KEY POINTS
- Enbridge’s Q3 profit doubled, driven by U.S. gas acquisitions.
- New projects in Canada and the U.S. add long-term growth.
- Strong oil demand pushes Mainline volumes to record highs.
Enbridge Inc. reported Friday that its third-quarter profit more than doubled from a year ago, citing incremental contributions from recent U.S. gas acquisitions. The Canadian energy infrastructure company also raised its estimate of organic growth opportunities.
Enbridge’s profit jumps in Q3 from U.S. gas acquisitions
Enbridge, which operates Canada’s largest oil export network and is the largest gas utility in North America, reported C$27 billion ($19.4 billion) in secured growth projects, an increase from the C$24 billion previously disclosed. New investments include the $1.1 billion Sequoia Solar project in Texas and the $700 million Canyon System Pipelines project in the Gulf of Mexico.
“Enbridge has seen increased visibility for our long-term growth, supported by strong energy infrastructure fundamentals, especially rising power demand,” CEO Greg Ebel said on a conference call.
Reuters further clarifies that Enbridge shares fell from 0.3% to C$56.08 on the Toronto Stock Exchange. For the quarter ending Sept. 30, the company reported a profit of C$1.29 billion, up from C$532 million a year earlier. Adjusted earnings of 55 Canadian cents per share missed analysts’ expectations by one cent, according to data from LSEG, due to higher financing costs associated with the U.S. gas acquisitions.
The company closed a $14 billion acquisition, including debt, of three Dominion Energy utilities—East Ohio Gas, Questar Gas, and Public Service Co. of North Carolina—by the third quarter. Enbridge’s adjusted core profit from gas distribution and storage rose 92.6% to C$522 million, with acquisitions contributing C$217 million.
Strong oil demand drives Mainline’s growth into 2024
Steady oil demand also supported Enbridge’s earnings, as its Mainline system transported 2.96 million barrels per day in the third quarter. The pipeline network’s adjusted core profit increased by 3.2% to C$1.35 billion.
“In liquids, demand for the Mainline remains strong, and our volumes for 2024 are expected to exceed 3 million barrels per day,” Ebel said, adding that Enbridge is advancing discussions with customers on new pipelines in Western Canada, targeting 2026.
The Mainline network, North America’s largest crude oil pipeline system, transports light and heavy crude oil, natural gas liquids, and refined products from Edmonton, Alberta, to markets in Canada and the U.S. Midwest.
