Pipes are seen at the Kinder Morgan Trans Mountain facility in Edmonton, Alta., Thursday, March 6, 2017. THE CANADIAN PRESS/Jonathan Hayward

Kinder Morgan Canada to release first results

CALGARY — Kinder Morgan Canada is facing mounting pressure to detail its plans for the Trans Mountain oil pipeline expansion when it releases its first earnings report Wednesday since going public.

Analysts and investors are hoping for clarity on the fate of the project, which has been thrust into question since John Horgan’s NDP in British Columbia wrestled power from the Liberals with the help of the Greens, who are staunchly opposed to the $7.4-billion development.

The company (TSX:KML), which has said it stands by the merits of the project, is scheduled to report its second-quarter results after markets close Wednesday, followed by a conference call with analysts.

“We expect KML-specific topics to be covered to include whether the Trans Mountain expansion project is on track for construction to begin in September 2017, as well as commentary on the NDP-led government in B.C.,” said RBC analyst Robert Kwan in a report to clients.

Kinder Morgan Canada president Ian Anderson has said he is willing to meet with the provincial NDP and Greens but won’t make further concessions on the project, setting the stage for a potential showdown between the energy giant and the fledgling government.

The company did not immediately respond to a request for comment on Tuesday.

In May, Kinder Morgan Canada completed its $1.75-billion initial public offering to raise funds for the Trans Mountain expansion in one of the biggest and most controversial IPOs in Canada in recent memory. Since then, its stock has lost ground from the initial offering of $17 per share, trading for $16.18 on the Toronto Stock Exchange on Tuesday.

TD Securities analyst Linda Ezergailis wrote in a report that clarification on timing of the Trans Mountain project will likely boost the company’s shares.

“We believe that KML shares will re-rate upwards once investor confidence in the timing of bringing TMEP into service is bolstered by a clear line of sight to the conclusion of provincial political uncertainty and litigation associated with social license issues,” she said.

Prime Minister Justin Trudeau approved the project to twin the Trans Mountain pipeline between Edmonton and Burnaby, B.C., last fall and then-B.C. premier Christy Clark came to support it in January after five conditions she placed on it had been met.

However, after Clark lost the election, Horgan has promised to use “every tool” available to stop the expansion.

The results from Kinder Morgan Canada kick off second-quarter earnings in the oilpatch, with news about shipper commitments for TransCanada’s Keystone XL pipeline also expected to garner attention when the pipeline company reports its results on July 28.

Higher Canadian interest rates and uncertainty about where oil prices are headed have made for a cautious mood as major Calgary-based producers roll out their latest earnings, with Husky Energy (TSX:HSE) and Encana (TSX:ECA) reporting on Friday.

Judith Dwarkin, chief economist at RS Energy Group, said higher interest rates generally mean a stronger loonie, spelling bad news for oil companies who pay most of their costs in Canadian dollars and sell most of their products in U.S. currency.

“It’s a little more headwind for producers already facing fairly strong headwinds,” she said.

“At the same time, oil prices are starting to move up so that to some extent may help to offset the impact of the higher dollar.”

CIBC analyst Arthur Grayfer said in a note Monday that results from oil and gas companies that also own refineries will be aided by better refining profit margins in the second quarter.

He said many major oil and gas producers in Western Canada had planned and unplanned maintenance shutdowns in the second quarter which could result in lower production and higher costs.

Just Posted

WATCH: Red Deer’s 2017-2021 council sworn in

Mayor and council ready to serve for the next four years

Red Deer’s Salvation Army vehicles vandalized twice in six weeks

Police investigating Sept. 10 and Oct. 21 incidents

Update: More details released of fatal police-involved shooting near Alix

ASIRT says man rammed police car, injured officer

Influenza vaccine clinics get started across Red Deer, Central Alberta

Clutching stuffed animals they got from the Calgary Zoo, Owen and Alton… Continue reading

Replay: Red Deer

Watch the highlights from this week

Montreal prepares for “Cohen Week” as first anniversary of singer’s death looms

Three sets of crumbling concrete steps have just been fixed heading into… Continue reading

Montreal prepares for “Cohen Week” as first anniversary of singer’s death looms

His soulful poetry, distinctive baritone and knack for writing runaway hit songs… Continue reading

Sylvan’s talent on display for fundraising show

Sylvan Lake Refugee Project is hosting Sylvan’s Got Talent Nov. 3

B.C. ice rink where 3 people died remains closed due to safety concerns

FERNIE, B.C. — Residents who were forced from their homes because of… Continue reading

Trudeau condemns appointment of Mugabe as WHO ambassador

EDMONTON — Prime Minister Justin Trudeau called the appointment of Zimbabwe President… Continue reading

Friday Oct. 21: Winning Lotto Numbers

Friday, October 20, 2017 LOTTO MAX Winning Numbers 1 4 12 27… Continue reading

New northbound Hwy 2 lanes at Gaetz Avenue to open this Sunday

Drivers heading north through Red Deer on Hwy 2 will have a… Continue reading

Canadian planet hunter seeking alien life

‘The shifting line of what is crazy’ says Toronto-born astrophysicist

Most Read


Five-day delivery plus unlimited digital access for $185 for 260 issues (must live in delivery area to qualify) Unlimited Digital Access 99 cents for the first four weeks and then only $15 per month Five-day delivery plus unlimited digital access for $15 a month