16 August 2013 18:14 [Source: ICIS news]
TORONTO (ICIS)--The investment by US billionaire Warren Buffett this week in Canadian oil sands major Suncor is good news for the country’s oil sands sector in general, and it may augur well for the controversial Keystone XL oil pipeline project, Canadian analysts said on Friday.
Buffett’s investment firm Berkshire Hathaway on Thursday disclosed that it acquired almost 18m Suncor shares, worth more than $500m (€375m).
Dirk Lever, managing director at investment firm AltaCorp Capital, said that the move could indicate that Buffett thinks that the US will finally approve the long-delayed Keystone XL pipeline to ship oil from Alberta's oil sands, as well as oil from North Dakota's Bakken shale region, to refineries on the US Gulf Coast.
"[Buffet’s] timing is usually pretty good," Lever told Canadian business television.
He also pointed to Buffett’s profitable investments in railroad firm. Railroads have expanded their oil railcar services in response to tight North American pipeline capacities.
Shafik Hirani, director at Investor Group Financial Services, also said that Buffett’s move on Suncor should be a "bullish sign" for the oil sands.
US President Barack Obama is expected to make a final decision on whether to approve Keystone XL by the end of the year. The project has met with strong opposition from US environmentalists, who criticise the emissions track record of Canada’s oil sands sector.
In addition to oil sands, Calgary-based Suncor is also an important refiner and petrochemicals producer.
($1 = €0.75)
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections