TransCanada Corp (TSE:TRP) (NYSE:TRP) shares fell Wednesday after President Obama, as expected, swiftly vetoed a bill approving the company's Keystone XL oil pipeline, leaving the controversial project in limbo for another indefinite period.
Immediately after, Senate Majority Leader Mitch McConnell announced the Republican-led chamber would attempt to override it by March 3. Obama has offered no indication as to whether he will eventually issue a permit for the pipeline, but a White House spokesman has said it is certainly possible after the State Department review.
The pipeline has sat in regulatory limbo in the U.S. for six years, and President Barack Obama has the authority to approve the pipeline himself since it crosses an international border.
Environmentalists oppose Keystone since it could help expand oil sands development.
The pipeline would connect to an existing TransCanada system, enabling some 830,000 barrels of crude per day, mostly from Alberta, to more directly reach the lucrative Gulf Coast market by cutting diagonally from the Saskatchewan-Montana border to Steele City, Nebraska.
"TransCanada remains fully committed to Keystone XL despite today’s veto of bipartisan legislation in support of the project," the company said in a statement.
"The facts show Keystone XL passes the national interest determination test and President Obama’s climate test. Without Keystone XL, U.S. refineries are forced to use other methods of transportation to get the oil they need for creating products we all rely on every day.
"This means higher GHG emissions and relying on methods of transportation that are not as safe or as efficient as pipelines, according to the U.S. Department of State."
Shares were down 0.4 percent at C$54.75 as of 10:20 am ET on Wednesday in Toronto.