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INTERPROVINCIAL PROPOSES $275 MILLION EXPANSION ANNOUNCES FIRST QUARTER RESULTS

 TORONTO, May 6 /PRNewswire/ -- Interprovincial Pipe Line System Inc. of Edmonton, Alberta is prepared to launch a $275 million expansion program to meet increased deliveries of Western Canadian crude oil to Eastern Canada and midwest U.S. markets, Brian F. MacNeill, president and chief executive officer, said today.
 MacNeill told shareholders attending Interprovincial's annual meeting here that expansion of the pipeline's capacity is one of a number of investment opportunities facing the company. Interprovincial operates the longest petroleum pipeline system in the world.
 MacNeill said the Interprovincial system has been operating at capacity for more than 2 1/2 years. This has resulted in substantial apportionment of volumes, creating two significant costs for the oil industry and government.
 "First, crude oil production at times has been shut in or has been diverted to other lower netback markets, the effect of which has been to reduce revenue to industry and government. Second, the Chicago market perceives that Western Canadian crude has deliverability risk associated with apportionment. As a result, the market price for all Western Canadian crude production is discounted, possibly as much as $0.50 and industry expects this will increase to at least $1 per barrel. Interprovincial's current supply forecasts indicate a continuing capacity shortfall of approximately 125,000 barrels per day."
 Interprovincial is actively discussing the level of shortfall with industry and promoting solutions to the problem, with expansion of the IPL System being an attractive choice, MacNeill said. A capacity expansion could be completed in 1994 if the decision to proceed was made quickly.
 In addition to capacity expansion, other potential Interprovincial investment opportunities include the expenditure of $1.2 billion over the next 10 years to maintain and improve a safe, efficient system, as well as a project to purchase and provide the "fill" in the pipeline system that presents a possible $700 million investment. Interprovincial is also pursuing two pipeline opportunities -- the St. Lawrence pipeline, costing an estimated $117 million and the InterCoastal pipeline, expenditures for which could total $70 million. Estimates to reverse the Sarnia, Ontario to Montreal pipeline, another opportunity, range from $40 to $90 million.
 Interprovincial also announced that earnings for the first quarter of 1993 were $16.5 million ($0.42 per share) compared with $23.1 million ($0.58 per share) during the first quarter last year. The decline in earnings was because of lower contributions from the IPL System and from corporate investing activities.
 IPL System earnings declined to $8.4 million compared with $13.3 million in 1992 primarily as a result of lower system utilization and unusual fluctuations in throughput because of operational problems experienced by some producers and feeder pipelines during the first quarter.
 Although IPL System earnings for the first quarter of 1993 were less than anticipated, these earnings are not indicative of the expected full-year results. The most recent throughput forecast indicates that IPL System utilization for the remainder of 1993 will recover and earnings should at least equal last year's level.
 Comparing earnings with last year, first quarter earnings in 1992 were unusually high because of the above average deliveries during that quarter and the timing of maintenance programs undertaken in 1992.
 Pipeline system deliveries of crude oil and other liquid hydrocarbons during the first quarter of 1993 averaged 1,479,000 barrels per day compared with 1,506,000 during the same quarter last year. Lower shipments of light crude oil were partly offset by increased shipments of medium and heavy oils because of higher production in Western Canada. System utilization declined to 84 billion barrel miles compared with 88 billion in 1992. The decrease reflects the lower deliveries during the first quarter, partially offset by an increase in longer haul deliveries to Eastern Canada.
 Cash from operations for the three months ended March 31, 1993, was $29.8 million, a marginal decline from the $31.4 million generated by operations in the same period last year.
 Capital expenditures of $8.1 million were incurred during the first quarter as part of ongoing programs to maintain and enhance the safety and efficiency of the pipeline system.
 A quarterly dividend of $0.50 per share was declared payable June 1, 1993 to shareholders of record May 17, 1993.
 Interprovincial Pipe Line System Inc. is a widely held, publicly owned corporation with shares traded on the Toronto and Montreal stock exchanges in Canada under the symbol "IPL," and in the United States on the NASDAQ market under "IPPIF."
 INTERPROVINCIAL PIPE LINE SYSTEM INC.
 Highlights
 (unaudited; dollars in millions, except per share amounts)
 Per Per
 Three months ended March 31, 1993 Share 1992(a) Share
 Financial
 Segmented earnings
 IPL system $8.4 $0.21 $13.3 $0.33
 IPL (NW) system 3.5 0.09 3.5 0.09
 Lakehead system 2.1 0.05 2.0 0.05
 Corporate 2.5 0.07 4.3 0.11
 Earnings $16.5 $0.42 $23.1 $0.58
 Cash from operations $29.8 $0.75 $31.4 $0.79
 Dividends $19.9 $0.50 $19.9 $0.50
 Operating
 Operating revenue $97.9 $100.5
 Capital expenditures $8.1 $12.6
 Deliveries (thousands of
 barrels per day) 1,479 1,506
 Barrels Miles (billions) 84 88
 Average haul (miles) 633 641
 (a) The 1992 results have been restated for the retroactive effect of the NEB decision rendered June 19, 1992 on IPL's Class 3 Toll Adjustment Application.
 -0- 5/6/93
 /CONTACT: Frank Ternan, manager, Investor Relations of Interprovincial Pipe Line System, 403-420-8471/
 (IPPIF)


CO: Interprovincial Pipe Line Inc. ST: Ontario IN: OIL SU: ERN DIV

MS -- LA029 -- 5527 05/06/93 14:05 EDT
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Date:May 6, 1993
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