CALGARY, ALBERTA--(Marketwired - Dec. 10, 2013) -
All financial figures are in Canadian dollars.
Gibson Energy Inc. ("Gibson" or the "Company") (TSX:GEI) is pleased to announce that its Board of Directors has approved the Company's 2014 capital spending plan of $410 million. This is approximately 30% higher than Gibson's 2013 capital budget and represents the largest planned spend in the Company's history.
2014 Capital Spending Summary
(in millions) | Growth | Upgrade and Replacement |
TOTAL | |||
TERMINALS AND PIPELINES | $ | 230 | $ | 10 | $ | 240 |
ENVIRONMENTAL SERVICES | 70 | 20 | 90 | |||
PROCESSING AND DISTRIBUTION | 20 | 20 | 30 | |||
TRUCK TRANSPORTATION | 10 | 15 | 35 | |||
OTHER CORPORATE | 10 | 5 | 15 | |||
TOTAL | $ | 340 | $ | 70 | $ | 410 |
Highlights
"Gibson's 2014 capital plan, which marks the third consecutive year that we have increased our annual capital program, demonstrates the demand for continued infrastructure growth in Alberta," said Stewart Hanlon, Gibson's President and Chief Executive Officer. "Our planned spending continues to be heavily weighted towards our Terminals and Pipelines segment, which should deliver predictable and growing cash flow for many years to come and, along with it, long term shareholder value."
2014 Capital Spending Strategic Objectives
The strategic objectives supported by Gibson's 2014 capital spending program are:
In 2014, approximately $340 million is allocated towards capital growth expenditures of which approximately $290 million represents spending associated with approved projects. A summary of key growth initiatives by business segment is outlined below:
Upgrade and replacement capital is planned to be $70 million in 2014. The planned spend which supports our growing asset base, will largely be focused on ensuring safety, reliability and efficiency of existing operations.
2015 Growth Capital Spending Estimate
The Company only prepared detailed capital budgets for 2014 but has initial indications of capital needs for 2015:
"Our early view of 2015 brings growth capital over the next 24 months to approximately $600 million," said Hanlon. "This growth capital program should result in significant EBITDA growth, led by our Terminals and Pipelines business, as we exit 2014 and into 2015."
"We plan to fund the capital program from cash on hand, cash flow from operations and availability under the revolving credit facility," said Donald Fowlis, Gibson's Chief Financial Officer. "Preserving the Company's strong balance sheet to maintain financial flexibility is a primary goal."
About Gibson
Gibson is a large, independent midstream energy company in Canada and an integrated service provider to the oil and gas industry in the United States. Gibson is engaged in the movement, storage, blending, processing, marketing and distribution of crude oil, condensate, natural gas liquids, water, oilfield waste and refined products. Gibson transports energy products by utilizing its network of terminals, pipelines, storage tanks, and trucks located throughout western Canada and through its significant truck transportation and injection station network in the United States. Gibson also provides emulsion treating, water disposal and oilfield waste management services in Canada and the United States and is the second largest retail propane distribution company in Canada.
Forward-Looking Statements
Certain statements contained in this news release constitute forward-looking information and statements (collectively, "forward-looking statements"). These statements relate to future events or the Company's future performance. All statements other than statements of historical fact are forward-looking statements. The use of any of the words "anticipate", "plan", "contemplate", "continue", "estimate", "expect", "intend", "propose", "might", "may", "will", "shall", "project", "should", "could", "would", "believe", "predict", "forecast", "pursue", "potential" and "capable" and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. No assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this news release should not be unduly relied upon. These statements speak only as of the date of this news release. In addition, this news release may contain forward-looking statements and forward-looking information attributed to third party industry sources. The Company does not undertake any obligations to publicly update or revise any forward looking statements except as required by securities law. Actual results could differ materially from those anticipated in these forward-looking statements as a result of numerous risks and uncertainties including, but not limited to, the risks and uncertainties described in "Forward-Looking Statements" and "Risk Factors" included in the Company's Annual Information Form dated March 5, 2013 as filed on SEDAR and available on the Gibson website at www.gibsons.com.
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