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TC Energy (TRP - Free Report) , a prominent Canadian energy company, made a significant move by seeking permission from the Federal Energy Regulatory Commission (“FERC”) to put parts of the North Baja natural gas pipeline expansion into service. This development aims to supply more natural gas from the United States to Mexico, with potential implications for both nations' energy sectors.
Let's delve into the details of this project and explore the significance of the same.
Aim of the Pipeline Expansion
The North Baja pipeline expansion project, with an estimated cost of $127 million, is designed to allow for a greater supply of natural gas from the United States to Mexico. With this development, TC Energy aims to strengthen cross-border energy cooperation and support the growing energy demands of both countries.
It will also facilitate energy trade between the two nations. The project aims to diversify Mexico's energy sources and reduce its dependence on other forms of energy generation.
Boosting Mexico's Energy Sector
One of the primary beneficiaries of the aforementioned project is Sempra Energy's Costa Azul liquefied natural gas (“LNG”) export plant, which is currently under construction. This LNG facility, located on Mexico's Pacific Coast, is anticipated to play a crucial role in converting natural gas into LNG for export purposes.
The increased supply of U.S. natural gas via the North Baja pipeline will significantly contribute to the operations of Costa Azul, supporting Mexico's aspirations to become a prominent LNG exporter in the US-Mexico region.
The Regulatory Process and Approval
On May 26, TC Energy's North Baja subsidiary submitted a request with the FERC to proceed with the pipeline extension project. The agency’s approval process involves a comprehensive evaluation to ensure the project’s alignment with regulatory requirements and environmental standards.
Conclusion
The expansion also marks a crucial step toward bolstering energy cooperation between the United States and Mexico. Following approval from the FERC, TC Energy aims to put parts of the pipeline into service, enabling the supply of U.S. natural gas to Mexico. This undertaking holds great potential for both nations, diversifying energy sources, encouraging cross-border energy trade and supporting Mexico's LNG aspirations.
Zacks Rank and Key Picks
TC Energy is a premier energy infrastructure provider in North America. It operates under five segments — Canadian Natural Gas Pipelines, U.S. Natural Gas Pipelines, Mexico Natural Gas Pipelines, Liquids Pipelines, and Power and Energy Solutions. TRP currently carries a Zacks Rank #3 (Hold).
Evolution Petroleum: EPM is worth approximately $265.82 million. EPM currently pays a dividend of 48 cents per share, or 6.01% on an annual basis.
The company currently has a forward P/E ratio of 7.23. In comparison, its industry has an average forward P/E of 18.10, which means EPM is trading at a discount to the group.
Murphy USA: MUSA is valued at around $6.13 billion. In the past year, its shares have risen 11.3%.
MUSA currently pays dividends of $1.52 per share, or 0.54% on an annual basis. MUSA's payout ratio sits at 6% of earnings.
Archrock: AROC is valued at around $1.46 billion. It delivered an average earnings surprise of 8.34% for the last four quarters and its current dividend yield is 6.43%.
Archrock is a provider of natural gas contract compression services and aftermarket services of compression equipment.
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FERC Approves TC Energy's (TRP) US-Mexico Pipeline Project
TC Energy (TRP - Free Report) , a prominent Canadian energy company, made a significant move by seeking permission from the Federal Energy Regulatory Commission (“FERC”) to put parts of the North Baja natural gas pipeline expansion into service. This development aims to supply more natural gas from the United States to Mexico, with potential implications for both nations' energy sectors.
Let's delve into the details of this project and explore the significance of the same.
Aim of the Pipeline Expansion
The North Baja pipeline expansion project, with an estimated cost of $127 million, is designed to allow for a greater supply of natural gas from the United States to Mexico. With this development, TC Energy aims to strengthen cross-border energy cooperation and support the growing energy demands of both countries.
It will also facilitate energy trade between the two nations. The project aims to diversify Mexico's energy sources and reduce its dependence on other forms of energy generation.
Boosting Mexico's Energy Sector
One of the primary beneficiaries of the aforementioned project is Sempra Energy's Costa Azul liquefied natural gas (“LNG”) export plant, which is currently under construction. This LNG facility, located on Mexico's Pacific Coast, is anticipated to play a crucial role in converting natural gas into LNG for export purposes.
The increased supply of U.S. natural gas via the North Baja pipeline will significantly contribute to the operations of Costa Azul, supporting Mexico's aspirations to become a prominent LNG exporter in the US-Mexico region.
The Regulatory Process and Approval
On May 26, TC Energy's North Baja subsidiary submitted a request with the FERC to proceed with the pipeline extension project. The agency’s approval process involves a comprehensive evaluation to ensure the project’s alignment with regulatory requirements and environmental standards.
Conclusion
The expansion also marks a crucial step toward bolstering energy cooperation between the United States and Mexico. Following approval from the FERC, TC Energy aims to put parts of the pipeline into service, enabling the supply of U.S. natural gas to Mexico. This undertaking holds great potential for both nations, diversifying energy sources, encouraging cross-border energy trade and supporting Mexico's LNG aspirations.
Zacks Rank and Key Picks
TC Energy is a premier energy infrastructure provider in North America. It operates under five segments — Canadian Natural Gas Pipelines, U.S. Natural Gas Pipelines, Mexico Natural Gas Pipelines, Liquids Pipelines, and Power and Energy Solutions. TRP currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks for investors interested in the energysector are Evolution Petroleum (EPM - Free Report) and Murphy USA (MUSA - Free Report) , each sporting a Zacks Rank #1 (Strong Buy), and Archrock (AROC - Free Report) , holding a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Evolution Petroleum: EPM is worth approximately $265.82 million. EPM currently pays a dividend of 48 cents per share, or 6.01% on an annual basis.
The company currently has a forward P/E ratio of 7.23. In comparison, its industry has an average forward P/E of 18.10, which means EPM is trading at a discount to the group.
Murphy USA: MUSA is valued at around $6.13 billion. In the past year, its shares have risen 11.3%.
MUSA currently pays dividends of $1.52 per share, or 0.54% on an annual basis. MUSA's payout ratio sits at 6% of earnings.
Archrock: AROC is valued at around $1.46 billion. It delivered an average earnings surprise of 8.34% for the last four quarters and its current dividend yield is 6.43%.
Archrock is a provider of natural gas contract compression services and aftermarket services of compression equipment.