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Released November 12, 2018 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--TransCanada Corporation's (NYSE:TRP) (Calgary, Alberta) controversial Keystone XL crude oil pipeline has received yet another setback. This time, a federal judge in Montana has halted construction on the pipeline, saying the U.S. government failed to examine closely the impact of the pipeline on greenhouse gas emissions and Native American land resources.
Click on the image at right for a breakdown of TransCanada projects by market region.
The pipeline will carry up to 830,000 barrels per day (BBL/d) of crude oil from Alberta's oil sands to a junction in Nebraska, where the oil can then proceed to the U.S. Gulf Coast to be refined or exported. Since the pipeline crosses international boundaries, it requires a presidential permit to be constructed. This permit initially was denied by former President Barrack Obama in 2015, after seemingly wading through environmental, land-acquisition and permitting issues. However, when President Donald Trump entered office in 2017, within the first few months of presidency he signed the presidential permit allowing TransCanada to construct the pipeline.
U.S. District Judge Brian Morris' halting of the pipeline came in response to lawsuits filed by environmental and indigenous groups after President Trump issued the permit. Morris agreed with the groups, which said a 2014 environmental impact statement fell short of regulatory standards. In his decision, Morris barred both TransCanada and the U.S. "from engaging in any activity in furtherance of the construction or operation of Keystone and associated facilities" until the U.S. State Department completes a supplemental review of the project. Morris was appointed by Obama in 2013.
Trump appeared infuriated over the judge's decision. "It was a political decision made by a judge. I think it's a disgrace," he told reporters at the White House.
This is not the first time the pipeline has faced headwinds since the project was resumed. Last November, the Nebraska Public Service Commission narrowly voted to approve construction of the pipeline in the state, but did so only by approving an alternative route not favored by TransCanada. The route put the pipeline's path in six counties that had been entirely eastward of the proposed route, prompting a new round of environmental and land-acquisition issues. For more information, see November 21, 2018, article - Nebraska Gives TransCanada OK to Build Keystone--with a Big Catch.
The pipeline has an estimated total investment value (TIV) of $8 billion. For more information, see Industrial Info's project reports on the Alberta, Saskatchewan, Montana, South Dakota and Nebraska portions of the project.
The project is important for Alberta as it would provide a way to move crude oil out of the province, which does not have a lot of takeaway capacity. The other major pipeline to move Alberta crude from the oil sands region, the Trans Mountain Pipeline, has faced its own environmental and permitting issues, notably from neighboring province British Columbia, from where the oil would be exported to destinations in Asia. For more information, see October 19, 2018, article - Kinder Morgan Builds Up Permian Plans, Drops Trans Mountain, with $25 Billion in Projects. Producers in the region have been relying substantially on rail and trucks to move the crude out of the oil sands area. As a consequence, Western Canadian Select (WCS), which comes from the oil sands, trades at a steep discount to West Texas Intermediate (WTI), the U.S. benchmark.
As a consequence, many potential oil sands producers have been wary to invest in the region, causing projects to be delayed. Exceptions include Cenovus Energy Incorporated (NYSE:CVE) (Calgary), which is underway with an $800 million oil sands project that is expected to be completed next year, and Imperial Oil Limited (TSX:IMO), which last week approved construction of its $2 billion Aspen project in Alberta. For more information, see Industrial Info's project reports on the Cenovus and Imperial Oil projects.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
Click on the image at right for a breakdown of TransCanada projects by market region.The pipeline will carry up to 830,000 barrels per day (BBL/d) of crude oil from Alberta's oil sands to a junction in Nebraska, where the oil can then proceed to the U.S. Gulf Coast to be refined or exported. Since the pipeline crosses international boundaries, it requires a presidential permit to be constructed. This permit initially was denied by former President Barrack Obama in 2015, after seemingly wading through environmental, land-acquisition and permitting issues. However, when President Donald Trump entered office in 2017, within the first few months of presidency he signed the presidential permit allowing TransCanada to construct the pipeline.
U.S. District Judge Brian Morris' halting of the pipeline came in response to lawsuits filed by environmental and indigenous groups after President Trump issued the permit. Morris agreed with the groups, which said a 2014 environmental impact statement fell short of regulatory standards. In his decision, Morris barred both TransCanada and the U.S. "from engaging in any activity in furtherance of the construction or operation of Keystone and associated facilities" until the U.S. State Department completes a supplemental review of the project. Morris was appointed by Obama in 2013.
Trump appeared infuriated over the judge's decision. "It was a political decision made by a judge. I think it's a disgrace," he told reporters at the White House.
This is not the first time the pipeline has faced headwinds since the project was resumed. Last November, the Nebraska Public Service Commission narrowly voted to approve construction of the pipeline in the state, but did so only by approving an alternative route not favored by TransCanada. The route put the pipeline's path in six counties that had been entirely eastward of the proposed route, prompting a new round of environmental and land-acquisition issues. For more information, see November 21, 2018, article - Nebraska Gives TransCanada OK to Build Keystone--with a Big Catch.
The pipeline has an estimated total investment value (TIV) of $8 billion. For more information, see Industrial Info's project reports on the Alberta, Saskatchewan, Montana, South Dakota and Nebraska portions of the project.
The project is important for Alberta as it would provide a way to move crude oil out of the province, which does not have a lot of takeaway capacity. The other major pipeline to move Alberta crude from the oil sands region, the Trans Mountain Pipeline, has faced its own environmental and permitting issues, notably from neighboring province British Columbia, from where the oil would be exported to destinations in Asia. For more information, see October 19, 2018, article - Kinder Morgan Builds Up Permian Plans, Drops Trans Mountain, with $25 Billion in Projects. Producers in the region have been relying substantially on rail and trucks to move the crude out of the oil sands area. As a consequence, Western Canadian Select (WCS), which comes from the oil sands, trades at a steep discount to West Texas Intermediate (WTI), the U.S. benchmark.
As a consequence, many potential oil sands producers have been wary to invest in the region, causing projects to be delayed. Exceptions include Cenovus Energy Incorporated (NYSE:CVE) (Calgary), which is underway with an $800 million oil sands project that is expected to be completed next year, and Imperial Oil Limited (TSX:IMO), which last week approved construction of its $2 billion Aspen project in Alberta. For more information, see Industrial Info's project reports on the Cenovus and Imperial Oil projects.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
