Enbridge Inc. said profit rose in the fourth quarter as record oil shipments on its main pipeline system shielded the country’s largest pipeline company from the collapse in prices.
Net income was C$378 million ($274 million), or 44 cents a share, compared with C$88 million, or 10 cents, a year earlier, theCalgary-based company said Friday in a statement. Excluding one-time items, per-share profit exceeded the 53-cent average of 13 analysts’ estimates compiled by Bloomberg.
While oil and gas producers have been reeling from the collapse of energy prices, firing workers and cutting costs, pipeline fees have provided a steadier source of income. Lines such as Enbridge’s Flanagan South and Seaway Twin have expanded Canadian crude shipments to the U.S. Gulf Coast, and the company also plans to expand in Colombia and Australia.
“Despite one of the most dramatic downturns in the energy sector in decades, we delivered very strong adjusted earnings and cash flow growth for our shareholders that were in line with our expectations,” CEO Al Monaco said in the statement. “Our fourth quarter actually came in a bit stronger than we anticipated late last year due to stronger performance from the Canadian liquids business in December and lower overall operating and administrative costs.”
Enbridge is focusing on expanding “low-cost, incremental” projects like twinning existing pipelines to provide producers with new transportation capacity as they struggle with low crude prices, Monaco told investors in October. The company’s C$7.5 billion Line 3 replacement is the largest project. The completion of that project and the Sandpiper pipeline project in Minnesota may be delayed until early 2019 after the state required the company was required to complete an environmental impact statement.
The pipeline operator’s customers including Canadian crude producers Suncor Energy Inc., Imperial Oil Ltd. and Cenovus Energy Inc. have suffered from losses or declining profit in the fourth quarter as lower oil prices have thwarted some expansion plans and resulted in spending and job cuts.