March 1 (Reuters) – Canada’s Enbridge Inc (ENB.TO) on Wednesday unveiled plans to invest C$3.3 billion (US$2.4 billion) in natural gas and liquids infrastructure and renewable energy this year, and said there are better investment opportunities in the US due to green power subsidies.
The Calgary-based company said the Biden administration’s Inflation Reduction Act, a $430 billion clean energy subsidy package, has made the US more competitive in attracting capital.
“Right now there are some more compelling elements in the United States when it comes to covering capital costs and then ongoing operating costs,” Chief Executive Greg Ebel said at a new post-Enbridge Investor Day conference.
“They really put a lot of carrots on the table to get people investing there.”
Enbridge, which moves about 20% of all gas consumed in the United States, will invest $2.4 billion in gas transmission modernization and announced plans to acquire gas storage facilities on the US Gulf Coast for $335 million in order to be Strengthen export business with liquefied natural gas (LNG) .
The assets, known as Tres Palacios, include 35 billion cubic feet of gas storage and the deal aims to tap high demand for North American LNG exports after Russia’s invasion of Ukraine upended global gas supplies.
Enbridge will spend $240 million to build the 2.5 million barrel Enbridge Houston Oil Terminal and begin a mandatory open season in March to secure shipper commitments, an additional 95,000 barrels of oil per day on its Flanagan system to pump south.
The company also invested $80 million to acquire a 10% interest in Divert Inc, a US-based food waste-to-energy company, the latest in a series of investments by major energy companies in biogas to replace traditional natural gas can, but is more expensive to manufacture.
The agreement includes additional investment opportunities to develop food-to-RNG projects in the United States, which Enbridge says will result in more than $1 billion in new capital growth, underpinned by long-term contracts. Continue reading
Enbridge expects its renewable portfolio to grow over 400% through 2028. The company is also forecasting a 4% to 6% annual growth rate in core earnings through 2025.
Enbridge shares closed up 1% at CA$51.70 on the Toronto Stock Exchange.
($1 = 1.3585 Canadian Dollars)
reporting from Sourasis Bose in Bengaluru and Nia Williams in British Columbia; Edited by Sriraj Kalluvila and Stephen Coates
Our standards: The Thomson Reuters Trust Principles.
