Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Keystone XL Pipeline: What's Next?

By

Some feel that the Obama Administration will wait until after November's mid-term elections to make a decision.

PrintPRINT
February saw a major breakthrough for the Keystone XL Pipeline, as an analysis determined that the project would not have a significant impact on Canadian oil sands. By virtue, many are taking that statement as indirectly suggesting that the project would not have a major environmental impact as well. The potential environmental backlash has long stood in the way of this project's completion, as many feel that the State Department has still failed to take into account the potential impact.

Ultimately, the report, which came in at a towering 11 volumes, stated that the "approval or denial of any one crude-oil transport project, including the proposed project, is unlikely to significantly impact the rate of extraction in the oil sands." Going further into that point, the study suggested that the same amount of oil would be extracted anyway, leaving the door open for the Obama administration to green light the project.

The Opposition

The report may have found that the amount of oil extraction would remain unchanged, but environmentalists are still not convinced of the project's safety. "It's like giving up on the interdiction of cocaine traffic into our country, because drugs are going to get in anyway," quipped Dan Weiss of the Center for American Progress. Many opposed to the plan urge that the release of carbon dioxide will increase global warming, not to mention the potential damage that will come from physically constructing the pipelines.

The debate has turned into a political hotbed, as one side feels that approving the project is a major step in oil independence while others think it leaves the door open for an environmental disaster. The project creates a particularly interesting conundrum for President Barack Obama, as oil dependence would be a big win for his presidency, but it may compromise his past stance on environmental protection.

What Happens Now?

The short answer? We wait. As if this project has not been put through the ringer long enough, some feel that the Obama Administration will wait until after November's mid-term elections to make a decision. However, the president is receiving heavy pressure from Congress to make a call sooner rather than later. Interestingly enough, the pipeline expansion has transcended political boundaries, as it has both support and opposition from Republicans and Democrats.

From an investing standpoint, keep a close eye on TransCanada Corp (NYSE:TRP), the operator of the proposed pipelines (as well as the system currently in place). Though it could be months before a final decision is made, TransCanada Corp is sure to be active all the way through the eventual outcome, as it is one of the most direct ways to make a play on the expansion.

Follow us on Twitter @CommodityHQ

Editor's note: This article by Jared Cummans was originally published on Commodity HQ.
No positions in stocks mentioned.
PrintPRINT
 
Featured Videos

WHAT'S POPULAR IN THE VILLE