The boss of TC Energy Corp. TRP-T believes the federal government is sincere in its goal to get oil and gas infrastructure built across Canada, but he says his company intends to stick to lower-risk expansions in the United States.
Francois Poirier told analysts on a Thursday morning earnings call that Ottawa’s Bill C-5 − which aims to bolster trade among provinces and territories and fast-track major infrastructure projects − is a positive for the Calgary-based energy infrastructure company.
“It’s nice to see a federal government that understands the sense of urgency around deploying capital to help make Canada an energy superpower,” he said.
“In our interactions with the federal government, we believe very much that that is a sincere objective on their part we will benefit from.”
Mr. Poirier is also optimistic about how new policy direction could help Canada reach its potential to become the largest exporter of liquid natural gas to Asia. Boosting LNG exports to the region could create up to $75-billion in incremental GDP for the country, he said.
“The provinces appear to be supportive. The policy support now appears to be there. And so it’s up to Canada, the provinces, Indigenous communities and the private sector to get out there and send the message to international markets that Canada is open for business again.”
Yet TC Energy intends to invest predominantly in projects in the U.S. until capital spending in other jurisdictions become more competitive.
“Canada gas has to compete for capital with the other business units in the company. And currently, the risk-adjusted returns in the U.S. are meaningfully higher than in Canada,” Mr. Poirier said.
Part of the attraction south of the border is the skyrocketing growth of electricity-thirsty AI and data centres, which has boosted the need for reliable, baseload power − much of which is coming from natural gas-fired plants.
Combined with growing exports of LNG and more demand for electricity across different industrial sectors, TC Energy expects North American natural-gas demand to grow by 45 billion cubic feet a day by 2035, up from its prior forecast of 40 Bcf.
That structural, long-term growth presents TC Energy a significant fiscal opportunity across its entire portfolio, Mr. Poirier said.
The company is in the midst of commercial conversations with more than 30 parties in the data-centre sector, several of which have indicated that they might need more capacity than they’d originally planned, he added.
Projects approved just last year have already been sized up to meet customer demands, and TC expects to make more project announcements – predominantly for brownfield and corridor expansions – through the second half of 2025 and into 2026.
The company will likely pursue a large number of smaller, brownfield projects that are in existing energy corridors, Mr. Poirier said, the average cost of which is around $450-million.
Mr. Poirier said the company has learned in the past that it must respect “human and financial capacity,” and ensure management has the ability to give its attention to larger capital programs before it takes that route.
“It’s challenging for us to consider a larger program, really, until 2028 or beyond.”
That’s not to say TC is ignoring its Canadian gas network.
It expanded capacity of its Mainline system last year, and Mr. Poirier said the company intends to follow through with its obligations to further that growth.
The pipeline system is the main transportation line for Canadian natural-gas producers, and there’s huge interest in more capacity; each time TC Energy runs an Open Season call for contracts on its pipelines, it gets “very robust subscriptions” for its service at full rates, Mr. Poirier said.
In all, the company said its second-quarter profits rose from a year earlier despite a complex macroeconomic backdrop. TC Energy said in its results that it had a net income of $862-million, or 83 cents per share in the quarter, up from $804-million or 78 cents a share last year.
Revenues totalled $3.74-billion, up from $3.33-billion last year.
The company says that despite volatility in commodity markets, the company is raising its expected earnings before certain deductions this year.
With a report from The Canadian Press