Enbridge Energy Partners said it expects its near-term profitability to remain within guidance, but external pressures mean a strategic review is necessary.
The company said Friday its guidance of adjusted earnings before interest, tax, depreciation and amortization of between $1.8 billion and $1.9 billion for 2016 was likely. The company, a top North American oil and gas distributor, said it was nevertheless continuing a strategic review into the second quarter.
"Despite significant progress on the cost structure, our natural gas gathering and processing business has been impacted by a continued cyclical downturn," Enbridge Energy Partners President Mark Maki said. "Therefore, we are taking necessary actions to support the partnership's near-term financial position and evaluate further strengthening measures through our strategic review."
At the trough of the market downturn last year, Maki said his company had a "high level of confidence" about its continued performance, but added vetting was underway for a wide range of options for durability.
The company at the time said mergers, joint ventures and reorganizations were among the options for its natural gas business.
Meanwhile, the company said it would continue to work under the broader Enbridge umbrella on advancing its proposed pipeline networks in North Dakota, one of the top shale producers in the United States. Maki's company, however, said reduced drilling in North Dakota and a decision last year to suspend efforts on the Sandpiper project designed for the Great Lakes states led to reduced revenue projections.
Nevertheless, Maki said the company's entire liquids pipeline business was performing well, both operationally and financially.
