Sep. 24, 2014, 2:50 PM
- Quebec's Superior Court grants a temporary injunction stopping TransCanada (TRP +0.2%) from conducting exploratory drilling in the development of the oil terminal at Cacouna in eastern Quebec until Oct. 15.
- According to the ruling, Quebec’s environmental regulator authorized the drilling without obtaining the answers it was seeking from Fisheries and Oceans Canada; the decision also pointed out that TRP had refused to sign an assurance that its work will not harm beluga whales.
- The marine terminal would allow TRP to export oil transported from the Alberta oil sands as part of its Energy East pipeline project, which has been submitted to the National Energy Board.
Sep. 22, 2014, 10:15 AM
- TransCanada’s (TRP -1.5%) bonds are trading at their biggest premium in six months amid fears the company will take on debt to fend off potential breakup attempts.
- The extra yield investors demand to hold TRP notes maturing in 2023 instead of U.S. government benchmarks increased Friday by 11 basis points, or 0.11 percentage point, to 105 bps.
- Even if a breakup is avoided, TRP may feel it needs to adopt more aggressive financial policies, including debt-funded share buybacks, to placate activist shareholders, Gimme Credit’s Phil Adams says.
- The news of added Keystone XL costs also are likely weighing on the bonds, as it could mean an extra $5B in issuance.
Sep. 19, 2014, 2:59 PM
- Mason Capital Management met with TransCanada (TRP +0.9%) shareholders to gauge interest in shaking up the company's corporate structure to boost its stock price, WSJ reports.
- Mason Capital discussed splitting up TRP's pipeline and power generation assets, and placing at least some of these assets in an MLP but is said to have met with some shareholder skepticism.
- Earlier today, TRP defended its corporate structure after reports suggested some U.S.-based activist hedge funds were looking at a possible breakup of the Canadian company and had contacted some large shareholders.
Sep. 19, 2014, 10:29 AM
- TransCanada (TRP +4.8%) is sharply higher in early trading as speculation abounds that U.S. activist hedge funds - perhaps including Dan Loeb's Third Point, which has amassed a position in recent months - are reviewing the company for a possible breakup.
- Responding to recent trading activity, TRP defends its corporate structure as the best way to maximize profit and dividend payouts to shareholders
- TRP also remains committed to plans to sell the rest of its U.S. natural gas pipeline assets to its TC PipeLines (TCP +4%) MLP over the coming years; it expects the assets to generate nearly $500M EBITDA in 2016 and beyond.
Sep. 18, 2014, 4:40 PM
- TransCanada (NYSE:TRP) CEO Russ Girling says the cost to build the Keystone XL pipeline likely will double from the current $5.4B estimate by the time the U.S. government completes its review of the project.
- The CEO's comments come after TRP told state regulators that the cost to build the South Dakota portion of the pipeline has more than doubled in the last four years to $1.97B from $921M due to pipe maintenance, labor agreements and inflation.
- Of the total 1,700-mile planned pipeline, the southern 485 miles which have been built and are transporting oil from Cushing, Okla., to Texas cost TRP ~$2.6B; for the remaining ~1,200 miles yet to be built, the company has invested $2.5B of the $5.4B figure it had estimated.
Sep. 18, 2014, 2:27 PM
- TransCanada (TRP +2.3%) spikes on a Reuters report that it is emerging as a possible M&A target, with several U.S. activist hedge funds reviewing the pipeline operator as a break-up candidate.
- Discussions about a potential campaign are in the early stages, but some of TRP's largest shareholders are said to have been contacted by hedge funds interested in a shake-up.
- The actions also have sparked discussion by TRP's board about its strategic direction, according to the report.
Sep. 16, 2014, 2:41 AM
- TransCanada (NYSE:TRP) says the cost of the South Dakota portion of the Keystone XL pipeline has more than doubled to almost $2B in the last four years while the project awaits federal approval.
- Many factors have led to the increase, including the drawn-out regulatory process, inflation, currency changes, labor cost increases and materials storage.
- The new estimate brings the total cost of the project to $5.4B, although it will be revised higher once regulatory approval is received.
Sep. 8, 2014, 7:23 PM
- Exxon Mobil (NYSE:XOM), ConocoPhillips (NYSE:COP), BP, TransCanada (NYSE:TRP) and the state of Alaska, working together to develop a pipeline and liquefied natural gas plant, have submitted a formal request to the FERC to start an environmental review required for siting, design and permitting for construction.
- The planned 800-mile pipeline from Alaska’s North Slope to a liquefaction plant in Nikiski on the southern coast’s Cook Inlet would carry as much as 3.5B cf/day of natural gas.
- The Alaska LNG project is in the pre-engineering and design phase, which is expected to be completed by 2016 and cost ~$500M, but total investment costs could hit $45B-$65B before all is said and done.
Sep. 5, 2014, 3:25 AM
- Nebraska's highest court will hear arguments today for TransCanada's (NYSE:TRP) proposed $5.4B Keystone XL pipeline, following five years of wrangling at the federal level.
- At issue is a 2012 decision that killed legislation allowing the Canadian company to chart the pipeline’s course through Nebraska.
- While a ruling upholding that decision would add another obstacle to the project, a reversal could immediately send the case to President Obama, forcing him to choose between unions who support the project and environmentalists who don’t.
Sep. 3, 2014, 2:49 PM
- Kinder Morgan's (KMI, KMP) expansion of the Trans Mountain conduit linking Canada's oil sands to the Pacific is beginning to face the same kind of backlash that turned TransCanada's (NYSE:TRP) proposed Keystone XL pipeline to the Gulf coast into a proxy battle against climate change, according to a Bloomberg report.
- The mounting opposition threatens KMI’s largest project, which represents 30% of its investment plan.
- "The environmental movement has realized that one front in the climate change battle is trying to delay or deny pipelines,” says Morningstar's Jason Stevens. "If it gets stymied out for a long, long time, it’s a big chunk of cash flow five years out that won’t materialize."
Aug. 28, 2014, 6:38 AM
- Keith Benes, a U.S. State Department lawyer who played a key role in the Keystone XL pipeline review is moving on, marking the latest senior official to depart from TransCanada's (NYSE:TRP) long-delayed project.
- The move could spark some fresh conversations about Keystone XL, prior to the lawsuits and rulings that will come about later this year.
- Benes' review concluded that the pipeline might encourage Canadian oil sands development, but would not meaningfully worsen global climate change.
Aug. 26, 2014, 2:46 PM
- The legal dispute over the proposed path for the Keystone XL pipeline in Nebraska is made to order for Pres. Obama in a congressional election year, giving him leeway to hold off on deciding the fate of the project until after November.
- Next Friday, the Nebraska Supreme Court will begin hearing oral arguments over whether a 2012 law giving Nebraska's governor authority to approve the state’s portion of the Canada-to-Texas oil sands pipeline violates the state constitution.
- If the Court upholds a lower court ruling favoring landowners, TransCanada (NYSE:TRP) would have to convince the state’s Public Service Commission to approve the proposed route, which could take six to nine months.
Aug. 25, 2014, 9:47 AM
- TransCanada (TRP +1.7%) opens higher after a favorable weekend report from Barron's, which says that even without the $5.4B Keystone XL pipeline, the company boasts an industry-leading $30B backlog of projects in the works.
- TRP shares aren't cheap based on reported earnings, trading at ~23x estimated 2014 after-tax profit, but TRP has a strong growth outlook - management sees EBITDA nearly doubling by the end of the decade - and the shares fetch just 12x estimated 2015 EBITDA.
- Investors have given TRP little credit for its conservative dividend policy, which pays out a third of its cash flow in dividends while retaining funds to reinvest in its capital program.; there's speculation that TRP, whose current investor base is dominated by Canadian institutional holders, could attract a U.S. activist investor who would push for a more generous dividend and a separation of the pipeline and power-generating assets.
Aug. 12, 2014, 2:04 AM
- Arguments over the planned route of TransCanada's (NYSE:TRP) Keystone XL $5.4B pipeline will soon be heard by the Nebraska Supreme Court, but a ruling regarding the controversial project is likely to be delayed until next year.
- Now in its sixth year of debate, the pipeline continues to face opposition from politicians, landowners and regulators, and ultimately lies in the hands of President Obama to make a final decision on whether to approve or veto the project.
Aug. 11, 2014, 8:58 AM
- The Keystone XL pipeline (NYSE:TRP) could produce 4x more global warming pollution than estimated earlier this year by the U.S. State Department, according to a new study from scientists at the Stockholm Environment Institute.
- The researchers estimate the proposed pipeline, which would carry oil from tar sands in western Canada to refineries on the Gulf coast, would increase world greenhouse gas emissions by as much as 121M/year of carbon dioxide; the State Department had figured that Keystone XL would increase world carbon dioxide emissions by no more than 30M tons.
- The American Petroleum Institute says the study is irrelevant because regardless of the pipeline, the tar sands will be developed and oil will be shipped by railroad if not by pipeline.
Jul. 31, 2014, 3:04 PM
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