Friday, September 22

Enbridge takes 30% stake in Woodfibre LNG project

Marks Enbridge’s first investment in a liquified natural gas terminal

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Enbridge Inc. said on Friday it will jointly invest in the construction and operation of the Woodfibre LNG project, marking the pipeline giant’s first investment in a liquified natural gas terminal.

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According to an agreement forged with Singapore-based Pacific Energy Corp., Enbridge will have a 30 per cent ownership stake in the $5.1-billion LNG project, planned for a site near Squamish, BC Pacific Energy will retain the remaining 70 per cent stake in the facility.

“We searched far and wide for this opportunity,” Enbridge chief executive Al Monaco told investors in a conference call Friday. “We looked at a lot of others actually and we’ve landed on this one because (it) ticked all the boxes for us and one of the important boxes is ensuring predictability of cash flows.”

In exchange for its capital contribution of $1.5 billion, Enbridge will receive a preferred equity interest that provides future cash flows, the company said.

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The LNG facility would be supplied through FortisBC Energy Inc.’s proposed Eagle Mountain-Woodfibre pipeline, which will connect through to Enbridge’s T-South natural gas transmission system.

Woodfibre issued a “notice to proceed” to its prime contractor in April. Construction is expected to commence in 2023 and could be substantially completed in 2027.

Enbridge also on Friday reported earnings attributable to common shareholders of $450 million, or 22 cents per share, in the second quarter — down from $1.39 billion, or 69 cents per share, over the same period last year.

Earnings were hit by non-cash, net unrealized derivative losses of $850 million.

On an adjusted basis, the company posted a profit of 67 cents per share, below analysts’ estimate of 71 cents per share, according to Refinitiv data.

With additional reporting from Reuters

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