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Trans Mountain Corporation releases 2019 results

Published by , Editorial Assistant
World Pipelines,

Trans Mountain Corporation (TMC) has posted to its website the company’s financial statements and associated management report for the year ending 31 December, 2019. The company’s financial results were also included in Canada Development Investment Corporation’s recently approved consolidated financial statements.

For the year ended 31 December, 2019, TMC net income totalled US$130.9 million as compared to US$9.5 million in the prior year. The increase is due to a full year of results in 2019 following the acquisition of the Trans Mountain entities on 31 August, 2018 coupled with an increase in equity AFUDC (Allowance for Funds Used During Construction) and capitalised interest due the increased capital spending on TMEP (Trans Mountain Expansion Project) and an income tax recovery due to the July 2019 decrease in the Alberta corporate tax rate.

Total throughput on the pipeline for the year averaged approximately 313 900 bpd and throughput to Washington State on the Puget pipeline averaged approximately 203 000 bpd for the year.

“This past year we saw significant progress and developments for the Expansion Project culminating with pipe in the ground in Alberta, a key milestone for Project construction” said Ian Anderson, President and CEO of Trans Mountain Corporation. “Both operationally and financially it was a successful year for the corporation, built on a foundation and culture of environment responsibility, health and safety and a commitment to the communities where we operate and are constructing.”

As of 31 December, 2019, Trans Mountain and its contractors have hired more than 2900 people to work on the Project including more than 300 Indigenous hires and spent almost 7 million person hours on the Expansion Project. Current workforce projections will see more than 5500 people working during peak construction, expected to be in mid to late 2021.

“We’re excited and optimistic about the year ahead and expect to have construction underway on the Project across the entire line,” added Anderson. “The Project has set new standards for Indigenous participation and inclusion, reflects the input and feedback from thousands of Canadians and incorporates the very best safety and environmental protections.”

On 4 February, 2020, The Federal Court of Appeal dismissed challenges to the Federal Government’s approval of the Project. On 7 February, 2020, TMC announced a revised cost estimate for the Expansion Project of US$12.6 billion with service expected to start by the end of 2022. The projected adjusted EBITDA (earnings before interest, taxes, depreciation, and amortisation and equity AFUDC) is expected to be at least US$1.5 billion in the first year of TMEP’s operation and expected to grow annually thereafter. These projections are underpinned by long-term contractual commitments for 80% of the system’s 890 000 bpd of capacity.

Construction of the Expansion Project has continued safely during the unprecedented Covid-19 pandemic. Extensive safe work measures have been adopted based upon the advice of health authorities and industry leading best practices.

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