CEO COMMENT - Al Monaco, President and Chief Executive Officer
"The COVID-19 pandemic has had an unprecedented impact on our society, our economies and the global energy industry. At Enbridge, we responded quickly and effectively to ensure safe and uninterrupted energy delivery to our customers across North America while protecting the health of our people. As COVID unfolded early in the year, we enacted plans to further bolster our operational and financial strength to protect against a prolonged downturn, and to mitigate the impact of lower throughput on our liquids Mainline system. We have weathered the near-term effects of the pandemic on our business well - and I'm very proud of the entire Enbridge team and how we have met the challenge.
"Over the last three years we have been focused on building an even more resilient business, which put us in a strong position coming into 2020, pre-COVID. We've materially diversified the business mix to natural gas, sold our gas gathering and processing business and significantly reduced leverage while moving to an equity self-funding model. We have also simplified our corporate structure, reduced overhead and successfully executed $30 billion of capital projects.
"This year we're taking additional action to further reinforce our financial strength and flexibility. We took advantage of strong debt markets to raise $6.9 billion of capital at attractive rates, which addresses our 2020 growth capital needs, and available liquidity has been increased to $14 billion, which means we don't need to access the capital markets through 2021. We also have now fully enabled cost reductions for 2020.
"In the face of the worst energy downturn our industry has ever experienced, the strength and resilience of our assets was demonstrated once again in the second quarter, with solid financial results. We achieved DCF per share of $1.21, which exceeded our expectations for the second quarter and for the first half of the year. While there will be headwinds in the second half of 2020, which will temper favourable first half results, we expect to achieve our full year guidance range of $4.50 to $4.80 DCF per share.
"All of our business units performed well and contributed to the strong second quarter results. Most notably, Gas Transmission along with Gas Distribution and Storage both saw high utilization and favorable decisions on rates. In Liquids Pipelines, Mainline throughput was about 400 thousand barrels per day lower than our first quarter results however, throughput has been improving steadily and in-line with our expectations. This trend reflects the strong competitive position of the Midwest and Gulf Coast refineries that take Canadian heavy barrels off of our system.
"Despite the COVID disruption, we've made good progress on our strategic priorities this quarter. We are progressing our $11 billion secured capital program, including Line 3 in Minnesota, where we've now completed the regulatory process related to the Environmental Impact Statement, Certificate of Need and Route Permit. And, the Pollution Control Agency has established a firm timeline to finalize construction permits by November 14th.
"This quarter we sanctioned $1 billion of newly secured growth projects comprised of four gas utility projects and another European offshore wind project. Our Mainline contract application review is also in full swing; the CER issued a hearing order outlining the key steps in the process and we're providing evidence that demonstrates the value that Mainline contracting will deliver to customers and to ensure the value of western Canadian resources are maximized.
"In summary, the first half 2020 performance has been stronger than expected, highlighting the resiliency of our business and our ability to deliver solid results in difficult market conditions. We remain focused on executing our secured capital program, which combined with growth embedded within our business, is expected to deliver 5 to 7% annual DCF per share growth through 2022."