Apr. 22, 2014, 7:21 PM
- Alaska’s legislature has approved Gov. Parnell’s plan to join four energy companies - XOM, BP, COP and TRP - in moving ahead on plans to build infrastructure to transport and market 35T cf of North Slope gas to be shipped by an 800-mile pipeline to a liquefied natural gas export plant.
- If the $45B-$65B project comes to fruition, gas could hit local and foreign markets in the mid-2020s, according to the state’s projections.
- The state would retain ownership of 25% of the LNG plant, which is planned at Nikiski in south central Alaska.
Apr. 22, 2014, 10:42 AM
- A court challenge holding up the Keystone XL (TRP +0.6%) pipeline should be dismissed, Nebraska Gov. Dave Heineman says as he asks the state’s top court to throw out a trial judge’s February ruling that the route for the pipeline was approved without proper authority.
- The Nebraska Supreme Court may not hear the case until at least September and probably will not rule until after November's congressional elections; if the court upholds the trial outcome, Keystone would need to apply to the state’s Public Service Commission for approval in a process that could take as much as seven months.
- The trial judge erred in allowing a challenge by three property owners to move forward because they hadn’t shown they had been injured as taxpayers by the state’s plan, the governor said in a court filing yesterday.
Apr. 21, 2014, 11:22 AM
- TransCanada (TRP -3.6%) shares suffer their biggest loss in more than two years after the Obama administration delays making a recommendation on the Keystone XL pipeline until legal questions about the way the route was approved through Nebraska are resolved - which could extend into next year.
- Morningstar's David McColl says the delay will raise the costs to build the pipeline, though probably not enough to kill it.
- While RBC Capital continues to believe the project has a present value of ~$5/share, the firm notes it included only half that value ($2.50/share) in its valuation and believes the market has ascribed even less value; as such, despite some downward pressure on the share price, the weakness should not be material (Briefing.com).
Apr. 19, 2014, 12:05 AM
- The Obama administration is indefinitely extending its review of the Keystone XL pipeline (TRP), probably delaying a decision on the project until after November's U.S. midterm elections.
- The State Department - which has had the project under review for nearly six years - says it needs more time to prepare its recommendation to Pres. Obama because of ongoing litigation in Nebraska that is unlikely to be resolved before next year; the department was set to close a review process with eight other federal agencies on May 7.
- Pipeline supporters are criticizing the delay as a political ploy, but the move looks likely to keep environmental activist money flowing into the election races; billionaire Tom Steyer, who has pledged to spend $100M to support candidates who back strong policies to fight climate change, is praising the delay as "good news."
- ETFs: XLE, ERX, OIH, VDE, ERY, DIG, DUG, IYE, PXJ, PXI, PSCE, FENY, FXN, RYE, DDG
Apr. 16, 2014, 10:48 AM
- Alberta looks likely to implement energy efficiency measures when it revamps its climate-change policy to win support for its oil sector, an about-face on the former premier’s vow that the province wouldn’t enact new rules until the U.S. did.
- The province plans to have new regulations on emissions in the near future and may include a higher carbon price, Alberta's environment minister says.
- The struggle by Alberta’s oil producers for access to new markets, as reflected in U.S. delays in approving the Keystone XL (TRP) pipeline, comes amid opposition to oil sands bitumen because of its higher carbon intensity and concerns around air and water pollution.
- Relevant companies include ECA, ENB, EEP, STO, XOM, IMO, SU, CVE, PGH, BP, CNQ, BTE, DVN, IVAN, AAV, RDS.A, RDS.B, PTR, ATHOF
Apr. 11, 2014, 2:34 PM
- "The best MLP you've never heard of" is Niska Gas Storage Partners (NKA +3.5%), according to a favorable profile by StreetAuthority's Daniel Cross, who says NKA stands out with a price-to-free cash flow ratio of ~14 while vs. a negative average for the industry, and a 9.6% dividend yield.
- This strength gives NKA the ability to make acquisitions and capital expenditures to grow at a much faster pace than other utility companies, Cross writes.
- Competitors such as Buckeye Partners (BPL) and TransCanada (TRP) also should also benefit from the rising tide in natural gas production since both companies trade at roughly NKA's P/E, but neither offers NKA's potential for double digit growth, according to Cross.
Apr. 10, 2014, 12:27 PM
- A group of 11 Senate Democrats, including five up for re-election this year, are pressing Pres. Obama to approve the Keystone XL (TRP) pipeline by the end of next month.
- "The process has been exhaustive in its time, breadth, and scope,” the Democrats wrote in a letter; that process has been winding its way through a regulatory review within the administration for more than five years, and Obama has not said when he will make a final decision.
- The letter asks for a decision by May 31 because it’s a few weeks after the 90-day clock ends on the administration’s interagency review of the State Department’s environmental report on the pipeline, which was released Jan. 31.
Apr. 4, 2014, 5:15 PM
- Enbridge (ENB) has obtained a license to re-export Canadian oil from the U.S., becoming the first company to publicly confirm a move that could fuel debate over U.S. trade policy and oil sands pipelines.
- ENB says its Tidal Energy subsidiary has a license to export "limited quantities" of Canadian-origin oil from a U.S. port, confirming speculation about such shipments; first cargoes are expected to sail for Europe later this month.
- Critics of the Keystone XL pipeline (TRP) have contended that allowing re-exports of Canadian oil from the U.S. undercuts Pres. Obama's pledge to protect the climate.
Apr. 4, 2014, 11:22 AM
- 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.
Apr. 2, 2014, 7:17 PM
- Canada's National Energy Board says it will hold public hearings into Kinder Morgan Partners' (KMP) planned $5.4B expansion of the Trans Mountain pipeline that carries crude from the Alberta oil sands to the Pacific coast, first hearing evidence from aboriginal groups in August.
- The regulator, which plans to issue a recommendation on the project's future no later than July 2015, says its review will focus on 12 issues, including impact on the environment, effects on marine shipping, aboriginal interests, and contingency planning for spills and accidents.
- Energy producers such as Exxon (XOM) affiliate Imperial Oil (IMO), BP and Suncor (SU) are looking to the Trans Mountain expansion and other proposed pipelines - most notably Keystone XL (TRP) - to help ease the bottlenecks that have led to steep discounts for Alberta oil on global markets.
Mar. 19, 2014, 6:18 PM
- Greg Rickford, appointed today as Canada's new Natural Resources Minister after Joe Oliver was moved from the post to become Finance Minister following Jim Flaherty's resignation, takes charge at a "critical time for Canada's natural resource sector.
- Rickford will have a lot on his plate: accelerated extraction of Alberta’s oil sands and liquefied natural gas exports on the west coast, contentious pipeline issues from Enbridge’s (ENB) Northern Gateway to TransCanada’s (TRP) Keystone XL, streamlining the mining permitting process, and pushing forward with development of the Ring of Fire in Ontario.
- His experience in aboriginal affairs could prove crucial as Canada's indigenous people demand greater say on how energy and mining projects proceed.
Mar. 18, 2014, 4:44 PM
- TransCanada's (TRP) proposed Energy East pipeline won’t be the boon to eastern Canadian refineries that supporters claim because most of its oil would be bound for export markets, environmental groups argue in a new report.
- The $12B project likely would use the lion’s share of its 1.1M bbl/day capacity to send unrefined oil sands crude to markets such as India, Europe and possibly the U.S., according to the report.
- Supporters say Energy East will help ailing refineries in the East - reliant on high-cost crude from abroad - by connecting them with a stable, low-cost supply from western Canada; TRP has said the project’s economic benefits would be massive and has described it as a nation builder on a level with the Canadian Pacific Railway.
Mar. 13, 2014, 5:39 PM
- Gen. James Jones, Pres. Obama's former national security adviser, tells the Senate Foreign Relations Committee that approving the Keystone XL pipeline (TRP) would send a message to Russian Pres. Putin and other "international bullies" that they cannot use energy security as a weapon, and rejection of the pipeline would "make Mr. Putin's day and strengthen his hand."
- The Senate panel is holding its first hearing on the pipeline five years after it was proposed, as Democrats wrestle with its impact on the 2014 election.
- Meanwhile, results from Canadian polling firm Nanos Research indicate U.S. support for Keystone XL at 62%, down from 74% in a survey it conducted nearly a year ago - still strong support but moving in the wrong direction, which the pollster says should concern the pipeline's proponents.
Mar. 11, 2014, 7:05 PM
- The Keystone XL pipeline is the safest and most environmentally sound way to transport Canadian and North Dakota oil to Gulf Coast refineries, TransCanada (TRP) says in its last-ditch appeal for approval, along with more than 100K other opinions during a government public comment period that ended Friday.
- More than a dozen environmental groups said in joint comments that Keystone XL would boost air pollution at refineries, carry the risk of tough-to-clean spills and “would not lead to energy independence."
- Whatever Pres. Obama's decision, he's going to anger either environmental activists or labor unions; leaders of various U.S. building trades unions gathered in D.C. today and suggested the wrong decision could mean consequences for Democrats in the November elections.
- Hillary Clinton also faces a quandary: Some wealthy Democrat environmentalists are considering withholding support for a 2016 presidential bid unless she reassures them about killing Keystone.
Mar. 5, 2014, 11:40 AM
- Canada's government sends a letter to the Obama administration expressing a desire to work closely with the U.S. on reducing the impact of climate change, as it makes a final push for approval of the Keystone XL pipeline (TRP +0.3%).
- The letter argues the merits of the pipeline on environmental, economic and energy security grounds, and offers a willingness - without offering specifics - to take additional steps to cut greenhouse gas emissions.
- The letter points out that, unlike other countries that export crude to U.S. refineries on the Gulf coast, Canada has actually committed to reducing greenhouse gas emissions and achieved some reductions since 2005.
Mar. 5, 2014, 9:08 AM
- TransCanada (TRP) yesterday took a key step toward obtaining regulatory approval for its proposed $12B Energy East oil pipeline, as it filed a preliminary project description with the National Energy Board.
- The pipeline would connect 1.1M bbl/day of crude from western Canada to refineries and export terminals in Quebec and New Brunswick; the project involves converting part of TRP's existing natural gas mainline to oil service between Alberta and Quebec and then laying new pipe the rest of the way.
- TRP expects to file a full regulatory application for Energy East this summer, with startup expected in 2018.
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