The White House’s threat of across-the-board 25% tariffs on Canada (and others) has caused a lot of drama on either side of the border.

The leaders of Canada’s largest midstream company, however, say they aren’t too worried.

“We’ve got tariff concerns out there, but there’s such a hard wiring of the energy system in North America,” said Greg Ebel, president and CEO of Enbridge Inc. “We just don’t see that as a material impact.”

Ebel discussed the situation in Washington during the company’s fourth-quarter earnings call Feb. 14.

During his campaign, Trump threatened to implement tariffs against Canada and Mexico on his first day in office, saying the countries needed to do more to stop illegal immigration and the drug trade. Then he agreed to wait two weeks before implementation.

On Feb. 4, Trump delayed the tariffs another 30 days. He's recently said neither country has done enough to stop him from carrying out his threat.

Enbridge Inc. owns a large portion of the energy industry’s hard wiring between Canada and the U.S. The company, headquartered in Calgary, Alberta, is North America’s largest gas utility, supplying customers in 31 states and four Canadian provinces.

Enbridge’s Mainline is the largest crude system on the continent, taking product from Alberta to the Midwest, on to connections headed to the Gulf Coast. In 2024, the Mainline averaged 3.1 MMbbl/d and has been in apportionment since November.

Asked about the company’s adjustments should the U.S. pass an import fee, Ebel said Enbridge would be able to continue with its current construction plans on infrastructure projects.

“Unless it’s a very high tariff and on a pronged basis, we just don’t see significant changes on that front,” he said.

The CEO also discussed how the White House’s current agenda on reforms for permitting, taxation and sustainability regulations, would be positive for a company with a massive amount of infrastructure in the U.S.

The executives also hoped that the current challenges could persuade the Canadian government to open up opportunities for the nation’s energy industry, with more pipelines and ports for export, without having to rely on the U.S.

Otherwise, the company will focus on continuing with its current strategy, Ebell said.

“We’re really focused intently more on broader themes,” he said. “Macro trends like production, demand growth, earnings, returns on capital, then day-to-day political gyrations.” 

Earnings growth

For 2024, Enbridge reported a 13% increase in EBITDA over 2023, at CA$5.13 billion (US$ 3.62 billion). The company delivered a dividend to stockholders for the 30th consecutive year.

Enbridge placed CA$5 billion (US$3.53 billion) of organic projects into service in 2024 across all four of its business units and approved CA$8 billion (U.S.$5.65) of new organic projects during the same time frame.

The company also announced that the Canadian Energy Regulator approved the CA$1.2 billion (US$850 million) Aspen Point T-North expansion, and project to boost natural gas capacity for the developing LNG industry in British Columbia.

Comments