VANCOUVER (Reuters) - A recent pipeline deal between Alberta and British Columbia is good news for Enbridge Inc’s ENB.TO proposed Northern Gateway pipeline, the company’s chief executive said on Wednesday.
“We have been confident for awhile in where Gateway is going to head and that the project will move forward,” Chief Executive Officer Al Monaco said during a conference call with investors following the release of the company’s third-quarter results.
“We are an export-based economy, so we do need access to the Asian markets, which are clearly the growth market going forward.”
Enbridge, Canada’s largest pipeline company, also reported higher third-quarter earnings on Wednesday as increased volumes on its crude pipelines offset higher costs.
Enbridge’s shares were up 1 percent at C$46.24 in early afternoon trading on Wednesday in Toronto.
The 1,177 km (730 mile) Northern Gateway pipeline has faced fierce opposition from aboriginal and environmental groups, who worry about the impact of a potential oil spill in British Columbia’s north.
The province rejected the proposal earlier this year, citing concerns over spill response, and set out five conditions that new pipelines would have to meet before being considered.
On Tuesday, Alberta agreed to support those five conditions if British Columbia agreed to back construction of oil pipelines to its coast, edging projects such as Northern Gateway closer to reality.
Monaco said his company has put more effort into consultation with affected communities and First Nations groups over the last six months, adding that the pipeline would be a world leader in safety and environmental protection.
Still, the $6.5 billion project faces many obstacles, including negative public sentiment and increasing costs.
Monaco confirmed on Wednesday that the cost of building the pipeline would increase, although he declined to give any new estimate until design and engineering work was completed.
Excluding one-time items, Enbridge’s third quarter profit rose 4 percent to C$278 million, or 34 Canadian cents per share, from C$267 million, or 34 Canadian cents a share, a year earlier.
Analysts on average were expecting 35 Canadian cents per share, according to Thomson Reuters I/B/E/S. Shares of the Calgary-based company were relatively flat shortly after the market opened on Wednesday, trading down 1 Canadian cent at C$45.79 in Toronto.
Net income attributable to common shareholders, impacted by unrealized derivative gains or losses, more than doubled to C$421 million, or 51 Canadian cents per share, from C$187 million, or 24 Canadian cents per share.
Reporting by Julie Gordon in Vancouver; Editing by Lisa Von Ahn and Andre Grenon