Capital Expenditure | Capital Expenditure - 2018

Gibson Energy IDs 2018 Budget of $120-150 Million

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   |    Wednesday,December 06,2017

[Summary: Gibson Energy has detailed its 2018 capital budget of $120-150 million.

Growth Capital ($ millions)      
  Hardisty Terminal   $90 - $110
  Edmonton Terminal     25 -   30
  Total Terminals   $115 - $140
         
  U.S. Infrastructure     5 -   10
         
  Total   $120 - $150
         
Upgrade and Replacement Capital ($ millions)  
  Infrastructure   $15 - $20
  Logistics(1)     5 -   10
  Other     0 -   5

Nearly all of the growth capital will be focused on the company's Hardisty and Edmonton terminals.]

ORIGINAL RELEASE:

Gibson Energy Inc.  announced today that its Board of Directors has approved a 2018 growth capital expenditure budget in the range of $120 million to $150 million, with in excess of 90% of investment directed towards sanctioned growth projects. Additionally, the Board of Directors has approved the allocation of approximately $30 million in upgrade and replacement capital expenditures.

“Our 2018 capital expenditure budget reflects our focus on our core infrastructure platform, with nearly all of our growth capital being invested at the Hardisty and Edmonton Terminals under long-term, take-or-pay agreements with investment grade counterparties,” said Steve Spaulding, President and Chief Executive Officer. “We continue to expect that we will sanction one to two tanks per year on a run rate basis in a flat oil price environment, but also believe that the company needs to further leverage its existing asset base to drive additional growth. Based on current commercial discussions, we anticipate we will secure incremental infrastructure growth projects that will provide the opportunity to invest a further $50 million to $100 million in 2018, which could result in total growth capital expenditures above $200 million.”

Gibson’s 2018 capital expenditure budget is expected to be allocated as follows:

Growth Capital ($ millions)      
  Hardisty Terminal   $90 - $110
  Edmonton Terminal     25 -   30
  Total Terminals   $115 - $140
         
  U.S. Infrastructure     5 -   10
         
  Total   $120 - $150
         
Upgrade and Replacement Capital ($ millions)  
  Infrastructure   $15 - $20
  Logistics(1)     5 -   10
  Other     0 -   5

     (1) Logistics excludes $5 - $10 million for U.S. Environmental Services, which Gibson intends to divest in the first quarter of 2018.

The company expects to provide additional detail on its capital budget and growth outlook, including incremental growth opportunities, at its Investor Day on January 30, 2018.

About Gibson
Gibson is a Canadian-based midstream energy company with operations in most of the key hydrocarbon-rich basins in North America. With headquarters in Calgary, Alberta, the Company’s North American operations include the storage, blending, processing, transportation, marketing and distribution of crude oil, natural gas liquids and refined products.


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