TransCanada may abandon Energy East pipeline facing tougher review

TransCanadawill suspend the application for its Energy East pipeline for 30 days and may abandon the project, the company said on Thursday, weeks after the National Energy Board regulator announced a tougher review process.

TransCanada will do a "careful review" of the new assessment process to gauge its effect on the costs, schedules and viability of the pipeline to the Atlantic coast, the company said in a statement.

The National Energy Board in August expanded the scope of Energy East's review, saying it will consider the project's indirect greenhouse gas contributions and will provide "more visibility" to the evaluation of risks associated with accidents such as oil spills.

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The Energy East pipelinewould take crude from Canada's oil heartland of Alberta and send it to eastern refineries and a marine terminal in Saint John. Itwould offer higher prices for Canadian producers, whose landlocked product trades at a discount to the West Texas Intermediate benchmark.

Assessing indirect emissions had been opposed by TransCanada, which had called it "completely redundant and unnecessary."

The company said on Thursday it will continue to advance its other projects despite pausing Energy East.

Dirk Lever, an energy infrastructure analyst at AltaCorp Capital in Calgary, said,"What they want to do is halt the clock on it, and I can't say I am surprised."

Assessing indirect emissions "is a really tough ask," he said.

Energy East's importance has diminished for TransCanada since U.S. President Donald Trump this year signed an order reviving the company's Keystone XL pipeline, which would expand capacity from Alberta's oilsands to U.S. refineries.

The pipeline was set for asecond NEB review, after the first stalled last year amid protests by environmentalists and after revelations that regulatory panel members met privately with a TransCanada consultant.

The NEB this year ordered Energy East's review to start again from the beginning, voiding all decisions from the project's previous panel.

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