“A Canadian warns Americans about tar sands oil,” Page A4, Aug. 21).

     

    Isabella incorrectly states that crude oil will be transported by Keystone XL to Texas refineries “for shipment to Asia.” This myth simply does not hold any water whatsoever. The United States is an overwhelming importer of crude oil, consuming nearly 7million barrels of foreign crude oil a day.

     

    The crude oil coming from Venezuela and the Middle East is more expensive than the Canadian and North Dakotan crude oil Keystone XL will safely transport.

     

    It makes no sense for refiners who have signed 18-20 year commitments to buy cheaper domestically produced oil, pay additional shipping fees to “ship it to Asia” while still importing 7 million barrels a day of higher-priced oil.

     

    To continue her Star Wars analogy, that would be like the Ewoks importing trees from the ice planet of Hoth to make tree-houses while selling their own trees from Endor for a discount on Tatooinee." James Millar, TransCanada
    4 Apr, 04:39 PM Reply Like
  • badbernanke
    , contributor
    Comments (231) | Send Message
     
    Which Texas refineries are geared up to process bitumen (as opposed to heavy crude)?
    5 Apr, 08:17 PM Reply Like
  • bobby44
    , contributor
    Comments (181) | Send Message
     
    It was suggested a while back to build Keystone from North Dakota. Build a big on ramp for Canadian oil coming via rail across the border. The priority cargo would be Bakken oil. The politics now are holding back plains oil as well as Canadian oil.

     

    When something gets approval look for the Bakken producers to pop as well.

     

    I think there are a couple of by-products from the non decision. 1- Buds like Buffet get windfalls. 2- Northern plains states get held to their hunter/gatherer status instead of taking their rightful place as value added financial leaders.
    4 Apr, 06:41 PM Reply Like
  • badbernanke
    , contributor
    Comments (231) | Send Message
     
    Did anyone actually make a proposal to build from North Dakota without Canadian product that included an environmental impact statement? I don't recall anyone doing anything other than talking hypothetically.
    5 Apr, 08:15 PM Reply Like
  • bobby44
    , contributor
    Comments (181) | Send Message
     
    It was suggested ONLY by another party. Nothing to do with the Keystone as such.
    6 Apr, 09:28 AM Reply Like
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