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TransCanada Profit Falls on Lower Natural Gas Shipments

Feb. 12 (Bloomberg) -- TransCanada Corp., the transporter of 20 percent of North America’s natural gas, said fourth-quarter profit fell 19 percent as shipments of the fuel on some pipelines declined.

Net income dropped to C$306 million ($304 million), or 43 cents a share, from C$376 million, or 53 cents, a year earlier, the Calgary-based company said in a statement today. Excluding a hedging loss, per-share profit was below the 49-cent average of 12 analysts’ estimates compiled by Bloomberg. Sales rose 3.7 percent to C$2.09 billion.

TransCanada is moving less gas on its pipelines because a glut in North American supplies has reduced prices, resulting in more of the fuel being kept in storage. Deliveries on its Canadian Mainline system fell 19 percent to average 4.2 billion cubic feet a day during the quarter. The company is soliciting market interest in converting part of the gas pipeline to crude, bringing oil from Alberta to eastern Canada.

“While the majority of our assets continued to generate stable and predictable earnings and cash flow, plant outages at Bruce Power and Sundance A along with a lower contribution from certain natural gas pipelines did adversely affect our financial results,” Chief Executive Officer Russ Girling said in the statement.

The company, which proposed the Keystone XL oil pipeline to bring crude from the oil sands to the Gulf Coast, sees a U.S. ruling on the $5.3 billion northern leg of the system by mid-2013, Girling said on a conference call with analysts today. TransCanada has spent $1.8 billion so far on the project, which it expects to be in service in late 2014 or early 2015.

TransCanada declined 1.4 percent to C$47.56 at the close in Toronto. The shares, which have eight buy, eight hold and one sell recommendation from analysts, have climbed 1.2 percent this year.

To contact the reporter on this story: Rebecca Penty in Calgary at rpenty@bloomberg.net

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net

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