Enbridge reassessing U.S. natural gas business after Q1 revenue plunges
Energy firm reviewing holdings in Midcoast Energy Partners and Midcoast Operating LP following 51 per cent revenue dip
HOUSTON—Enbridge Energy Partners LP is looking at a possible sale of its main natural gas business in the United States, which has experienced a 51 per cent decline in first-quarter revenue and a higher operating loss compared with last year.
The Enbridge-run limited partnership, which is primarily involved in transporting oil from Western Canada and North Dakota, says it is reviewing its holdings in Midcoast Energy Partners and Midcoast Operating LP—its main natural gas holdings.
Enbridge Energy Partners also announced a 43 per cent decline in net income and a 26 per cent decline in overall revenue in the first quarter, mainly attributed to weakness in natural gas.
Total revenue was US$1.06 billion, including $431.9 million from natural gas. That’s down from $1.43 billion, including $873.5 million from natural gas, in the first quarter of 2015.
Net income dropped to $80 million or seven cents per unit from $140.1 million or 26 cents per unit. Adjusted net income dropped 20 per cent to $113.8 million or 17 cents per unit from $142.8 million or 26 cents per unit.
The natural gas segment’s operating loss increased to $29.9 million from $26 million and it reduced total net income by $22.8 million. The liquids business increased its operating profit to $301.4 million from $270.2 million.
Enbridge says its strategic review of the natural gas business is in its early stages and no decision has been reached.