TC Energy's NGTL Pipeline Faces Pressure Reduction Order Despite Repaired Rupture: Report
Portfolio Pulse from Lekha Gupta
The Canada Energy Regulator (CER) has ordered TC Energy Corp.'s (NYSE:TRP) NOVA Gas Transmission Ltd. (NGTL) to reduce the operating pressure for the Grande Prairie Mainline gas pipeline in Alberta, despite the pipeline being repaired after a rupture in April. TC Energy stated that there are no current service restrictions or anticipated interruptions in natural gas delivery. Investors can gain exposure to TC Energy through VanEck Energy Income ETF (NYSE:EINC) and Barclays iPath Select MLP ETN (BATS:ATMP).
May 15, 2024 | 4:53 pm
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NEGATIVE IMPACT
Barclays iPath Select MLP ETN (BATS:ATMP) includes exposure to TC Energy, which is dealing with a regulatory order to reduce pressure on its NGTL pipeline. No service interruptions are expected.
ATMP includes TC Energy, which is under regulatory scrutiny. This could negatively affect the ETN's short-term performance, though the absence of service interruptions is a mitigating factor.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 50
NEGATIVE IMPACT
VanEck Energy Income ETF (NYSE:EINC) provides exposure to TC Energy, which is facing a regulatory order to reduce pressure on its NGTL pipeline. No service interruptions are expected.
EINC holds TC Energy, which is facing regulatory pressure. This could negatively impact the ETF's performance in the short term, although the lack of service interruptions provides some relief.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 50
NEGATIVE IMPACT
The Canada Energy Regulator has ordered TC Energy's NGTL to reduce operating pressure on the Grande Prairie Mainline pipeline. Despite this, TC Energy does not anticipate any service interruptions.
The regulatory order to reduce operating pressure could be seen as a negative development, potentially impacting operational efficiency and future earnings. However, the company's assurance of no service interruptions mitigates some of the negative impact.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100