This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Keystone XL Pipeline May Fail but Investors Can Still Profit

NEW YORK (TheStreet) – The much-debated and highly controversial Keystone XL pipeline project hit a new snag when a recent study published in the journal Nature Climate Change found the Keystone XL pipeline can generate up to four times the amount of greenhouse gas emissions as previously estimated.

Investors want to know how to play this news and whether this is just another blow to a project that seemed dead on arrival. From my vantage point, there are still plenty of other options to capitalize on the growth spurt underway in the U.S. energy infrastructure.

A relatively unknown engineering company like Primoris Services (PRIM) can still energize many portfolios by capitalizing in infrastructure investments. Investors may also consider a large contractor like CB&I (CBI). The company has won several contracts to build large storage facilities and platforms.

So investors can still profit from projects like terminal expansions and companies looking to retrofit their refineries and plants. Not to mention, there are other pipelines, not just the Keystone XL, that are being built and they come with much less political and environmental obstacles.

Keystone has taken the headlines for now. Supporters argue this pipeline will stabilize and secure domestic oil supply. In the process, consumers are expected to benefit from lower gas prices, while providing the U.S. the energy security it needs. But neither outcome is guaranteed.

In fact, a recent article by Tom Randall at Bloomberg noted:

"In Keystone’s weirdonomics, the pipeline would actually increase prices of gasoline for much of the country, according to at least three studies that have looked into it. Keystone would divert crude from Midwest refineries to Gulf Coast refineries, where it would then be shipped to more expensive markets. Bypassing heartland refineries could drive up prices at home.

Randall makes an excellent point. This is a potential unintended consequence that is being overlooked. To Randall's point, the retail price of gasoline, which is set using two benchmarks -- Brent sourced from the North Sea, and West Texas Intermediate crude -- for the crude prices, is not as predictable as other resources.

At the time of publication, the author held no positions in any of the stocks mentioned, although positions may change at any time.

Follow @Richard_WSPB

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.70 -0.60%
FB $101.91 0.90%
GOOG $681.92 -0.32%
TSLA $150.47 4.73%
YHOO $26.75 -1.30%


Chart of I:DJI
DOW 15,660.18 -254.56 -1.60%
S&P 500 1,829.08 -22.78 -1.23%
NASDAQ 4,266.8370 -16.7550 -0.39%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs