UPDATE 2-TransCanada stands by Keystone XL; profit beats

Fri Jul 31, 2015 3:10pm EDT
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(Adds CEO comments on Keystone XL, details on Energy East costs, updates share price)

By Julie Gordon

VANCOUVER, July 31 (Reuters) - TransCanada Corp is still committed to building the Keystone XL pipeline despite stubborn opposition in the United States that has thrown the C$8 billion ($6.2 billion) project into regulatory limbo, the chief executive of the Canadian company said on Friday.

But even as hopes fade that the Obama administration will approve the controversial cross-border pipeline, CEO Russ Girling said he has not yet decided if he will use the NAFTA trade agreement to try to push it through.

"At this point in time that's not a focus we have," Girling said when asked if he'd consider a trade challenge if the project was ultimately blocked. "No decisions have been made, so it would be premature to speculate."

Girling spoke after the company reported that profits from existing Keystone operations helped TransCanada post higher-than-expected quarterly profit.

The company also warned that the price tag of its C$12 billion Energy East pipeline, which would carry Alberta crude to refineries and export markets Eastern Canada, will likely increase due to higher building costs and route changes.

Girling said demand for crude oil is growing in the United States and there remains a strong need for Keystone XL, adding that the focus was on resolving regulatory and legal issues, and preparing for construction.

"TransCanada, and its shippers, remain 100 percent committed to this project," he said.   Continued...