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Jul. 14, 2015, 2:13 PM
- Quebec will support TransCanada’s (TRP -0.2%) Energy East pipeline only if it generates jobs for the province and if Alberta does more to protect the environment, Alberta Premier Rachel Notley says after meeting with Quebec Premier Couillard.
- Carbon pricing and the Energy East pipeline were among the topics discussed at the meeting, with both governments agreeing on their importance.
- While pipelines are “ultimately the best way to move” product from the oil sands, Notley says she and Couillard "need to see is some meaningful action with respect to environmental protection and climate change, and it needs to make economic sense."
- The proposed C$12B Energy East pipeline would transport as much as 1.1M bbl/day across six Canadian provinces to the Atlantic coast.
Jul. 1, 2015, 10:45 AM
- TransCanada (TRP -0.9%) says Canada’s recently announced plans to cut carbon emissions should be considered by U.S. policy makers when weighing the Keystone XL pipeline.
- TRP makes the argument in a new letter to Sec. of State Kerry and other U.S. officials, as the U.S. presidential authorization the pipeline needs to cross the border enters its seventh anniversary without a decision.
- The letter discusses Canada’s May announcement that it plans to cut greenhouse gas emissions by 30% below 2005 levels by 2030, Alberta’s decision to double the carbon tax it charges to $30/ton by 2017, and the stands taken by oil sands players Suncor and Cenovus in favor of tougher carbon pricing.
Jun. 23, 2015, 6:53 PM
- A new peer-reviewed study funded by the U.S. Department of Energy says Canada’s oil sands greenhouse gas emissions are an average of 20% higher than U.S. conventional crude, a finding that will add ammunition to opponents of the Keystone XL pipeline (NYSE:TRP) and other critics of Canadian crude.
- Noting that oil sands output is projected to more than double in the next 15 years with much of the crude potentially winding up in the U.S., the study says "higher [well-to-wheel] emissions for gasoline and diesel production in the U.S. are expected when oil sands products become a larger fraction of the U.S. fuel mix.”
- The study is likely to bring renewed scrutiny to U.S. imports of Canadian oil, which make up the largest single source of foreign crude in the U.S.
Jun. 23, 2015, 4:38 PM
- TransCanada (NYSE:TRP) says it is eliminating 185 full-time and contract jobs following a restructuring of its major projects department, saying the cuts were needed to ensure the lowest-cost services to its customers.
- The department oversees development of TRP's largest projects, including the Keystone XL and Energy East projects.
- Canadian oil and gas producers have cut thousands of jobs as weak oil prices hurt profits and cash flows, but these are TRP's first job cuts since the slump.
Jun. 12, 2015, 11:39 AM
- TransCanada (TRP -0.1%) says the positive final investment decision for the Pacific Northwest LNG liquefaction and export project is a significant milestone for its own Prince Rupert Gas Transmission Project, which would deliver gas to the proposed facility.
- In related news, the Canadian government accepted the National Energy Board's recommendation to conditionally approve TRP's North Montney Mainline Pipeline Project; the project will connect Montney and other Western Canadian Sedimentary Basin supply to natural gas markets including Pacific NorthWest LNG terminal through its interconnect with Prince Rupert.
Jun. 9, 2015, 7:17 PM
- Pipelines such as TransCanada’s (NYSE:TRP) Energy East are the only viable way to develop Alberta’s oil sands, Total (NYSE:TOT) CEO Patrick Pouyanné says, adding that he believes pipelines are a safer way to transport crude oil than by rail.
- "I can only encourage Canadians to develop your own infrastructure and not to complain about the U.S. not accepting Keystone if you cannot develop your own pipelines to the east or to the west,” the CEO says.
- Acknowledging a major challenge facing Alberta’s oil sands is the logistical difficulty of transporting crude from the landlocked territory: “If you don’t have the pipelines, the oil sands will be stuck there in Alberta and it will be a real problem."
- TOT has two oil sands projects through JVs with Suncor Energy (NYSE:SU) which have been dealing with high production costs and low oil prices, along with competition from rising U.S. shale oil production.
Jun. 5, 2015, 10:47 AM
- TransCanada (TRP -0.3%) says there is room for optimism along the bumpy road toward starting a liquefied natural gas industry in British Columbia after winning significant aboriginal support for two crucial gas pipeline projects.
- TRP has been quietly working on the Prince Rupert Gas Transmission and Coastal GasLink Pipeline for two years to link rich gas fields in northeast B.C. to proposed liquefaction projects on the coast.
- Each line crosses the traditional lands of 19 First Nations groups, but TRP’s president of development tells Financial Post "we will get the vast majority of the nations to support the projects."
- “We had success by illustrating that you don’t have to choose between your salmon, or your hunting and fishing, or your land, and the project,” the TRP exec says. “We strive to demonstrate that you can have both.”
Jun. 1, 2015, 3:49 PM
- Exxon Mobil (XOM -0.1%) says it received authorization from the U.S. Energy Department to export liquefied natural gas to non-free trade agreement countries from its proposed Alaska LNG terminal.
- The project includes a liquefaction facility, an 800-mile pipeline, up to eight natural gas compression stations and at least five take-off points for in-state gas delivery, as well as a gas treatment plant on Alaska's North Slope, where XOM already has operations at Prudhoe Bay and Point Tomson.
- Other participants in the Alaska LNG project include BP, TransCanada (NYSE:TRP) and ConocoPhillips (NYSE:COP).
Jun. 1, 2015, 11:59 AM
- TransCanada (TRP -1.8%) says it has reached project agreements with three more First Nations in British Columbia as part of efforts to build the Prince Rupert Gas Transmission pipeline across the province to a proposed liquefied natural gas terminal on the coast.
- TRP does not announce specifics but says they provide for annual legacy payments over the commercial life of the pipeline plus benefits upon signing and at other milestones.
- TRP already had reached four other First Nations agreements but members of the Lax Kw’alaams First Nation rejected a $1.15B offer from Petronas, which wants to build the Pacific Northwest LNG terminal on Lelu Island south of Prince Rupert.
May 18, 2015, 7:45 PM
- Goldman Sachs had a lot to say about all corners of the energy sector today in addition to the cut in its long-term oil price forecast, its Sell recommendations for oil majors BP, Statoil (NYSE:STO) and Chevron (NYSE:CVX), and its gloomy outlook for offshore drillers Transocean (NYSE:RIG), Diamond Offshore (NYSE:DO) and Atwood Oceanics (NYSE:ATW).
- Goldman awards a Buy rating for Exxon Mobil (NYSE:XOM), "the only U.S. or European major that can generate sufficient free cash flow to cover its dividend near $60/bbl in 2016-17"; while the firm says other oil majors will be struggling to keep the dividend flat, XOM will be in a position to increase the dividend for the next several years.
- With its expectation for long-term weakness in oil and gas prices, Goldman sees risk exposure in many names that are reliant on commodity prices, suggesting selling LINE, DPM, NGLS, while predicting PAGP and NS would benefit from a removal of the U.S. crude oil export ban.
- The firm thinks many midstream MLP names now offer attractive valuations, recommending ENB, EPD, ETE, PAA, SXL, WNRL.
- Goldman sees an upturn for frac sand provider Emerge Energy (NYSE:EMES), upgrading shares to Buy from Neutral.
- Other Buys: CLR, NFX, CQP, HEP.
- Other Sells: TRP, TCP, GPOR, MUR, GTE
May 15, 2015, 2:45 PM
- Canada says it is committing to cut greenhouse gas emissions by 30% below 2005 levels by 2030, partly by introducing new regulations on its oil and gas sector.
- Environment Minister Aglukkaq says Canada will cut its emissions to 515 metric megatons by 2030 from 726 metric megatons in 2013; earlier this week, Ontario - Canada’s most populous province - set its own 2030 target of 112 megatons, which would represent a 46% cut from 2005 levels.
- To meet the new target, Canada will develop regulations to cut methane emissions from the oil and gas sector, such as industrial leaks and gas flares, as well as new rules to control emissions from the electricity and chemical sectors, including from nitrogen fertilizers.
- Relevant tickers: SU, ENB, TRP, IMO, CNQ, CVE, TCK, TAC, OTCQB:HUSKF, OTCQX:COSWF
May 14, 2015, 1:10 PM
- More than 60 organizations are calling on Canada's National Energy Board to suspend TransCanada’s (TRP +0.4%) application for the Energy East pipeline.
- TRP is due to update its application for the pipeline in Q4 with a new location for a proposed marine terminal in Quebec, but the groups say the regulator should overhaul the review process entirely and restart its evaluation of Energy East from the beginning once the company submits the new information.
- TRP is searching for a new location for the marine terminal after a Quebec Superior Court injunction last fall against seismic work at the site meant to protect nearby beluga whale calving grounds.
May 7, 2015, 6:25 PM
- Canadian oil producers plunged for a second straight day as "all bets are off" after election results in Alberta raised concerns over the possibility of higher taxes for the companies.
- Among today's losers: SU -2.6%, OTCQB:HUSKF -5.2%, GTE -5.8%, PWE -5.7%, IMO -1%, CVE -1%, OTCQX:COSWF -3.4%, OTCPK:MEGEF -5%.
- COSWF is among the most exposed to a potential hike in royalties and stricter environmental policies, while electricity supplier TransAlta (NYSE:TAC) would suffer from the new government’s vow to shut coal plants sooner than planned, according to analysts at BMO Nesbitt Burns and RBC Dominion.
- Advice is split on owning stocks of companies that transport and process fuels in Alberta; Raymond James says stocks such as TransCanada (NYSE:TRP) and Enbridge (NYSE:ENB) are less directly exposed to reduced investment in the sector, but RBC advises to sell pipeline and midstream companies with operations in Alberta.
- Analysts also are divided about how much producers with oil refineries, such as SU and IMO, could offset losses from potentially higher royalties by boosting processing of crude in Alberta, a move pro-labor NDP has pledged to support.
May 6, 2015, 2:36 PM
- Canadian energy stocks are broadly lower after the shocking election result in Alberta raised questions about the future of the country's oil industry: SU -3.3%, ENB -2.8%, TRP -2.6%, IMO -2.3%, CNQ -2.3%, CVE -5.8%, OTCQB:HUSKF -1%, TCK -1.6%, TAC -4.1%, OTCQX:COSWF -6%.
- "Energy is such a critical issue to Alberta, I’m really not that concerned," ENB CEO Al Monaco says, but investors and analysts disagree.
- "It’s completely devastating" for energy companies and investors, saysCanoe Financial's Rafi Tahmazian of stated plans by the newly elected government to raise corporate taxes, review the government’s take of energy revenue, scale back advocacy for pipelines and phase out coal power more quickly.
- “If you are invested in energy stocks, you should be concerned,” says AltaCorp’s Jeremy McCrea, noting that drillers already face higher costs to extract oil and gas in Alberta than in many jurisdictions, so an increase in royalties would make the province even less competitive.
May 6, 2015, 7:38 AM
- In a stunning election result, voters in Canada's energy-rich Alberta province swept aside the four-decade hold on power by the ruling Progressive Conservative Party and elected an New Democratic Party majority government that wants to raise corporate taxes and increase oil and gas royalties.
- NDP leader Rachel Notley - who has vowed to raise the corporate tax rate to 12% at a time energy companies are reeling from layoffs and project cancellations amid weaker oil prices - is expected to succeed Jim Prentice as Alberta’s premier.
- Notley has said she would not lobby for the proposed Keystone XL pipeline to link Alberta’s oil deposits to refineries in Texas, and that she is against the Northern Gateway pipeline from Alberta to the British Columbia coast.
- She also has promised another review of oil royalties at a time other oil producing areas around the world that are also struggling with low oil prices are expected to make their terms more appealing.
- Relevant tickers: ENB, SU, TRP, IMO, CNQ, CVE, OTCQB:HUSKF, OTCQX:COSWF, XOM, BP, RDS.A, RDS.B
May 1, 2015, 7:20 PM
- Despite Pres. Obama's refusal to grant a permit for the northern cross-border leg of the Keystone XL pipeline (NYSE:TRP), "just as water will find its way through any crack in a foundation," Canada’s oil keeps streaming its way to Texas’ Gulf refineries, Financial Post's Claudia Cattaneo writes.
- While Keystone’s approval has sat stalled for six years, other pipelines have been built or expanded to ease bottlenecks: TRP's southern leg of Keystone XL and its Marketlink project from Cushing to Port Arthur, Enbridge (NYSE:ENB) and Enterprise Products' (NYSE:EPD) Seaway pipeline from Cushing to Freeport, and there's heavy oil coming by train and barge - it takes longer, costs more and is less efficient, but it's coming nevertheless.
- Even a prolonged slump in oil prices is not likely to stop Canada’s rush to the Texas coast: Both Imperial Oil (NYSEMKT:IMO) and Suncor (NYSE:SU) said this week their Q1 oil sands production levels are up 11% Y/Y, with IMO soon doubling production at the Kearl oil sands mine and new production beginning at its Nabiye operation.
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