Blue-chip potential for Enbridge Gas Distribution's blue-flame business

An investor bulletin from 2015 Enbridge Day (Part 4)

Low natural gas prices. A steadily growing customer base. Rising diversity of supply. Enormous reserves. And, down the road, serious potential for new growth platforms.

Add them all up, and you get a very rosy picture for Enbridge’s blue-flame business, Enbridge Gas Distribution.

“People are used to hearing me say that we have a really solid core business with some decent growth opportunities. And that is absolutely true,” Glenn Beaumont, president of Enbridge Gas, recently told the 17th annual Enbridge Day Investment Community Conference.

“But I also believe that completely understates what this business can become.”

Enbridge’s 2015 Enbridge Day investment conference, held Oct. 7 in Toronto and Oct. 8 in New York, gave current and potential Enbridge investors insight into our business fundamentals, our financial outlook, our long-term vision, and our large and diversified set of future growth opportunities – including the natural gas distribution picture.

In addition to a strategic company overview by president and CEO Al Monaco, who discussed our $38-billion, five-year capital growth program, 2015 Enbridge Day also included updates by various Enbridge leaders on key aspects of our business – including a Gas Distribution presentation by Mr. Beaumont.

Enbridge Gas is already the largest gas distribution utility in Canada, with more than two million customers. The company has doubled its customer base in the past 20 years, and that growth rate—about 35,000 new customers a year—shows no signs of slowing down. Over the next five years, Enbridge Gas will invest $3 billion in its core business, including the $800-million GTA Project that’s expected to wrap up by early 2016, to support that growth.

And because of the tremendous growth in natural gas supply over the past decade, Enbridge Gas is also poised to capitalize on the capability, the availability, and the competitiveness of natural gas to extend and enhance its operations in the longer term.

These opportunities may include:

  • Additional pipeline and storage infrastructure, required by expanding production basins and shifting supply patterns;
  • Some expected transition of medium- and heavy-duty transportation to natural gas;
  • And the potential change in electricity distribution models, with the pursuit of Combined Heat and Power (CHP) systems fueled by natural gas.

“This North American price advantage is supporting something of a natural gas renaissance in many sectors,” said Mr. Beaumont. “These disruptive changes in the end-use market for energy create potential opportunities. We are incredibly well-positioned to look at which business models fit our investment triangle.”

The Gas Distribution presentation, as part of 2015 Enbridge Day, is available on the website.