Enbridge Inc., the largest transporter of Canadian crude to the U.S., reported its first quarterly loss in two years on hedging contracts.
The fourth-quarter net loss was C$267 million ($244 million), or 32 cents a share, compared with a profit of C$146 million, or 18 cents, a year earlier, the Calgary-based company said today in a statement. Excluding one-time items, the company reported a 44-cent per-share profit, missing the 45-cent average of 14 analysts’ estimates compiled by Bloomberg.
The company is counting on rising demand from producers to boost earnings in the coming years, as oil-sands output is set to more than double to 4.5 million barrels a day by 2025. Enbridge has said it plans to invest in C$36 billion worth of projects through 2017, including the reversal of an oil pipeline to carry crude to refineries in Quebec and the 1,178-kilometer (732-mile) Northern Gateway pipeline to the Pacific Coast.
Sales rose 18 percent in the fourth quarter to C$8.29 billion, exceeding the C$8 billion average estimate. Enbridge’s gas pipelines, processing and energy services unit reported a C$325 million loss for the quarter, due mainly to “financial contracts intended to hedge the value of committed physical transportation capacity,” the company said.
Enbridge won approval from Canadian regulators in December to proceed with its C$6.5 billion Northern Gateway pipeline to carry Alberta bitumen to the Pacific for export to Asian markets. The National Energy Board placed 209 conditions on the project, which will push up costs, Chief Executive Officer Al Monaco said at the time.
Enbridge rose 1 percent to C$47.82 at 4 p.m. in Toronto. The shares, which have 16 buy, two hold and two sell recommendations from analysts, have gained 3 percent this year.