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Enbridge Reports First Quarter 2022 Financial Results and Advances New Organic Growth Opportunities

Press Release

CALGARY, AB, May 6, 2022  – Enbridge Inc. (Enbridge or the Company) (TSX: ENB) (NYSE: ENB) today reported first quarter 2022 financial results, reaffirmed its 2022 financial outlook and announced the advancement of further organic growth opportunities.

Highlights
(All financial figures are unaudited and in Canadian dollars unless otherwise noted. * identifies non-GAAP financial measures. Please refer to Non-GAAP Reconciliations Appendices.)

  • First quarter GAAP earnings of $1.9 billion or $0.95 per common share, compared with GAAP earnings of $1.9 billion or $0.94 per common share in 2021
  • Adjusted earnings* of $1.7 billion or $0.84 per common share*, compared with $1.6 billion or $0.81 per common share* in 2021
  • Adjusted earnings before interest, income taxes and depreciation and amortization (EBITDA)* of $4.1 billion, compared with $3.7 billion in 2021
  • Cash provided by operating activities of $2.9 billion, compared with $2.6 billion in 2021
  • Distributable cash flow (DCF)* of $3.1 billion or $1.52 per common share*, compared with $2.8 billion or $1.37 per common share* in 2021
  • Reaffirmed 2022 full year guidance range for EBITDA of $15.0 billion to $15.6 billion and DCF per share of $5.20 to $5.50
  • Placed the 455-kilometre, $0.2 billion East-West Tie Transmission Line into service providing reliable, long-term electricity to Northwest Ontario
  • Sanctioned $0.3 billion expansion of the Panhandle Regional Transmission System to meet growing natural gas demand in Southern Ontario; operations to commence in late-2023
  • Announced an Open Season for up to a 400 MMcf/d expansion of the B.C. Pipeline System’s T-North section with a 2026 in-service date to meet increasing demand
  • Awarded the right to advance the Open Access Wabamun Carbon Hub designed to capture 4 million tonnes of CO2 emissions annually
  • Announced Letter of Intent with Humble Midstream LLC to develop blue hydrogen, ammonia and associated carbon capture infrastructure at the Enbridge Ingleside Energy Center near Corpus Christi, Texas on the U.S. Gulf Coast
  • Progressing construction of four French offshore renewable projects with combined gross power generation of approximately 1.5 gigawatts (0.3 GW net)
  • Advancing capital allocation priorities; on track to achieve Debt to EBITDA of 4.7x or lower by year end and executed initial share repurchases during the first quarter

CEO COMMENT

Al Monaco, President and CEO commented on the following:

“It’s clear we are at an inflection point in global energy markets. Energy demand continues to grow, which combined with underinvestment in new supply, is driving energy shortages and higher prices. Now, more than ever, it’s evident that all forms of energy, conventional and low carbon, are needed to meet the growing demand while ensuring society has access to affordable, reliable, secure and cleaner energy.

“This global energy crisis further heightens the essential role that conventional energy will play for decades to come. But, we also need to meet our global emissions goals across the value chain and leverage existing infrastructure to accelerate investment in low-carbon energy.

“The current environment reinforces that our two-pronged strategy to advance both conventional and low-carbon energy investments is a prudent approach to ensure delivery of the energy that people need and want in their daily lives. Our diversified asset footprint, integrated North American transportation systems, access to tide water, and established renewable power assets and low-carbon execution capabilities, provide us a competitive advantage. We’re working closely with our customers to accelerate new infrastructure investments to meet growing demand, increase connections to export markets, and enable cleaner energies.

“ESG leadership is central to our differentiated approach to energy delivery and our goal is to continue to lead our sector. We have advanced our diversity goals at all levels of the organization, including our Board of Directors, and making good progress. Early actions and business plans have us on track to meet our 2030 emissions intensity and 2050 Net-Zero goals to stay ahead of the curve. We’ve also recently committed to additional actions, including supporting organizations developing science-based guidelines for the midstream sector and engaging with key suppliers to further support Scope 3 emissions reductions.

“First quarter operational performance and utilization across each of our businesses translated into a strong start to the year. The $14 billion of capital we placed into service in 2021, including the Ingleside acquisition, is generating incremental EBITDA and distributable cash flow growth. We are on target to achieve our full year financial guidance.

“In Liquids Pipelines, we’re in discussions with industry on a new commercial framework for our Mainline. Detailed cost information has been shared with shippers, providing the transparency necessary for negotiations, and we continue to expect to have a new commercial model in effect by mid-to-late 2023.

“The acquisition of the Ingleside Energy Center has provided us with the premier crude oil export facility in the U.S. Gulf Coast at a time when greater supply of more sustainable and secure North American energy is needed. In the first quarter, Ingleside loaded over 20% of export volumes on the Gulf Coast, reflecting our ability to offer lowest basin-to-water costs. We continue to see strong customer interest to expand our storage and product loading capabilities, including NGLs. We’re also now developing hydrogen and ammonia opportunities at Ingleside, which will include carbon capture and sequestration that will allow production of low-carbon fuel sources. Our Texas Eastern System on the Gulf Coast can provide feed gas, demonstrating the synergies across our diversified asset base.

“We’re very excited to be moving our Alberta carbon capture strategy forward with the Open Access Wabamun Carbon Hub, which received approval from the Government of Alberta for further development. Our partnerships with Capital Power and Lehigh Cement, and local Indigenous and Métis communities, will enable the sequestration of nearly 4 million tonnes of CO2 annually, and there’s expansion potential beyond that.

“In Gas Transmission, we’re seeing a strong pick up in commercial interest from Asia and Europe to secure export capacity. We currently serve four operating LNG facilities in the Gulf Coast. Three more LNG developments, Plaquemines LNG, Rio Grande and Texas LNG, are moving towards investment decisions and we’ve secured projects to serve those facilities if they reach a final investment decision.

“In Western Canada, the fundamentals for LNG export are strengthening, with abundant low-cost reserves and shorter transport times to Asian markets. Today, we announced an open season for a $1 billion expansion of the T-North section of the B.C. Pipeline to support production and demand growth, including west coast LNG demand. We continue to advance the proposed $2.5+ billion T-South expansion to support growing demand in the Pacific Northwest, including from Woodfibre which recently announced that it is advancing preliminary construction activities. Growing demand in the region could support further growth on our Westcoast system including a second expansion of T-North.

“Our utility franchise continues to generate ratable growth. We’re on track to add more than 40 thousand natural gas customers this year. Yesterday we sanctioned a $300 million expansion of the Panhandle Transmission System to support increased customer demand. The Markham hydrogen blending project has now been successfully operating during the first quarter with good results and we’re developing over fifty in-franchise RNG opportunities.

“In Renewables, we’re making good progress on construction of four offshore wind projects in France with the first project planned to enter service late this year. In North America, our solar self-power projects serving our liquids and gas transmission businesses is well advanced with three projects in service and ten more projects capable of generating 100 megawatts (MW) under construction. We’re developing a further 160MW of utility-scale projects that would serve third parties at our Corpus Christi export terminal in Texas and our Plummer pump station in Minnesota.

“Our existing assets and execution of the secured capital program over our three-year plan is expected to support a 5-7% distributable cash flow per share compound average growth rate through 2024 relative to 2021. After providing for a strong balance sheet and ratable dividend growth, we’ll possess $5-6 billion of annual investable capacity, which we’ll continue to deploy in a disciplined manner to maximize shareholder returns.

“In summary, we are pleased with our progress on our strategic priorities and a good start to the year. Our existing connections to the best markets, paired with leading low-carbon capabilities, position Enbridge to generate long-term shareholder value while building a bridge to a cleaner energy future.

Read More: https://www.enbridge.com/media-center/news/details?id=123723&lang=en

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