Enbridge forecast C$13,9 billion earnings in 2021

Enbridge 2021 financial forecast

Canadian company Enbridge announced this Tuesday its 2021 financial forecast, and it expects core earnings of C$13,9 billion or even C$14,3 billion, slightly higher than its 2020 forecast of C$13,7 billion.

Incremental would be pushed by higher volumes on its Liquids Mainline System, as it will be improved next year. Also, the company raised its annual dividend by 3%, and maintained its 5-7% average long-term annual distributable cash flow (DCF) per share growth outlook.

As the coronavirus pandemic led a destruction in demand for crude and related products, many oil and gas operators and major companies had to shut-in production for this year.

Nevertheless, higher oil prices and hopes about the vaccine reshaping the market’s landscape have prompted producers to restart production and distribution for their goods.

“Over the past year, the energy industry has faced unparalleled challenges. While our business has not been immune, we’ve proven again that our low-risk commercial model generates resilient cash flows in all market conditions. Our infrastructure is in high demand and is essential to North America’s economy, and we’re confident that it will be for many decades,” said Al Monaco, President and CEO of Enbridge.

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Enbridge after Line 3

As we’ve reported previously, after much litigation, Line 3 project from Enbridge finally has gotten the greenlight to start construction. The project would see a 50-year-old segment of pipeline replaced.

The new segment of the pipeline would upgrade its output to a maximum capacity of 760,000 barrels per day, without the risk of leaks or other safety issues, that worried Enbridge with the old pipe. It has $2,6 billion in investment and will enable nearly 4,200 jobs.

This project would also peak Enbridge’s performance in 2021; it will transport crude from Alberta, Canada, across North Dakota and Minnesota, to Enbridge’s terminal in Wisconsin. In this regard, Al Monaco, said:

“In the near-term, our Plan continues to prioritize the execution of our $16 billion secured growth program… which is expected to deliver approximately $2 billion of incremental EBITDA from 2021 to 2023. The Line 3 Replacement project is an important element of that program.”

“Over the medium and longer term, Enbridge’s diversified asset base, integrated infrastructure networks and extensive reach provide us with many opportunities to invest our expected post- Line 3 annual investment capacity of $5-6 billion. We will, however, stay true to our investment discipline, deploy capital to the best uses, and stick to what we know best,” he concluded.

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