All financial figures are in Canadian dollars unless noted otherwise.
CALGARY, Dec. 14, 2011 /CNW/ - Gibson Energy Inc. (TSX: GEI) ("Gibson"
or the "Company"), is pleased to announce that its Board of Directors
has approved a 2012 capital budget of $173 million for internal growth
investments, strategic investments and for the upgrade and replacement
of existing assets.
Approximately $113 million - or 65% - of the 2012 capital expenditure is
directed towards growth investments. About 55% of the growth
investments are earmarked for the Terminals and Pipelines segment,
which includes Custom Treating and Terminals. Significant investments
are also planned for both the Truck Transportation and Processing and
Wellsite Fluids segments.
"Gibson's 2012 capital expenditure program is directly aligned with the
Company's long-term objective of generating stable and growing cash
flow for shareholders," said Stew Hanlon, President and Chief Executive
Officer. "Planned spending is well balanced between business segments,
which should enable our integrated oil levered assets to provide
diversified cash flow and stability through various commodity cycles."
2012 Capital Expenditure Strategic Objectives
The strategic objectives of Gibson's 2012 capital expenditure program
are:
-
Continued growth at the Hardisty Terminal via additional large tank
construction backstopped by long term contracts;
-
Growth at the Edmonton Terminal by leveraging new feeder pipeline
connectivity;
-
Expanding Gibson's integrated service offerings in growing North
American oil plays, such as the Western Canadian Sedimentary Basin,
Bakken, Niobrara, Granite Wash and Eagleford regions, by:
-
Building and expanding on the investment platform the Company
established in 2011 in emulsion treating, water disposal and oilfield
waste management;
-
Exploring alternatives to expand the terminal and pipeline business in
the United States; and
-
Expanding Truck Transportation services into new product offerings and
to meet growing demand;
-
Fund the capital program from cash on hand, cash flow from operations
and, if necessary, the Company's existing credit line; and
-
Preserve the Company's strong balance sheet to maintain financial
flexibility. The Company does not budget for acquisitions but will
evaluate opportunities as they arise.
2012 Capital Expenditure Highlights
In 2012, approximately $113 million is allocated towards internal growth
investments of which $69 million represents spending associated with
previously approved projects. Significant investments include:
-
Terminals and Pipelines for $63 million, primarily related to the
Hardisty West project, the development of treating facilities, disposal
wells and landfills and expansion opportunities at the Edmonton
Terminal;
-
Truck Transportation for $24 million, relating to growth in both Canada
and the United States; and
-
Processing and Wellsite Fluids for $21 million, largely at Moose Jaw
Refinery, to increase the Stoney Beach pipeline capacity to realize
transportation and supply benefits and to complete construction of a
finished product tank.
In addition, capital expenditure of $10 million is allocated to purchase
additional land in Alberta and to upgrade the recently acquired
Sexsmith property near Grande Prairie, Alberta. These investments are
strategic in nature and will provide important infrastructure and
market access for the Company's trucking, wellsite fluids and propane
businesses.
Upgrade and replacement capital is approximately $50 million in 2012.
The planned spending will largely be focused on ensuring safety,
reliability and efficiency of existing operations.
The amount and allocation of capital expenditures for 2012 is subject to
review and modifications by management on an ongoing basis throughout
the year. In addition, the Board of Directors regularly reviews the
capital program during the year in light of business and economic
conditions and may modify the 2012 Capital Expenditure Plan during the
year.
2012 Capital Expenditure Program
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Upgrade
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and
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(in millions)
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Growth
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Strategic
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Replacement
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TOTAL
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TERMINALS AND PIPELINES
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$63
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$-
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$13
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$76
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TRUCK TRANSPORTATION
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24
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-
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24
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48
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PROPANE AND NGL MARKETING AND DISTRIBUTION
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5
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-
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5
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10
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PROCESSING AND WELLSITE FLUIDS
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21
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-
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4
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25
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OTHER CORPORATE
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-
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10
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4
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14
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TOTAL
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$113
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$10
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$50
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$173
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About Gibson
Gibson Energy is one of the largest independent midstream energy
companies in Canada and a major participant in the crude oil
transportation business in the United States. Gibson transports
hydrocarbons and water by utilizing its integrated network of
terminals, pipelines and truck fleet, located throughout western Canada
and the United States. Gibson shares trade on the Toronto Stock
Exchange under the symbol GEI.
Gibson's primary objective is to generate stable and growing cash flows
for shareholders through an attractive dividend and a growing asset
base.
Forward-Looking Statements
Certain statements contained in this news release constitute 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 Supplemented Prep Prospectus dated
June 7, 2011 as filed on SEDAR and available on the Gibson website at www.gibsons.com.