Keystone XL was seen as a major step toward solving that problem. The pipeline would have added 830,000 barrels of daily shipping capacity — about 4.2 percent of U.S. oil demand — when it came into service, which was expected to happen in 2021. Any potential setback will make other projects, including Enbridge Inc.’s Line 3 expansion and the federal government’s Trans Mountain expansion project, all the more crucial for the industry.
Delays also may send TransCanada back to oil producers or Canada’s government for assurances that the trouble of trying to push ahead with the pipeline will be worthwhile, according to Royal Bank of Canada’s Robert Kwan.
“There is a clear economic need for the project and we wonder whether TransCanada will choose to pursue the project with a stronger backstop from shippers and/or various levels of government,” Kwan said in a note.