Page 6 - NorthAmOil Week 42 2022

NorthAmOil PIPELINES & TRANSPORT NorthAmOil

Report: TC Energy could sell Keystone

oil pipeline, say analysts

NORTH AMERICA CALGARY-BASED TC Energy could sell bil- saying it does not comment on speculation or
lions of dollars in assets for partially funding rumours.
projects in Western Canada and Mexico and may The company’s shares recently fell to an
even seek the sell-off of the Keystone oil pipeline almost two-year low after it issued new equity to
to the US, according to Bloomberg. fund a natural gas project in Mexico.
The news service cited RBC Capital Markets TC Energy had to cancel its much-delayed
analyst Robert Kwan, in a note, who suggested Keystone XL oil pipeline, after US President Joe
that the Canadian company could sell its liquids Biden revoked a key cross-border permit on
pipelines and smaller gas pipelines, with pro- his first day in office in January 2021. Climate
ceeds targeted to be CAD4bn ($2.9bn). Kwan change concerns related to emissions from the
said he recently met with the chief financial production of oil sands crude were Biden’s pri-
officer of TC, Joel Hunter. mary reason for the cancellation, he said at the
Meanwhile, Tudor Pickering Holt & Co. time.
(TPH) analysts also say they foresee TC Energy The Canadian company scrapped its Energy
monetising assets as the company bolsters its East pipeline after years of delay.
balance sheet. In a note, TPH analyst Matthew According to Bloomberg, the company
Taylor said that were TC Energy to sell its liquids has faced a 70% cost overrun in its Coastal
pipelines, it would be an “ESG-accretive dives- GasLink pipeline. The pipeline, which is
titure” and “the major prize in right-sizing the located in British Columbia, would supply
balance sheet.” Taylor upgraded the stock from the Shell-led LNG Canada project. It is nearly
hold to buy. three-quarters finished, but faces opposition
TC Energy did not comment to Bloomberg, from First Nations.™

INVESTMENT

BP to buy biogas producer Archaea for $4.1bn

US BP is buying leading Texas-based biogas pro- A growth in biogas supports both bp’s cus-
ducer Archaea Energy for $4.1bn in cash and tomer decarbonisation goals and the superma-
net debt. jor’s aim to reduce the carbon intensity of the
The acquisition of a leading US renewable energy products it sells. BP is targeting for net-
natural gas (RNG) producer will accelerate zero emissions by 2050.
growth of BP’s strategic bioenergy transition “Archaea is a fantastic fast-growing busi-
growth engine, the London-based company said. ness, and bp will add distinctive value through
RNG is biogas made from decomposed our trading business and customer reach. It will
organic matter from landfills or farms. accelerate our key bioenergy growth engine,
Archaea operates 50 RNG and landfill gas-to- creating a real leader in the biogas sector and
energy facilities across the US producing around support our net-zero ambition,” said BP’s CEO,
6,000 barrels of oil equivalent a day (boepd) of Bernard Looney. “And, importantly, we’re doing
RNG, and has a development pipeline support- this while remaining focused on the disciplined
ing the potential for around a five-fold increase execution of our financial frame. Investing with
in RNG volumes by 2030. discipline into the energy transition, creating
The deal doubles the EBITDA – a measure of further value through integration – this is exactly
profit – that BP expects from biogas to around what bp’s transformation into an integrated
$2bn by 2030 and supports an increase in bp’s energy company is all about.”
aim for EBITDA from transition growth busi- It is BP’s largest acquisition since Looney took
nesses by 2030 from $9-10bn to more than over in 2020.
$10bn. BP plans to increase Archea’s output five-fold
Bioenergy is one of five strategic transition by 2030 to 30,000 boepd, Looney told Reuters.
growth engines that BP intends to expand rap- Earlier this year, Archaea announced a joint
idly during this decade. The oil company expects venture with Republic Services to develop 40
investment into its transition growth businesses RNG projects across the US. The joint venture
to reach more than 40% of its total annual capi- will convert landfill gas into pipeline-quality
tal expenditure by 2025, aiming to grow this to RNG that can be used for a variety of applica-
around 50% by 2030. tions to displace conventional natural gas.™

P6 www. NEWSBASE .com Week 42 20•October•2022