Pipeline Restarting- Good News For Producers

Alberta Canada's Rainbow pipeline has been shut down since April 28th due to a one-two punch of an oil spill and forest fires. The main pipeline leaked about 28,000 barrels of light oil and the cleanup was halted when a fire evacuation order hit the province.

The forest fires that raged through Alberta's Slave Lake region did not reach the spill site and now that power has been restored around the fire-zone, the pipeline's southern section will begin to move crude to Edmonton later today. The northern section of pipeline still remains out of commission for now.

With the Rainbow pipeline beginning to resume at least partially, certain producers in the area can breathe a sigh of relief. Nearly 150,000 barrels of oil production has been halted amid the pipeline problems and Alberta energy companies are losing more than $10 million per day in revenue.

For investors, Rainbow pipeline owner Plains All American Pipeline (NYSE: PAA) could be a buy, as the shock of closed pipeline has taken its stock below its highs. In addition, both Cenovus (NYSE: CVE), which halted production at its Pelican Lake project and Canadian Natural Resources (NYSE: CNQ) should trade higher now that the pipeline can carry their oil.