After fighting hard for seven years, TransCanada (NYSE:TRP) lost its political battle to build the Keystone XL Pipeline in 2015 when the Obama Administration officially rejected it due to climate-change concerns. That seemingly put an end to a project that would have moved 830,000 barrels of oil per day from Canada's oil sands region to refineries in Texas.

However, the Trump Administration resurrected the project by reversing that decision and approving the necessary permit last year. That opened the door for TransCanada to proceed.

One of the next steps was making sure there were still enough customers interested in shipping oil on the line to justify the estimated $8 billion investment. It turns out that there were, since the company announced this week that shippers committed to long-term contracts for 500,000 barrels per day. While the company still has some work to do before it begins construction, securing these contracts is a significant accomplishment.

A close-up of a pipeline under construction.

Image source: Getty Images.

What does this mean for the project?

TransCanada initially began soliciting commercial support for the project last July and extended the deadline for another month in September to give customers in Houston more time to sign up after Hurricane Harvey. That patience paid off, as TransCanada was able to secure 20-year commitments for 500,000 barrels of oil per day.

While that's below the initial design capacity of 830,000 barrels per day, the cash flow from those agreements makes it an economically viable project for TransCanada. That said, the company still plans to solicit additional support so it can fill up its capacity and improve the project's economics even further.

However, just because it now has enough firm commitments to move forward doesn't mean it will start construction anytime soon. That's because it still needs to secure the rights-of-ways and other permits to build the pipeline. That process will likely take the company an entire year, which is why it doesn't expect construction to begin until 2019. With an estimated two-year build timeline, that would put it into service by 2021, at the earliest.

A pipeline under construction.

Image source: Getty Images.

What does this mean for investors?

That timeframe lines up well with TransCanada's current growth forecast. The company announced late last year that it had 24 billion Canadian dollars' ($19.3 billion) worth of expansion projects underway, which was enough to grow earnings by an 8% to 10% annual rate through 2021. That rising cash flow would enable the company to boost its dividend at the upper end of an 8% to 10% annual rate through 2020, and by another 8% to 10% in 2021. As such, this project potentially sets the company up to extend the visibility of its dividend-growth forecast beyond that current time horizon.

That ability to maintain fast-paced dividend growth increases the odds that TransCanada can continue delivering market-beating returns. In fact, since the company started raising its dividend in 2000, it has produced an average annual total return of 14%. Given the size of this project, it alone could move the needle enough to help the company maintain a market-beating growth rate in the year it enters service.

A little bit closer to more growth

Securing commercial support for this project is a big win for TransCanada because it proves that oil producers in Canada still need this pipeline, even after all the delays. It's also important to investors because it means that the project will generate a needle-moving return on investment for TransCanada, which could fuel additional dividend growth in the coming years. That said, there's still a long way to go before the company starts construction, so investors shouldn't begin counting on those higher dividend checks just yet.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.