Dislocation = Opportunity In Enbridge Preferred Shares
Keubiko • 36 Comments
Keubiko • 36 Comments
Nov. 17, 2015, 8:35 AM
- Enbridge (NYSE:ENB) said late Monday it will lay off 500 workers and not follow through with hiring another 100 unfilled positions, as Canada's largest pipeline company looks to cut costs.
- The layoffs represent ~5% of ENB’s total workforce and are spread across the company’s operations in Canada and the U.S.
- ENB says the cuts are not related to the Canadian government's commitment to a moratorium on crude oil tanker traffic off the coast of northern B.C., which analysts say hurts the prospects for the construction of ENB’s Northern Gateway pipeline project.
- ENB -0.9% premarket.
Nov. 16, 2015, 12:29 PM
- Canadian oil and gas execs are dismayed by the federal government's imminent ban of crude oil tanker traffic on British Columbia's northern Pacific coast, which would hurt the chances for the construction of Enbridge's (ENB +0.5%) Northern Gateway pipeline, Financial Post reports.
- "Forcing western Canada to sell its oil and gas at a lot less than the world price to the benefit of Americans really seems ridiculous and counter to our strategic interests, so how could we possibly justify blocking the trade routes that would fix that problem?” says one company CEO.
- Environmental groups and some First Nations groups consider the moratorium a death blow to Northern Gateway's prospects, but ENB also has supporters among First Nations, and the company's response to the oil tanker traffic ban included a reminder that any moratorium would require First Nations support.
Nov. 13, 2015, 7:15 PM
- The president of Kinder Morgan's (NYSE:KMI) Canadian unit, Ian Anderson, tells Bloomberg he is seeking to find common ground with opponents to the company's proposed C$5.4B Trans Mountain pipeline expansion, including Burnaby mayor Derek Corrigan, one of the project's more vociferous opponents.
- Canada’s oil industry has turned its attention to the Trans Mountain pipeline, which already ships Alberta crude to the port of Vancouver, as well as Enbridge's (NYSE:ENB) Northern Gateway and TransCanada’s (NYSE:TRP) Energy East after Keystone XL was rejected by the U.S. last week.
- Shipments from Trans Mountain now account for as much as 4% of Port Metro Vancouver traffic, and Anderson says an expansion would boost that to as much as 8%.
- Canada’s federal government announced today that it would make good on a promise to ban tankers on the northern Pacific coast, which would affect Northern Gateway but not Trans Mountain; environmental opponents to Trans Mountain are pushing for a similar measure in southern coastal waters.
Nov. 13, 2015, 3:55 PM
- Newly elected Canadian PM Trudeau has instructed his minister of transport responsible for the Coast Guard to implement a ban oil tanker traffic on the northern coast of British Columbia, Bloomberg reports.
- The ban has been in place informally for years but the move nevertheless will add another hurdle to Enbridge's (ENB -1.3%) proposed Northern Gateway pipeline to move Alberta crude to the port of Kitimat and on to Asia to open new markets for Canadian oil.
- ENB had won conditional approval under former PM Harper, so long as it met hundreds of criteria set out by the national energy regulator.
Nov. 12, 2015, 7:11 PM
- Hard-hit Canadian energy producers, coming off a bleak Q3 earnings season, are signaling they will cut capital spending for a second straight year in 2016, Reuters reports.
- The seven biggest Canadian producers cut 2015 capital spending by 39%, or a combined C$12B, from last year, and Eric Nuttall, portfolio manager at Sprott Asset Management, expects another 10%-20% reduction for 2016.
- Of the seven, so far only Cenovus Energy (NYSE:CVE) and Canadian Natural Resources (NYSE:CNQ) have outlined 2016 budgets; CVE estimates 2016 capex of C$1.5B-C$2B vs. C$1.8B-$1.9B in 2015, and CNQ expects to spend C$4.5B-C$5B next year from C$5.44B in 2015.
- Encana (NYSE:ECA) today bucked the trend a bit by speeding up investment in the U.S. Permian Basin this year but is using capital originally earmarked for 2016; the company suggested in its earnings conference call that 2016 spending will be carefully controlled.
- Also: SU, TRP, ENB, IMO, OTCPK:HUSKF
Nov. 7, 2015, 8:25 AM
- With Keystone XL nixed by Pres. Obama, the Canadian energy industry - and its opponents - are turning their attention to the three pipelines proposed to carry oil sands volumes from Alberta to Canada’s Pacific and Atlantic coasts and avoid crossing into the U.S.
- Alberta believes Kinder Morgan’s (NYSE:KMI) Trans Mountain expansion to the Pacific and TransCanada’s (NYSE:TRP) Energy East line to the Atlantic have the best chances for success, while Enbridge’s (NYSE:ENB) Northern Gateway is seen as less likely because of strident local opposition.
- ENB also has been waiting since 2012 for a U.S. decision on a permit to nearly double the capacity of its Alberta Clipper cross-border pipeline, but the company notes the existing line is already fully operating and was permitted in 2009.
- Analysts say the Keystone denial will embolden opponents, making all pipelines more difficult to build, and is a blow not just to Canadian companies but to U.S. pipeline firms such as Plains All American (PAA, PAGP) and Energy Transfer (ETE, ETP, SXL) that already are delaying projects (I, II) in response to lower oil prices and tougher environmental reviews.
- Meanwhile, a major beneficiary could be Venezuela, who produces heavy crude similar to Canada’s oil sands and whose economy relies largely on shipping it to the same U.S. Gulf coast refineries that Keystone was meant to supply.
Nov. 5, 2015, 10:49 AM
- Enbridge (ENB -2.1%) is lower in early trading after Q3 earnings fall slightly short of expectations and saying a delay in starting up the Line 9 pipeline project that will move crude from Ontario to Quebec will hold down earnings for the year.
- ENB says the 400-mile Line 9 will start deliveries in December but initially was expected to be in service in early 2015; partly as a result, ENB says it now expects full-year 2015 EPS to fall within the lower half of the estimated range of C$2.05-C$2.35.
- ENB says Q3 results in its base business were strong and that its C$38B five-year growth plan is expected to generate average annual adjusted earnings growth of 11%-13%.
- ENB also says its Mainline system, which moves the bulk of Canadian crude exports to the U.S., shipped an average of 2.2M bbl/day in Q3 vs. ~2M bbl/day a year earlier.
Nov. 5, 2015, 7:58 AM
- Enbridge (NYSE:ENB) agrees to acquire a 24.9% stake in E.ON's (OTCQX:EONGY) €1.9B ($2.1B) offshore Rampion wind project Rampion in the U.K. for C$750M (US$570M), and will manage construction of the project.
- E.ON will remain the controlling shareholder of the 400 MW project with a 50.1% stake, with the remaining stake being held by the UK Green Investment Bank.
- ENB and E.ON already are partners in the Magic Valley wind farm in Texas and the Wildcat wind farm in Indiana.
Nov. 5, 2015, 7:09 AM
- Enbridge (NYSE:ENB): Q3 EPS of $0.47 misses by $0.01.
Nov. 4, 2015, 5:30 PM
- AAWW, ACIW, ACRE, ACTA, AES, AGIO, AGU, AINV, ALSK, AMCX, AMED, AMRC, ANSS, APA, ATHM, AZN, BBEP, BCE, BCRX, BDBD, BEE, BR, CCC, CCOI, CECE, CELG, CLDT, CNK, CNP, CNQ, CNSL, CONE, COTY, CROX, CSTM, CWEI, DNR, DUK, EGL, ENB, ENDP, ENOC, ESI, FUN, GEO, GLOG, GLP, GOGO, HFC, HGG, HII, HRC, INSY, IRC, IT, ITC, ITG, KATE, KOP, LAMR, LBY, LINE, LPI, LXP, MEG, MGA, MITL, MPEL, MPW, MSG, MSO, MVIS, MZOR, NDLS, NGS, NHI, NILE, NRP, OGE, OMED, PBH, PDCE, PRFT, PRIM, PWE, PWR, RDUS, RGEN, RGLD, RICE, RL, RLGY, RRD, RVLT, RWLK, SCOR, SEAS, SFM, SFY, SJI, SNSS, SPAR, SRC, SRPT, SSTK, STN, STWD, SYMC, TAP, TDC, TE, THS, TIME, TK, TLP, TNK, TRXC, TU, USAC, VC, VER, VIVO, WAC, WIN, WPP, ZEUS
Nov. 4, 2015, 1:10 PM
- Enbridge (ENB -3.1%) says it plans to spend $5B building three oil storage facilities in the Gulf of Mexico region as part of a "full frontal assault” aimed at fortifying its strategic position in the U.S. market, WSJ reports.
- ENB's plan calls for three terminals stretching from Houston toward New Orleans, each with crude storage tanks, ship docks, pipelines and other infrastructure to allow for both the import and export of U.S. and Canadian crude as well as processed condensate and refined products.
- The plan is in the early stages, but the facilities likely would be rolled out in phases over the coming years.
- If the U.S. crude oil export ban is lifted, the terminals would position ENB at the forefront of the U.S. oil export industry.
Oct. 27, 2015, 7:37 PM
- Energy-dependent Alberta today unveiled its 2015 budget, the first under the new NDP government, projecting a record deficit on falling revenue linked to the sharp slump in crude oil prices.
- It's a spend and borrow budget that will see the province borrowing for operating for the first time in two decades, promising to spend an additional C$4.5B above previous commitments over the next five years for infrastructure such as new transportation projects and hospitals.
- As for the oil sector, which is pleading for a three-year lag before royalties are changed, Finance Minister Ceci indicated no letup from the NDP's promise of royalty increases and tougher climate change regulations once reviews now underway are completed over the next few months.
- Relevant tickers: SU, ENB, TRP, KMI, IMO, CVE, CNQ, OTCPK:HUSKF, OTCQX:COSWF.
Oct. 20, 2015, 5:59 PM
- The newly elected Liberal party does not have the legal means to reverse the federal approval of Enbridge’s (NYSE:ENB) Northern Gateway pipeline, and would have to amend current legislation to create that power, says a lawyer involved in a court challenge of the project, as reported by Financial Post.
- Trudeau's party had pledged to scrap the previous government’s approval of the controversial Alberta-to-Pacific Coast pipeline, if elected.
- The Conservative government approved the 525K bbl/day pipeline in 2014 after slapping 209 conditions on the project.
- FirstEnergy Capital nevertheless expects the Liberal government to officially rescind the Northern Gateway permit, but believes investors have not factored the project into ENB’s stock price.
- Earlier: Canada's energy firms look on the bright side of a new Liberal government
Oct. 20, 2015, 2:30 PM
- Canada's oil patch may have lost a major energy opportunity with the defeat of the Conservative government, but Canadian energy stocks are mostly higher despite the surprise mandate won by Justin Trudeau's Liberals that promises less favorable energy policies and increased environmental stewardship.
- The Liberal majority at least removes the uncertainty of a widely speculated minority government and gives the changing industry political stability in Ottawa, the president of the Canadian Association of Petroleum Producers says.
- Energy proponents in Alberta may be relieved that last May’s provincial NDP victory did not translate into a federal win by Tom Mulcair’s NDP, which would have brought far tougher anti-oil policies that the winning Liberals.
- Trudeau is opposed to Enbridge's (ENB +1.1%) Northern Gateway pipeline, but has expressed qualified support for TransCanada's (TRP +1.4%)Keystone XL and Energy East and Kinder Morgan’s (KMI +0.5%) TransMountain projects, though he would also bring in tougher environmental review processes and a national plan to tackle greenhouse gases.
- Some say an Obama administration veto for Keystone XL would make the job easier for the new Prime Minister in an effort to reset a relationship with the U.S. he says was damaged by the outgoing Stephen Harper.
- Also: SU +1.3%, IMO +1.1%, CVE +1.1%, CNQ +3%, OTCPK:HUSKF +0.6%, CNI +1.9%, CP +3.8%.
- Earlier: Canadian energy stocks to turn red if Harper fails to win upcoming election (Oct. 14)
Oct. 14, 2015, 7:37 PM
- Canadian energy companies grow increasingly nervous as Canada’s Liberal Party appears to be moving ahead of the incumbent Conservative government in the final days of a tight race ahead of Monday’s national election.
- "A non-Conservative federal government would likely be viewed in a negative light given the NDP and Liberal parties’ policies on environmental legislation, regulatory oversight and export pipelines,” Canaccord analysts write.
- Among potential winners and losers, analysts say stricter emissions rules favored by the Liberals and NDP could hurt shares of companies such as Suncor (NYSE:SU) and Imperial Oil (NYSEMKT:IMO), while those that produce greener energy and could sell credits or avoid new taxes may benefit, such as Brookfield Renewable Energy Partners (NYSE:BEP).
- Harper is the only candidate to favor all four pending major pipelines - TransCanada’s (NYSE:TRP) Keystone XL and Energy East, Enbridge’s (NYSE:ENB) Northern Gateway and Kinder Morgan’s (NYSE:KMI) Trans Mountain - and further delays could hit share prices.
- But more delays likely would mean higher crude-by-rail shipments, a potential benefit to Canadian National Railway (NYSE:CNI) and Canadian Pacific Railway (NYSE:CP).
Oct. 7, 2015, 12:59 PM
- Enbridge (ENB +1.8%) plans to spend $38B through 2019 on new projects including liquids and natural gas lines, as well as power generation and gas processing, despite a "higher degree of risk," CEO Al Monaco tells investors.
- ENB is focusing on expanding “low-cost, incremental” projects such as twinning existing pipelines to provide producers with new transportation capacity as they struggle with low crude prices, Monaco says; its $7.5B Line 3 replacement is the largest project.
- ENB says it is performing early development work on a plan to twin Line 61 which runs from Superior, Wis., to Flanagan, Ill., as expansion of the Mainline system which carries crude from western Canada to Superior and may be increased by 800K bbl/day requires the Line 61 expansion to avoid a bottleneck.
Enbridge, Inc. transports, generates and distributes energy in Canada and U.S. The company is involved in natural gas transmission and midstream businesses. It operates through five business segments: Liquids Pipelines, Gas Distribution, Gas Pipelines, Processing and Energy Services, Sponsored... More
Sector: Basic Materials
Industry: Oil & Gas Pipelines
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