* Now sees Keystone XL in service by early 2015
* To reapply for Presidential Permit in "near future"
* Boosts cost estimate by $800 mln to $7.8 bln
* Q4 comparable profit C$0.52/shr vs est C$0.53
* Shares rise 1.6 pct in Toronto
By Scott Haggett
CALGARY, Alberta, Feb 14 TransCanada Corp
, the backer of the Keystone XL pipeline, said on
Tuesday it plans to soon reapply for U.S. approvals for the
project, adding that the line would be further delayed and
raising its cost estimate to $7.8 billion.
The company, which reported a 39 percent rise in net income
on Tuesday and boosted its dividend by 4.8 percent, said it
expects to have the 830,000 barrel Alberta-to-Texas oil pipeline
up and running by early 2015 after last estimating it could be
operating by late 2014.
Alex Pourbaix, the head of TransCanada's pipeline
division, said the schedule was revised because the company now
expects it will not receive the required presidential permit
clearing construction until the first quarter of 2013.
"We've always said that the time period for
construction of Keystone XL would be two full years and we're
just taking a look at the timeframe," he said on a conference
call. "We believe that a reasonable date to get a new
Presidential Permit is in Q1 of 2013, and it was really just
The Obama administration has twice withheld approval for the
Keystone XL line, once in November when it delayed a decision
until after the 2012 presidential election and again last month,
when Republican legislators tried to force the president to make
a final decision on the line. Barack Obama rejected that bid
because environmental studies were incomplete.
But TransCanada maintains that Obama's denial was not based
on the merits of the project and it plans to re-apply for the
crucial Presidential Permit in the near future.
"I don't have any reservations that this pipeline is going
to get completed," said Russ Girling, the company's chief
executive. "The U.S. needs to import some 10 million barrels a
day of oil, every day, and currently get it from places like
Venezuela, Saudi Arabia, Nigeria. We're just going to replace
that oil with Canadian oil."
At the request of shippers who have contracted for capacity
on Keystone XL, TransCanada is still mulling first completing
the leg of the pipeline that would run from the bloated oil
storage hub at Cushing, Oklahoma, to Texas refineries on the
Gulf of Mexico.
"We think there's a pretty compelling need for the
project," Pourbaix said. "So we've got to do our homework with
shippers. But I would expect that this is the kind of thing
we'll be considering over the next couple of months."
The Keystone XL line has been bitterly opposed by
environmental groups concerned about spills along the route and
the expansion of the Alberta oil sands. The oil sands are the
world's third largest crude storehouse, but producing its
tar-like bitumen is more energy intensive and emits more
greenhouse gases than conventional oil production.
TransCanada said it now has firm contracts to ship as much
as 1.1 million barrels of crude per day on Keystone XL and its
existing Keystone system, which takes oil sands crude to Cushing
and southern Illinois.
The company also raised its cost estimate for the
line to $7.8 billion from $7 billion to account for the costs of
building an 80 km (50 mile) extension to Houston, as well as
additional linkages to Cushing and the Bakken oil field in North
NET INCOME RISES
The company said fourth-quarter net income rose 39 percent
to C$375 million ($375 million), or 53 Canadian cents a share,
compared with C$269 million, or 39 Canadian cents a share.
Comparable earnings, which exclude most unusual items, fell
about 5 percent to C$366 million, or 52 Canadian cents a share,
from C$384 million, or 55 Canadian cents, a year ago. That was
just under the average analyst forecast of 53 Canadian cents a
share, according to Thomson Reuters I/B/E/S.
The company said its lower comparable earnings were due to
weaker results from its natural gas pipelines and reduced profit
from its stake in Ontario's Bruce Power nuclear generating
station, and its U.S. power plants.
TransCanada also said it will raise its quarterly dividend
by 2 Canadian cents to 44 Canadian cents a share.
Fourth-quarter revenue rose about 15 percent to C$2.36
TransCanada shares rose 67 Canadian cents to C$42.15 on the
Toronto Stock Exchange on Tuesday