TransCanada books Keystone XL writedown, raises dividend
By Nia Williams
CALGARY, Alberta (Reuters) - TransCanada Corp (TRP.TO: Quote), the country's second-largest pipeline company, reported a fourth-quarter loss on Thursday as a result of a one-off C$2.9 billion ($2.08 billion) impairment charge relating to its rejected Keystone XL oil pipeline.
However, excluding the Keystone XL writedown, the company reported a higher-than-expected profit and raised its dividend at a time when most energy companies are scaling back shareholder payouts.
Calgary-based TransCanada said long-term contracts helped underpin its business during a "very challenging year", in which global crude oil prices tumbled on concerns about oversupply.
The company endured a difficult end to 2015 after U.S. President Barack Obama blocked the cross-border Keystone XL pipeline in a victory for environmentalists who campaigned against the project for more than seven years.
Last month, TransCanada filed legal action against the United States for the rejection and has vowed to press ahead with the project.
The company's proposed Energy East pipeline from Alberta to Canada's Atlantic coast has also run into environmental opposition, and new interim rules on energy project reviews imposed in January could lead to further delays. [L2N15B1QM]
"We are still assessing the impact of the NEB (National Energy Board) changes...we are still targeting 2020 but I think it's fair to assume with a extension of the regulatory process that may translate into a delay in bringing it into service," said Paul Miller, president of liquids pipelines, said on an earnings call.
Excluding the after-tax impairment charge related to Keystone XL, TransCanada's profit was 64 Canadian cents per share in the fourth quarter, higher than the average analyst estimate of 61 Canadian cents. Continued...