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TransCanada hikes dividend, delays Keystone

Tags: TransCanada
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TransCanada (TRP-T), one of Canada's largest pipeline operators, announced on Tuesday that its controversial Keystone XL project won't come online until 2015 -- one year later than it initially forecast The company said in its fourth-quarter earnings report that it's is in discussions with lawmakers in Nebraska to re-route the project around the sensitive Ogallala Aquifer in Nebraska.

The threat of an oil spill over the aquifer became a rallying point for environmentalists opposed to the project, which will ship oil from Alberta to refineries on the Gulf Coast. In January -- after months political partisanship -- the U.S. State Department denied TransCanada a permit to go ahead with Keystone XL, but said the company was open to reapply.

"The Company, while disappointed, remains fully committed to the construction of Keystone XL. Plans are already underway on a number of fronts to largely maintain the construction schedule of the project," the company said in its fourth-quarter earnings statement.

TransCanada hiked its dividend by five percent to 44 cents per share, while fourth-quarter earnings came in below analyst expectations.

Fourth-quarter comparable earnings were $366 million, or 52 cents per share, compared to $384 million or 55 cents per share, a year earlier. Analysts polled by Thomson Reuters were expecting the company to report comparable earnings of 53 cents per share.

Higher power prices in Alberta helped net income attributable to common shares increased in the fourth quarter to $375 million, or 53 cents a share, compared to $269 million or 39 cents a share a year earlier.

Pierre Lacroix, an analyst at Desjardins Securities, said in a note to clients that while the earnings slightly missed expectations, it shouldn't have "material implications for the shares."

"We would consider any share price weakness as a buying opportunity in the current market context," he said.

Lacroix had a 'buy' rating on the stock and a $46 price target.

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