Nalcor Energy Releases Business and Financial Report for 2016
March 30, 2017, St. John’s, NL – Nalcor Energy released its annual Business and Financial Report today, including Annual Audited Consolidated Financial Statements for the year ended December 31, 2016.
Nalcor recorded revenues of $824.1 million in 2016, an increase of approximately $13.6 million over the previous year. Operating profit for 2016 was $136.3 million, an increase of $152.3 million over 2015. Nalcor’s capital expenditures were $3.2 billion last year as the company continued to make critical investments in the ongoing construction of the Muskrat Falls Project as well as in core electricity assets. Total assets continued to grow to $14.1 billion as at December 31, 2016, up from $12.3 billion at the end of 2015.
“Nalcor’s overall financial performance in 2016 was positive, as we reorganized and focused on effective execution of our priority projects, while maintaining a clear commitment to safety and to delivering for customers, ” said Stan Marshall, President and CEO.
In 2016, key changes were made to the company’s organizational and management structure, to ensure a closer focus on Nalcor’s priority areas. These changes included 1) creating a more distinct separation between Newfoundland & Labrador Hydro and Nalcor’s non-regulated businesses, and 2) dividing management of the Muskrat Falls Project into two separate components – Power Supply (transmission) and Power Development (generation) – to bring increased focus, oversight, and risk mitigation to each area.
Progress continued on construction of all components of the Muskrat Falls Project last year. In Power Supply, work on all major transmission components was substantially advanced, including the transmission line from Churchill Falls to Muskrat Falls (more than 90 per cent complete as at December 31, 2016) and the Labrador-Island Transmission Link from Muskrat Falls to the Avalon Peninsula (more than 68 per cent complete). For the Strait of Belle Isle marine cable crossing, all three underwater cables were successfully installed on the seafloor, connecting Labrador and the island of Newfoundland for the first time.
In Power Development, approximately 58 per cent of total construction of the generation project was completed as at the end of 2016. Significant work was done in terms of concrete placement for the powerhouse and intake, the spillway was put into operation, the temporary cofferdams were completed and the river was diverted through the spillway, stabilization work on the North Spur dam was substantially completed, and river impoundment commenced.
Hydro continued to invest responsibly in the province’s electricity system in 2016 and put safe, reliable service for customers at the forefront. Approximately $219 million was invested in capital improvements during the year, and additional investments to improve reliability for customers will be made in 2017.
In the Oil and Gas business, Nalcor continued its offshore exploration strategy last year. An independent resource assessment conducted in 2016 indicated a potential 25.5 billion barrels of oil and 20.6 trillion cubic feet of gas in the West Orphan Basin. The November 2016 licence round for parcels in the West Orphan Basin yielded work commitments totalling nearly $462 million.
“Nalcor is dedicated to maintaining and managing the province’s energy assets for the long-term benefit of Newfoundland and Labrador, and the company is focused on making all the necessary preparations for integration of our electricity system and interconnection to the North American grid,” said Marshall.
Nalcor will provide a further overview of 2016 business and financial results at its Annual Meeting taking place today, Thursday, March 30 at 10:30 a.m. at the Holiday Inn in St. John’s. To register, please visit www.nalcorenergy.com or email firstname.lastname@example.org. The meeting will also be webcast live on Nalcor’s site.
Nalcor’s 2016 Business and Financial Report is available online at nalcorenergy.com.
Deanne Fisher, General Manager, Corporate Communications and Stakeholder Engagement