Q1 2025 TC Energy Corp Earnings Call

Thank you for standing by this is the conference operator.

Operator: Thank you for standing by.

Operator: This is the conference operator. Welcome to the TC Energy first quarter 2025 results conference call. As a reminder, all participants are in listen only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then one on your telephone keypad. If you need assistance during the conference call, you may signal an operator by pressing star, then zero.

Speaker Change: Two the TC energy first quarter 2025 results conference call. As a reminder, all participants are in listen only mode and the conference is being recorded.

After the presentation, there will be an opportunity to ask questions.

Speaker Change: Joined the question queue, you May Press Star then one on your telephone keypad do.

Speaker Change: Do you need assistance during the conference call you May signal, an operator by pressing Star then zero.

Gavin Wylie: I would now like to turn the conference over to Gavin Wylie, Vice President, Investor Relations. Please go ahead. Thanks very much and good morning.

Speaker Change: I would now like to turn the conference over to Gavin Bailie, Vice President Investor Relations. Please go ahead.

Gavin Bailie: Thanks, very much and good morning, I'd like to welcome you to TC Energy's 2025 first quarter Conference call. Joining me are freshwater for Ya, President and Chief Executive Officer, Sean Odonnell Executive Vice President and Chief Financial Officer, along with other members of our senior leadership team.

Gavin Wylie: I'd like to welcome you to TC Energy's 2025 first quarter conference call. Joining me are Francois Poirier, President and Chief Executive Officer, Sean O'Donnell, Executive Vice President and Chief Financial Officer, along with other members of our senior leadership team. Francois and Sean will begin today with some comments on our financial results and operational highlights. A copy of the slide presentation that will accompany their remarks is available on our website under the Investors section. Following their remarks, we'll take questions from the investment community. We ask that you limit yourself to two questions.

Speaker Change: First one Shawn will begin today with some comments on our financial results and operational highlights.

Gavin Bailie: Copy of the slide presentation that will accompany their remarks is available on our website under the investors section.

Gavin Bailie: Following their remarks, we will take questions from the investment community. We ask that you limit yourself to two questions and if you remember of the media. Please contact our media team today.

Operator: And if you're a member of the media, please contact.

Gavin Wylie: Today's remarks will include forward-looking statements that are subject to important risks and uncertainties. For more information, please see the reports filed by TC Energy with Canadian Securities Regulators and with the U.S. Securities Exchange Commission. Finally, during the presentation, we'll refer to certain non-GAAP measures that provide additional information on TC Energy's operational and financial performance. However, these measures may not be comparable to similar measures presented by other entities.

Gavin Bailie: <unk> remarks will include forward looking statements that are subject to important risks and uncertainties for more information. Please see the reports filed by TC energy with Canadian Securities regulators and with the U S Securities Exchange Commission.

Gavin Bailie: Finally during the presentation, we'll refer to certain non-GAAP measures that provide additional information on Tc Energy's operational and financial performance.

Gavin Bailie: However, these measures may not be comparable to similar measures presented by other entities a reconciliation of various GAAP and non-GAAP measures is contained in the appendix of the presentation with that I'll turn it over to Francois.

Gavin Wylie: A reconciliation of various GAAP and non-GAAP measures is contained in the appendix of the presentation.

Francois Poirier: With that, I'll turn it over to Francois. Thanks, Gavin, and good morning.

Francois: Thanks, Kevin and good morning.

Francois Poirier: Before we begin the formal presentation.

Francois: Before we begin the formal presentation.

Francois Poirier: On behalf of TC Energy, I offer my congratulations to the newly elected Prime Minister of Canada, Mark Carney. Canadians have never been more united in the belief that its abundant energy is key to economic sovereignty and prosperity. As matters of top priority, we urge the new government to grow the energy sector and establish a clear, predictable regulatory framework for timely infrastructure development approval. The energy sector stands ready to collaborate with the new government on critical infrastructure projects that will benefit all Canadians. These investments will position Canada as a reliable global energy supplier while creating substantial economic benefits nationwide.

Speaker Change: On behalf of TC Energy I offer my congratulations to the newly elected Prime Minister of Canada, Mark Carney.

Speaker Change: Canadians have never been more United in the belief that its abundant energy is key to economic sovereignty and prosperity.

Speaker Change: As a matter as a top priority, we urge the new government to grow the energy sector and established a clear predictable regulatory framework for timely infrastructure development approvals.

Speaker Change: The energy sector stands ready to collaborate with the new government on critical infrastructure projects that will benefit all Canadians.

Speaker Change: These investments will position, Canada, as a reliable global energy supplier, while creating substantial economic benefits nationwide.

Speaker Change: By leveraging our continental expertise in natural gas and power generation Tc energy stands ready to support North America's role as a trusted energy partner.

Francois Poirier: By leveraging our continental expertise in natural gas and power generation, TC Energy stands ready to support North America's role as a trusted energy partner.

Speaker Change: Now turning to our first quarter results and we are off to a strong start.

Francois Poirier: Now turning to our first quarter results, and we are off to a strong start. We are proud to report that our safety incident rates continue to trend at five-year lows. Our resilient business model has continued to deliver strong results despite the volatility in the broader market, and we continue to see multiple drivers for future growth. In April, we filed Section 4 rate cases with FERC on both A&R and Great Lakes to increase their respective maximum transportation rates.

Speaker Change: We are proud to report that our safety incident rates continue to trend at five year lows.

Speaker Change: Our resilient business model has continued to deliver strong results. Despite the volatility in the broader market and we continue to see multiple drivers for future growth.

Speaker Change: In April we filed a section four rate cases with FERC on both Anr and great lakes to increase their respective maximum transportation rates. Additionally, we approved the U S zero point $9 billion, North Woods project to expand our Anr system.

Francois Poirier: Additionally, we approved the U.S. $0.9 billion Northwoods project to expand our ANR system. We continue to expect net capital expenditures for 2025 to be between $5.5 and $6 billion. And we remain on track to place $8.5 billion of assets into service this year. In aggregate, those projects are currently tracking to approximately 15% below budget. With ongoing strong EBITDA and capital expenditure performance, we are reaffirming our overall 2025 outlook that continues to enhance our financial strength and flexibility.

We continue to expect net capital expenditures for 2025 to be between five and a half and $6 billion and we remain on track to place eight and a half a billion dollars of assets into service this year.

Speaker Change: In aggregate those projects are currently tracking to approximately 15% below budget.

Speaker Change: With ongoing strong EBITDA and capital expenditure performance, we are reaffirming our overall 2025 outlook that continues to enhance our financial strength and flexibility.

Speaker Change: The southeast Gateway project is complete and ready for service the.

Francois Poirier: The Southeast Gateway Project is complete and ready for service. The project was completed in under three years from a final investment decision. and was delivered 13% below our original budget, a monumental achievement. I would once again like to thank the Ministry of Energy, our customer, the CFE, and our dedicated teams for their unwavering commitment to this project. The project is contracted until 2055 and once placed into service will represent a significant inflection point in our long-term cash flow profile. Our partner and customer, the CFE, has agreed to the contracted rate and accepted all requirements for in-service.

Speaker Change: The project was completed in under three years from a final investment decision.

Speaker Change: And was delivered 13% below our original budget a monumental achievement.

Speaker Change: I would once again like to thank the ministry of energy, our customer the Cfe and our dedicated teams for their unwavering commitment to this project.

Speaker Change: The project is contracted until 2055 and once placed into service will represent a significant inflection point in our long term cash flow profile.

Speaker Change: Our partner and customer the Cfe has agreed to the contracted rate and accepted all requirements for in service.

Francois Poirier: We are just waiting on approval for our regulated rates from the National Energy Commission, or CNE, which only applies to interruptible service. Now, while 100% of our capacity is contracted with the CFE and we have no requests for interruptible service, approval of the regulated rate is normal course prior to commencing service. The C&E has not expressed any material concerns or questions, and based on our conversations with the Ministry of Energy and the C&E, our expectation is to receive C&E approval by the end of May.

Speaker Change: We are just waiting on approval for our regulated rates from the National Energy Commission or C. N E, which only applies to interruptible service.

Speaker Change: Wow, 100% of our capacity is contracted with the Cfe and we have no request for interruptible service approval of the regulated rate is normal course prior to commencing service.

Speaker Change: The C. Any has not expressed any material concerns or questions and based on our conversations with the ministry of energy and the C. Any our expectation is to receive see any approval by the end of May.

Francois Poirier: Receipt of this approval is the final step to achieving in service on Southeast Gateway. We continue to have strong alignment with President Scheinbaum's Plan Mexico 2030 that aims to attract over U.S. $270 billion in investments through public-private partnerships with a substantial focus on energy infrastructure. The Southeast Gateway Pipeline is a critical component of this plan. Looking at the map on the left, this plan includes 8.5 gigawatts of capacity from 14 new natural gas plants proposed by the CFE, of which 10 sit within our strategic corridor.

Speaker Change: Receipt of this approval is the final step to achieving in service on South East Gateway.

Speaker Change: We continue to have strong alignment with president Shine bounds planned Mexico 2030 that aims to attract over U S $270 billion in investments through public private partnerships with a substantial focus on energy infrastructure.

Speaker Change: The southeast Gateway pipeline is a critical component of this plan.

Speaker Change: Looking at the map on the left this plan includes eight and a half gigawatts of capacity from 14, new natural gas plants proposed by the Cfe of which 10 sit within our strategic corridors.

Speaker Change: Shifting to the U S. We have been working towards a meaningful announcement relating to data centers for some time and today, we have sanctioned our north Woods project.

Francois Poirier: Shifting to the U.S., we have been working towards a meaningful announcement relating to data centers for some time, and today, we have sanctioned our Northwoods project, a U.S. $900 million expansion of our A&R pipeline system. This 0.4 BCF per day expansion is expected to enter service in 2029 and will serve new gas-fired electric generation to support demand from data centers and economic development in the U.S. Midwest. Importantly, the Northwards project is backed by a 20-year take-or-pay contract with an investment-grade utility, and achieves an estimated EBITDA build multiple of approximately six times. The map on the right highlights the repeatability of these Northwoods type projects, which are low risk.

<unk> $900 million expansion of our Anr pipeline system.

Speaker Change: This 0.4 Bcf per day expansion is expected to enter service in 2029 and will serve new gas fired electric generation to support demand from data centers and economic development in the U S. Midwest.

Speaker Change: Importantly, the north where its project is backed by a 20 year take or pay contract with an investment grade utility and achieved an estimated EBITDA build multiple of approximately six times.

Speaker Change: The map on the right highlights the repeat ability of these north woods type projects, which are low risk.

Francois Poirier: and in-corridor growth as seen on our A&R. And I would extend this opportunity to other areas where we are seeing on Columbia and other assets across several different customer groups. This exemplifies the value of our footprint and our incumbency.

Speaker Change: And in corridor growth as seen on our Anr system.

Speaker Change: And I would extend this opportunity.

Speaker Change: Two other areas, where we are seeing on Colombia, and other assets across several different customer groups.

Speaker Change: This exemplifies the value of our footprint and our incumbency.

Speaker Change: The Bruce power major component replacement program is the cornerstone of our strategy to enhance the reliability and availability of our nuclear assets.

Francois Poirier: The Bruce Power Major Component Replacement Program is the cornerstone of our strategy to enhance the reliability and availability of our nuclear assets. In April, we sanctioned the Unit 5 MCR following approval of its cost and schedule estimate from the ISO. This $1.1 billion investment in emissionless nuclear energy adds significant long-term value by extending the life of Unit 5 by over 35 years. And alongside the MCR program, our Project 2030 at Bruce aims to substantially boost its net peak output through the end of the decade, and nearly double our equity income by 2035. Project 2030 is projected to increase Bruce Power's capacity from its 2019 base of 6.4 gigawatts to over 7 gigawatts through three stages in a cost effective manner.

Speaker Change: In April we sanctioned the unit five MCR following approval of its cost and schedule estimate from the ISO.

Speaker Change: This $1 $1 billion investment in emission less nuclear energy adds significant long term value by extending the life of unit five by over 35 years.

Speaker Change: And alongside the MCR program or project 2030 at Bruce aims to substantially boost its net peak output through the end of the decade and nearly double our equity income by 2035.

Speaker Change: Project 2030 is projected to increase Bruce Power's capacity from its 2019 base of six four gigawatts to over seven gigawatts through three stages in a cost effective manner.

Speaker Change: And together these programs are integral to our strategy of delivering long lived value through disciplined investment.

Francois Poirier: And together these programs are integral to our strategy of delivering long-lived value through disciplined investment.

Speaker Change: On this next chart, which you've seen before illustrating our growth visibility through the end of the decade.

Francois Poirier: On this next chart, which you've seen before, illustrating our growth visibility through the end of the decade. Over the past six months, and including the Bruce Unit 5 MCR and the Northwoods Project announcements today, we've successfully added approximately $4 billion of long-term contracted projects with compelling build multiples in the 5 to 7 times range with no commodity price or volumetric risk. Given the strength of our origination pipeline, we have line of sight to an increased cadence of project announcements in the second half of this year and into 2026. These projects will predominantly have capital spend and in service dates toward the end of the decade.

Speaker Change: Over the past six months and including the Bruce unit, five MCR and the North Woods project announcements today, we successfully added approximately $4 billion of long term contracted projects with compelling build multiples in the five to seven times range with no commodity price or <unk>.

Speaker Change: Metric risk.

Speaker Change: Given the strength of our origination pipeline.

Speaker Change: We have line of sight to an increased cadence of project announcements in the second half of this year and into 2026.

Speaker Change: These projects will predominantly have capital spend and in service dates toward the end of the decade.

Francois Poirier: which aligns with our financial capacity and further extends the duration of our growth portfolio. I will also add that of the recently sanctioned projects, a portion of the spend is in 2025 and 2026, which is expected to enhance our 2027 comparable EBITDA outlook, highlighting our ability to bring forward short cycle to cash projects. We are well positioned to deliver on our value proposition of solid growth, low risk, and repeatable performance.

Speaker Change: Which aligns with our financial capacity and further extend the duration of our growth portfolio.

Speaker Change: I will also add that of the recently sanctioned projects a portion of the spend is in 2025, and 2026, which is expected to enhance our 2027 comparable EBITDA outlook, highlighting our ability to bring forward short cycled the cash projects.

Speaker Change: We are well positioned to deliver on our value proposition of solid growth low risk and repeatable performance.

Sean: And now I'll turn the call over to Sean.

Sean O'donnell: And now I'll turn the call over to Sean. Thanks, Francois. Good morning, everybody. From an operational standpoint, TC continued to see strong demand in the first quarter. On the left hand side, we highlight a number of volume increases and new records set across our three pipeline business units this quarter. TC has actually set 13 all-time delivery records since early 2024. On a TC wide basis, throughput increased 6% in the quarter, which underscores the exceptional safety and operational performance from all of our teams. The key themes I'd like for you to take away from this slide are first, our teams are continuously finding ways to improve system efficiency.

Sean: Thanks, Francois and good morning, everybody.

Sean: From an operational standpoint, Tc continued to see strong demand in the first quarter.

Sean: On the left hand side, we highlight a number of volume increases and new records set across our three pipeline business units this quarter.

Sean: <unk> is actually set 13, all time delivery records since early 2024.

Sean: On a PC wide basis throughput increased 6% in the quarter, which underscores the exceptional safety and operational performance from all of our teams in the field.

Sean: The key themes I'd like for you to take away from this slide are first our teams are continuously finding ways to improve system efficiency.

Sean O'donnell: And second, those capacity increases are being immediately taken up by the robust customer demand we're seeing across our footprint. In our power and energy solutions business, Bruce achieved 87% availability in line with our Q1 plan, which included the planned outage on Unit 5. We continue to expect availability to be in the low 90% range for full year 2025. The MCR execution has been outstanding, as the Bruce team returned Unit 6 on time and on budget, and is similarly tracking to plan on Unit 3. With that exceptional MCR track record, Bruce is now upgrading two units per year for the next five years, which will accelerate the station's operating efficiency and capacity increases that Francois mentioned earlier.

Sean: And second those capacity increases are being immediately taken up by the robust customer demand, we're seeing across our footprint.

Sean: And our power and energy solutions business, Bruce achieved 87% availability in line with our Q1 plan, which included the planned outage on unit five.

Sean: We continue to expect availability to be in the low 90% range for full year 2025.

Sean: The MCR execution has been outstanding as the Bruce team returned unit six on time and on budget and is similarly tracking to plan on unit three.

Sean: With that exceptional MCR track record Bruce's now upgrading two units per year for the next five years, which will accelerate the stations operating efficiency and capacity increases that Francois mentioned earlier.

Sean: Shifting to the EBITDA bridge on the right I'll discuss some of the variances versus the first quarter of 2024.

Sean O'donnell: Shifting to the EBITDA bridge on the right, I'll discuss some of the variances versus the first quarter of 2024. First, Canada gas EBITDA increased due to higher depreciation and taxes on NGTL, offset by lower interest expense from our successful refinancings earlier this year. I'd like to highlight that our regulated cost of service framework ensures that all of these costs are fully recovered. Additionally, Coastal GasLink saw higher contributions following the pipeline's commercial in-service date last October. In the US, we saw incremental growth and modernization investments going to service this quarter, in addition to a stronger US dollar.

Sean: <unk>, Canada gas EBITDA increased due to higher depreciation and taxes on N. G. T L offset by lower interest expense from our successful refinancings earlier this year.

Sean: I'd like to highlight that our regulated cost of service framework ensures that all of these costs are fully recovered through tolls. Additionally.

Sean: Additionally, coastal gas link saw higher contributions following the pipelines commercial in service date last October.

Sean: In the U S. We saw incremental growth and modernization investments go into service. This quarter. In addition to a stronger U S dollar.

Sean O'donnell: These increases were partially offset by the divestiture of Portland Natural in 2024. Our Mexico business remained largely in line with the first quarter of 2024, but did benefit from a stronger US dollar exchange rate in the quarter. Lastly, our Power and Energy Solutions business experienced lower contributions from Bruce, given we now have Units 3 and 4 undergoing their MCR and a planned outage on Unit 5. This decrease was partially offset by a higher average realized price of $106 per megawatt hour, which is up $12 per megawatt hour relative to the first quarter of 2024. Our Alberta co-gen fleet continued to deliver exceptional performance with 98% availability, which maximizes our capacity payments, although EBITDA was partially offset by lower Alberta power prices that averaged approximately $40 per megawatt hour in the quarter.

Sean: These increases were partially offset by the divestiture of Portland natural in 2024.

Sean: Our Mexico business remained largely in line with the first quarter of 2024, but did benefit from a stronger U S dollar exchange rate in the quarter.

Sean: Lastly, our power and energy solutions business experienced lower contributions from Bruce given we now have units three and four undergoing their MCR and the planned outage on unit five.

Sean: This decrease was partially offset by a higher average realized price of $106 per megawatt hour, which is up $12 per megawatt hour relative to the first quarter of 2024.

Sean: Our Alberta, Cogent fleet continued to deliver exceptional performance with 98% availability, which maximizes our capacity payments, although EBITDA was partially offset by lower Alberta power prices that average proximately $40 per megawatt hour in the quarter.

Sean O'donnell: Finally, natural gas storage contributions were lower relative to the exceptional quarter that business had in early 2020.

Finally, natural gas storage contributions were lower relative to the exceptional quarter that business had an early 2024.

Sean: On this slide we have a refreshed view of our funding plan that remains largely unchanged from what we showed at Investor day.

Sean O'donnell: On this slide, we have a refreshed view of our funding plan that remains largely unchanged from what we showed at Investor Day. Given the high probability of the Bruce MCRs proceeding, we had included the Unit 5 MCR in our funding plan prior to sanctioning. In addition, the majority of the capital spend on Northwoods is weighted to the back end of the decade. Our updated plan requires about $31 billion in funding over the next three years that will be largely funded by $24 billion of internally generated cash. We continue to expect the remaining $7 billion in funding to come from capital markets without the need to issue equity.

Sean: Given the high probability of the Bruce MCR is proceeding we had included the unified MCR and our funding plan prior to sanctioning.

Sean: In addition, the majority of the capital spend on Northwood is weighted to the back end of the decade.

Sean: Our updated plan requires about 31 billion in funding over the next three years that will be largely funded by $24 billion of internally generated cash flow.

Sean: We continue to expect the remaining $7 billion in funding to come from capital markets without the need to issue equity.

Sean O'donnell: As we continue to optimize our capital expenditures, we expect to deliver approximately 1.3 billion of total capital reductions in 2026 and 2027. It is this ongoing capital optimization and strong operational performance that allow us the flexibility to fund our incremental growth.

Sean: As we continue to optimize our capital expenditures, we expect to deliver approximately $1 3 billion of total capital reductions in 2026 and 2027 it.

Sean: It is this ongoing capital optimization and strong operational performance that allow us the flexibility to fund our incremental growth.

Sean: Turning to our financial outlook, we are reaffirming our 2025 through 2027 EBITDA outlook that we provided last quarter.

Sean O'donnell: Turning to our financial outlook, we are reaffirming our 2025 through 2027 EBITDA outlook that we provided last quarter. Our guidance continues to reflect the effectiveness of our long term contracting strategy in the face of the commodity volatility that we're all seeing. Our 2025 comparably without outlook remains at 10.7 to 10.9 billion, which represents a 7% to 9% increase over our 2024 results. Looking out to 2027, we continue to target 11.7 to 11.9 billion, which implies a 5 to 7% three-year growth rate. That again, highlights the predictability of our base business and our underlying demand for capacity on our I'll remind you that our base case outlook uses an average USD CAD exchange rate of 1.35, which is lower than the spot exchange rates we've seen year to date.

Sean: Our guidance continues to reflect the effectiveness of our long term contracting strategy in the face of the commodity volatility that we're all seeing.

Sean: Our 2025 comparable EBITDA outlook remains at 10, 7% to $10 9 billion, which represents a 7% to 9% increase over our 2024 results.

Sean: Looking out to 2027, we continue to target a 11, 7% to $11 9 billion, which implies a 5% to 7% three year growth rate that again highlights the predictability of our base business and our underlying demand for capacity on our systems.

Sean: I'll remind you that our base case outlook uses an average USD CAD exchange rate of 135, which is lower than the spot exchange rates, we've seen year to date.

Sean O'donnell: We have provided sensitivities on the slide showing potential for incremental EBITDA of approximately 200 million if exchange rates were achieved a full year average of 1.40. I'll reiterate that we systematically hedge our U.S. dollar net income to insulate our comparable earnings from FX volatility. So we do not expect a material impact related to foreign exchange on our 2025 comparable earnings. Longer term, on an unhedged basis, a penny change in USD CAD corresponds to roughly a penny change in comparable EPS.

Sean: Have provided sensitivities on the slides showing potential for incremental EBITDA of approximately $200 million. If exchange rates were achieved a full year average of 1.40.

Sean: Reiterate that we systematically hedge our U S dollar net income to insulate our comparable earnings from FX volatility.

Sean: We do not expect a material impact related to foreign exchange on our 2025 comparable earnings.

Sean: Longer term on an unhedged basis, a penny change in USD CAD corresponds to roughly a penny change in comparable EPS.

Sean O'donnell: Moving to the right side of We summarized several other factors that could impact our EBITDA outlook. For the purposes of our base case outlook, we tend to build in conservative assumptions on rate case settlements, such as the active cases on Columbia, A&R, and Great Lakes that Francois mentioned. We also have ongoing revenue enhancement and cost optimization initiatives across the organization that have the potential to drive additional ups. We continue to target availability improvements on our power generating assets, particularly Bruce, where the refurbishments are already paying dividends and operating performance. Continuing to place projects into service on schedule and under budget remains a top priority and value driver, which provides a tailwind to capital efficiency and EBITDA performance.

Sean: Moving to the right side of the page, we summarize several other factors that could impact our EBITDA outlook.

Speaker Change: For the purposes of our base case outlook, we tend to build and conservative assumptions on rate case settlements such as the active cases on Colombia, Anr and great Lakes that Francois mentioned.

Speaker Change: We also have ongoing revenue enhancement and cost optimization initiatives across the organization that have the potential to drive additional upside.

Speaker Change: We continue to target availability improvements on our power generating assets, particularly Bruce where the refurbishments are already paying dividends and operating performance.

Speaker Change: Continuing to place projects into service on schedule and under budget remains a top priority and value driver, which provides a tailwind to capital efficiency and EBITDA performance.

Sean O'donnell: I'll note that under our current expectation of receiving approval from CME by the end of May, we do not expect an impact on our 2025 outcome. With our 97% EBITDA underpinned by rate regulated or take or pay contracts, we remain insulated from increased price and volume risk that we're currently seeing in the market. This resilience has enabled us to grow our dividend for 25 consecutive years, which remains a core component of our shareholder value property.

Speaker Change: I'll note that under our current expectation of receiving approval from <unk> by the end of May we do not expect an impact on our 2025 outlook.

Speaker Change: With our 97% EBITDA underpinned by rate regulated or take or pay contracts. We remain insulated from increased price and volume risk that we're currently seeing in the market. This.

Speaker Change: This resilience has enabled us to grow our dividend for 25 consecutive years, which remains a core component of our shareholder value proposition.

Francois Poirier: With that, I will pass the call back to Francois. Thanks, John. As I mentioned before, our focus remains on the key factors that have brought us success. Number one, maximizing the value of our assets through safety and operational excellence. Secondly, executing on our selective portfolio of growth projects, including bringing $8.5 billion of assets into service in 2025. And third, ensuring financial strength and flexibility. It's by adhering to these priorities that we'll continue to deliver solid growth, low-risk, and repeatable performance year after year.

Francois: With that I will pass the call back to Francois.

Francois: Thanks, Sean.

Francois: As I mentioned before our focus remains on the key factors that are brought US success number one maximizing the value of our assets through safety and operational excellence.

Francois: Secondly, executing on a selective portfolio of growth projects, including bringing $8 $5 billion of assets into service in 2025, and third ensuring financial strength and flexibility.

Francois: It's by adhering to these priorities that will continue to deliver solid growth low risk.

Francois: And repeatable performance year after year.

Speaker Change: Operator, we will now take questions from the conference call.

Operator: Operator, we will now take questions from the conference call. Thank you. We will now begin the question and answer session. To join the question queue, you may press star then 1 on your telephone keypad. You will hear a tone acknowledging your request. Please limit your question to two, and if you should have additional questions, please re-enter the queue. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star, then two.

Francois: Thank you.

Francois: We will now begin the question and answer session to join the question queue. You May Press Star then one on your telephone keypad.

Francois: So in acknowledging your request.

Francois: Please limit your question to two and if you should have additional questions. Please reenter the queue.

Francois: If youre using a speakerphone please pick up your handset before pressing any Keith.

Francois: Italia question. Please press Star then two.

Speaker Change: The first question comes from Bonnie B with Wells Fargo. Please go ahead.

Praneeth Satish: The first question comes from Praneeth Satish with Wells Fargo. Please go ahead. Thanks. Good morning.

Bonnie B: Thanks, Good morning.

Praneeth Satish: First question here, just given your what looks like a very strong origination pipeline for US gas projects and, and, and good returns, how are you thinking about capex and potentially going to the high end of your six to seven billion annual range? Is that something you'd consider if it could be done in a leverage neutral manner and staying below the 4.75?

Speaker Change: First question here, just given your what looks like a very strong origination pipeline for U S gas projects and and good returns how are you thinking about capex and potentially going to the high end of your 6% to $7 billion annual range is that something you would consider if it could be done in a leverage neutral.

Bonnie B: Manner and staying below the $4 75.

Francois Poirier: Praneeth, it's Francois. You know, what got us here in the really solid place we're in is the value of our footprint. It's a strategic advantage. It's so and we are definitely seeing accelerated set of opportunities for low risk higher return opportunities. What I'd say though, is that the focus firstly would be on our human capital and our ability to continue to deliver the project execution performance that has provided us with, you know, delivering projects for 2025 on all eight and a half billion at about 15% below the original plan. So that's going to be if and when we want to contemplate, you know, going above a $6 billion annual number, we're going to be focusing first on making sure that we've got the human capital and the bench to execute well on our projects.

Francois: It's francois.

Francois: What what got us here and the they're really solid place where we're in is the.

Speaker Change: The value of our footprint.

Francois: <unk>.

Francois: It's a strategic advantage.

Francois: We are definitely seeing accelerated.

Francois: Set of opportunities for lower risk higher return opportunities, what I'd say, though is that the focus firstly would be on our human capital and our ability to continue to deliver the project execution performance that has provided us with delivering projects for 2025 on all $8 5 billion.

Francois: 15% below the original plan so.

Francois: That's gonna be if and when we want to contemplate.

Francois: Going above a $6 billion annual number we're going to be focusing first on making sure that we've got the human capital.

Francois: And the the bench to execute well on our projects I don't expect that to occur for the 25 or the 2026 a year.

Francois Poirier: I don't expect that to occur for the 25 or the 2026 year. I think the 4.75 debt debit is a firm commitment on our part. And right now all of the growth that we see is in the next, you know, half of the year and into 2026. is still filling out the white space below the $6 billion number in our in our chart on slide nine, given the fact that it's foreign service states that are near the end of the decade, but to the extent we have the opportunity to consider later in the decade. Projects that deliver very attractive returns.

Francois:

Francois: I think the 475 debt to EBITDA is affirmed.

Francois: Our firm commitment on our part.

Francois: And right now all of the growth that we see.

Francois: Is and the next.

Francois: Half of the year and into 2026.

Francois: Still filling out the white space below the $6 billion number.

Francois: And our chart on.

Francois: On slide nine given the fact that it's a foreign service dates that are near the end of the decade, but to the extent we have the opportunity to consider later in the decade.

Francois: Projects that deliver very attractive returns, we will consider those but first from a human capital standpoint, and then secondly.

Francois Poirier: We will consider those but first from a human capital standpoint and then secondly living within our means and consider what all the funding alternatives are at that point.

Francois:

Francois: Living within our means and consider what all the funding alternatives are at that point.

Francois: Got it that's helpful.

Praneeth Satish: Yeah, that's helpful.

Praneeth Satish: And then just maybe a few kind of clarifying questions here on Southeast Gateway. So looks like CFE has signed off. You're waiting for CNE approval.

Francois: And then just maybe a few kind of clarifying questions here on southeast Gateway. So it looks like <unk> signed off Youre waiting for see any approval.

Praneeth Satish: Can you just clarify what the payment mechanics could look like once the project is operational? What would the effective date of the project be? Would it be end of May as it stands now? And when would you actually receive payments where it would start to show up in EBITDA? Is that also end of May or would that take another month or so?

Francois: Can you just clarify what the payment mechanics could look like once the project is operational what.

Francois: What would the effective date of the project being would it be end of May as it stands now and when would you actually received payments where it would start to show up in EBITDA is that also end of may or would that take another month or so and then finally can you move forward with in service of the pipeline without see any approval or is that.

Tina Faraca: And then finally, can you move forward with in-service of the pipeline without CNE approval or is that a gating item for service to start? Thank you.

Francois: The gating item for service to start thank you.

Francois: Hi, Puneet this is Tina.

Tina Faraca: Praneeth, this is Tina. We're really excited to have the project completed and to have CFE support on that project. mentioned in our release, we are waiting on just one final regulatory approval and expect to have that no later than the end of the month. Once we get that approval, then we will roll into our normal. Voicing Cycle. And that is just per our agreement with CFE.

Francois: We're really excited to have.

Francois: Project completed and to have see cfe support on that project.

Francois: As mentioned in our.

Speaker Change: Not really.

Speaker Change: We are waiting on just one final regulatory approval and expect to have that no later than the end of the month.

Speaker Change: Once we get that approval, then we will roll into our normal.

Speaker Change: Licensing cycle.

Speaker Change: And that is just part of our agreement with Cfe. So typically are in a 30 day lag on invoicing and looking forward to getting that project fully commercialized and what I might add to that is that.

Tina Faraca: Unknown Speaker, Unknown Speaker, Identifying Public Property Management docuseries Projects online www.tinacop.on.ca And what I might add, Praneeth, to that is that... You know, we have a total adjustment mechanism that preserves the NPV of payments, which is, you know, a big reason why we don't expect an impact on our 2025 outlook, irrespective of when the in-service date occurs. And then to your, you know, Part B of that second question, we do need the CNE certificate for regulated rates in order to go into service. Thank you.

Speaker Change: We have a tolling adjustment mechanism that preserves the NPV of payments, which is a big reason why we don't expect an impact on.

Speaker Change: Our 2025 outlook irrespective of when the in service date occurs.

Speaker Change: And then to your part B of that second question we.

Speaker Change: We do need the C. Any certificate for our regulated rates in order to go into service.

Speaker Change: Thank you.

Speaker Change: The next question comes from Jeremy Tonet.

Jeremy Tonet: The next question comes from Jeremy Tonet with J.P. Morgan. Please go ahead. Hi, good morning. Um, in the States, we hear a lot about, you know, data centers across, you know, different regions, I was wondering, you know, we don't quite hear as much on the Alberta outlook there. And it seems with the cheap resource, the the policy focus, there would be a lot of opportunity there, particularly as it relates to, you know, behind the meter. And just wondering, you know, your thoughts there, what that could mean for TC given the NGTL footprint that really dominates.

Speaker Change: J P. Morgan. Please go ahead.

Speaker Change: Hi, good morning.

Speaker Change: Good morning.

Speaker Change: Hum.

Speaker Change: In the states, we hear a lot about.

Speaker Change: Data centers across different regions. I was just wondering you know we don't quite hear as much on the Alberta outlook, there and it seems with the.

Speaker Change: The cheap resource.

Speaker Change: The policy focus.

Speaker Change: There would be a lot of opportunity there, particularly as it relates to.

Speaker Change: Behind the meter and just wondering.

Speaker Change: Your thoughts there what that could mean for Tc given the N GT L footprint that really.

Speaker Change: Dominates.

Speaker Change: Yeah.

Francois Poirier: Thanks, Jeremy.

Speaker Change: Thanks, Jeremy I'll start and I'll pass it over to Tina.

Francois Poirier: I'll start and I'll pass it over to Tina. You know, if you look at our strategy, just contrasting the US and Canada, as you alluded to, in the US, we're really focusing predominantly in front of the meter, we connect to eight of the 10 largest LDCs in the US. We're starting to see a significant inbound flow of requests for service. So there's really no need for us to focus behind the meter in the US other than perhaps strictly from a pipeline perspective, it's a little bit different in Canada, a little bit more of a if you build it, they will come kind of approach.

Tina: If you look at our strategy just contracting the U S and Canada as you alluded to.

Tina: In the U S. We're really focusing predominantly in front of the meter we connect to eight of the 10 largest LDC is in the U S.

Tina: We're starting to see a significant inbound flow of requests for service.

Tina: So theres really no need for us to focus behind the meter in the U S. Other than perhaps.

Tina: Strictly from a pipeline perspective, it's a little bit different in Canada.

Tina: A little bit more of a if you build it they will come kind of approach. So we are working with Purdue.

Francois Poirier: So we are working with producers, developers as well, to see what the solution set might look like.

Tina: Producers.

Speaker Change: Developers as well to see what the solution set might look like and perhaps Tina and Greg can provide a little bit of additional color on how we would be looking to more of a full service approach I'll start with the gas pipeline side.

Francois Poirier: And perhaps Tina and Greg can provide a little bit of additional colour on how we would be looking to more of a full service approach. I'll start with the gas pipeline side. Canada as Francois. Data Center Developers and Producers, and as you know, our So we are really well positioned. from a pipeline perspective. Working with our counterpart. In some of these locations, power is necessary.

Tina: Canada as I.

Tina: As I mentioned we are in.

Tina: Various conversations with several different entities, including data center developers and producers.

Tina: As you know our system's transported about 80% of the WCS the production and the Tc or.

Tina: About 70% of Ontario, and 98% of that demand. So we are really well positioned to capture data center load as it materializes.

Tina: And from a pipeline perspective.

Tina: Working with our Counterparties to determine the optimal locations are too from a siding perspective and in some of these locations power is necessary and I'll turn it over to Greg to talk about kind of how we're thinking about it from that perspective.

Greg Grant: And I'll turn it over to Greg to talk about kind of how we're thinking about Sure, thanks.

Greg: Sure. Thanks, it's a great Grand tier.

Greg Grant: It's Greg Grant here. I mean, as we've seen globally, there's been unprecedented need for electricity and the AI data center front is continuing to enhance that. We've been operating gas transmission storage power in Alberta for decades, so I think that uniquely positions us. how we can quickly bring some of these services to fruition here to help alleviate that need. Just a point of current fact, just in Alberta here, we have about a Q of about 12 gigawatts, just on data center. So when you think about the size of the existing grid of Alberta, which is about 12.

Greg: I mean, as we've seen globally, there's been unprecedented need for electricity and the EIA data center front is continuing to enhance that.

Greg: We've been operating gas transmission storage power in Alberta for decades, So I think that uniquely positions us.

Greg: And how we can quickly bring some of these services to fruition here to help alleviate that need.

Greg: And then just a point of current in fact, just in Alberta here, we are about our Q of about 12 Gigawatts just on data centers.

Greg: So when you think about the size of the existing grid about Burger, which is about 12.

Greg Grant: that could double it just in of itself. So we are looking at opportunities, as Tina mentioned, where we can leverage our experience on the gas and power side in a complementary solution.

Greg: That could double it just in of itself.

Greg: So we are looking at opportunities as Tina mentioned, where we can leverage our experience on the gas and power side in a complementary solution.

Francois Poirier: But I just want to be clear, Francois did mention in the last quarter, we are not looking to start an IPO. going to be very thoughtful in our approach. Of course, we must compete for capital amongst all the other great opportunities that we've already talked about. So we'll continue to look at ways we can offer that support to our customers, but we'll be very selective.

Greg: But just want to be clear our friends, who I did mentioned in the last quarter. We are not looking to start an IPP, we're going to be very thoughtful in our approach.

Greg: And of course, we must compete for capital amongst all the other great opportunities that we've already talked about so we'll continue to look at ways that we can offer that support to our customers, but we'll be very selective in doing that.

Speaker Change: Got it very helpful. Thank you for that.

Greg: Just trying to reconcile I guess.

Speaker Change: The capex outlook for 'twenty five here.

Speaker Change: I think youre trending you know really are under budget there.

Speaker Change: And just wondering if this means you're looking at the low end of the range or is it not the low end of the range because you're able to fill in I guess these new incremental attractive projects as you just outlined.

Speaker Change: Hey, Jeremy it's Sean Good morning, we were cleared 2025, bringing $8 $5 billion into service. This year, we're gonna be elevated relative to our $4 75 target we were pretty clear about that investor day. So.

Sean O'donnell: Jeremy, it's Sean. Good morning. Well, we were we're clear 2025, bring in eight and a half billion dollars into service this year, we're going to be elevated relative to our 4.75 target, you know, we were pretty clear about that investor day. So the we are above 4.75 in 2025. And then you start to see really the full effect of eight and a half billion dollars of capital and full year 26 really, and an SDP being the biggest driver though. So it's 26, where we start to see the deleveraging not in 25. Right, sorry, just in terms, Jeremy, of where we fall inside the range, when we put our plan together, you know, in late 2024, for the 2025 year, we already have some of those savings, or coming in under budget baked in.

Speaker Change: We are about $4 five in 2025, and then you start to see really the full effect of $8 $5 billion of capital in full year, 'twenty, six really and STP being the biggest driver of those so it's 26, where we started to see the deleveraging that in 'twenty five.

Jeremy Tonet: Right sorry, Jeremy.

Jeremy Tonet: And in terms of Jeremy of where we fall inside the range when we put our plan together.

Jeremy Tonet: In late 2024 for the 2025 year, we already have some of those savings.

Jeremy Tonet: Savings or coming in under budget baked in so you should not infer because we're planning on bringing projects in well under the original board sanction capital amounts that that will necessarily on its own drive us to the lower end of that range.

Sean O'donnell: So you should not infer, because we're planning on bringing projects in well under the original board sanction capital amounts, that that will necessarily on its own drive us to the lower end of that range. And as you're, as you can surmise, if we have opportunities for short cycle projects to add cash flow, to the extent we can do so, and stay within our budget, we'll always consider those. So we're confident in the five and a half to six, where we'll fall within that range, we'll have to see as the year unfolds and any other, you know, short cycle opportunities that present Got it.

Jeremy Tonet: And as your as you can surmise, if we have opportunities for short cycle projects to add cash flow.

Jeremy Tonet: To the extent, we can do so and stay within our budget, we'll always consider those so.

Jeremy Tonet: We're confident in the five five to six where we will fall within that range, we'll have to see as the year unfolds and any other short cycle opportunities that present themselves.

Jeremy Tonet: Got it very helpful. Thank you.

Sean O'donnell: Very helpful.

Rob Hope: Thank The next question comes from Rob Hope with Scotiabank. Please go ahead.

Speaker Change: The next question comes from Rob Hope with Scotia Bank. Please go ahead.

Tina Faraca: Morning, everyone. Regarding the increased line of sight to higher project announcements over the next year, is this just a function of potential projects moving further down the contracting path? And you have now visibility on contracts being signed. And when you take a look at these projects, are they mainly data center related? Or is there a good mix of coal to gas and energy as well?

Speaker Change: Good morning, everyone regarding the increased line of sight to higher projected estimates over the next year is this just a function of potential projects moving further down the contracting path and you have now visibility on on.

Speaker Change: Contracts being signed and when you take a look at these projects are they mainly data center related or is there a good mix of coal to gas and LNG as well.

Tina: Good morning, this is Tina and.

Tina Faraca: Good morning, this is Tina. And yes, we've been really working to understand the pipeline as it's been developing. And where we're focused right now is Progressing projects that, although not limited to just one demand element of overall growth, power generation has really become a bright spot for us and where we're quite active. And that's just taken a bit of time to progress and determine how we're going to best serve that load. And so that's why we're seeing some of this pick up quite a bit. So across our broader suite of that opportunity set, we see the coal-to-gas conversions, data center demand, and then incremental just power generation for increased electrification.

Tina: Yes, we've been really working to understand the pipeline as its been developing and where we're focused right now is.

Tina: Progressing projects that although not limited to just one demand element of overall growth.

Tina: Our generation has really become a bright spot for us and where we're quite active and thats just taken a bit of time to progress and determine how we're going to best serve that load and so that's why we're seeing some of that pick up quite a bit.

Tina: So across our broader suite of that opportunity set we see the coal to gas conversions data center demand and then incremental just power generation for increased electrification. So right now we are working with Counterparties in the amount of about 25 gigawatts of new opportunities.

Tina Faraca: So right now we are working with counterparties in the amount of about 25 gigawatts of new opportunities. That translates to almost six BCF per day in various stages of development. And as those projects progress, they all look and feel like our previous projects. Highly creditworthy counterparties, long-term take-or-pay commitments, and in the five to seven times bill.

Tina: That translates to almost six Bcf per day in various stages of development and as those projects progress.

Tina: They all look and feel like our previous projects highly credit worthy Counterparties counterparties long term take or pay commitments and in the five to seven times build multiple.

Francois Poirier: Rob, these are not our... Our guidance to you around the cadence of additional projects is not just based on a macro backdrop. It's based on A series of specific projects in which we are in late stages of negotiations and development. I appreciate that color.

Tina: These are not our.

Tina: Our guidance to you around the cadence of additional projects is not just based on the macro backdrop. It's based on a series of specific projects in which we are in late stages of negotiations and development.

Speaker Change: Okay I appreciate that color.

Francois Poirier: And then maybe as a follow up in terms of data center or power related projects, you know, can we use Northwoods as a template meaning looping compression, maybe a little bit of a lateral with we'll call it one to $2 billion Canadian as the sweet spot. Yes, when we think about our strategy, particularly in the US, as we've mentioned before, we are focused on serving the data center load through our existing utility.

Speaker Change: And then maybe as a follow up in terms of data center or power related projects can we use north woods as a template, meaning looping and compression maybe a little bit of a lateral.

Speaker Change: With we'll call it $1 billion to $2 billion Canadian is the sweet spot.

Speaker Change: Yes, when we think about our strategy, particularly in the U S. As we've mentioned before we are focused on serving the data center load through our existing utility.

Speaker Change: System, and leveraging our footprint to do that so brownfield in corridor formidable constructed projects are where we're focused and I think when we rollout further projects in the future youre going to see a repeatable do you have that.

Theresa Chen: Thank you. The next question comes from Theresa Chen with Barclays. Please go ahead. Morning.

Speaker Change: Thank you.

Speaker Change: The next question comes from Theresa Chen.

Speaker Change: Please go ahead.

Speaker Change: Good morning, I'd like to go back to the increased cadence of project announcements through the remainder of 2025 and.

Theresa Chen: I'd like to go back to the increased cadence of project announcements through the remainder of 2025 and understand better what is driving this momentum. Have there been any salient learnings coming out of your commercial discussions? Since you've been involved in more of them as time goes on, that better positions TC Energy to win in a competitive environment, which would hopefully translate to filling the backlog beyond 2025. Or is this project always going to be yours based on your, I think, Francois, the word used was incumbency of your asset positions?

Speaker Change: Understand better what is driving this momentum.

Speaker Change: Any statements of earnings coming.

Speaker Change: Commercial discussions since you've been involved in more of them as time goes on that better positions Tc energy to win in a competitive environment, which will hopefully translate to filling the backlog beyond 2025.

Speaker Change: Or is this once these projects are always going to be yours based on Europe, and I think frankly, what the word useless incumbency of your asset position and would love to understand spots behind us.

Francois Poirier: I would love to understand the thoughts behind that.

Francois: At <unk> Francois I'll take I'll take this one.

Francois Poirier: Theresa, Francois, I'll take I'll take this one. you know, as connect to eight of the 10 largest LDCs in the United States and our strategy in the U.S. is predominantly focused on in front of the meter business. A lot of these utilities have to have a competitive process. So in many of these instances, even when you have incumbency, you know, they have to make sure that they ensure competitive tension. Having said that, utilities have to be very careful also and mindful of making sure that their considering The rate impacts across all customer classes as they think about adding significant data center load, for example.

Speaker Change: <unk>.

Speaker Change: You know as.

Speaker Change: We connect to eight of the 10 largest LDC.

Speaker Change: LDC in the United States and our strategy in the U S is predominantly focused on in front of the meter business.

A lot of these utilities have to have the competitive process, so and in many of these instances even when you have incumbency.

Speaker Change: They have to make sure that they ensure competitive tension.

Speaker Change: Having said that utilities.

Speaker Change: Utilities have to be very careful also and mindful of making sure that they're considering.

Speaker Change: The rate impacts across all customer classes as they think about adding significant data center load for example, and so it's taken them a bit more time to.

Francois Poirier: And so it's taken them a bit more time to sort through that. And what we've seen since the early part of this year is they have now sorted through quite a bit of that. And we're ready to put their plans into place and coming to us and I'm sure others and talking about. So that's the dynamic that has unfolded, and again, our footprint is strategic, and it allows for repeatable growth because we're located in parts of the country and have incumbency in the Midwest and also in places like Virginia where there are large clusters of data centers under development.

Speaker Change: To sort through that and what we've seen since the early part of this year is they have now sorted through quite a bit of that and we're ready to put their plans into place and coming to us and I'm sure others and talking about them.

Speaker Change: Getting capacity on our system. So that's the dynamic that has unfolded.

Speaker Change: And.

Speaker Change: Again, our footprint is strategic.

Speaker Change: And it allows for repeatable growth because were.

Speaker Change: Located in parts of the country.

Speaker Change: Have incumbency.

Speaker Change: In the Midwest and also in places like Virginia, where there are large clusters of data centers under development.

Speaker Change: Got it thank you.

Francois Poirier: Got it. Thank you.

Greg Grant: And turning to the nuclear side of things beyond the near to medium term, would you be able to provide an update on the status of Brucey and the environmental assessment that's happening there? Yeah, I'd be happy to.

Speaker Change: Turning to.

Speaker Change: The nuclear side of things beyond the near to medium term.

Speaker Change: Would you be able to provide an update on the status of <unk> and the environmental assessment of what's happening there.

Gregg Teresa: Yeah, I'd be happy to it's Gregg Teresa.

Greg Grant: It's Greg, Theresa. Brucey continues with the development work that we had talked about last quarter. Through the impact and environmental assessment, we're engaging with local and indigenous communities. Partners on OPS, the Saugeen Ojibway Nation, there's very strong alignment.

Speaker Change: Bruce.

Speaker Change: With the development work that we had talked about last quarter through the impact and environmental assessment.

Speaker Change: We're engaging with local and indigenous communities, including.

Speaker Change: Our partners on OPM the saga in the nation.

Speaker Change: Theres very strong alignment.

Speaker Change: And this expansion this fits with the Ontario government schools are adding almost 18.

Greg Grant: Transcripts provided by Transcription Outsourcing, LLC. Unknown Speaker End that supports their 75% increase in power demand here by the end. And I also just want to remind everybody that we actually have federal support as well. We did receive the $50 million from NRCan in helping expand this, so it's good to see the alignment across multiple jurisdictions. And lastly, I would just add, we do believe we have a great.

Speaker Change: <unk> 18, gigawatts of nuclear power to the grid Ah.

Speaker Change: That supports their 75% increase in power demand here by the end of 2050 and it also just wandering mind everybody that we actually have federal support as well we did receive the $50 million from inner can and helping expand necessarily it's good to see the alignment across multiple jurisdictions and lastly, I would just.

Speaker Change: We do believe we have a great existing locational advantage on Bruce C. We have a phenomenal management team that continues to be able to invest billions of dollars on time and on budget. So we think Bruce C is the next best option for expansion on Ontario.

Unknown Executive: the women's women's reel.

Speaker Change: Thank you.

Unknown Executive: Thank you.

Speaker Change: The next question comes from Aaron Macneil with TD Cowen. Please go ahead.

Aaron Recnio: The next question comes from Aaron Recnio with the TD Cohen. Please go ahead. Good morning, all.

Aaron MacNeil: Hi, Good morning, all thanks for taking my questions can you speak to the commitment for $6 billion to $7 billion in net capital expenditures and what role.

Aaron Recnio: Capital Expenditure. What Role Selling Does? down the road in order to maintain that guidance just given the robust opportunity set or is that not a...

Selling down your interest in Mexico might play down the road in order to maintain that guidance just given the robust opportunity set or is that.

Aaron MacNeil: Not a factor in your view.

Aaron MacNeil: Maybe I'll start Erinn, it's Francois I pass it over to Sean to give you a little bit more in terms of specifics and what I'll just touch on it in Mexico as are our goals have not changed our first.

Francois Poirier: Maybe I'll start, Aaron. It's Francois.

Francois Poirier: I'll pass it over to Sean to give you a little bit more in terms of specifics. And what I'll just touch on in Mexico is our goals have not changed. Our first objective is to make sure all of our projects are flowing gas. Secondly, our cash flowing. We expect that to happen for all the pipes that we have in construction. by the end of 2025 or thereabouts. On VDR South, some of the land acquisition we're waiting for. And so this is really a first half of 2026 type of effort. We're going to be patient. We see a lot of value.

Aaron MacNeil: The objective is to make sure all of our projects are flowing gas and then secondly are cash flowing.

Aaron MacNeil: We expect that to happen for all of the pipes that we have in construction.

Aaron MacNeil:

Aaron MacNeil: By the end of 2025 or thereabouts, depending on timing of.

Aaron MacNeil: On <unk>, south and some of the.

Aaron MacNeil: Land acquisition were waiting for.

Aaron MacNeil: And so this is really a first half of 2026 type of effort, we're going to be patient, we see a lot of value in our business in Mexico, North America's at Intercontinental system, and we're the only gas transmission company. That's in all three countries.

Francois Poirier: our business in Mexico, North America is an intercontinental We're the only gas transmission company that's in all three countries. We want to make sure that if we contemplate a divestiture of a portion of Mexico, it is at a value that is fair value and matches up with our view of the intrinsic value of the asset. So we're going to be patient. We're not going to rush that. We are focused on... heading towards a 10% consolidated EBITDA over time for Mexico. I view Mexico as less of a source of deleveraging and more in terms of optimizing the portfolio.

Aaron MacNeil: We want to make sure that if we contemplate divestiture.

Aaron MacNeil: Of a portion of Mexico.

Aaron MacNeil: It is at a value that is fair value and matches up with our view of the intrinsic value of the asset. So we're gonna be patient, we're not going to rush that.

Aaron MacNeil: We are focused on.

Aaron MacNeil:

Speaker Change: Heading towards a 10% of consolidated EBITDA overtime for Mexico, I view, Mexico is less of a source of deleveraging and more in terms of optimizing the portfolio. So I wanted to give you that color before I hand, it over to Sean.

Sean O'donnell: So I wanted to give you that color before I handed it over to Sean.

Sean: Yeah. Thanks, Aaron I, you know as Francois said, we have there's multiple paths that we have to both fund the growth and achieve leverage targets and capital rotation. As you would expect is always one of those and inside of capital rotation.

Sean O'donnell: Yeah, thanks, Aaron. You know, as Francois said, you know, we have, there's multiple paths that we have to both fund the growth and achieve leverage targets. And capital rotation, as you would expect, is always one of those. And inside a capital rotation, more partnerships probably than rotation is kind of our view of the world now, just just given the value of assets and incumbency. But it's, we've got a couple of years on this, and we've got a couple of levers. So it's it's one of several. But we're also waiting, as Francois said, we've got projects coming online, ahead of plan ahead of budget this year, we've got we've got costs and capital initiatives internally.

Sean: More partnerships, probably then rotation that's kind of our view of the world now just just given the value of assets and incumbency, but it's we've got a couple of years on this and we've got a couple of levers. So it's one of several but we're also waiting as Francois said, we've got projects come on online had a plan ahead of budget. This year, we've got we've got costs and capital.

Sean: <unk> initiatives internally and all of those ingredients over the next 12 to 24 months are going to inform how exactly we fund and how much growth we fund with each of those different levers, but thank you.

Sean O'donnell: And all those ingredients over the next 12 to 24 months are going to inform how exactly we fund and how much growth we fund. to those different levers.

Speaker Change: Makes sense switching to Canada, Francois you've been a public advocate for more Canadian LNG projects, including LNG, Canada Phase. Two you also signed the build Canada now open letter to Mark Carney yesterday. So now that we have clarity in terms of the election outcome what <unk>.

Aaron Recnio: Switching to Canada, Francois, you've been a public advocate for more Canadian LNG projects. Karnius. So now that we have clarity in terms of the election.

Francois Poirier: what regulatory Thanks for that question, Aaron. First, I'd underscore that, you know, between the liberal and conservative members of parliament, we have over 300. Members. Supported Infrastructure Growth and Acceleration of Access to Our Coast to Diversify Our Customer Base, Reducing Our Dependence on the United States, etc., etc. I've been very clear on the need for acceleration of timelines. The letter from Industry, which was reiterated yesterday, is also very clear on In order to do that. and we look forward to collaborating with. The federal government. and Cabinet Ministers. to make that happen. For us. In terms of LNG to the West Coast, we are optimistic about the prospects for Phase 2 of LNG Canada, but I'll be clear that that is LNG Canada's decision, our obligation.

Sean: Inventory obstacles do you think the Canadian industry needs to overcome to get a positive LNG.

Speaker Change: LNG, Canada phase III.

Speaker Change: Further Canadian LNG development more broadly.

Speaker Change: Thanks for that question Erin.

Speaker Change: First I'd underscore that between the Liberal and conservative members of Parliament, we have over 300.

Speaker Change:

Speaker Change: Members, who supported infrastructure.

Speaker Change: Growth and acceleration of.

Speaker Change: Access to our coast to diversify our customer base, reducing our dependence on the United States et cetera et cetera.

Speaker Change: I've been very clear on the need for.

Speaker Change: Acceleration of timelines are the letter from industry, which was reiterated yesterday is also very clear on the needs and.

Speaker Change: In order to do that.

Speaker Change: And we look forward to collaborating with them the federal government.

Speaker Change: And cabinet ministers to make that happen.

Speaker Change: For us in terms of LNG to the West Coast, we are optimistic about the prospects for phase two of LNG, Canada, but let's be clear that that is LNG Canada's decision our obligation is to.

Francois Poirier: to deliver a bona fide class three estimate on the expansion that they will factor into their FID decision. which I believe will be coming at some point in 2026. In terms of prospects for additional pipelines to the West Coast, there are a number of other projects in development and construction, the Silisms project, we sold them our PRDT project is in early stages of construction. I expect that that one has very strong prospects for moving forward. There are a number of other projects that are in construction. Cedar LNG is proceeding very, very well in terms of our contribution, which is the lateral and the meter station in order for the HIZLA and Pembina to proceed with their project.

Speaker Change: Deliver a bonafide class III estimate on the expansion that they will factor into their F. I D decision, which I believe it will be coming at some point in 2026.

Speaker Change: In terms of prospects for additional pipelines to the West coast. There are a number of other projects in development and construction the <unk> project.

Speaker Change: We sold.

Speaker Change: Sold them or PR GT project.

Speaker Change: In early stages of construction.

Speaker Change: I expect that that one has very strong prospects for moving forward.

Speaker Change: There are a number of other projects that are in construction Cedar LNG is proceeding very very well in terms of.

Speaker Change: Our contribution which is the lateral in the meter station.

Speaker Change: In order to for the highest end pembina to to proceed with their projects. So it's just.

Francois Poirier: So it's just... Political Will and leadership and clarity of regulations with clear and enforceable timelines is what we're going to need as an industry to make sure we prosecute this opportunity successfully.

Speaker Change: Political will.

Speaker Change: And leadership and clarity of regulations with clear and enforceable timelines as what we're going to need as an industry to make sure. We prosecute this opportunity successfully.

Speaker Change: Understood. Thanks, I'll turn it back.

Speaker Change: The next question comes from Mike Carroll with RBC. Please go ahead.

Maurice Choy: The next question comes from Maurice Choy with RBC. Please go ahead. Thanks, and good morning, everyone.

Mike Carroll: Thanks, and good morning, everyone. Just following up on those comments about permitting reform.

Maurice Choy: Just following up on those comments about permitting reform, if I could just zoom in specifically to TC Energy, is this reform a gating factor to help unlock new gas infrastructure projects for you in Canada? And if so, is this merely CGL, or are there other ones being contemplated? Or is it more of a broad call to action that will spur more activity in the basin, motivating better volumes on NGTL and the mainline? Maurice, it's broader, I would say, so the latter characterization. We see an opportunity for the basin's productivity to grow, healthy producer-customers. are good for the industry and actually TC Energy benefits from that.

Speaker Change: Could you just zoom in and simply Tc energy.

Speaker Change: The Street Forum, a gating factor to help unlock new gas infrastructure projects for you in Canada and there is still.

Speaker Change: Nearly CTO or are there other ones being contemplated.

Speaker Change: Or is it more of a broad call to action that will spur more activity in the basin motivating better volumes on <unk> and the mainline.

Speaker Change: Or is it broader are I would say so the ladder characterization.

Speaker Change: We see an opportunity for the basin its productivity to grow healthy producer customers.

Speaker Change: Are good for the industry and actually TC energy benefits from that and whether we are expanding C. G. L or we are expanding N. G. T. L to serve other pipelines that are going to the coast that benefits us and benefits the industry I did mentioned on the prior call that based on the opportunity set we have today.

Francois Poirier: And whether we are expanding CGL or we are expanding NGTL to serve other pipelines that are going to the coast, that benefits us and benefits the industry.

Francois Poirier: I did mention on the prior call that based on the opportunities that we have today, that the lion's share of our discretionary capital wants to flow to the U.S. That's where we see the highest risk-adjusted return. But having said that, having more competition. from customers for service and capacity on our systems in all three countries. just enhances our opportunity set and allows us to deliver the greatest value for our shareholders by having more competition for our capacity.

Speaker Change: Hey.

Speaker Change: The lion's share of our discretionary capital wants to flow to the U S. That's where we see the highest risk adjusted returns.

Speaker Change: But having said that having more competition.

Speaker Change: From customers for service and capacity on our systems in all three countries.

Speaker Change: Just enhances our opportunity set and allows us to deliver the greatest value for our shareholders by having more competition for our capacity.

Speaker Change: This doesn't make sense.

Speaker Change: Image off with.

Speaker Change: The comment you made.

Maurice Choy: It sounds like there is upside to the 2027 comparable EBITDA guidance. from New Projects. not just from FX. If that's a fair statement, do you see that as being, you know, reinforcing the 5 to 7% category moving you to the upper end of that range?

Speaker Change: It sounds like there was.

Upside to the 2027 comparable EBIT guidance from new projects.

Speaker Change: Just from FX.

Speaker Change: That's a fair statement do you see that.

Speaker Change: That's being.

Speaker Change: Reinforcing the 5% to 7% CAGR I'm moving to the upper end of that range.

Sean O'donnell: Or is it more about moving above that Hey, Maurice, it's Sean. I'll take that question to start. Look, you heard in Francois' comment that the execution success we had in 2024 is continuing into 2025 on time under budget. It's a little early in the year. So bear with us. We're being cautious as to how we reflect that in our estimates. But yes, we were confident that that, you know, that trend and capability, as Francois talked about, the team is getting it and has gotten it for the last two years, and that needs to carry through to 2025 and 2026.

Speaker Change: Is it more about moving above that range.

Speaker Change: Hey, Morris, it's Sean I'll take that question to start.

Speaker Change: Look you've heard in France was comment that the execution success. We had in 2024 is continuing into 2025.

Speaker Change: On the on time under budget, it's little early in the year. So.

Speaker Change: Bear with us, we're being cautious as to how we reflect that in our estimates, but yes, we were confident that that.

Speaker Change: Did that trend in capabilities, France, what I talked about the team is getting it and has gotten over the last two years and that's that needs. The character of the 25 and 26, but we need to show you the proof before willing to kind of reflect any changes in guidance on that.

Sean O'donnell: But we need to show you the proof before we're willing to kind of reflect any changes in guidance on that.

Speaker Change: Perfect. Thank you very much.

Sean O'donnell: Perfect, thank you very much.

Speaker Change: The next question comes from Ben Pham with BMO. Please go ahead.

Ben Pham: The next question comes from Ben Pham with BMO. Please go ahead. Thanks, good morning. Just just come back to the Canadian election. Is there anything beyond policy reform that you could be expecting on that front that could potentially benefit your Canadian business? And is there anything else beyond the Western Canadian footprint in terms of growth opportunities like in East to West? expansions or anything on the East Coast. So, Ben, our focus has been more westbound than eastbound. We have an important customer base. through our main line in Ontario and Quebec, where we do see increased energy demand, increased electricity demand, which does translate into increased natural gas demand.

Ben Pham: Alright, Thanks, good morning, just coming back to it.

Speaker Change: An election season.

Ben Pham: Anything beyond policy reform that.

Ben Pham: You could be expecting on that front that could potentially benefit your Canadian business.

Ben Pham: Is there anything else beyond the western Canadian footprint in terms of growth opportunities like an east to west.

Ben Pham: Expansions or anything on the east coast.

Ben Pham: So then our focus has been more westbound and eastbound.

Ben Pham: We have an important customer base.

Ben Pham: Through our mainline in Ontario, and Quebec.

Ben Pham: Where we do see it.

Ben Pham: Increased energy demand increased electricity demand, which does translate into increased natural gas demand.

Francois Poirier: You've seen throughputs on our main line increase, you know, quarter one of 2025 compared to the first quarter of last year. So it does present growth opportunities for us across the entire country. In terms of, in addition to policy change, what needs to happen, if I understood your question correctly. We are going to need to go out and compete for the business, so it's a bit of a cultural change where we're going to need to see more collaboration between governments, the private sector and indigenous leaders to make sure that we're providing policy stability and certainty to attract capital from.

Ben Pham: You've seen throughput on our mainline increase.

Ben Pham: Quarter, one of 2025 compared to the first quarter of last year. So it does prevent present growth opportunities for us across the entire country in terms of in addition to policy change what needs to happen.

Ben Pham: If I understood your question correctly.

Ben Pham:

Ben Pham: We're going to need to go out and compete for the business. So it's a bit of a cultural change where we're going to need to see more collaboration between the governments and the private sector and indigenous leaders to make sure that we're providing.

Policy stability and certainty to attract capital from.

Ben Pham: From LNG customers. So we're optimistic that could happen as I said.

Ben Pham: LNG customers. So we're optimistic that can happen as I said. Both the liberal and conservative parties were advocating for accelerated development. Pipeline Infrastructure, which we think This is a great macro backdrop for a company like this. Okay, got it.

Ben Pham: Both the Liberal and conservative parties, we're advocating for accelerated development of pipeline infrastructure, which we think is a great macro backdrop for a company like T C.

Ben Pham: Okay got it.

Ben Pham: And second question on Mexico.

Sean O'donnell: Second question on Mexico and maybe more specifically on Pemex and their quarter. Are you are you effectively in quite insulated from what's happening there, whether it's your existing assets or, or timing on on the soft project? Hey, Ben, it's Sean. Yeah, we're our contracts just to be clear in Mexico are 100% with CFE that that is our customer that is an investment grade national utility. We have no commercial arrangements whatsoever with Pemex. So I'd probably just clarify that and leave the question unless there's something I'm Yeah, it's just a more indirect impact than anything in Mexico.

Ben Pham: Yes.

Ben Pham: Maybe more specific on Pemex in third quarter.

Speaker Change: Are you are you in fact again quite insulated from what's happening there.

Speaker Change: Asking assets or our timing on on this project.

Speaker Change: So.

Sean: Hey, Ben it's Sean.

Speaker Change: There are contracts just to be clear in Mexico are 100% with cfe that that is our customer that has an investment grade national utility we have no commercial ranges whatsoever.

Sean: With Pemex.

Speaker Change: So I'd, probably just clarify that and we will leave the question unless there's something I missed for Ya.

Sean: Yes.

Sean: Indirectly impact anything in Mexico ideas.

Sean O'donnell: Like there's, there's nothing, what's happening in Pemex is not going to do just the timing. implications of Solver just brought it on Mexican government and and credit and everything just to become more indirect impact indirect.

Sean: That's not what's happening Pemex didn't I can do this.

Sean: The timing.

Sean: Implications of sulfur.

Sean: This brought about asking government and credit and everything just thinking more indirect impact in direct.

Sean: Okay I'll offer you a little bit of a follow up.

Francois Poirier: Okay, I'll offer you a little bit of a follow-up. The growth plan that CFE very recently laid out is not about PEMEX. It's about providing electricity and upgrading fuel oil plants throughout the entire country. It's not about PEMEX. It's about modernizing grid and plant and bringing power to various parts of the country. And that's independent of PEMEX entirely. So we'd be happy to follow up offline on that, but we're an entirely CFE kind of focused customer, partner and customer in that regard. Okay, all right, thank you.

Sean: Yeah.

Speaker Change: The growth plan that that Cfe very recently laid out it's not about pemex, its about providing electricity and in upgrading fuel oil plants throughout the entire country is not about Pemex is it's about modernizing grid and plant.

Speaker Change: And bringing power to various parts of the country and that that's independent of Pemex entirely so we'd be happy to follow up offline on that but.

Speaker Change: We were an entirely cfe kind of focus customer partner and customer in that regard not pemex.

Speaker Change: Okay alright, thank you.

Speaker Change: The next question comes from John Kim with Goldman Sachs. Please go ahead.

John Mackay: The next question comes from John Mackay with Goldman Sachs. Please go ahead. Hey, good morning, team. Thanks for the time.

Speaker Change: Hey, good morning team. Thanks for the time I just want to go back to the six Bcf a day of potential projects being talked about.

Tina Faraca: I just want to go back to the six BCF a day of potential projects being talked about. Any way to frame that as effectively kind of in basin in the Marcellus and Utica versus out of basin, either Virginia or Midwest? And for that latter group, how do you be thinking about effectively getting incremental supply to those new demand sources? Thanks, John.

Speaker Change: Any way to frame that as effectively kind of in basin, and the Marcellus and Utica versus out of based on either Virginia or Midwest and for that latter group, how you'd be thinking about effectively getting incremental supply to those new demand sources.

Speaker Change: Thanks, John This is Tina as I mentioned before although we have focused across multiple growth areas right now where we're very active is in the power generation space related to survey natural gas demand for those sectors, including incremental generation.

Tina Faraca: This is Tina. As I mentioned before, although we have focus across multiple growth areas, right now, where we're very active is in the power generation space related to serving natural gas demand. those sectors including incremental generation, data centers and coal to gas. They're across multiple systems. We're seeing interest in Ohio, Virginia, Kansas, Indiana, Illinois, Louisiana, Nevada. It's really the power of our footprint is really showing up here related to where these opportunities are progressing. We will see likely more activity on some of our larger assets, which are A&R and Columbia and Columbia Gulf, given the corridor of where this power generation activity is occurring.

Speaker Change: Data centers in coal to gas.

Speaker Change: There there across multiple systems, we're seeing them interest in.

Speaker Change: Ohio, Virginia, Kansas, Indiana, Illinois, Louisiana, Nevada.

Speaker Change: It's really the power of our footprint is really showing up here related to where these opportunities are progressing.

Speaker Change: We will see likely more activity on some of our larger assets, which our anr and Columbia in Columbia Gulf given the corridor, where the power is generation activities occurring.

Tina Faraca: whether that be coal-to-gas, new electrification, or data center load. Also, if you if you look at some of where our large utilities are centered across our assets, you can expect that as their loads be able to also provide service to them from that perspective. Also, from a basin perspective, where this gas would be coming from. You may be familiar that we're attached to some very large basins, whether that's the WCSB, Appalachia, and Hainesville. And so many of our projects would be sourcing from those basins that we're already connected to, and that, in some cases, we have a very large incumbent.

Speaker Change: Whether that be coal to gas, new electrification or data center load.

Speaker Change: Also if you look at some of where our large utilities are centered across our assets you can expect that as their loads increase.

Speaker Change: We would be able to also provide service to them from that perspective.

Speaker Change: Also from a basin perspective, where the gas will be coming from.

Speaker Change: You may be familiar that were attached to some very large basins, whether that's the WCS be an app.

Speaker Change: <unk> and Haynesville and so many of our projects would be sourcing from those basins that were already connected to and that in some cases, we have that very large incumbency with.

Speaker Change: I appreciate that thank you and second question for me, maybe just Sean going to your comments on.

John Mackay: I appreciate that. Thank you.

Sean O'donnell: And second question from me, maybe just, Sean, going to your comments on, you know, I guess, partnering on new projects to kind of manage the capital needs and keep watching the leverage level. Can you just talk a little bit more about what that means? Is that kind of like what we saw in Colombia, where you, you know, effectively sell down an interest but maintain operational control? Is it selling a stake in a project specifically? Or is it maybe what you're doing with Williams on Socrates, right, kind of indirectly partnering with someone using, you know, your assets and something else they're going to build?

Speaker Change: I guess partnering on new projects to kind of manage the capital needs and keep watching the leverage level can you just talk a little bit more about what that what that means is that kind of like what we saw on Columbia, where you effectively sell down of interest I mean operation maintain operational control is it selling its stake in a project.

Speaker Change: <unk>, specifically or is it.

Speaker Change: I don't know, maybe what youre doing with Williams on Socrates right kind of indirectly partnering with someone.

Speaker Change: You know your assets and someone else, they're going to build thanks.

John Kim: Yes, John Good question.

Sean O'donnell: Yeah, John, good question. Look, I think, candidly, the bias is probably shifting a little bit to partnerships, right? We don't like selling assets that have all this kind of embedded optionality and growth and finding partners that are willing to value that and help us grow it and help us, you know, not pressure the balance sheet to capture this growth that's likely that's likely the avenue, especially with, you know, some of the larger projects kind of towards the end of the decade, you heard Greg talk about. And what I might add to that, John, is...

John Kim: I think candidly the bias is probably shifting a little bit the partnerships right. We don't like selling assets that have all of this is kind of embedded optionality and growth of finding partners that are willing to value that and help us grow it.

John Kim: And help us.

Not pressured the balance sheet to capture this growth that's likely that's likely the avenue.

Speaker Change: Especially with some of the larger projects kind of towards the end of the decade, you heard Gregg talk about.

John Kim: And what I might add to that John is.

John Kim: In Canada, if we're looking at pursuing datacenter opportunities, where it's more of a discrete greenfield project or a set of assets.

Sean O'donnell: So in Canada, if we're looking at pursuing data centre opportunities, where it's more of a discreet, greenfield project or a set of assets, that does lend itself well to partnership particularly with Indigenous communities. We have a very clear roadmap for greenfield infrastructure development in Canada now. We feel it's very important to involve Indigenous communities from day one in that, and not only in terms of consultation and design, but as partners. In a circumstance where we're looking at a new system or a new project that can be ring fenced. That would be, I think, a different That makes sense.

John Kim: That does lend itself well to partnership, particularly with indigenous communities.

John Kim: We.

John Kim: You know we have a very clear roadmap for Greenfield infrastructure development in Canada now we feel it's very important to involve indigenous communities from day one in that.

John Kim: And not only in terms of consultation and design, but as partners. So.

John Kim: In a circumstance, where we're looking at a new system or a new project that can be ring fenced.

John Kim: That would be I think.

John Kim: A different approach.

John Kim: That makes sense I appreciate the time thank you.

John Mackay: Appreciate the time. Thank you.

John Kim: <unk>.

John Kim: The next question comes from Keith Stanley with Wolfe Research. Please go ahead.

Keith Stanley: The next question comes from Keith Stanley with Wolf Research. Please go ahead. Hi, good morning, wanted to follow up on the data center strategy. The Williams Project in Ohio is obviously right by Columbia and presumably sources gas from Columbia. recognize you're more focused on front of the meter for the US.

Keith Stanley: Hi, Good morning wanted to follow up on the data center strategy.

Keith Stanley: The Williams project in Ohio is obviously right by Colombia, and presumably sources gas from Colombia.

Speaker Change: Recognize you're more focused on front of the meter for the U S. But can you maybe give any thoughts on why that wasn't a fit for you as a project and then when Youre looking at potential integrated solutions in Canada inclusive of power.

Keith Stanley: But can you maybe give any thoughts on why that wasn't a fit for you as a project?

Keith Stanley: And then when you're looking at potential integrated solutions in Canada, inclusive of power, what criteria are you looking at in terms of contract duration and returns to get into that business? Yeah, thanks. Thanks, Keith, for that question. We have a great corridor through Ohio where a lot of that data center load is appearing and certainly we will Participate where it makes sense for us from a capacity perspective and or perhaps short laterals as necessary But keeping the focus as well in the larger connections that would be through our utility based customers So it's really a risk preference for us.

Speaker Change: Criteria are you looking at in terms of contract duration and returns to get into that business.

Speaker Change: Yes, thanks, Keith for that question.

Speaker Change: We have a great corridor through Ohio, where a lot of that data center load is.

Speaker Change: Peering and certainly we will.

Speaker Change: Participate where it makes sense for us from a capacity perspective, and or perhaps short laterals as necessary, but keeping the focus as well on the larger connections that would be through our utility based customers.

Speaker Change: So it's really a risk preference for us we want to see long term contracts.

Keith Stanley: We want to see long-term contracts. at a five to seven times build multiple. and we have a very long runway of those types of projects.

Five to seven times build multiple.

Speaker Change: And we have a very long runway of those types of projects I'll turn it over to Greg for quick questions on that.

Greg Grant: I'm going to turn it over to Greg for... Sure. Yeah, happy to add a little bit on that. We talked a bit about the demand we're seeing, obviously, on the on the power side. And as you think about return and contracting, we already have an amazing pipeline. that low rest. Hybrid Turing Opportunities. I just say, as we think about branching into those complementary solutions, we're going to continue to test it against the existing.

Speaker Change: Sure.

Speaker Change: Sure.

Speaker Change: Speed a little bit onto that you know we've talked a bit about the demand. We're seeing obviously on the on the power side and as you think about return in contracting and we already have an amazing pipeline.

Speaker Change: Low risk.

Speaker Change: High returning opportunities.

Speaker Change: I'd just say as we think about branching into those complementary solutions, we're going to continue to test it against the existing footprint.

Speaker Change: Okay. Thank you for that and on North Woods I'm, just curious on any more details you can share on the project are you Debottlenecking, a particular area on anr rebuilding of lateral for new power just new pipe compression just any any more specifics.

Greg Grant: Okay, thank you for that.

Greg Grant: And on Northwoods, I'm just curious on any more details you can share on the project. Are you de-bottlenecking a particular area on A&R? Are you building a lateral for new power, just, you know, new pipe, compression, just any any more specifics on the project?

Speaker Change: On the project.

Speaker Change: Yeah. Thanks, So we're really excited that we announced that project today on our Anr system 400 million cubic feet, a day and $900 million five to seven times build multiple.

Greg Grant: Yeah, thanks. So we're really excited that we announced that project today on our A&R system 400 million cubic feet a day, $900 million, five to seven times build multiple As I mentioned before, it's just right in our fairway of how we like to progress projects. So expanding our existing infrastructure, this is focused on Midwest demand. And we'll be likely just combination of looping and compression activities to increase capacity into that region. And we have a really strong record of progressing those types of projects. on time and on budget.

Speaker Change: As I mentioned before it's just right in our fairway of how we'd like to progress project. So.

Expanding our existing infrastructure. This is focused on Midwest demand.

Speaker Change: And we'll be likely just combination of looping and compression activities to increase capacity into that region and we have a really strong record of progressing those types of projects.

Speaker Change: On time and on budget.

Speaker Change: Thank you.

Speaker Change: The next question comes from Robert Kelly.

Robert Catellier: The next question comes from Robert Catellier with CIBC Capital Markets. Please go ahead. Hi, good morning. I have two questions here. First, there was an attempt to improve permitting in the US through alternative arrangements for NEPA compliance. What's TC Energy's take on this? And specifically, do you have an appetite to elect to have projects reviewed under these alternative arrangements?

Speaker Change: CIBC capital market. Please go ahead.

Speaker Change: Hi, Good morning, I have two questions here first there was an attempt to improve permitting in the U S through alternative arrangements for NEPA compliance.

Speaker Change: Do you see <unk> take on this and specifically do you have an appetite to elect her projects reviewed under these alternative arrangements.

Tina: Hi, Robert this is Tina.

Tina Faraca: Hi, Robert, this is Tina. You know, with respect to general permitting reform, you know, at the macro level, we're seeing a number of executive orders that focus on streamlining and simplifying regulation of overall permitting process. So we're firmly in favor of anything that achieves this in a pragmatic and durable way. Right now what we really need to see is congressional action that puts these orders into law, and so we're really focused as an industry in clarifying that timing and certainty of progress through legislative action. Without that, we will have to just follow our current regulations as we progress.

Speaker Change: With respect to general permitting reform at the macro level, we're seeing a number of executive orders that focus on streamlining and simplifying regulation. Although overall permitting process. So we are firmly in favor of anything that achieved this in a pragmatic and durable way.

Tina:

Tina: Right now, what we really need to see his congressional action that.

Tina: That puts these action these orders into law and so we're really focused as an industry.

Tina: Clarifying that that timing uncertainty of progress through legislative action.

Tina: And without that we will have to just follow our current rate regulations as we progress the projects.

Tina: Yeah.

Robert Catellier: Yeah, that makes a lot of sense.

Tina: Makes lot of sense, and then just maybe to summarize.

Francois Poirier: And then just maybe to summarize a lot of what we've heard today, just can you summarize how the volatility caused by trade policy and the Canadian election results impact where you're finding the best risk adjusted returns? And maybe as a follow up, do you think tariffs have any implications for growth in Mexico and your plans for an eventual sell down there. Yeah, Robert, it's Francois. I'll address that question. As we said before, we don't take volumetric or commodity price risk. our pipeline projects. And so in the near term, there's No impact, and I think as demonstrated today by our strong and very predictable financial results with the volatility that we've seen over the last few months.

Tina: Lot of what we've heard today just can you some.

Tina: How the volatility caused by trade policy.

Tina: The Canadian election results impact, where you're finding the best risk adjusted returns and maybe as a follow up.

Tina: <unk>.

Tina: Tariffs.

Speaker Change: Have any implications for growth in Mexico, and your plans for an eventual slowdown there.

Speaker Change: Yeah, Robert It's Francois I'll address that question.

Speaker Change: As we've said before we don't take volumetric or commodity price risk.

Speaker Change: Our pipeline projects and so in the near term.

Speaker Change: There's no impact.

Speaker Change: As demonstrated today by our strong and very predictable financial results with the volatility that we've seen over the last few months.

Francois Poirier: Longer term, we're focused on our ability to deliver our projects on time and on budget or better. And some of these tariffs... tariffs that have been applied could you know apply some inflationary pressure on raw materials and things of that nature right now when we look at our capital spend in Canada it's predominantly at Bruce and we have a 95% you Canadian Domiciled Supply Chain. For our projects that are underway in the United States, it's almost exclusively certainly in terms of major. components of supply a U.S. domestic. Transcripts provided by Transcription Outsourcing, LLC. several years of capital into the SGP project.

Speaker Change: Longer term, we're focused on our ability to deliver our projects on.

Speaker Change: On time and on budget or better and some of these tariffs.

Speaker Change: Terrorists that've been applied could you know.

Play some inflationary pressure on raw materials and things of that nature.

Right now when we look at our capital spend in Canada, it's predominantly at Bruce and we have a 95% Canadian domiciled supply chain for our projects that are underway in the United States, It's almost exclusively.

Speaker Change: Certainly in terms of a major.

Speaker Change: Components of supply.

Speaker Change: U S domestic.

Speaker Change: <unk> chain and in Mexico.

Speaker Change: We front end loaded.

Speaker Change: Several years of capital into it.

Speaker Change: The STP projects so while.

Francois Poirier: So while we are looking at The CFPB is a long-term planning scenario where there will be a need for additional capacity on a number of their systems. Transcription by CastingWords Transcription by Transcription Outsourcing, LLC. Right, so if I take this all in, it doesn't sound like the risk adjusted returns have really changed. So you're still finding good opportunities pretty much across the portfolio, but maybe with the best opportunities still in the US, is that the way to look at it? Thank you. Yes, that's exactly right, Robert. We look at our discretionary capital and as I said, it wants to flow to the highest risk adjusted returns.

Speaker Change: While we are looking at them with our partner and customer the Cfe.

Speaker Change: Our long term planning scenario, where there will be a need for.

Speaker Change: The additional capacity on.

Speaker Change: A number of their systems.

Speaker Change: I don't see that happening in the immediate future and so it should not have an impact on on.

Speaker Change: The composition of our portfolio.

Speaker Change: And it.

Speaker Change: It should not create pressure for us to look for a partner or some other way of monetizing Mexico before we feel that we're going to get fair value.

Speaker Change: Right. So if I take this all then it doesn't sound like.

Speaker Change: The risk adjusted returns have really changed we're still finding good opportunities pretty much across the portfolio, but maybe with the.

Speaker Change: The opportunity is still in the U S.

Speaker Change: Yeah.

Speaker Change: Yes, yes, that's exactly right Robert.

Speaker Change: We look at our discretionary capital and as I said, it wants to Florida to the highest risk adjusted returns that's definitely the U S. I expect it to continue to be the U S for the next several quarters.

Francois Poirier: That's definitely the U.S. I expect it to continue to be the U.S. for the next several quarters. Until and if we see progress on permitting and other matters in Canada. to compete for capital but even then it's going to have to compete for capital internally with projects in other jurisdictions. Okay, thank you.

Speaker Change: Until and if we see progress on permitting and other.

Speaker Change: Other matters in Canada.

Speaker Change: To compete for capital, but even then it's going to have to compete for capital internally with projects in other jurisdictions.

Speaker Change: Okay. Thank you.

Speaker Change: Ladies and gentlemen. This concludes the question and answer session is there any further questions. Please contact investor relations at Tc energy.

Operator: Ladies and gentlemen, this concludes the question and answer session. If there are any further questions, please contact Investor Relations at TC Energy.

Gavin Wylie: I will now turn the call over to Gavin Wylie for any closing remarks. Please go ahead. Yeah, once again, thank you, everyone, for your participation this morning and your interest in TC Energy.

Speaker Change: Ill turn the call over to Kevin Riley for any closing remarks. Please go ahead.

Speaker Change: Once again, thank you everyone for your participation. This morning, and your interest in TC energy as the operator stated if we didn't get to your question today. Please.

Gavin Wylie: As the operator stated, if we didn't get to your question today, please feel free to reach out this morning to either myself or the investor relations team, we'll be happy to get back to you first thing. So thanks again for your for your interest.

Speaker Change: Please feel free to reach out this morning, it's either myself or the Investor relations team will be happy to get back to you first thing. So thanks again for your interest. Thanks again for the time. This morning, and we look forward to our next update in late July.

Gavin Wylie: Thanks again for the time this morning and we look forward to our next update.

Speaker Change: This brings to a close today's conference call. You may disconnect. Your lines. Thank you for participating and have a pleasant day.

Operator: This brings to a close today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.

Speaker Change: [music].