President Obama has been wavering on the proposed Keystone XL extension that would complete the Keystone Oil Pipeline. In a Tuesday speech, the President said “our national interest will be served only if this project does not significantly exacerbate the problem of carbon pollution.” Obama stated that he would ask the State Department to not approve the project until the environmental impact could be fully assessed.

The request from Obama is welcome news for oil companies. Its gives energy companies a clearer idea of the benchmark that must be met to finally complete the pipeline, which was first proposed in 2005.

Obama has long looked to appease both the environmental and oil lobbies on the pipeline issue. By issuing this carbon pollution requirement – one the Canadian government is confident will be met – Obama can now claim that he has insured that the environmental impact would be minimal while the Pipeline project marches on towards completion. Despite protests, and dissent in the Democratically controlled Senate, if new Secretary of State John Kerry gives his blessing to Obama, the completion of the Pipeline looks promising.

And this is welcome news indeed for companies vested in the $7 billion dollar project.

The Pipeline’s History

Designed to connect Canada’s oil sands in Alberta to refineries in Texas, the Keystone Pipeline was originally conceived by TransCanada (TRP), with ConocoPhillips (COP) joining as partner in early 2008. ConocoPhillips sold out their half the next year, leaving TransCanada as the sole owner. Valero (VLO) is reportedly in talks to make volume commitments in exchange for equity in the pipeline.

Construction has already begun on a southern leg of the project that connects Oklahoma to Texas.

Future Economic Impact for US and Canada

The pipeline would carry 800,000 barrels of oil a day across six U.S. states to refineries along the Gulf Coast. While it’s clear that much, much more oil will be moving through the U.S., the economic impact is unclear.

TransCanada’s website claims the Pipeline will “support the significant growth of crude oil production in the United States by allowing American oil producers more access to the large refining markets found in the American Midwest and along the U.S. Gulf Coast.” Ideally, the Pipeline would create jobs centered around the moving and refinement of Canadian crude.

But other analysts expect the exact opposite: a drastic increase in oil prices for Americans. As quoted in the Minneapolis Star Tribune, Philip K. Verleger, a respected consultant who specializes in research on oil economics, “the firms involved have asked the US State Department to approve this project, even as they’ve told Canadian government officials how the pipeline can be used to add at least $4 billion to the US fuel bill.”

So Who Benefits?

While it’s unclear whether the Pipeline would be a boon for American consumers, Canadian consumers, both, or neither, it certainly will for the energy companies invested in the project.

Canada Natural Resources (CNQ), a big player in Canadian oil extraction, plans to cut costs related to thermal sands production, the method used to extract crude in Alberta’s fields. Their stock is up .21 percent to $28.36 a share.

Valero has long looked for alternative methods to get crude from Canada to the US, and a stake in the pipeline would be a huge boon for them. Valero is up 1.32 percent to $35.44 a share.

And perhaps the biggest winner of all will be the progenitors of the entire project. With the completion of the Pipeline, TransCanada would be poised to become one of the leading oil-movers on the entire North American continent. By 2030, the Pipeline would be expected to move 1.3 million barrels of sand oil crude a day, with TransCanda maintaining at least an 85 percent stake in the line.

The Alberta-based gas and oil distributor’s stock is up 1 percent today to $42.97 a share. TransCanada was at $26.39 three years ago.