CALGARY- TC Energy Corp. is reporting lower net profits in its latest quarter as it continued to feel some effects from a large impairment charge that will be shared with the Alberta government on its cancelled Keystone XL export oil pipeline.
The Calgary-based energy producer says its net income attributable to shareholders was $982 million or $1 per diluted share in the second quarter, down from $1.28 billion or $1.36 per share a year earlier.
The results included a $2-million impairment charge for Keystone while it recorded a $408-million gain in the prior year’s quarter from the partial sale of Coastal GasLink LP.
Excluding one-time items, comparable earnings increased 21 per cent to $1.05 billion or $1.07 per share, from $863 million or 92 cents per share in the second quarter of 2020.
Revenues in the three months ended June 30 increased three per cent to $3.18 billion from $3.09 billion.
TC Energy was expected to post 96 cents per share in comparable earnings or $3.39 billion of revenues, according to financial data firm Refinitiv.
The company says the net financial impact on it from the Keystone XL termination was $1.1 billion as of the end of the quarter. It took an after-tax charge of $2.2 billion last quarter.
The Keystone XL expansion to an existing pipeline network would have increased Canadian oil export capacity by up to 830,000 barrels a day. It was suspended after newly elected U.S. President Joe Biden fulfilled a campaign promise to cancel its presidential permit.
TC Energy decided to start construction of Keystone XL in March 2020 after the Alberta government agreed to take a $1.5 billion equity stake and provide a $6 billion loan guarantee to ensure work started immediately.
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