Keystone could encourage risky tar-sands investments: Carbon Tracker.

Huffington Post: “The Keystone XL pipeline could encourage risky investments in the Alberta oil sands, according to a report released Monday by a climate change think tank.” “If completed, Keystone XL would transport 800,000 barrels of tar sands oil per day from Alberta, Canada, down to Gulf Coast refineries in the United States. The Obama administration has delayed a decision on the section of the pipeline that would cross the U.S.-Canada border, which needs approval from the State Department to proceed.
Carbon Tracker’s new report
indicates that while Keystone XL would increase revenues for oil sands companies in the short term, the long-term profitability of tar sands is questionable, given fluctuating oil prices and growing concerns over carbon emissions. Environmental concerns may lead to increased regulations to curb emissions, the report contends, which could affect potential profits from oil sands (also known as tar sands).
But the immediate, potential windfall from Keystone may make the oil sands attractive to investors, according to Carbon Tracker co-adviser Mark Fulton.
“We’re saying, ‘Watch out,'” Fulton said, adding that even if Keystone XL is built, tar sands development would still be “really on the margin of what’s profitable” for investors. The study describes tar sands development as “risky high-cost, high-carbon projects, dependent on rising oil prices.” If investors put too much capital into Alberta oil sands and then oil prices don’t meet expectations, Fulton said it could be a “very rough ride” for investors.
….Mark Lewis, external research adviser to Carbon Tracker, said that the benefits of Keystone XL may not come to fruition, particularly for investors. Lewis said in a statement that “the vision of improved prices it promises could quickly be wiped out by increasing costs, meaning investors who believed the mirage of improved oil-sands economics with KXL will be left disappointed”.”