Nalcor Energy provides second quarter update

Press Releases

August 13, 2015

Nalcor Energy provides second quarter update
August 13, 2015, St. John’s, NL – Nalcor Energy released its 2015 second quarter update today.

“Despite challenging global commodity prices, Nalcor’s businesses are performing well and the company is in a position of strength,” said Ed Martin, President and Chief Executive Officer. “We are continuing to invest in and grow Newfoundland and Labrador’s energy assets, which are now at more than $11 billion and rising. Revenues from our renewable and non-renewable energy resources will continue to rise as we bring new projects online, providing increasing returns to the province for future generations.”

Overall, profit for the year ending December 31, 2015 is currently forecasted to be slightly lower than
2014. Year-to-date profit to June 30 was $21.5 million, with a loss of $8.0 million in the second quarter. Lower oil production and global commodity prices overall continue to be significant factors affecting results, with profits in the Oil & Gas and Energy Marketing businesses impacted by decreased oil prices and electricity export prices respectively. Churchill Falls profit was up $5.8 million in the second quarter and $14.1 million year-to-date over the same period in 2014, a result of additional energy sales, driven by higher prices, from the former Twinco Block to Hydro.

Newfoundland and Labrador Hydro’s loss increased by $5.7 million year-to-date from 2014, due largely to higher costs associated with operations and depreciation, which were partially offset by higher sales. As a result of not receiving regulatory approval to implement interim rates until July 1, Hydro recorded a loss of approximately $22 million for the first six months of this year. Hydro’s year-to-date results do not reflect the outcome of the General Rate Application (GRA). Actual profit for full year 2015 will be impacted significantly by rate setting and other regulatory decisions from this upcoming GRA process.

During the last quarter, Muskrat Falls construction progressed on all components of the project, including the spillway and powerhouse, North Spur stabilization work, the Labrador-Island Link, and the HVac transmission line that will connect Churchill Falls and Muskrat Falls. In the oil and gas business segment, first oil was achieved from the South White Rose Extension tie-back in late June, and a multi-client license agreement was signed for new 3D seismic survey data which will be available to the global industry in advance of the next license rounds in late 2015.

Ed Martin and Derrick Sturge, Vice President and Chief Financial Officer, will hold a live webcast today at 2:00 p.m. NDT to provide an overview of the second quarter results. A copy of the quarterly report and a recording of the webcast will be available at www.nalcorenergy.com.

-30-

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

Media Contact:
Deanne Fisher
Corporate Communications and Stakeholder Engagement
t: 709.733.5299
c: 709.697.3418
e: deannefisher@nalcorenergy.com

AB2