HomeNewsPipeline Operator TC Energy Beats Profit Estimates as Demand Boost Offsets Oil Spill Costs

Pipeline Operator TC Energy Beats Profit Estimates as Demand Boost Offsets Oil Spill Costs

2/14/2023

(Reuters) — TC Energy Corp. beat market estimates for fourth-quarter profit on Tuesday as sustained demand for energy helped the North American pipeline operator soften a C$650 million ($488 million) cost hit from an oil spill at its Keystone pipeline in Kansas.

The company also recorded a C$3 billion ($2.25 billion) impairment on its equity investment in Coastal GasLink LP due to cost overruns.

RELATED: 416-Mile Coastal GasLink Pipeline Project Nears Completion

Demand for oil and gas surged following Russia's invasion of Ukraine last year as sanctions against Moscow left Europe scrambling to find alternate supplies and fortify its long-term energy security.

"We expect this positive momentum to continue into 2023 despite macroeconomic challenges, with 2023 comparable EBITDA expected to be 5%-7% higher than 2022," CEO François Poirier said in a statement.

The Calgary-based company reported comparable earnings of C$1.11 per share for the three months ended Dec. 31, while analysts on average had expected earnings of C$1.10 per share, according to Refinitiv data.

TC Energy, however, reported a loss of C$2.6 billion for its Canadian Natural Gas Pipelines segment due to impairment charges and the costs accrued over a 12,937-barrel oil spill at its Keystone Pipeline in rural Kansas.

Earlier this month, the company had hiked cost estimates for its 670-km (416-mile) Coastal GasLink pipeline project by 30%.

The project will transport natural gas to the Shell Plc-led SHEL.L LNG Canada facility on the west coast of British Columbia — Canada's first liquefied natural gas export terminal.

($1 = 1.3322 Canadian dollars)

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