Enbridge Inc. plans to raise C$2 billion ($1.5 billion) in a share sale to shore up its finances in the midst of an oil price rout.
The Canadian pipeline company agreed with a group of lenders to issue 49.14 million common shares from treasury in a so-called bought deal, according to a statement. The funds will be used to pay short-term debt, the company said.
Canadian energy companies face a wave of debt maturities over the next five years that could make it challenging for them to access financing as investors drive up borrowing costs and shun commodities-related debt. Oil has plunged about 70 percent since mid-2014, sapping revenue.
Enbridge’s sale follows two other bought deals in the past week. Whitecap Resources Inc. and Raging River Exploration Inc. both raised C$95 million in the past week through equity raises of their own to pay down debt and fund capital expenditures.
Enbridge’s profit rose in the fourth quarter as record oil shipments on its main system have so far shielded the pipeline operator from the oil rout. 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.
Shares of Enbridge have declined 29 percent in the past year. They rose 0.9 percent to C$48.16 in Toronto on Wednesday.