CALGARY Jul 31, 2020 (Thomson StreetEvents) -- Edited Transcript of TC Energy Corp earnings conference call or presentation Thursday, July 30, 2020 at 3:00:00pm GMT

* Donald R. Marchand

* Russell K. Girling

TC Energy Corporation - Executive VP & President of U.S. Natural Gas Pipelines

* Tracy A. Robinson

TC Energy Corporation - Executive VP & President of Canadian Natural Gas Pipelines

CIBC Capital Markets, Research Division - Executive Director of Institutional Equity Research

Thank you for standing by. This is the conference operator. Welcome to the TC Energy 2020 Second Quarter Results Conference Call. (Operator Instructions) The conference is being recorded. (Operator Instructions)

I would now like to turn the conference over to David Moneta, Vice President, Investor Relations. Please go ahead.

Thanks very much, and good morning, everyone. I'd like to welcome you to TC Energy's 2020 second quarter conference call. With -- joining me today are Russ Girling, President and Chief Executive Officer; Don Marchand, Executive Vice President, Strategy and Corporate Development and Chief Financial Officer; Franois Poirier, Chief Operating Officer and President, Power and Storage and Mexico; Tracy Robinson, President, Canadian Natural Gas Pipelines; Stan Chapman, President, U.S. Natural Gas Pipelines; Paul Miller, President, Liquids Pipelines; Bevin Wirzba, Senior Vice President, Liquids Pipelines; and Glenn Menuz, Vice President and Controller.

Russ and Don will begin today with some opening comments on our financial results and certain other company developments. A copy of the slide presentation that will accompany their remarks is available on our website. It can be found in the Investors section under the heading Events And Presentations. Following their prepared remarks, we will take questions from the investment community. If you are a member of the media, please contact Jaimie Harding following this call and she'd be happy to address your questions.

(Operator Instructions) Also, we ask that you focus your questions on our industry, our corporate strategy, recent developments and key elements of our financial performance. If you have detailed questions relating to some of our smaller operations or your detailed financial models, Hunter and I would be pleased to discuss them with you following the call.

Before Russ begins, I'd like to remind you that our remarks today will include forward-looking statements that are subject to important risks and uncertainties. For more information on these risks and uncertainties, please see the reports filed by TC Energy with Canadian Securities Regulators and with the U.S. Securities and Exchange Commission.

And finally, during this presentation, we'll refer to measures such as comparable earnings, comparable earnings per share, comparable earnings before interest, taxes, depreciation and amortization or comparable EBITDA and comparable funds generated from operations. These and certain other comparable measures are considered to be non-GAAP measures. As a result, they may not be comparable to similar measures presented by other entities. They are used to provide you with additional information on TC Energy's operating performance, liquidity and its ability to generate funds to finance its operations.

With that, I'll turn the call over to Russ.

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Russell K. Girling, TC Energy Corporation - President, CEO & Director [3]

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Thank you, David, and good morning, everyone, and thank you all for joining us today. Clearly, we live in unprecedented times with COVID-19 having had a significant impact on people around the world. When the World Health Organization declared it global pandemic in early March, our business continuity plans were put in place across our whole organization, allowing us to continue to effectively operate our assets and execute on all of our capital programs.

All of the services we provide were deemed essential or critical in Canada, the United States and Mexico, given the important role our infrastructure plays in delivering energy to people across this continent. This essential designation included both our daily operations and our construction projects. We take that responsibility extremely seriously, and I'm proud to say that we have continued to deliver the energy that millions of people rely on every day and continue to advance all of our construction projects that are vital to powering industries and institutions for many decades yet to come.

As we've always done over the past few months, we've continued to conduct our business in a safe and reliable manner, while maintaining our workforce, employing thousands of construction workers, fulfilling our obligations to suppliers and supporting the communities in which we are working. This would not have been possible without the dedication of all of our employees, and I want to acknowledge and thank them and their families for their ongoing efforts to ensure the energy that is vital to the daily lives of so many continues to be delivered seamlessly across North America. I can tell you that your efforts continue to make a big difference.

Turning now to our second quarter financial results and other recent developments across our 3 core businesses. Despite the challenges brought by COVID-19, our operations have largely been unimpacted, with a few exceptions, flows and utilization levels remain in line with historic and seasonal norms, underscoring the critical nature of our energy infrastructure assets. With approximately 95% of the comparable EBITDA in our company coming from regulated or long-term contracted assets, we continue to be largely insulated from the short-term volatility associated with volume throughput and commodity prices.

As a result, as highlighted in our second quarter report, our $100 billion portfolio of high-quality, long life energy infrastructure assets continue to produce solid results. We continue to realize the growth expected from our industry-leading capital expansion program. And today, we are advancing $37 billion of secured capital projects. In addition, we continue to advance $11 billion of projects under development, including the refurbishment of another 5 reactors at Bruce Power as part of their long-term life extension program.

Over the last 6 months, we took significant steps to fund our 2020 capital expenditure program and maintain our strong financial position despite the challenging capital market conditions that we're experiencing. More specifically, we enhanced our liquidity by more than $11 billion through the issuance of long-term debt in both Canada and the United States at very attractive rates, the establishment of an incremental committed credit facility and various portfolio management activities, including the sale of 3 Ontario natural gas-fired power plants and the 65% interest in the Coastal GasLink project. When combined with our predictable and growing cash flow from operations, we believe that we're well positioned to fund our capital program and meet all of our other obligations.

Looking forward, we expect our solid operating and financial performance to continue. And as a result, our outlook for the full year 2020 is essentially unchanged, with comparable earnings per share still anticipated to be similar to the record results we produced in 2019. While we're extremely proud of our financial performance and the significant returns that we've generated for our shareholders, we know that our ongoing success depends on our ability to balance profitability with safety and environment and social responsibility. We have a 65-year track record of safe and reliable operations, but we recognize that we can always do better. As a result, we remain focused on continuous improvement as well as long-term fundamentals to ensure our business remains sustainable and resilient in an ever-evolving energy landscape.

With that as an overview, I'll expand on some of the recent developments, beginning with a brief review of our second quarter financial results. Don will provide more detail on our results and liquidity in just a few moments.

So excluding certain specific items, comparable earnings were $863 million or $0.92 per common share for the 3 months ended June 30 compared to $924 million or about $1 per share in 2019. Comparable EBITDA of $2.2 billion -- well, comparable funds generated from operations were about $1.5 billion. For the 6 months ended June 30, our comparable earnings were $2 billion or $2.10 per common share compared to $1.9 billion or 2 -- or $2.07 per share in the same period in 2019.

Comparable EBITDA of $4.7 billion and comparable funds generated from operations of $3.6 billion were similar to the amounts that we reported last year. Each of those amounts reflects the solid performance of our legacy assets as well as contributions from $3 billion of new long-term contracted and rate-regulated assets placed into service in the first half of 2020. This was partially offset by lower contributions from our liquids marketing business due to lower margins as well as lower equity income from Bruce Power due to the Unit 6 MCR program that we commenced at the beginning of the year and the sale of certain assets that will help fund our secured capital program for many years to come.

Next, I'll make a few comments on our 3 core businesses. First, in our Natural Gas Pipelines business, customer demand for our services remains extremely strong despite the COVID-19 impacts on the broader North American economy. Evidence of this can be seen in the volumes transported across our systems with the NGTL field system receipts averaging about 12.3 billion cubic feet a day, the Canadian Mainline Western receipts averaging 3.1 billion cubic feet a day, our broader U.S. pipeline network moving about 25 billion cubic feet a day, and our Mexican pipelines moving approximately 1.6 billion cubic feet a day for the first 6 months of this year.

Each of those amounts are similar to or greater to the volumes we moved over the same period last year. At the same time, we continue to advance approximately $22 billion of capital projects associated with our natural gas business. That program includes significant expansions of our NGTL system, capacity additions on our U.S. network, the Villa de Reyes and Tula projects in Mexico and our Coastal GasLink pipeline project in British Columbia, which will play a very important role in delivering clean Canadian natural gas to Asian markets that will displace coal.

During the second quarter, the NGTL system held a capacity optimization open season to assist customers in optimizing their transportation service needs and align system expansions with customer growth requirements. The open season confirmed that all of our proposed system expansion projects will continue to be required to meet aggregate system demand, although the in-service dates for some of those facilities has moved. As a result, a certain amount of the capital spending plan for 2020 and 2021 will be made in 2022 to 2024. The net impact of these deferrals, together with some expected increasing costs on the 2021 expansion program will see us invest a total of about $9.9 billion, up from $9.4 billion on the '21 program. These changes have been reflected in the secured capital projects table in our quarterly report.

Turning to our U.S. Natural Gas Pipelines business, where our expansion plans now include an incremental investment of approximately USD 400 million to replace, upgrade and modernize certain facilities on the highly utilized section of the ANR pipeline system. The program, which is known as the Elwood Power/ANR Horsepower Replacement Project will reduce emissions along the system and is another good example of an in-corridor expansion to meet growing demand utilizing our existing facilities and our existing right of ways.

Also in the U.S. Pipelines business. In the coming days, our Columbia Gas transmission system intends to file a section 4 rate case with FERC, requesting an increase in its maximum transportation rates effective February 1, 2021. It's Colombia's first rate case filing in over 20 years and will seek to recover currently incurred operating costs as well as a fair return on and of our historical and future capital investments in this expansive system that provides our customers with reliable access to low-cost natural gas. At the same time, we will continue to pursue a collaborative process to find a mutually beneficial outcome with the Columbia Gas transmission customers through settlement negotiations.

Finally, in Natural Gas Pipelines, construction activities continue on the 2.1 billion cubic feet a day Coastal GasLink project that will connect abundant Western Canadian Sedimentary Basin natural gas reserves to the LNG Canada plant to export from Kitimat, British Columbia. Field activity continues to increase along the route following the spring thaw. As we ramp up construction, our focus will remain on the health and safety of our employees, our contractors and the communities through strict adherence to our COVID-19 protocols.

Ongoing work includes the construction of roads, bridges, worker accommodations and grading. Pipe delivery also continues with more than 50% of the required pipes supplied to site and the mainline mechanical construction activities planned for the balance of the summer. In May, as you know, we completed the sale of a 65% interest in the Coastal GasLink project and entered into a secured long-term project financing credit facility to fund the majority of the construction cost. This resulted in combined net proceeds of approximately $2.1 billion. Looking forward, we'll continue to work with the 21st nations that have executed agreements with the Coastal GasLink project to provide them with an opportunity to invest in the project with an option to acquire a 10% interest on similar terms and conditions.

Turning now to our Liquids business, which also generated solid results during the first half of 2020 despite the extraordinary volatility in global crude oil markets. While the volatility has had an impact on our market link and liquids marketing businesses, Keystone continued to produce solid results as it serves important markets in the U.S. Midwest and Gulf Coast and is underpinned by long-term take-or-pay contracts with very strong counterparties.

We are very pleased with yesterday's decision by President Trump to sign a new presidential permit for the base Keystone system. The new permit will allow us to respond to market demand and fully utilize the Keystone pipeline system to safely deliver additional crude oil from Canada to refining centers in the U.S. Midwest and the Gulf Coast. This new presidential permit will allow us to utilize -- or to realize the benefits from the 50,000 barrel a day open season conducted in June 2019 and we anticipate starting to increase the flows in 2021. The additional crude oil that will be delivered by the Keystone pipeline will increase the secure and reliable source of Canadian oil to meet growing demand from refineries and markets in the United States.

Also in the Liquids business, we continued to advance construction on Keystone XL during the second quarter while managing the various legal and regulatory matters. In Canada, construction activities at our pump stations and along more than 100 kilometers of the mainline right of way have continued to advance. In the U.S., we are making progress on a revised 2020 construction plan, which is focused in areas where all of our permits and approvals are in place and includes facilities and preconstruction activities. At the same time, we continue to seek authorizations from the U.S. Army Corps of Engineers for the necessary permits and approvals to reconvene U.S. pipeline -- Mainline pipeline construction in 2021.

Keystone XL continues to be a very important project for both Canada and the United States. It will create thousands of high-paying union jobs and advanced energy security in both nations in an environmentally sustainable and responsible way. The project will require an additional investment of approximately $8 billion, and it is underpinned by new 20-year take-or-pay contracts that are expected to generate approximately USD 1.3 billion of incremental EBITDA on an annual basis once the pipeline is placed into service in 2023.

To advance the project, we have partnered with the government of Alberta, who will invest approximately USD 1.1 billion of equity into the project and fully guarantee a USD 4.2 billion project-level credit facility. Once the project is completed and placed into service, we expect to acquire the government of Alberta's equity investment and refinance the credit facility. Moving forward, we will continue to carefully manage various legal and regulatory matters as we construct this pipeline, which will have the capacity to move approximately 830,000 barrels a day of responsibly produced energy from Canadian oil sands to the continent's largest refining market, which is in the U.S. Gulf Coast.

Turning now to our Power and Storage business, where Bruce Power continued to produce solid results through the first 6 months of this year. Also, after years of preparation, in January, Bruce Power commenced the work on the Unit 6 major component replacement, or MCR project as we call it, when they took it off-line here in January. We expect to invest approximately $2.4 billion in that program as well as ongoing asset management program through 2023 when the Unit 6 refurbishment is targeted for completion and to come back online. Unfortunately, because of COVID-19, in late March, Bruce Power declared a force majeure under its contract with the independent electric system operator. This force majeure covered unit 6 MCR as well as certain asset management work.

That said, I'm pleased to report that in early May, work on the Unit 6 MCR resumed with additional prevention measures in place for worker safety related to COVID-19. Progress is being made on critical path activities as Bruce works to isolate Unit 6 from the remaining units in preparation for the removal of the fuel channels in late third quarter. The impact of force majeure continues to be evaluated and will ultimately depend on the extent and duration of this global pandemic. Operations and plant outage activities on all other units continued as expected in the second quarter.

Finally, in Power in late April, we did complete the sale of 3 natural gas-fired power plants in Ontario, the Napanee plant, Halton Hills and our 50% interest in the Portlands Energy Center. Net proceeds from that disposition netted approximately $2.8 billion that we used to fund our industry-leading capital program.

So in summary, today, we are advancing $37 billion of secured growth projects that are largely expected to enter service between now and 2023. We have invested approximately $11 billion into this program to date, with approximately $5 billion of those projects expected to be completed by the end of 2020. Notably, all of these projects are underpinned by cost of service regulation or long-term contracts, giving us visibility to the earnings and cash flow they will generate as they enter service.

Based on the strength of our financial performance and the promising outlook for the future, earlier this year, TC Energy's Board of Directors increased the quarterly dividend to $0.81 per common share, which is equivalent to $3.24 per share on an annual basis. This represents an 8% increase over the amount declared in 2019 and is the 20th consecutive year that our Board has raised the dividend.

Over that same time frame, we have maintained consistently strong coverage ratios with our dividend on average representing a payout of approximately 80% of comparable earnings and 40% of comparable funds generated from operations, leaving us with significantly internally generated cash flow to reinvest in our core businesses. Based on the continued strong performance of our base businesses and the organic growth we expect to realize as we advance our $37 billion secured capital program, we expect to continue to grow our dividend at an average annual rate of 8% to 10% through 2021, and 5% to 7% thereafter.

So in summary, I'll leave you with the following key points. Today, we are a leading North American energy infrastructure company with a very strong track record of delivering long-term shareholder value. Our assets provide essential service to the functioning of North American society and the economy and the demand for our services remains strong.

We have 5 significant platforms for growth: Canadian, U.S., Mexican and Natural Gas Pipelines, Liquids Pipelines and our Power and Storage business. As we advance our $37 billion secured capital program, we expect to build on our long track record of growing earnings, cash flow and dividends per share. We also have $11 billion of projects in advanced stages of development and expect numerous other in-corridor organic growth opportunities like the $400 million Elwood Power and ANR Horsepower Replacement Project that we announced today to emanate from our extensive critical asset footprint.

Looking forward, we will remain disciplined, continuing to our focus on safety, sustainability, working according to our values and responding quickly to market signals and signposts to ensure we remain industry-leading and resilient as we grow shareholder value.

I'll now turn the call over to Don who will provide you more details on our second quarter results and our financial position. Don, over to you.

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Donald R. Marchand, TC Energy Corporation - Executive VP of Strategy & Corporate Development and CFO [4]

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Thanks, Russ, and good morning, everyone. As outlined in our results issued earlier today, net income attributable to common shares was $1.3 billion or $1.36 per share in the second quarter of 2020 compared to $1.1 billion or $1.21 per share for the same period in 2019. For the 6 months ended June 30, 2020, net income attributable to common shares was $2.4 billion or $2.59 per share compared to net income of $2.1 billion or $2.30 per share in 2019. Second quarter results included a $408 million after-tax gain on the sale of a 65% interest in Coastal GasLink, along with an incremental $80 million after-tax loss on the disposition of the Ontario natural gas-fired power plants.

Second quarter 2019 also included certain specific items as outlined on the slide and discussed further in our second quarter 2020 report to shareholders. These specific items as well as unrealized gains and losses from changes in risk management activities are excluded from comparable earnings. Comparable earnings for the second quarter were $863 million or $0.92 per common share compared to $924 million or $1 per common share in 2019. For the 6 months ended June 30, 2020, comparable earnings were $2 billion or $2.10 per share compared to $1.9 billion or $2.07 per share in 2019.

Turning to our business segment results on Slide 15. In the second quarter, comparable EBITDA from our 5 operating segments was $2.2 billion, a $125 million decrease compared to 2019. Canadian Natural Gas Pipelines' comparable EBITDA of $621 million was $93 million higher than second quarter 2019, primarily on account of increased rate base earnings as well as flow-through depreciation and financial charges on the NGTL system from additional facilities placed in service. NGTL system net income increased $21 million compared to the same period in 2019 as a result of a higher average investment base from continued system expansions, and reflects an ROE of 10.1% on 40% deemed common equity, while net income for the Canadian Mainline decreased $3 million, largely due to lower incentive earnings.

U.S. Natural Gas Pipelines' comparable EBITDA of USD 595 million, or CAD 824 million in the second quarter, fell by USD 46 million or CAD 33 million compared to 2019, mainly due to the sale of certain Columbia midstream assets in August 2019, as well as increased operating costs on Columbia gas.

Mexico Natural Gas Pipelines' comparable EBITDA of USD 130 million or CAD 181 million rose USD 23 million or CAD 40 million versus second quarter 2019, primarily due to Sur de Texas equity income resulting from the commencement of transportation services in September 2019, and lower interest expense attributable to the weakening of the Mexican peso.

Liquids Pipelines' comparable EBITDA declined by $150 million to $432 million in the second quarter driven by lower uncontracted volumes on Keystone, decreased margins from liquids marketing activities and the sale of an 85% equity interest in Northern Courier in July 2019.

Power and Storage comparable EBITDA in the second quarter fell by $84 million year-over-year, primarily due to the planned removal from service of Bruce Power Unit 6 in January for its MCR program, along with lower Canadian power earnings, largely as a result of the sales of our Ontario natural gas-fired power plants in April 2020 and

Coolidge in May 2019 as well as an outage at our Mackay River cogeneration facility in 2020.

For all our businesses with U.S. dollar-denominated income, including U.S. Natural Gas Pipelines, Mexico Natural Gas Pipelines and parts of Liquids Pipelines, EBITDA was translated into Canadian dollars using an average exchange rate of $1.39 in second quarter 2020 compared to $1.34 for the same period in 2019. As a reminder, our U.S. dollar-denominated revenue streams are in part naturally hedged by interest on U.S. dollar-denominated debt. We then actively manage the residual exposure on a rolling 2-year forward basis with realized gains and losses on this program reflected in comparable interest income and other.

Now turning to the other income statement items on Slide 16. Depreciation and amortization of $635 million increased $14 million versus second quarter 2019 largely due to new projects placed in service in Canadian Natural Gas Pipelines, which is fully recoverable in tolls on a flow-through basis.

Interest expense of $561 million in the quarter was $27 million lower year-over-year primarily due to higher capitalized interest related to Keystone XL and Coastal GasLink up to its date of partial sale in May, subsequent to which CGL is now accounted for under the equity method versus previous full consolidation. The increase at Keystone XL is a result of additional capital expenditures, along with the inclusion of previously impaired capital costs in the basis for calculating capitalized interest following our decision to proceed with construction of the project. This is partially offset by new long-term debt issuances net of maturities.

AFUDC decreased $18 million compared to the same period in 2019, largely due to NGTL system expansion projects placed in service as well as the suspension of recording AFUDC on Tula effective January 2020.

Comparable interest income and other was $7 million in the second quarter and consistent with 2019.

Income tax expense included in comparable earnings was $125 million in the second quarter 2020 compared to $199 million for the same period last year. The $74 million decrease was mainly due to lower pretax earnings and a lower Alberta income tax rate. Excluding Canadian rate-regulated pipelines where income taxes are a flow-through item and are, therefore, quite variable, along with equity AFUDC income in the U.S. and Mexico Natural Gas Pipelines, we expect our 2020 full year effective tax rate on comparable income to be in the mid- to high teens.

Comparable net income attributable to noncontrolling interest of $63 million in the quarter increased by $6 million relative to the same period last year primarily due to higher earnings at TC Pipelines LP.

And finally, preferred share dividends of $40 million were in line with second quarter 2019.

Now turning to Slide 17. During the second quarter, comparable funds generated from operations totaled $1.5 billion, and we invested approximately $2.2 billion in our capital program, which, as noted, reflects equity accounting for our remaining 35% investment in Coastal GasLink post the closing of this partial equity sale.

While capital market conditions in 2020 have seen periods of extreme stress and volatility, during the second quarter, we took significant actions that meaningfully enhanced our liquidity and financial position. In April, we issued $2 billion in medium-term notes and USD 1.25 billion of senior unsecured notes in the Canadian and U.S. debt capital markets, respectively, on compelling terms.

In addition, we arranged USD 2 billion of incremental committed credit facilities and closed the sale of our Ontario natural gas-fired power plants for net proceeds of approximately $2.8 billion. In May, we completed the sale of a 65% equity interest in Coastal GasLink as well as the initial draw on a newly-established secured long-term project credit facility, resulting in combined proceeds of approximately $2.1 billion.

Finalizing these arrangements on Coastal GasLink, along with secured government of Alberta support for Keystone XL in the form of a USD 1.1 billion equity contribution and USD 4.2 billion loan guarantee means that a substantial portion of the funding required to advance these 2 large initiatives is now in place.

Now turning to Slide 18. This graphic illustrates our forecasted sources and uses of funds in 2020. The left column details total funding requirements of approximately $17.5 billion, comprised of long-term debt maturities and redemptions of $3.9 billion, dividend and noncontrolling interest distributions of approximately $3.3 billion and capital expenditures of approximately $10.3 billion, reflecting 100% of Coastal GasLink costs up to the date of its partial sale and only equity contributions to the project thereafter.

Funding sources are shown in the second column and include forecast internally generated cash flow of approximately $7 billion. Proceeds from the disposition of our Ontario natural gas-fired power plants, sale of a 65% interest in Coastal GasLink and associated project-level financing at CGL, which together generated approximately $4.9 billion. The government of Alberta's equity investment in Keystone XL of USD 1.1 billion, and $4.1 billion comprised of long-term debt that was issued in April, along with movements in balances of cash held in commercial paper outstanding.

Taken together, we are effectively fully funded for 2020 and along with more than $13 billion of committed credit facilities in place and well, supported commercial paper programs in both Canada and the U.S., positioned to assuredly navigate any prolonged period of disruption should that occur.

Now turning to Slide 19. In closing, our solid financial and operational results in what has been a rather momentous first half of 2020, highlight our long-standing diversified low-risk business strategy, the criticality of our essential energy infrastructure as well as the contribution of new high-quality assets from our ongoing capital program.

Our overall financial position remains robust. Today, we are advancing a $37 billion suite of secured projects through resilient internally generated cash flow and an array of attractive funding options.

Our portfolio of critical energy infrastructure projects is poised to generate high-quality long life earnings and cash flow for our shareholders, underpinned by strong fundamentals, solid counterparties and premium service offerings. We're offering numerous distinct platforms for future attractive and executable in-corridor organic investment. That is expected to support annual dividend growth of 8% to 10% in 2021 and 5% to 7% thereafter.

Finally, we will continue to maintain our historic financial strength and flexibility at all points of the economic cycle.

That's the end of my prepared remarks. I'll now turn the call back over to David for the Q&A.

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David Moneta, TC Energy Corporation - VP of IR & Financial Communications [5]

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Thanks, Don. Just a reminder before I turn it over to the conference coordinator for questions. (Operator Instructions) With that, I'll turn it back to the conference coordinator.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from Jeremy Tonet of JPMorgan.

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Jeremy Bryan Tonet, JPMorgan Chase & Co, Research Division - Senior Analyst [2]

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Just wanted to start off with KXL and wanted to see, I guess, to hit the 2023 in service, as you envision it now, how do you see the kind of legal hurdles or legal challenges going at this point? Just trying to get a feeling for how much contingency is built in there. And what milestones we should be looking for, try to get a better feeling for how that will progress. And I guess, what type of outcomes there would have you guys kind of step away from the project on the legal challenge side?

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Bevin Mark Wirzba, TC Energy Corporation - SVP of Liquids Pipelines [3]

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Thanks, Jeremy. This is Bevin. With respect to the legal challenges, there are 2 lawsuits, the first of which challenging the presidential permits, and the balance challenging our ability to advance construction in certain areas that have wet lands. Our schedule and plans can accommodate -- we're still targeting our 2023 in-service date at this point, and we anticipate resolving these issues through the balance of this year and into next.

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Edited Transcript of TRP.TO earnings conference call or presentation 30-Jul-20 3:00pm GMT - Yahoo Finance