The estimated cost of the Coastal GasLink natural gas pipeline in northern British Columbia has soared 70 per cent to $11.2-billion, but TC Energy Corp. TRP-T says it’s optimistic about completing construction by the end of 2023.
The project previously carried a price tag of $6.6-billion for the 670-kilometre pipeline, which is designed to transport natural gas from northeast B.C. to LNG Canada’s $18-billion export terminal, which is under construction in Kitimat, B.C.
Capital costs have risen from the original estimate because of design changes, the impact of COVID-19, weather and other events, TC Energy said in a statement on Thursday as part of its second-quarter financial results.
“We continue to believe the project remains economically viable,” said the statement from TC Energy, an energy infrastructure company that will operate the pipeline.
TC Energy said it hopes LNG Canada will eventually expand its export capacity because that would improve Coastal GasLink’s financial performance.
For now, TC Energy chief executive officer François Poirier said Coastal GasLink has resolved a dispute over pipeline costs with LNG Canada. “Our revised agreements with LNG Canada establish a better framework for project advancement and one that further strengthens our long-term partnership,” he said during a conference call with industry analysts.
The infrastructure company’s goal is to complete Coastal GasLink by late 2023, start testing the pipeline in 2024 and have Shell PLC-led LNG Canada start shipping liquefied natural gas in 2025 for export on Asia-bound tankers.
TC Energy plans to make a $1.9-billion equity contribution toward the pipeline, starting with its first instalment next month.
Denita McKnight, LNG Canada’s vice-president of corporate relations, welcomed TC Energy’s announcement about resolving their differences.
“LNG Canada and its joint venture participants have reached a commercial resolution with Coastal GasLink (CGL) to address CGL’s cost and schedule performance,” Ms. McKnight said in a statement. “This positive step allows both companies to progress forward with a renewed focus on delivering the pipeline within the revised cost estimate, and to support LNG Canada’s first LNG cargo by the middle of this decade.”
The Coastal GasLink website says the pipeline has hit a milestone that shows 66 per cent overall progress, including engineering and procurement, with 58.5 per cent of construction completed. LNG Canada estimates that its Kitimat project is more than 60 per cent completed.
Calgary-based TC Energy posted an $889-million profit in the second quarter, down 9 per cent from the same period in 2021. Its quarterly revenue climbed 14 per cent year over year to $3.64-billion.
TC Energy concluded the sale of a 65-per-cent stake in the pipeline venture in 2020 to Alberta Investment Management Corp. and KKR & Co. Inc.
TC Energy, which currently owns 35 per cent of Coastal GasLink, announced a deal in March to set aside a 10-per-cent stake for the planned equity sale to as many as 20 elected First Nation councils along the pipeline route.
Those elected band councils have agreed to support the pipeline. But the Office of the Wet’suwet’en, a non-profit society that represents hereditary chiefs who oppose the pipeline, maintains that elected Indigenous leaders don’t have jurisdiction over the Wet’suwet’en’s traditional, off-reserve territory.
A group of Wet’suwet’en hereditary chiefs and their supporters have staged protests at Coastal GasLink construction areas near Houston, B.C., over the past four years.
John Ridsdale, a climate activist whose Wet’suwet’en hereditary chief name is Na’Moks, said such opposition to pipeline construction remains steadfast. “No change,” he said in a text message to The Globe and Mail on Thursday.
Nearly 5,000 people are working this month on the pipeline across British Columbia, while LNG Canada entered its busiest building schedule this spring, requiring up to 7,500 workers on rotation.
Costs related to the entire supply chain had been pegged at $40-billion, which includes $18-billion for LNG Canada’s first phase of the Kitimat export terminal and infrastructure that includes the pipeline, as well as drilling for natural gas in northeast British Columbia. But with the extra $4.6-billion now budgeted for pipeline costs, that increases the total to $44.6-billion.
The co-owners of the LNG Canada joint venture are pondering whether to approve Phase 2, which would double the export capacity to 28 million tonnes a year. LNG Canada has not indicated when it will make a final decision.
Coastal GasLink president Bevin Wirzba said talks with LNG Canada are in a well-advanced stage over the prospect of the Kitimat expansion and any future pipeline upgrades such as new compressor stations that would be required.
“So we’re in active discussions with LNG Canada around Phase 2 and the feasibility, doing the appropriate front-end work to establish what the scope and scale of that project will be,” Mr. Wirzba said. “The combination of Phase 1 and Phase 2 brings us back into a very competitive return scenario for the entire project.”
Ms. McKnight said LNG Canada and its co-owners, also known as joint venture participants (JVPs), are evaluating the timeline and scope for Phase 2. “Any final investment decision will take into account a range of factors, which include competitiveness, affordability, carbon intensity, technologies and individual JVP portfolio considerations,” she said.
LNG Canada is the only LNG export terminal under construction in the country.
Canada currently has no operational LNG export terminals. FortisBC’s Tilbury LNG plant in the Vancouver suburb of Delta is a small-scale operation mainly for domestic storage and has briefly exported only a small amount of LNG in containers.
Proponents of two export proposals on the East Coast, Pieridae Energy Ltd.’s PEA-T Goldboro LNG in Nova Scotia and Repsol SA’s Saint John LNG in New Brunswick, are studying the economics of shipping LNG to Europe, but face pipeline constraints in Central Canada and New England.
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TORONTO – Roots Corp. may have built its brand on all things comfy and cosy, but its CEO says activewear is now “really becoming a core part” of the brand.
The category, which at Roots spans leggings, tracksuits, sports bras and bike shorts, has seen such sustained double-digit growth that Meghan Roach plans to make it a key part of the business’ future.
“It’s an area … you will see us continue to expand upon,” she told analysts on a Friday call.
The Toronto-based retailer’s push into activewear has taken shape over many years and included several turns as the official designer and supplier of Team Canada’s Olympic uniform.
But consumers have had plenty of choice when it comes to workout gear and other apparel suited to their sporting needs. On top of the slew of athletic brands like Nike and Adidas, shoppers have also gravitated toward Lululemon Athletica Inc., Alo and Vuori, ramping up competition in the activewear category.
Roach feels Roots’ toehold in the category stems from the fit, feel and following its merchandise has cultivated.
“Our product really resonates with (shoppers) because you can wear it through multiple different use cases and occasions,” she said.
“We’ve been seeing customers come back again and again for some of these core products in our activewear collection.”
Her remarks came the same day as Roots revealed it lost $5.2 million in its latest quarter compared with a loss of $5.3 million in the same quarter last year.
The company said the second-quarter loss amounted to 13 cents per diluted share for the quarter ended Aug. 3, the same as a year earlier.
In presenting the results, Roach reminded analysts that the first half of the year is usually “seasonally small,” representing just 30 per cent of the company’s annual sales.
Sales for the second quarter totalled $47.7 million, down from $49.4 million in the same quarter last year.
The move lower came as direct-to-consumer sales amounted to $36.4 million, down from $37.1 million a year earlier, as comparable sales edged down 0.2 per cent.
The numbers reflect the fact that Roots continued to grapple with inventory challenges in the company’s Cooper fleece line that first cropped up in its previous quarter.
Roots recently began to use artificial intelligence to assist with daily inventory replenishments and said more tools helping with allocation will go live in the next quarter.
Beyond that time period, the company intends to keep exploring AI and renovate more of its stores.
It will also re-evaluate its design ranks.
Roots announced Friday that chief product officer Karuna Scheinfeld has stepped down.
Rather than fill the role, the company plans to hire senior level design talent with international experience in the outdoor and activewear sectors who will take on tasks previously done by the chief product officer.
This report by The Canadian Press was first published Sept. 13, 2024.
VANCOUVER – Mediated talks between the union representing HandyDART workers in Metro Vancouver and its employer, Transdev, are set to resume today as a strike that has stopped most services drags into a second week.
No timeline has been set for the length of the negotiations, but Joe McCann, president of the Amalgamated Transit Union Local 1724, says they are willing to stay there as long as it takes, even if talks drag on all night.
About 600 employees of the door-to-door transit service for people unable to navigate the conventional transit system have been on strike since last Tuesday, pausing service for all but essential medical trips.
Hundreds of drivers rallied outside TransLink’s head office earlier this week, calling for the transportation provider to intervene in the dispute with Transdev, which was contracted to oversee HandyDART service.
Transdev said earlier this week that it will provide a reply to the union’s latest proposal on Thursday.
A statement from the company said it “strongly believes” that their employees deserve fair wages, and that a fair contract “must balance the needs of their employees, clients and taxpayers.”
This report by The Canadian Press was first published Sept. 12, 2024.
MONTREAL – Travel company Transat AT Inc. reported a loss in its latest quarter compared with a profit a year earlier as its revenue edged lower.
The parent company of Air Transat says it lost $39.9 million or $1.03 per diluted share in its quarter ended July 31.
The result compared with a profit of $57.3 million or $1.49 per diluted share a year earlier.
Revenue in what was the company’s third quarter totalled $736.2 million, down from $746.3 million in the same quarter last year.
On an adjusted basis, Transat says it lost $1.10 per share in its latest quarter compared with an adjusted profit of $1.10 per share a year earlier.
Transat chief executive Annick Guérard says demand for leisure travel remains healthy, as evidenced by higher traffic, but consumers are increasingly price conscious given the current economic uncertainty.
This report by The Canadian Press was first published Sept. 12, 2024.
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