Nalcor Energy provides third quarter update

November 12th, 2015

Nalcor Energy released its 2015 third quarter update today.

“Nalcor’s businesses are in good position overall as we approach the end of 2015,” said Ed Martin, President and Chief Executive Officer. “The company remains focused on safety as our top priority, on executing our current projects, and on continuing to manage and grow the province’s energy portfolio to benefit Newfoundlanders and Labradorians over the long-term.”

Overall, profit for the year ending December 31, 2015 is currently forecasted to be below 2014 levels. Year-to-date profit to September 30 was $20.3 million, with a loss of $1.2 million in the third quarter. Lower oil production and global commodity prices overall continue to be significant factors affecting results, with profits in the Oil & Gas and Energy Marketing businesses impacted by decreased oil prices and electricity export prices respectively. Churchill Falls profit was up $6.1 million in the third quarter and $20.2 million year-to-date over the same period in 2014, primarily a result of additional energy sales, driven by higher prices, from the former Twinco Block to Hydro.

Newfoundland and Labrador Hydro’s loss increased by $5.1 million year-to-date from 2014, due largely to higher costs associated with operations and depreciation, partially offset by the implementation of new interim electricity rates as of July 1, 2015, higher electricity demand and lower power purchase costs. Hydro’s year-to-date results do not reflect the outcome of the ongoing General Rate Application (GRA). The public hearing of Hydro’s GRA began on September 9, 2015 and is expected to conclude at the end of November 2015. The outcome of the GRA will have a significant impact on Hydro’s 2015 financial results.

During the third quarter, Muskrat Falls construction progressed on all components of the project, including the powerhouse, North Spur stabilization work, the Labrador-Island Link, the HVac transmission line that will connect Churchill Falls and Muskrat Falls, and completion of the concrete placement for the spillway. In the oil and gas business segment, although drilling at the White Rose field was suspended, production is planned to resume in early 2016. Significant progress continued during the quarter on the Hibernia Southern Extension and Hebron projects. Further, Nalcor signed a multi-client license agreement for seabed coring and slick capturing and acquired four additional investments in offshore exploration multiclient data acquisition programs. The data acquired from the new seismic, seabed coring and other ongoing exploration programs will be used by Nalcor to scientifically evaluate Newfoundland and Labrador’s frontier oil and gas resource potential in advance of future license rounds.

Ed Martin and Derrick Sturge, Vice President and Chief Financial Officer, will hold a live webcast today at 10:30 a.m. NDT to provide an overview of the third quarter results. A copy of the quarterly report and a recording of the webcast will be available at

Nalcor Energy’s business includes the development, generation, transmission and sale of electricity; the exploration, development, production and sale of oil and gas; industrial fabrication and energy marketing. Focused on sustainable growth, the company is leading the development of the province’s energy resources and has a corporate-wide framework which facilitates the prudent management of its assets while continuing an unwavering focus on the safety of its workers and the public. Nalcor has six lines of business: Newfoundland and Labrador Hydro, Churchill Falls, Oil and Gas, Lower Churchill Project, Bull Arm Fabrication and Energy Marketing.

Media Contact:
Deanne Fisher
Corporate Communications and Stakeholder Engagement
t: 709.733.5299
c: 709.697.3418

Key Financial Highlights YTD 2015

• $592.5 million in YTD revenue, an increase of $2.7 million over the same period in 2014.
• YTD profit of $20.3 million, a decrease of $24.8 million over 2014. Major factors for the decrease include lower oil production, lower commodity prices and higher operating costs, offset partially by increased profit generated by Churchill Falls primarily due to increased revenue.
• Continued the execution of Nalcor’s capital plan. YTD capital expenditures of $2.0 billion, a 49.0% increase over the same period in 2014.
• Total assets continue to grow; $11.6 billion as at September 30, 2015, an increase of $1.0 billion over December 31, 2014.
• Debt to capital ratio is 67.2% as at September 30, 2015, a 1.9% decrease from December 31, 2014.