) received a favorable federal court ruling regarding its pipeline
to carry tar sands oil between Oklahoma and Illinois. Earlier, the
fate of the pipeline became uncertain owing to the petition by the
Sierra Club and the National Wildlife Federation that the failure
to conduct an environmental impact review of the pipeline violated
the National Environmental Protection Act. The environmental groups
alleged that the pipeline would have significant detrimental impact
as it would be constructed by clearing thousands of water bodies,
wetlands, wildlife habitat and other sensitive areas.
U.S. district judge Ketanji Brown Jackson in Washington rejected
the petition citing that the pipeline was constructed mostly on
privately owned land. The ruling noted that the builders of the
pipeline had already approached more than 1,700 private land
owners, and secured 96% of land rights along the 589-mile pipeline
route. The pipeline will carry crude oil from Pontiac, IL, to
Cushing, OK; through the states of Missouri and Kansas.
Canada-based Enbridge Inc. is a leading energy transportation and
distribution company. As a transporter of energy, Enbridge operates
the world's longest crude oil and liquids pipeline system in Canada
and the United States. The company is also involved in natural gas
transmission and midstream businesses in other countries. As a
distributor of energy, Enbridge owns and operates Canada's largest
natural gas distribution company. It provides distribution services
in Ontario, Quebec, New Brunswick and New York State.
We remain apprehensive about the company's midstream natural gas
business, which is sensitive to changes in natural gas
supply-demand fundamentals and commodity cycles associated with gas
Enbridge currently carries a Zacks Rank #3 (Hold). Investors
interested in the oil and gas sector could consider better-ranked
stocks like Weatherford International plc (
), Sanchez Energy Corporation (
) and Sunoco Logistics Partners L.P (
). All these stocks sport a Zacks Rank #1 (Strong Buy).
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