The Keystone XL oil pipeline, from Canada to the United States was already rejected by President Barack Obama, but TransCanada Corp, the company behind it, said they will keep pressing the administration to build it, as stated by Reuters.
A couple of investors already said that they’re skeptical about the scenario in which the project will be approved, so they suggested TransCanada to focus on an alternative, implying building the pipeline solely on Canadian territory.
The company needs to focus on one project
“Although (TransCanada has) been trying to keep the Keystone pipeline alive, really their attention is diverted onto other projects; there is more emphasis on Energy East and other elements,” Julie Brough, vice president at investment managers Morgan Meighen & Associates, which owns TransCanada stock, said.
The main reason why the Obama administration rejected Keystone XL is because it wouldn’t make a meaningful long-term contribution to the United States economy, according to Reuters.
As for TransCanada‘s situation, it wasn’t the best week for them, after requesting Washington to suspend the consideration of the Keystone project on Monday, while on Thursday they scrapped plans for another Energy East marine terminal.
The latter is a project under development, with the purpose of moving 1.1 million barrels of western crude to the Canadian East Coast per day. Of course, they’re dealing with opposition from environmentalist trying to stop this industry’s expansion.
Will Energy East be their main focus now?
Also, Keystone’s rejection can boost the case for Energy East. “It provides clarity to the industry about what options are going to be there and helps the Canadian government move forward on what their position is going to be,” said Skip York, analyst for Wood Mackenzie.
Finally, the new Canadian liberal government said they’re prepared to support domestic pipelines like Energy East, as long as there’s a buy-in from local communities.