Enbridge Announces Plans to Expand Westcoast Pipeline

Enbridge Inc. ENB has unveiled plans for an expansion of the Westcoast Pipeline in British Columbia to address the rising natural gas demand in the province and the U.S. Pacific Northwest.

The Sunrise Expansion Program suggests extending the southern segment of the pipeline, referred to as Transmission-South.

The expansion project will add a 137-kilometer looping pipeline with a 42-inch diameter, significantly boosting the natural gas transportation capacity by 300 million cubic feet per day. The development is intended to ensure a steady supply of natural gas for various uses, including heating homes and businesses, powering hospitals and schools, and generating electricity.

The Westcoast Pipeline, operational for 70 years, has a history dating back to the 1950s when the initial 30-inch diameter pipeline was installed, followed by a 36-inch diameter pipeline in the 1970s. The system is regulated by the Canada Energy Regulator ("CER") as it is an interprovincial pipeline.

Enbridge submitted its application for the Sunrise Expansion Program to the CER on May 30, 2024. The company anticipates starting construction in 2026, with a projected completion date by the end of 2028.

Westcoast Energy Inc., an Enbridge subsidiary, owns and operates the extensive Westcoast/BC Pipeline system, which spans more than 2,900 kilometers from Fort Nelson and Gordondale near the Alberta border to the Canada-U.S. border and Huntington/Sumas.

To minimize the project's impacts on local communities, Enbridge will implement a socio-economic management plan, recognizing the presence of indigenous groups in the area. The project will include temporary lodging and parking facilities, requiring approximately 10 acres of land to accommodate up to 120 workers during construction.

Furthermore, the company is committed to prioritizing workplace health and safety training, human rights protection, and human trafficking prevention awareness throughout the project.

The Sunrise Expansion Program reflects Enbridge's commitment to meeting the growing energy needs, while addressing socio-economic and environmental considerations in the regions it serves.

Zacks Rank & Key Picks

Currently, Enbridge carries a Zack Rank #3 (Hold).

Investors interested in the energy sector may look at some better-ranked companies mentioned below. The three companies presently carry a Zacks Rank #2 (Buy).

Enterprise Products Partners EPD is among the leading midstream energy players in North America. It has an extensive network of pipelines that spreads across more than 50,000 miles.

The Zacks Consensus Estimate for EPD's 2024 and 2025 earnings per share is pegged at $2.73 and $2.87, respectively. The company has a Zacks Style Score of A for Value and Momentum. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.

ProPetro Holding Corporation PUMP is an oilfield services provider operating primarily in the Permian Basin spread over West Texas and New Mexico. ProPetro's strategic transition to next-generation equipment, including FORCE electric fleets, underscores its market leadership and cutting-edge technology.

The Zacks Consensus Estimate for PUMP's 2024 and 2025 EPS is pegged at 67 cents and 83 cents, respectively. The company has a Zacks Style Score of A for Value and B for Growth. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.

USA Compression Partners, LP USAC is one of the largest independent natural gas compression service providers across the United States in terms of fleet horsepower. USA Compression Partners earns its revenues from the overall horsepower use of natural gas transported rather than the price. As such, the partnership is largely insulated from fluctuations in commodity prices.

The Zacks Consensus Estimate for USAC's 2024 and 2025 EPS is pegged at 77 cents and 98 cents, respectively. The company has a Zacks Style Score of B for Growth. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.

To read this article on Zacks.com click here.