TransCanada: Blue-Chip Canadian Pipeline Company At A Depressed Valuation
Thomas Lott • 35 Comments
Thomas Lott • 35 Comments
Apr. 16, 2015, 12:45 PM
- TransCanada (TRP -0.1%) says Canada's National Energy Board issues a report recommending the federal government approve its proposed $1.7B North Montney Mainline project.
- TRP says the initial capacity of North Montney Mainline will allow the shipment of ~2.4B cf/day of natural gas, and that Petronas subsidiary Progress Energy Canada has contracted for 2.1B cf/day of firm delivery service.
Apr. 14, 2015, 7:40 PM
- Canada is seeking new customers for its crude oil as a U.S. review of the Keystone XL (NYSE:TRP) pipeline drags on and oil prices languish near $50/bbl, says Natural Resources Minister Greg Rickford.
- Canada sells 99% of its oil and 98% of its natural gas to the U.S., a partnership that amounts to $140B/year, but Rickford says future oil sales to the U.S. may depend in part on Keystone, which would "ensure that U.S. refineries have access to a secure supply."
- The minister also says Canada is eager to expand cooperation with the U.S. on environmental standards for oil and natural gas and to work toward a global climate agreement.
Apr. 14, 2015, 4:37 PM
- Magellan Midstream Partners (NYSE:MMP) and TransCanada (NYSE:TRP) entered into a joint agreement to develop a project to connect TRP's Houston tank terminal to MMP's East Houston terminal.
- The project would give TRP's Keystone and Marketlink shippers access to MMP's Houston and Texas City crude oil distribution system.
- The $50M project would include the construction of a nine-mile pipeline in which MMP and TRP would have 50/50 ownership interests; MMP will be construction manager and operator of the pipeline.
Apr. 9, 2015, 12:43 PM
- Canada must stop inter-provincial bickering and political indecision to ensure major energy projects get done before global markets move on to other suppliers, Bank of Nova Scotia CEO Brian Porter says, calling Canada's inability to deliver energy to world markets "detrimental" to the country’s economy.
- TransCanada's (NYSE:TRP) Energy East project to transport oil to the Atlantic coast and Enbridge's (NYSE:ENB) Northern Gateway pipeline that would transport Alberta oil to the Pacific coast for shipment to Asia would create tens of thousands of jobs with economic benefits spread across Canada, Porter says.
- Meanwhile, Shell's (RDS.A, RDS.B) proposed combination with BG Group (OTCPK:BRGXF, OTCQX:BRGYY) likely will result in one fewer liquefied natural gas project being built on the British Columbia coast between Shell's LNG Canada and BG's Prince Rupert LNG.
Apr. 7, 2015, 10:59 AM
- If it were up to Lawrence Summers, the former U.S. treasury secretary who also served as chief economist at the World Bank, the U.S. would approve the Keystone XL pipeline (NYSE:TRP) - and should have already done so.
- The U.S. should OK the pipeline based on considerations such as the country’s energy needs, the importance of Canada as an ally, and the danger of shipping oil by rail, Summers told a crowd at the University of Toronto, noting the potential for accidents and environmental damage.
- Summers has not been holding back recently on criticism of the U.S., chastising the U.S. in a recent Financial Times column for allowing political pressure from all sides to render the country “increasingly dysfunctional” as a global powerhouse.
Apr. 2, 2015, 5:55 PM
- TransCanada’s (NYSE:TRP) decision not to build a crude oil export terminal near a beluga whale habitat on the St. Lawrence River may delay its $12B Energy East pipeline project by two years and run up costs, Financial Post reports.
- The company is not yet forecasting an increase in the project cost, but some analysts aren't so sure; CIBC's Paul Lechem says "it is possible the cost and/or schedule could change when the amended application is filed" with the National Energy Board.
- Recall that, as of November, the anticipated cost of TRP's Keystone XL pipeline jumped to $8B from $5.4B as a result of six years of regulatory delays.
- Conversely, BMO analyst sees some potential upside to the latest cancellation: "On the positive side, we think being responsive/sensitive to the Quebec environmental challenge will help generate a smoother regulatory process and this in turn should increase the odds of the project."
Apr. 2, 2015, 10:12 AM
- TransCanada (TRP +1%) confirms it has scrapped plans to build a marine oil export terminal at Cacouna in Quebec as part of its proposed Energy East pipeline project, and will consider alternate terminal options in Quebec.
- "This decision is the result of the recommended change in status of the Beluga whales to endangered,” TRP CEO Russ Girling says.
- Some businesses in New Brunswick are hoping TRP finds no acceptable Quebec alternative, and that their province could be the only export point for crude oil transported through Energy East.
- Earlier: Report: TransCanada will not build Quebec oil export terminal
Apr. 1, 2015, 2:44 PM
- Trans Canada (TRP -0.1%) reportedly has decided not to build the proposed Cacouna oil export terminal in Quebec as part of its C$12B Energy East pipeline, choosing instead to ship the crude from Alberta to another terminal in New Brunswick.
- The project has been strongly opposed by environmentalists who worry about the risk of oil spills as well as the impact construction and shipping would have on Beluga whales in the St. Lawrence River.
- The terminal is one of two marine export facilities planned as part of the Energy East pipeline, which would carry 1.1M bbl/day of crude oil to refineries and ports in eastern Canada.
- Earlier: TransCanada to decide fate of Cacouna oil terminal this week
Apr. 1, 2015, 10:58 AM
- TransCanada (TRP +0.1%) says it expects to make a decision this week on the fate of its controversial proposed Cacouna marine oil terminal in Quebec, a feature of the Energy East pipeline project that opponents say would destroy beluga whale habitat.
- The Cacouna terminal has been a source of controversy for TRP since December, when a federal committee recommended beluga whales be classified as endangered and said the whale populations in the area had fallen to 1K from 10K.
- If built, Cacouna would be one of two export points for the oil carried along the $12B Energy East pipeline route; TRP has suspended work on the terminal and says it is considering other options than the facility planned for the shores of the St. Lawrence River.
Mar. 26, 2015, 2:36 PM
- Canada's government says it will give the National Energy Board until next year to deliver up-to-date guidelines for oil pipeline companies to improve safety and protect the environment.
- The instructions coincide with several major pipeline expansion projects proposed in Canada by companies such as Kinder Morgan (NYSE:KMI), Enbridge (NYSE:ENB) and TransCanada (NYSE:TRP).
- The Conservative government has promoted expansion of the oil and gas industry, pledging to make the country an "energy superpower."
- Meanwhile, the NEB reportedly is investigating up to a dozen new allegations of natural gas pipeline safety code violations at TRP, which would mark the second time in recent years the regulator has probed safety practices at TRP following complaints by a whistleblower.
Mar. 18, 2015, 3:54 PM
- Canada's National Energy Board reportedly is investigating up to a dozen new allegations of gas pipeline safety code violations at TransCanada (TRP +1.9%).
- Documents reviewed by Reuters show the allegations include faulty or delayed repairs, sloppy welding work and a failure to report key issues to the regulator.
- It would mark the second time in recent years that Canada's energy regulator has investigated safety practices at the pipeline company following complaints by a whistleblower.
Mar. 17, 2015, 10:58 AM
- The Keystone pipeline disappointment is hardly a death knell for TransCanada (NYSE:TRP), as the company remains one of the top holdings in Skip Aylesworth’s Hennessy Gas Utility fund, which climbed 21% last year as distribution gains trumped price drops.
- TRP is "a fine, healthy company and, yes, this is a hiccup, and they would love to see Keystone happen, but it is just a part of their business," Aylesworth tells Barron's.
- Of one Aylesworth's favorite energy investments actually is Berkshire Hathaway (BRK.A, BRK.B), which is heavily involved in the distribution of natural gas and owner of Burlington Northern, which is exploring using natural gas to fuel long-distance freight trains.
- Other favorites: ENB, WMB, LNG, NJR, KMI, SE
Mar. 6, 2015, 6:30 PM
- Pres. Obama's latest remarks about the Keystone XL pipeline (NYSE:TRP) appear to be his most negative yet, raising the hopes of green groups that the president is likely to decide against the project.
- "The reason a lot of environmentalists are concerned about it is the way that you get the oil out in Canada is an extraordinarily dirty way of extracting oil, and obviously there are always risks in piping a lot of oil through Nebraska farmland and other parts of the country," Obama told students today in South Carolina.
- The president says he still has not made a final decision, but "we’re not going to authorize a pipeline that benefits largely a foreign company if it can’t be shown that it is safe and if it can’t be shown that overall it would not contribute to climate change."
- "If indeed he is criticizing the extraction process itself, it does seem a step more negative,” says an analyst at ClearView Energy Partners.
Mar. 5, 2015, 10:58 AM
- Canada's National Energy Board says it received 1,800 applications to participate in hearings on TransCanada’s (TRP +1.2%) proposed Energy East pipeline project, but many of the applications appear to be copies of the same letter.
- Various individuals, companies, organizations and municipalities - such as the city of Winnipeg, which says a spill from the pipeline could affect its source of drinking water - submitted applications, as well as an unknown number of individuals that copied and pasted Greenpeace’s letter into their applications; not all applicants will be allowed to participate in the review process.
- The identical applications want the regulator's approval process to include a review of Energy East’s potential contributions to climate change.
- Energy East is a $12B project that would carry 1.1M bbl/day of oil from Alberta and Saskatchewan to refineries in Quebec and New Brunswick, and has sparked debate across Canada about climate change.
Mar. 4, 2015, 2:58 PM
- The U.S. Senate fails to override Pres. Obama’s veto of legislation approving the Keystone XL pipeline (TRP +0.7%), as the 62 votes to override fell short of the two-thirds majority needed.
- The effort to override Obama's veto was not expected to succeed, but Republicans saw the move as a way to emphasize that the pipeline has support of both parties; in today's tally, eight Democrats voted to override.
Feb. 26, 2015, 11:24 AM
- The Irving family, one of New Brunswick’s most powerful, appears to be at odds over the routing of TransCanada’s (TRP -1.4%) proposed Energy East pipeline, Financial Post reports.
- J.D. Irving Ltd., the family-owned forest products and shipbuilding company, has filed an application with Canada's National Energy Board saying it is “vitally concerned” about the portion of the pipeline that would pass through its Crown-leased lands in New Brunswick.
- The issue pits JDI against family-owned Irving Oil, which is partner with TRP in the marine terminal at the end point of the $12B project; Irving Oil has been a vocal supporter of Energy East and has committed to refine a minimum of 50K bbl/day delivered through the pipeline once it is built.
TransCanada Corp. provides gas storage and related services. It operates as an energy infrastructure company in North America. The company operates its business through three segments: Natural Gas Pipelines, Liquid Pipelines and Energy. TransCanada was founded on May 15, 2003 and is... More
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