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UPDATE 2-Pipeline operator TC Energy beats profit on strong energy demand

UPDATE 2-Pipeline operator TC Energy beats profit on strong energy demand

Reuters · 07/28/2022 07:57
UPDATE 2-Pipeline operator TC Energy beats profit on strong energy demand

Compares with estimates; adds CEO comment, result details, industry background

- Canadian Pipeline operator TC Energy TRP beat quarterly profit estimates on Thursday, as clients vying for energy boosted demand for its transport services.

Demand for liquefied and renewable gases has been rising in North America as well as Europe which has cut gas imports from Russia after its invasion of Ukraine.

Last month, the Canadian Foreign Minister Melanie Joly said the country was in talks with its European allies about exporting oil and gas from its east coast to provide an alternative to Russian energy.(https://reut.rs/3vkakZn)

"Demand for clean, responsibly sourced gas remains high in North America, with energy security also driving incremental growth in the global LNG market," TC Chief Executive Officer François Poirier said in a statement.

TC said its Coastal GasLink Limited Partnership had entered into a deal with LNG Canada which will provide the first direct path for Canadian gas to reach global LNG markets.

The 670-kilometre Coastal GasLink project is about 70% complete, with mechanical in-service expected by the end of 2023.

TC added it will make equity contributions of about C$1.3 billion in 2022 to Coastal GasLink LP due to which it expects total capital expenditures for the year to be about C$8.5 billion ($6.63 billion), up from a prior estimate of C$7 billion.

The company also said higher project costs are expected for the company's NGTL gas gathering and transportation system due to higher labour and materials' costs.

Calgary-based TC said its earnings across segments, including Canadian Natural Gas Pipelines and Liquids Pipelines, rose 7.7% to C$1.68 billion ($1.31 billion) in the reported quarter.

It posted comparable earnings of C$1 per share, beating estimate of 98 Canadian cents per share, according to Refinitiv data.

($1 = 1.2828 Canadian dollars)

(Reporting by Arunima Kumar in Bengaluru;
Editing by Vinay Dwivedi)

((Arunima.Kumar@thomsonreuters.com; Twitter: https://twitter.com/Aru_Kumar94 ;))