Wed, May 6, 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.
Wed, Mar. 18, 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.
Tue, Feb. 3, 11:59 AM
- The EPA says developing the Keystone XL pipeline (TRP +2.9%) would “significantly increase” the greenhouse gas emissions from the oil sands, a conclusion environmental groups say gives Pres. Obama reason to reject the proposed pipeline.
- In a letter to the State Department, the EPA’s Cynthia Giles undercuts assurances that the pipeline would not have an impact on Canadian emissions, saying the State Department’s environmental impact analysis concludes the pipeline would result in as much as 27.4M metric tons of carbon dioxide equivalents per year, the same as emissions from 5.7M passenger vehicles.
- The Natural Resources Defense Council says the assessment means the pipeline fails the standard Obama has said he’ll use to judge the project.
Fri, Jan. 9, 10:05 AM
- The Nebraska Supreme Court issues a reversal of a lower court ruling that had blocked a route for the Keystone XL pipeline, leaving in place legislation that favored TransCanada's (TRP +3.2%) claim to build the pipeline across the state.
- The ruling ends the legal challenge to a Nebraska law that allowed the Republican governor to determine the route of the pipeline in the state.
- The project’s fate now returns to Pres. Obama, who has cited the lawsuit in deferring a decision on approving the project.
Tue, Jan. 6, 2:11 PM
- The White House specifically states for the first time that Pres. Obama would veto legislation to approve the Keystone XL pipeline (TRP -4%), setting up a likely showdown against the Republican-controlled Congress in the coming weeks.
- Obama's press secretary says there is a well-established review process being run by the State Department that should not be undermined by legislation; Congress says it has the authority to regulate interstate commerce and thus is able to green-light the pipeline.
- Senators Hoeven and Manchin, a Republican and Democrat respectively, say the bill now has 60 co-sponsors, but no one is saying yet that there's enough support to override a presidential veto.
Dec. 4, 2014, 3:25 PM
- Enbridge (ENB +10.8%) soars to all-time highs on heavy volume following news of its sweeping plan to raise its dividend by 33% and transfer ownership of its Canadian pipelines to affiliates in a bid to lower funding costs for future expansion and new projects.
- The dropdown allows ENB “to accelerate dividend growth immediately and for the next four-plus years,” ScotiaBank analyst Matthew Akman says.
- "It's another attempt to remove the conglomerate discount by streamlining its businesses," says Colin Cieszynski of CMC Markets.
- The move comes as rival TransCanada (TRP +1.6%) faces pressure from activist investors to overhaul its business, including accelerating dropdowns into its U.S.-based affiliate TC Pipelines (TCP +0.6%) and a spinoff of its power business.
- EEP +6.6%, EEQ +7.3%.
Nov. 19, 2014, 3:28 PM
- Despite coming up just short in yesterday's U.S. Senate vote on the Keystone pipeline, Credit Suisse upgrades TransCanada (TRP +2.4%) to Outperform from Neutral with a price target raised to C$68 from a prior C$58, noting that TRP's asset base is well positioned for several investment themes including Alberta's oil sands and west coast liquefied natural gas shipments.
- The firm continues to believe TRP's "journey to a more capital efficient model will be evolutionary rather than revolutionary," comparing the company's ascendance to Aesop's Tortoise and the Hare fable.
- The firm adds that TRP has a low-cost generation exposure in "structurally tight" power markets.
Nov. 17, 2014, 2:15 PM
- Sen. Landrieu and other supporters of a bill to force approval of TransCanada's (TRP +2.3%) Keystone XL pipeline appear to be one vote short of the 60 needed for tomorrow’s vote.
- Aides to three Senate Democrats whose votes have been courted by Keystone supporters said today that the lawmakers - Coons of Delaware, Klobuchar of Minnesota and Udall of Colorado - would oppose the bill.
- Among senators still being courted are King of Maine, an independent who caucuses with Democrats, and Democrat Johnson of South Dakota.
- The House last Friday passed an identical bill 252-161, with support from 31 Democrats.
Nov. 5, 2014, 10:43 AM
- TransCanada (TRP +2.8%) is up sharply as the new Republican-led U.S. Senate is expected to send Pres. Obama a bill to authorize the Keystone XL pipeline and dare him to veto it.
- Under a Democrat majority, a binding vote on Keystone has not been held since 2012, even though some of its members campaigned in favor of the pipeline ahead of yesterday's elections; the Republican-controlled House repeatedly has voted for the pipeline's construction.
- The larger question is whether TRP will build the pipeline at all, even if it gets through Congress and Pres. Obama; the proposed 1.1M bbl/day Energy East pipeline running from Alberta to Canada’s east coast would send Canadian crude to Europe, Asia and the U.S. Gulf coast, and rail transportation has cut the need for Keystone, whose costs have exploded to nearly $8B.
Nov. 4, 2014, 12:05 PM
- TransCanada (TRP -1.6%) reveals plans to spend as much as C$2.7B to expand its Nova natural gas pipeline system in western Canada to meet surging growth in unconventional natural gas supplies, and another C$475M to expand a gas pipeline project in southern Ontario.
- The news comes even as the company, in its Q3 earnings report, says estimated costs for its long-delayed Keystone XL oil pipeline have ballooned to ~$8B from $5.4B, and followed its filing last week of plans for a new, C$12B cross-Canada pipeline.
- TRP says the Nova Gas system will meet firm commitments for volumes of ~4B cf/day; subject to approvals from Canada’s National Energy Board as well as local regulators, TRP expects construction to start in 2016 and be completed by Q2 2017.
- The Ontario spending will be for additional natural gas infrastructure for its Canadian Mainline system to bring gas from the Marcellus Shale formation in the U.S. to eastern Canadian markets.
Oct. 16, 2014, 12:11 PM
- Resistance is mounting in Quebec over TransCanada's (TRP +3.5%) $12B cross-country Energy East project to convert a natural gas pipeline to oil, just weeks before the company files its formal proposal with the National Energy Board.
- Quebec’s largest natural gas distributor, Gaz Metro, plans to enlist the support of the provincial government to oppose the project it says will lead to supply shortages, higher prices and threaten Quebec’s economic growth.
- Roughly two thirds of Energy East would make use of underused natural gas pipe that’s already in the ground, with new pipe being built through Quebec and New Brunswick, but Gaz Metro says a portion of the pipeline already is fully used by customers at peak winter periods.
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, 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, 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.
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.
Apr. 30, 2014, 2:49 PM
- Royal Dutch Shell (RDS.A +3%) is raising its stake in the proposed Canada LNG project on British Columbia's coast at Kitimat to 50% after two of the Asian partners pared their interests.
- Mitsubishi and Korea Gas had each owned 20%, and they now own 15% each, while PetroChina (PTR) maintains its 20% interest; Shell had owned 40%.
- Shell says early engineering work on the multi-billion dollar project is set to begin and would take up to two years to complete, but a final investment decision is still months away; it is partnering with TransCanada (TRP) on a proposed pipeline to carry gas to the coast.
- LNG Canada is designed to process 1.7B cf/day of gas in its first phase.
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