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Interesting that TC announced today 1.6B in contract awards for keystone... just before the election, with comments of support from various companies and union officials. Biden has previously said he would kill it. I think not.
 

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I'm thinking the move is to make it harder for Biden to cancel. America does need KXL built in the long run, but its purely political today.
 

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TRP shares are at a 15 yr low in valuation.
RBC Dominion Securities analyst Robert Kwan:
“With the upcoming November 3 election, a Trump re-election should give the company a four-year window to complete the financially attractive Keystone XL project (6 times EBITDA cash on-cash build multiple),” he said. “However, if Biden becomes president, we see multiple avenues for upside, including: (1) potential for increased natural gas demand to firm up accelerated renewable power deployment and also drive meaningful GHG emissions reductions from coal-to-gas switching; (2) removing the distraction of KXL; and (3) with KXL out of the picture, we see the potential for an attractive move to monetize the Liquids Pipelines assets, which would have numerous benefits.”
Not sure if any of this crystal-ball gazing will materialize, but with TRP shares approaching 50, it is looking attractive.
 

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(2) removing the distraction of KXL; and (3) with KXL out of the picture, we see the potential for an attractive move to monetize the Liquids Pipelines assets, which would have numerous benefits.”
I don't know, but that sounds like some real spin there. It seems like someone who says, "finally after all these years of worrying about my execution date, they finally set it. Now I can get back to being happy again."

But maybe I'm wrong.

ltr
 

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I'm thinking the move is to make it harder for Biden to cancel. America does need KXL built in the long run, but its purely political today.
My take is KXL will not be required long term. As land vehicles move to EV, oil consumption in the form of gasoline and diesel will dramatically decrease. Some 70% of US oil consumption is used for all forms of transportation overall so if we were to say 50% is used for land transportation with the rest being marine and air, that is almost 10 million barrels per day of circa 20 million barrels per day of total usage.. Even a 50% reduction in land transportation use would dramatically reduce oil consumption by 5 million barrels per day. KXL could be a heavily underutilized white elephant by 2030 or so

Added: The stacked bar charts just below the pie charts in this link tell the story.
 

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My take is KXL will not be required long term. As land vehicles move to EV, oil consumption in the form of gasoline and diesel will dramatically decrease. Some 70% of US oil consumption is used for all forms of transportation overall so if we were to say 50% is used for land transportation with the rest being marine and air, that is almost 10 million barrels per day of circa 20 million barrels per day of total usage.. Even a 50% reduction in land transportation use would dramatically reduce oil consumption by 5 million barrels per day. KXL could be a heavily underutilized white elephant by 2030 or so
No doubt some part of ICE land transportation will move to EVs. But I suppose there will still continue to be growth in total number of vehicles?

I read somewhere that much of oil (2/3?) shipped to gulf coast from Alberta would, after refining, be exported as finished product to Mexico, South America, China etc . Need for the pipeline would perhaps not be totally dependent on transportation demand in USA.
 

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With excess refining capacity in the USA, product is exported, but there is (will be) excess refining capacity everywhere in the world. Aging European refineries are most at risk but there will be headwinds for Gulf Coast refineries trying to move product into Europe. A reason why it makes no sense for anyone to buy and re-start Come-by-Chance in NF and why Irving in Saint John has no appetite to invest in capacity to treat more volumes of bitumen. If Venezuela ever got its shite together gain, its Orinoco heavy would compete with Canadian bitumen on the Gulf Coast.

Some info in this link and a simple chart here There is simply way too much capacity worldwide.
 

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The refinery in Newfoundland is done. It only ever operated because the government waived all past environmental liability. Companies are lining up to see if the government will offer subsidies, but there is no stand alone business model that makes sense. RIP
 

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I think the demise of internal combustion engines is overstated. Will there still be gas engines in 20 years.....yes, I think they will still be produced. Gas engines are also getting more efficient which I think will prolong their use.

I think the biggest factor with EVs, is the lack of charging infrastructure across the country. Americans in particular love the “road trip” and often have family much farther away than your typical Canadian family. We also seem to have huge difficulties getting large-scale infrastructure projects off the ground in North America.
 

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TRP will weather this storm because the demand for NG is soaring, and there is a bit of a supply crunch shaping up that could last years. EV infrastructure is coming along but you can plot the decline in oil consumption in the developed world and still end up with far more oil demand 10 and 20 years out based on the rest of the world, including/especially India and China.
 

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I think the demise of internal combustion engines is overstated. Will there still be gas engines in 20 years.....yes, I think they will still be produced. Gas engines are also getting more efficient which I think will prolong their use.

I think the biggest factor with EVs, is the lack of charging infrastructure across the country. Americans in particular love the “road trip” and often have family much farther away than your typical Canadian family. We also seem to have huge difficulties getting large-scale infrastructure projects off the ground in North America.
I agree there will be plenty of ICE vehicles still remaining on the roads in 20 years. If they are still selling them in 2030 (and they will be), it will take another 10-15 years to retire them off the roads. That is really not the point since demand for both gasoline and diesel will be in permanent decline for decades.

Individual states, some more than others, are investing fairly heavily in EV infrastructure along major routes so that will not be the impediment many think it will be. A few links Three US states will spend $1.3 billion to build more electric vehicle charging and Electric Cars in America: How States are Creating Electric Vehicle Infrastructure | BidNet In many ways, the more progressive of the US states are moving a lot faster than Canada may ever be. We talk a good game but do little.

Added: Yes, both TRP and ENB will do just fine. Both move a lot of gas in the USA (Spectra was purchased by ENB for a reason) and existing oil pipelines will continue to generate revenue with minimal recurring operating capital.
 

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Interestingly - if the big players like Volvo/VW and others are making changes on that scale, it looks like the next 5 years will see some real change in auto sales... but it begs the question "which companies/businesses stand to benefit most from this huge transition to EV?" Would it be Hydro companies (highly regulated)? Would it be companies that develop/replace electric car batteries (sounds like these companies are/would be foreign - but I don't know, I think China has the battery market pretty locked up)?
Are companies like TRP/ENB positioning themselves to respond to the change? Some crystal-ball gazers suggest that companies like TRP stand to benefit because their natural gas business stands to benefit as Power companies use natural gas to help augment power from renewable sources etc. Not sure who knows these answers, but I'd be interested to learn who follows this kind of stuff.
 

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I think something many are missing is that Enbridge is one of the largest renewable energy companies in Canada.


TransCanada is also investing in a long string of renewable energy infrastructure although I can't find a decent link to post.

These guys are more than gas & oil pipes.
 

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One of the reasons that companies like TRP rename themselves. A lot of cash flow not being invested in new pipe can be invested in renewables. It pays to take a look at their Investor Presentations for at least trends in management direction, if not specifics.
 

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TRP approaching a 5 yr low, not unexpected given the comments that the DEMs made about keystone and fossil fuels...but given that the DEMS would be unable to pass laws etc, I'm wondering whether KXL will prevail. We'll see.
 

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Well they won't need presidential approval for the border crossing anymore since it was installed back in May.
 

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I sold TRP at $69 back on 28 Feb. It looks good here at $50 with a 6.4% yield, but so does ENB at $35.82 and 9.0% and PPL at $26.78 and 9.4%. Everytime a pipeline fight erupts, it makes the ones in the ground more valuable. But I think I would wait for more of a short term bottom at least, all of them are setting new lows every week here.
 

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So when the inevitable order comes down that KXL is dead, what recourse does TC have? Could they sue??? if yes what kind of damages may they be awarded? Billions down the drain on this foolish bet. I have zero doubt this is done like dinner as n Biden's speech he mentioned Climate change again and Systemic Racism so it is clear he is going HARD LEFT.
 
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