Northern Gateway foes hijack Enbridge meeting
CALGARY — B.C. opponents of the Northern Gateway pipeline took over question period at Enbridge Inc.’s annual meeting Wednesday as hangover costs of a 2010 oil spill in Michigan continued to cloud its financial reports.
A half-dozen people, all from British Columbia, filed to the microphones at the meeting in downtown Calgary to question and then re-question the Calgary energy transportation company’s controversial oil link from Edmonton to Kitimat on the West Coast.
In his first AGM as chief executive after succeeding Pat Daniel last year, Al Monaco answered patiently, allowing the questions to continue for nearly 90 minutes.
Trevor Jang of Terrace, a member of the Small Frog Clan of the B.C. Wet’suwet’en First Nation, went to the microphone to say he had won a creative writing contest sponsored by Enbridge when he was 16 but is now ashamed that his picture had been used in Enbridge advertising.
“I will never allow you to use me again the way you did previously,” he charged, adding he is now competing in the same contest as an adult.
“I will never allow you to make me your native poster boy again.”
Monaco congratulated the necktie-wearing 20-year-old and apologized for any misuse of his image but defended Enbridge’s community investments as proper spending, not attempts to buy support.
Questioners challenged Enbridge’s commitment to social licence, its right to build without native support and asked what will happen if the project is approved but fails due to legal challenges or civil disobedience.
Meanwhile, many of the other investors stood and left the room.
“No disrespect to all these people who came in from B.C. and who are concerned about what’s happening. I love seafood,” said shareholder Guida Gobaud outside the meeting.
“But, did you ride on a horse when you came in here? Did you bring your sled with the dogs?”
Monaco told reporters later letting opponents speak without limit is part of the consultation process.
“The key is you have to be respectful. If they are shareholders or have valid proxies, you have to let them speak,” he said.
The National Energy Board recently published 199 potential conditions if approval is granted for the $6-billion project to construct two 1,170-kilometre pipelines and a terminal to load oil tankers.
Comments are to be accepted until May 31, oral final arguments are to commence in June in Terrace and the joint review panel’s recommendation is to be rendered by the end of the year.
The federal government’s final decision on Northern Gateway is expected by mid-2014.
Earlier in the day, Enbridge reported first-quarter net earnings of $250 million, down from $261 million in the first quarter of 2012.
The shortfall was mainly due to unrealized hedging losses, but included additional remediation work ordered in March by the U.S. government following the Line 6B spill that dumped 840,000 gallons of oil in Michigan’s Kalamazoo River.
Enbridge Inc.’s after-tax hit is $24 million of $175 million set aside by affiliate Enbridge Energy Partners LP, the partnership that operates the U.S. portion of Enbridge’s oil pipeline network.
The total cost of the cleanup is now estimated at $820 million US ($137 million for Enbridge Inc.), excluding fines and penalties.
First-quarter earnings adjusted to remove one-time and non-cash items were $488 million or 62 cents per share, up from $373 million or 49 cents in the same period last year.
Enbridge announced it has agreed to invest $1.2 billion in EEP by buying 7.5 per cent annual yield preferred units.
The two also said that EEP would reduce ownership in the Lakehead system expansions of both the Eastern Access and Mainline Expansion projects from 40 per cent to 25 per cent, although it will have the option to backtrack for one year after the in-service dates.
The deals are expected to reduce third-party credit needs of the partnership by over $1.9 billion.
EEP has traded between $26.88 and $31.12 US in the past 52 weeks on the New York Stock Exchange. It jumped five per cent to $30.22 on Wednesday. Enbridge shares climbed five cents to $47.60.
In a note, FirstEnergy Capital analyst Steven Paget said Enbridge beat earnings per share expectations by 10 cents but that was mainly due to non-recurring earnings from gas distribution and commodity marketing.
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