TC Energy Corporation Stock

Welcome to the TC Energy Third Quarter 2026 Results Conference Call. [Operator Instructions] The conference is being recorded. [Operator Instructions] [Audio Gap] Vice President, Investor Relations. Please go ahead.

Thanks very much, and good morning. I'd like to welcome you to TC Energy's Third Quarter 2026 Conference Call. Joining me are Francois Poirier, President and Chief Executive Officer; Tina Faraca, Executive Vice President and Chief Operating Officer, Natural Gas Pipelines; Greg Grant, Executive Vice President and President, Power and Energy Solutions; and Sean O'Donnell, Executive Vice President and Chief Financial Officer.

Francois will start today with our strategic update, including our extended long-term growth outlook. Tina and Greg will then walk you through the growth drivers in each of our businesses in more detail. Sean will wrap up with our quarterly results and financial outlook with a few closing remarks by Francois before we move to Q&A.

A copy of the slide presentation is available on our website under the Investors section. Following remarks, we'll take questions from the investment community. Please limit yourself to 2 questions. If you're a member of the media, please reach out to our media team.

Today's remarks will include forward-looking statements that are subject to important risks and uncertainties. These include statements about our comparable EBITDA outlook, our growth projections and long-term financial targets. For more information, please see the reports filed by TC Energy with Canadian securities regulators and the U.S. Securities and Exchange Commission.

Finally, we refer to certain non-GAAP measures that may not be comparable to similar measures presented by other entities. A reconciliation is contained in the appendix of this presentation.

Before I pass to Francois, I'd like to start with a quick video celebrating 75 years of TC Energy.

[Presentation]

Thanks, Kevin, and what a great video that was. This year, we celebrate 75 years of delivering essential infrastructure. And while markets, technology and policy have evolved over time, 3 things have remained constant for TC Energy. First, our unrivaled geographic diversification, where we're the only midstream company operating at scale in Canada, the U.S. and Mexico.

Second, our focus on natural gas pipelines, reliably and affordably delivering the fuel North America relies on to meet growing energy demand. And finally, our extensive footprint, which is uniquely positioned at the intersection of natural gas and power, creating a differentiated platform to capture the next wave of energy demand. Our portfolio is one of one. We own and operate the most extensive natural gas network in North America with over 94,000 kilometers of pipeline infrastructure, moving more than 30% of the natural gas consumed across the continent, complemented by more than 4,600 megawatts of power generation, anchored by our equity interest in Bruce Power.

We connect prolific low-cost natural gas supply with major demand markets across Canada, the U.S. and Mexico, giving us deep incumbency, significant diversification and infrastructure that is increasingly difficult to replicate. And it's this incumbency that creates opportunity, but it is our culture that is the foundation of our ongoing performance. Our consistent focus on safety, personal accountability, one team and active learning underpins how we operate and execute. It enables us to maximize the value of our assets, execute on our portfolio of growth projects and ensure financial strength and agility. The result is what we've committed to deliver for our investors, solid growth, low risk and repeatable performance.

In 2023, we committed to strengthen our financial position, simplify our business and execute our clear set of strategic priorities, and we have continued to deliver on each. We focused on enhancing capital discipline and driving EBITDA outperformance, and we now expect our debt-to-EBITDA to exit 2026 at 4.55 to 4.6x, providing ample headroom to our long-term target of 4.75x. We became a pure-play natural gas and power company following the spin-off of South Bow, focusing on accretive, repeatable in-corridor assembly line style growth.

We've structurally integrated our natural gas business across our technical, safety and project groups, transforming project execution into a competitive advantage. And that progress has translated into meaningful value for our shareholders, delivering a total shareholder return of 118%. Over the last few quarters, we've discussed our readiness to increase our annual capital spending above our previous $6 billion to $7 billion range, contingent on financial capacity, continuation of attractive returns on new growth projects and the team's execution capacity to deliver projects on time and on budget or better.

First, we have built significant financial capacity by growing comparable EBITDA at a compound annual rate of 9% since 2022, while performing at the low end of our annual CapEx outlook. I'll remind you that every 10 basis points of headroom to our 4.75 leverage ratio gives us around $1 billion of incremental investment capacity to fund growth as we look out to 2031, which Sean will discuss in more detail. Second, the quality of our growth opportunities continues to offer generational returns, increasing from roughly 8% in 2020 to over 12% today while maintaining our low-risk preferences.

And finally, we have demonstrated execution excellence and have the organizational capacity to do more. 95% of our projects in development and construction are on or ahead of schedule and projects from 2025 to today have been delivered in aggregate at more than 10% under budget. We're building on that capability through AI and innovation, giving our teams new tools to improve productivity and create more value from our assets.

With that in mind, we are on track to achieving our $100 million goal of run rate AI and innovation-driven comparable EBITDA in 2026 with a target of an incremental $100 million in 2027. Combined, these factors are what drive our confidence to responsibly scale our capital program and deliver the next phase of growth.

U.S. LNG, LDC reliability and supply access have been the important drivers of our demand outlook over the past several years and remain foundational to the 51 Bcf per day of North American demand growth we see through 2035. But more recently, that outlook has expanded further, driven by accelerating power demand and growing momentum behind Canadian LNG and a greater focus on infrastructure development to diversify supply access in critical markets. In Canada, Bill C39 has proposed significant permitting reform that could offer greater certainty and reduce project time lines by 1 to 2 years while also offering improved cost efficiency and without compromising the rigor of the process.

More broadly, all 3 jurisdictions are prioritizing policies that advance energy projects and support the rising demand for reliable and affordable power. That alignment matters. It gives customers confidence and greater confidence to make the long-term commitments needed to underpin new infrastructure, creating more opportunities for us to invest at attractive risk-adjusted returns. Power and global electrification are major drivers behind the increase in our demand forecast compared to last year. Gas-fired generation in North America is forecast to grow 83% between 2015 and 2035 as natural gas provides both the baseload and the fast ramping generation needed to keep the grid reliable.

About 70% of the forecasted gas power demand growth over the next decade is in the U.S. Heartland, Alberta and Mexico combined, and we already are the incumbent in those markets, and new generation there will need firm transportation to secure its supply. And in Ontario, 18 gigawatts of new nuclear capacity is required by 2050, roughly doubling installed nuclear capacity, and that speaks directly to Bruce Power. The power opportunities we're advancing demonstrate how we can capture growth where molecules and electrons intersect.

Now this next slide is one of my favorite as it tangibly represents the future of TC Energy and the opportunity we have in front of us. With today's announcement of $3 billion of new projects, we now have $30 billion of sanctioned and pending approval project spend through 2031, primarily served through the continued conversion of our backlog into low-risk in-corridor natural gas transmission projects. Looking to our projects in origination, we've increased our opportunity set to more than $40 billion, reflecting the strength of rising power demand across both natural gas pipelines and power businesses. We've been deliberate in advancing our Canadian Power and Energy Solutions opportunity set. You've heard us over the past few quarters speak to the evolving customer needs and willingness to enter into commercial agreements that now align with our risk return preferences.

We've taken the time to high-grade that portfolio, giving us confidence to now present more than $15 billion of opportunities currently in commercial discussion. And Greg will discuss this in more detail shortly. Taken together across our natural gas and power businesses, over 2/3 of our capital opportunities are tied to growing power demand. This demonstrates once again that regardless of the demand driver, the strength of our footprint and the ability to provide complementary, reliable solutions with speed to market positions us to capture and monetize this opportunity set. We continue to make meaningful progress converting this opportunity set into high-quality growth that drives our financial outlook.

On the project execution side, year-to-date, we've placed $2.5 billion of assets into service on time and under budget and expect to get to $3.4 billion by year-end. Including today's announcements, so far this year, we've sanctioned $6 billion of growth projects, already achieving the low end of our $6 billion to $8 billion expectation for the entire year at returns that are consistent with what we are seeing today. Looking ahead to 2027, we're targeting an incremental $8 billion of project announcements informed by both our $6 billion of pending approval projects and over $40 billion in origination. These projects will continue to fill our unallocated capital capacity that will deliver our long-term growth outlook with IRRs consistent with 12%.

So this year, we are extending our outlook to 2031 and expect comparable EBITDA to grow at 5% to 7% annually over the next 5 years. Importantly, we can deliver solid, low-risk repeatable growth across this range while adhering to our debt-to-EBITDA target of 4.75x and growing our common share dividend at an annual rate of 3% to 5%.

We also have significant visibility to that growth with our sanctioned and pending approval projects, along with optimization of our base business, underpinning the low end of the range. What drives us to the upper end of the range is additional conversion of projects in origination to sanctioned capital. We have 75-year history of delivering results, and I am confident in our team's ability to continue that trend as the opportunity ahead of us is now even bigger.

And with that, I'll turn it over to Tina to walk through our natural gas business and how it's capturing its share of growth.

Our natural gas pipeline businesses continue to deliver exceptional results with record EBITDA and 10 new flow records set so far in 2026, all while operating safely and reliably. This performance is a direct result of our commitment to safety and execution excellence with our commercial, regulatory, project execution and operations teams working together across borders and disciplines. Our commercial strategy is working. We have reached 8 consecutive win-win settlements with our customers and regulators since 2024, providing greater revenue certainty while preserving opportunities to outperform.

In Canada, our extended incentive-based mainline settlement allows us to share an upside with our customers, driving strong discretionary revenue. In the U.S., our teams continue to capture value through new and amended contracts and operating efficiencies across the network. And in Mexico, our assets deliver strong availability, operating discipline and stable contracted earnings. Underlying all of this are our long-standing customer relationships, providing insights into evolving market needs and positioning us to deliver growth opportunities across our footprint.

Our network forms a strong platform for the next wave of demand, linking low-cost supply basins with growing markets. By 2035, more than 60% of North American production is expected to come from basins connected to our system. What sets us apart is our ability to connect that supply to market. First, we provide supply diversity at scale. Our footprint links 4 of the continent's most prolific supply basins directly to the Midwest, one of our fastest-growing markets.

Second, we are built for reliability. Whether it is our Crossroads project announced today or our 532 Bcf of integrated U.S. storage, we can provide flexibility across our network, helping us meet peak demand when our customers need it the most, and that is a competitive advantage.

Third, we have the reach to serve growing demand and reliability needs in constrained markets, creating opportunities to grow within our footprint and expand into new markets. Our Columbia Gas strategic corridor shows our strategy and competitive advantage in action. The Appalachian Basin has over 1,100 Tcf of proven natural gas reserves, representing over 80 years of long-term supply.

Our Columbia gas system alone moves roughly 20% of that production, which is forecasted to grow by 10 Bcf per day by 2035, supporting demand growth across 10 states. Columbia's TECO pool provides a key trading hub for that region, leveraging supply liquidity and storage assets to support growth across its footprint. The Appalachia supply project we sanctioned earlier this year, which is expandable through capital-efficient facilities demonstrates how we can leverage these advantages into growth.

Ohio demand is forecasted to grow by up to 40% by 2035. And our Columbia system delivers more gas to the state than any other operator, and our mainline corridors, laterals and storage provide a distinct advantage over single-line competitors. In the Mid-Atlantic, growing power demand is creating an increasing need for supply diversity with data centers, electrification and coal-to-gas conversions forecast to drive natural gas demand up to 45% by 2035.

As we look toward the Gulf Coast and Midwest corridors, we see opportunities to extend and connect our unmatched supply access to growing markets across our broader network. Crossroads is a great example, extending the reach of Appalachian supply through greater connectivity across our Midwest systems, including A&R and Northern Border. In the Midwest corridor, natural gas demand is expected to grow by more than 20% by 2035, led by power generation in MISO.

As the region becomes increasingly constrained, we see a significant opportunity to extend our reach, leveraging our U.S. and Canadian pipeline networks, storage and customer relationships to help meet that growing demand. Importantly, peak demand can almost double average demand in this region, among the highest in the country. Chicago cash prices have reached over $10 per MMBtu in 5 of the last 6 winters. This volatility increases the value of firm capacity that can reliably deliver gas when customers need it most.

Together, those fundamentals create opportunities to provide greater supply diversity, reliability and peak day deliverability while deepening our reach in a core market. So let's dive a bit deeper into the natural gas projects we've announced today. Crossroads is a USD 1.8 billion project that adds 1.4 Bcf per day of capacity, connecting the supply diversity strength of our network directly to growing Midwest demand. This project supports power generation, LDC reliability and supply diversity and access. It is a proof point for our corridor strategy. Crossroads creates another downstream extension opportunity through the American Midwest project, linking our diversified supply access directly to growing Midwest demand.

The American Midwest project modifies existing facility and adds compression to enable up to 1 Bcf per day of East-to-West capacity across Northern Border with a total project cost of approximately USD 400 million and TC Energy's proportionate equity contribution of approximately USD 100 million. Both projects are underpinned by 20-year take-or-pay contracts, primarily anchored by investment-grade utilities with a build multiple of approximately 6x and an expected in-service date in 2030.

Switching gears to Canada and our LNG connectivity. In September, we announced our investment in Coastal GasLink Phase 2, which advances our strategy to help meet growing global LNG demand. The expansion leverages existing infrastructure, adding 5 compressor stations and upgrading existing facilities. As the WCSB continues to look for additional egress opportunities and export market access, Phase 2 will nearly double the capacity of the pipeline supplying LNG Canada to approximately 4.5 Bcf per day.

At an estimated total project cost of $4.9 billion, Phase 2 represents a capital-efficient expansion with TC Energy's committed equity contribution of up to $250 million. LNG Canada will lead execution, while CGL provides technical advisory support with defined limits on capital and schedule risk. Importantly, CGL will remain the owner, operator and permit holder, maintaining the relationships we've built over many years with indigenous and local communities, governments, regulators, landowners and other stakeholders.

This project demonstrates our ability to grow alongside our customers while staying firmly within our risk preferences. As we look to convert the significant opportunity set in front of us, our approach is deliberate and disciplined. We work with customers early to rightsize and often upsize projects. We remain focused on our risk return preferences, long-term contracts with quality counterparties and returns that fit within our 5 to 7x build multiple range. And we engage early with communities, indigenous groups and regulators to derisk delivery. That work is creating tangible value.

Approximately 80% of the natural gas capital we sanctioned this year has been upsized through the development phase. The same discipline is translating into strong project execution across our portfolio. Our projects in development are tracking approximately 5% under budget with over 95% on or ahead of schedule. That's an exceptional result and a credit to our project teams. What we are seeing today gives me confidence that our development queue will continue to grow with high-quality, low-risk and executable projects.

Finally, active learning is how we continue to get better, and AI is now embedded in how our teams work every day. One of the clearest examples is a decision our gas control and commercial teams make every morning. How much pipeline capacity can we sell that day. Let me show you what that looks like in practice.

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Year-to-date, across our U.S. and Canada pipeline systems, AI-enabled capacity management initiatives have generated approximately $65 million of incremental EBITDA, demonstrating how we can unlock additional value from our existing assets. And that's just one of many levers. Across asset and market optimization, we are also using AI to enhance reliability and integrity, improve supply chain efficiency and strengthen safety and enterprise effectiveness.

This brings us back to where I started. Our incumbency gives us an advantaged asset base, but how we operate and optimize our assets is what drives outperformance. AI is giving our teams another tool to unlock that value. Ultimately, it's about continuously finding new ways to get more from the network we already have and translating opportunities into sustainable earnings growth.

With that, I'll pass it to Greg to update you on our Power and Energy Solutions business.

Thanks, Tina, and good morning. The opportunity in Power and Energy Solutions starts with our existing footprint and the strong operating capabilities of our team. For decades, we have owned and operated multiple generation technologies, including natural gas, solar, wind, hydro and of course, nuclear. And we've consistently delivered high availability, low forced outage rates that demonstrate our ability to build and operate these assets safely and reliably. That experience provides a solid foundation as we evaluate the opportunities ahead.

Right now, we have an enormous opportunity with an unparalleled position across Canada with over 4,600 megawatts of power, gas storage and an incumbent natural gas footprint that create the ability to offer a breadth of energy solutions to our customers. This creates a unique opportunity to leverage our natural gas footprint to develop and build the critical, reliable power generation that our customers demand. That combination of operating experience, infrastructure, market presence positions us to serve one of the fastest evolving power markets we've seen in decades. Now customers are looking for reliable power, speed to market and long-term certainty.

This aligns with what TC Energy has been doing for 75 years. Canadian electricity demand is expected to double to 2050, requiring substantial new investment in generation and the supporting infrastructure. While data centers have been the talk in all the headlines, the significant growth we're seeing actually is quite broad-based across electrification, transportation, industrial and residential load. And we're focused on opportunities that leverage our capabilities across our gas and our power footprints with strong counterparties that provide contracted cash flows with a return on and of our capital. And given our footprint, the depth of opportunities and our complementary capabilities allow us to be selective and pursue only those that meet our risk return threshold and still provide meaningful growth.

Bruce Power provides a clear example of how operating expertise, innovation, repeatability translate into increased cash flow and earnings. And we've talked previously about the MCR program and our team's ability to execute. Now what is particularly exciting is how technological innovation is creating the benefits that can compound for many years. At our Bruce teach-in earlier this year, we highlighted the robotic tooling pioneered on Unit 3, which helped the team return the unit 7 months ahead of the original ISO schedule. It was a great session led by our Bruce Power CEO, Eric Sassard, and is available on our website if you haven't had a chance to see it.

And we're already seeing those learnings carry forward. As an example, on Unit 4, the team delivered the Calandria tube install 25 days faster than Unit 3. And better execution has a direct financial benefit. In fact, now we expect to see Unit 4 back online by the end of 2027, almost 4 months ahead of the ISO plan. And as the MCR program progresses, equity income and distributions from Bruce Power are expected to increase materially in the 2030s. That growing stream of cash flow expands our ability to fund future growth while remaining within our debt-to-EBITDA target.

By the early 2030s, we expect Bruce Power free cash flow to unlock an additional $2 billion to $3 billion of annual investment capacity for TC Energy, providing greater capacity to pursue attractive opportunities, both across natural gas and our power footprint. The value of execution at Bruce extends well beyond the MCR program. We learn, we innovate and we carry these improvements forward that ultimately expand cash flow and earnings back to TC Energy.

Now we have multiple pathways to capture meaningful growth with a growing suite of power development opportunities located strategically along our natural gas footprint allow us to leverage our complementary natural gas and power capabilities. We have spent the last couple of years evaluating these opportunities and building a clear view of where our capabilities can create the most value.

Our customers' need for certainty, reliability and speed to market has created a unique value proposition for us. And given the breadth of our footprint and our ability to tailor solutions to customer demand. This portfolio now includes over $15 billion of projects in origination, representing almost 4 gigawatts of capacity. And importantly, these are relatively short cycle with more than 80% currently expected to begin contributing EBITDA within our outlook period to 2031.

And of these projects, we are already seeing significant traction and progress with potential announcements by the end of the year, representing $500 million to $1 billion of incremental investment. This portfolio represents a diverse set of projects in multiple markets that adhere with our risk return preferences and the ability to contribute near-term EBITDA. And I look forward to discussing this portfolio in more detail as it develops and sharing additional project announcements through 2027.

And at Bruce Power, our in-flight longer-term growth opportunities continue to progress. Project 2030 remains a capital-efficient, low-risk set of projects that will increase our output to approximately 7,000 megawatts, effectively adding the equivalent of a ninth reactor. And Bruce C provides longer-term optionality for up to 4,800 megawatts of potential new nuclear capacity. And the execution we're seeing through the MCR program provides an experienced workforce, supply chain, operating expertise and the project capabilities that give us the confidence to build Canada's next nuclear facility.

Taken together, we have multiple pathways for growth in power, maximizing the value of our existing assets, developing new contracted generation that can serve the growing power demand and continuing to advance our opportunities at Bruce Power, all within the same disciplined risk return framework, and this provides TC Energy with another pillar of low-risk, repeatable growth for decades to come.

Thank you. I'll now pass it to Sean to walk you through the financials.

Thanks, Greg. As you've heard this morning, strong execution and operating performance continue to translate directly into strong financial results. We've delivered over $3 billion in third quarter comparable EBITDA, up 13% year-over-year and comparable earnings per share of $0.94, up 22%. Year-to-date, comparable EBITDA is now $9 billion, up 13% versus the first 9 months of 2025. Each of our 4 business segments was higher year-over-year. Our natural gas pipeline business continued to perform exceptionally well with our U.S. natural gas pipeline comparable quarterly EBITDA up 17% versus last year, benefiting from $2 billion of assets placed in the service, commercial settlements and innovative contract sales.

Bruce Power achieved 97% overall availability and a full quarter of contributions from Unit 3 after the early completion of its MCR, driving our Power and Energy Solutions EBITDA up 35%. Together, these results put us in a strong position as we move through the balance of the year and give us confidence in the outlook ahead. The strength of our operating and commercial performance year-to-date gives us the confidence to raise our 2026 comparable EBITDA outlook to $11.8 billion to $12 billion.

As you see on the left-hand chart, our revised guidance represents a $200 million increase versus our previous 2026 range and more than $500 million above our 2023 Investor Day outlook. On the right-hand side, our strong performance is carrying forward into 2027. We now expect comparable 2027 EBITDA of $12.3 billion to $12.5 billion compared with the $11.7 billion to $11.9 billion outlook we provided at our 2024 Investor Day. Our ability to consistently deliver outstanding performance will be driven by a number of factors, including continued high asset availability, innovative AI and commercial marketing gains and continued scaling of our proven project delivery capabilities.

Turning to our capital program that underwrites this growth outlook. We continue to develop stronger and better visibility on our business development projects into the early 2030s. As you move across the chart, in origination opportunities will convert into secured projects over time, providing a clear path to growing our capital program. The backbone of that program continues to be our natural gas pipelines, representing more than 80% of our $30 billion sanctioned and pending approval project pipeline, all underpinned by long-term take-or-pay contracts or cost of service frameworks.

An increasing part of our opportunity beyond that is coming from our Power and Energy Solutions business, as Greg mentioned, where we are developing a multi-decade growth platform with many of these proposed projects having shorter development and construction time lines, allowing us to move more quickly from announcement to capital investment and ultimately to cash flow and EBITDA contribution. The timing and composition of our annual capital spending will evolve. As projects continue to develop, we'll look to optimize spend to smooth the capital curve over time. But what won't change our underwriting discipline, incremental investment must continue to deliver compelling risk-adjusted returns, strong cost and schedule execution profiles and consistency with our commitment to maintaining debt-to-EBITDA at or below 4.75x.

And as Francois mentioned, we are updating our long-term outlook to 5 years through 2031, where we are expecting to deliver comparable EBITDA growth of 5% to 7% over the new outlook period. Importantly, the low end of our range of approximately 5% is underpinned by sanctioned and pending approval projects and continued optimization efforts across our base businesses. Our 5-year outlook includes a portion of unallocated capital as we continue to high-grade our project backlog and increase our balance sheet's investment capacity to underwrite this EBITDA growth.

As you can see from the new waterfall format, delivering the EBITDA midpoint assumes approximately $8 billion to $9 billion of annual net capital spending from 2029 through 2031. And as a rule of thumb, $8 billion to $9 billion of annual CapEx implies we achieve approximately a 15% conversion ratio of our more than $40 billion origination pipeline that Francois presented. A higher conversion rate would support a run rate of net capital investment of more than $9 billion per year. That scenario would create a path to the upper end of the EBITDA range with the continued support of our commercial, operational, technological and AI innovations that you've heard a lot about today.

And finally, it's important to reflect on the tagline that TC will continue to adhere to our debt-to-EBITDA target of 4.75x as we deliver this updated plan. Turning next to the funding plan that supports our updated path to growth. We want to explain how the business is positioned to fund the investment opportunities across the 5-year plan. New capital being placed into service, strong operating performance, improved build multiples and capital efficiency over the past few years have built significant financial capacity on the balance sheet today.

And as Francois noted, we expect leverage to exit this year in the 4.55 to 4.6x range, well below our 4.75x long-term target. We've also taken further steps to bolster our financial capital available for growth projects through high-value capital rotation like our recently announced sale of our mature Guadalajara pipeline asset in Mexico. I'll reiterate, that our top priority is to continue to prudently grow EBITDA and additional balance sheet capacity ahead of the increased investment opportunities that we see coming in the next few years. We will do this through commercial and operational optimization, AI and technological innovation. We will maximize our capital efficiency on new investments and our return on invested capital across our existing asset base.

And as Greg highlighted, looking ahead to the early 2030s, growing free cash flow from Bruce Power is expected to unlock an additional $2 billion to $3 billion of investment capacity every year, which provides a substantial source of funding for our power and pipeline growth programs. I want to wrap up on this slide by highlighting the differentiated combination of solid growth, low risk and exposure to some of the strongest energy fundamentals in North America that our portfolio uniquely provides. 98% of our comparable EBITDA is from rate-regulated or long-term take-or-pay arrangements, while we continue to grow our dividend in the 3% to 5% range. We have compelling investment opportunities across our natural gas and power footprints, 2 areas where we see significant long-term demand growth, supported by a strong balance sheet and BBB+ credit rating.

And importantly, we have demonstrated our ability to translate those advantages into tangible shareholder value over the past few years, and we are confident in our ability to deliver on that same unique value proposition with the growth opportunities now ahead of us.

With that, I'll turn it back to Francois.

Thanks, John. I sum up the case for TC Energy in 4 words: Number one, stable. 98% of our cash flows are rate regulated or take-or-pay. We've got investment-grade customers in every jurisdiction and 26 consecutive years of dividend growth.

Number two, visible. We expect 5% to 7% comparable EBITDA growth through 2031, supported by nearly $6 billion of projects pending approval and more than $40 billion in origination. Number three, proven. We placed over $8 billion of assets into service in 2025 and expect another $3.4 billion in 2026 at an aggregate of 10% under budget.

And finally, number four, we are ready. With over $40 billion of opportunities in origination, where policy is incrementally supportive, fundamentals continue to improve and our teams have been built up to ensure safety, commercial and project execution excellence, we are ready to deliver the next wave of shareholder value.

With that, operator, we are now ready for questions.[Operator Instructions] The first question comes from Rob Hope with Scotiabank.

I appreciate all the incremental details here. I want to dive a little bit deeper in the 5% to 7% EBITDA growth outlook through 2031. So you do note that the low end supported by sanction and projects pending approval plus the optimization. But when we think about the upper end of that growth outlook, with new pipeline investments like Crossroads taking 4 to 5 years to get in service, does this imply that we could see incremental or higher power investments as those are shorter duration projects to get you towards that upper end of the band as it seems like pipeline investments may be beyond 2031.

Rob, thanks for the question. This is Sean. I'll take that one. Yes, you're exactly right. Let me just repeat back the question for you. Our 5% end of the range is completely underpinned by sanctioned and pending projects. That's more or less our $6 billion a year run rate that you've seen. To the midpoint and high end of the range, what we're working off of this $8 billion to $10 billion of incremental capital from $29 billion to $31 billion.

That could be another $6 billion to $12 billion on top of our sanction and pending. And that $6 billion to $12 billion that we're looking for to get to the high end of that range, we're working off of a $40 billion backlog to get to that $6 billion or $12 billion to kind of understand where the high end of the range might come from in between [indiscernible] business, there's a lot of fixed opportunity across gas pipe and power. And there's $15 billion of that is in power. So I think it's highly likely that you're going to see a meaningful component in the back end of the decade that power begins to deliver capital and EBITDA [indiscernible].

Maybe moving over to the second question. How are you thinking about kind of the risk reward framework for incremental Power and Energy Solution investments? If you are targeting 10- to 25-year contracts, are you looking to ensure that you get the full return of capital in the contract period? Or are you willing to take some recontracting depending on where you're seeing the fundamentals?

I'll start, Rob, and then I'll ask Greg to provide some comments. I just overall from a macro perspective, what we've seen, particularly in Canada is an increased willingness to enter into longer-term contracts. So in every circumstance we're looking at here and what's in the $15 billion of backlog, we earn a return on and of our capital entirely in the contract period. Some instances, the contracts are as short as 10 years. But in those instances, we do still check that box. Greg?

Yes, sure. And happy to have. We -- as I mentioned in the opening remarks, we've been taking a couple of years looking at the market. We spend a lot of time looking through numerous opportunities. You can imagine the number of opportunities we see across our footprint given the need for that reliable backstop power, which gas is the natural solution for that. So we have a very diverse group of projects, and we are being extremely selective. We have to hit the risk return preferences. Tina's team continues to deliver great projects, and I'm going to deliver the same thing.

Your next question comes from Praneeth Satish with Wells Fargo.

There's a bit of an echo when you guys speak. So I'm not sure if some of what I'm saying has been covered. But maybe just on the early-stage origination funnel. So that doubled from $20 billion last quarter to $40 billion this quarter. Can you just unpack, I guess, what's driving that step-up? Is it a few large opportunities or the power projects in there? And then you gave the percentage of projects that are natural gas, but can you comment on what percentage of the $40 billion are specifically U.S. gas projects?

Maybe I'll start, Praneeth, give you a little bit of a breakdown. Of that $40 billion funnel, it's roughly broken down 50-50 between the U.S. and Canada. And from a natural gas pipeline perspective versus power, it is $25 billion for the gas business and $15 billion for power. All of our Power and Energy Solutions projects in the origination bucket are in Canada.

Okay. That's helpful. And then maybe just -- sorry, go ahead.

No, I didn't have anything to add. Thanks, Praneeth.

Okay. Maybe just on the power opportunity, the 3.5 gigawatts, $15 billion. I guess I was a little surprised to see the contract duration as short as 10 years. I know it's a range there. But what types of projects or risk profiles would you -- would make you comfortable accepting a shorter duration contract? And then on the technology for these projects, are you looking at combined cycle gas turbines or simple cycle gas turbines? And are you expecting these to be grid connected or fully off-grid?

Okay. Great. Thanks. It's Greg. I'll take that one. So just reinforcing Francois's previous comments, even if it is shorter-dated contracts, we are looking for return of capital -- risk and return on capital. So when we talk about 10 years, we're not being exposed to terminal value risk in those situations. So you will see a multitude of duration just given some of the customer mix that we have. And they will all be counter or counterparty creditworthy, of course. In terms of technology, the opportunity set that we have is actually quite diverse.

It could be all of the above that you mentioned, whether it's combined cycle, simple, recips or otherwise. What we are looking to do is provide a very unique customer solution for different customers. Some of those might behind the meter. Some of those will be grid connected. As I mentioned in my opening remarks, we're seeing demand not only for data centers, but in industrialization, electrification or otherwise. So we do have a diverse set of opportunities across Canada, which is why I'm so excited and why I believe that we'll be able to accelerate some of these opportunities.

And if I might, Praneeth, I'll just add that -- you've heard us talk in the past about how deliberate and strategic we are around creating strategic relationships and alliances with our supply chain, for example, for turbines for compressor stations and the like. We've taken the same approach on the power side. So despite the fact that these are quick to cash flow projects, we have a high degree of confidence in being able to secure all of the required equipment and the various technologies to deliver on these projects in the near term as we've been working on this for quite some time.

Your next question comes from Ben Pham with BMO Capital Markets.

I want to start with the Canadian business. The existing NGTL framework supports up to $3.3 billion of capital. You've only announced $1.2 billion FID. Do you update on discussions on a broader investment framework beyond the current program and whether these Canadian projects tend to compete more consistent with the U.S. side of things?

Thanks for the question, Ben. I'll start, and I'll pass it over to Tina to provide a little bit more detail. NGTL is foundational to this company's business profile, its business mix and its growth. I would say that discussions with our customers are progressing. We have over 300 customers on NGTL versus less than 100 on the mainline. So it's proven to take a bit more time. And I want to be clear that we intend to build -- we simply need to land on an appropriate risk return framework.

You alluded to the multiyear growth program and our original estimate of over $3 billion of capital being required to meet our commitments of egress in excess of 1 Bcf a day. We've actually outperformed and we found a way to exceed that 1 Bcf per day commitment with far less capital than was originally estimated. That's a win-win because it keeps the tolls down for our customers.

So the new investment framework, I'll remind you, we had a settlement until 2029. This is about capital allocation from 2029 forward. And we are prepared to take on more risk on the cost and revenue side of the equation in order to have the opportunity to earn a higher return. And as I said, we are starting to see some progress with our customers. And over to Tina to give you a little bit of color on that.

Yes. Thanks, Francois. As you mentioned, we are working really closely with our customers to develop a win-win solution. We really care about the health of the basin. And as a proof point, our NGTL rate base has more than tripled over the last decade. We've invested between 2015 and 2025, we've increased from $6.1 billion to about $18.7 billion. And just over the last 5 years, we've invested about $6.5 billion of growth capital along with almost $2 billion of maintenance capital as well.

To advance the investment framework, we are in the market and with service offerings that have recently closed, and we're seeing a strong uptake on the 1 Bcf of offerings that we've put out into the market, again, continuing to reflect the customer engagement and the need for capacity on the system.

A couple of interesting tailwinds. Bill C-39 could be a really important opportunity for us to more efficiently build out the system and build it out in a shorter time frame. So we're looking at that as a very positive tailwind for us to support the basin and support our customers. And we're really proud of the track record we've had on previous settlements, and we're confident we can get to a settlement.

Our time line for this is we're targeting a settlement by the end of Q1 of 2027 so that we can ensure we can advance the capital necessary to support that growth. And at that time, if we have not achieved a settlement, then we would need to look at alternative routes to get that capacity moving forward, including working with the regulator to advance those projects.

Okay. Got it. Maybe to switch over to Bruce Power. You mentioned again that $2 billion to $3 billion of annual investment capacity that could get unlocked in early 2030s. Can you confirm whether or not a portion of that amount is baked in that $8 billion to $10 billion capacity you mentioned today? And can you also clarify how much you think of that $2 billion to $3 billion will be tied up in the MCR program versus being available for the growth opportunities?

Ben, it's Sean. Thanks for the question. To the first part of your question, how much of Bruce is in that capital program, of course, the MCR program, right? Some of the first and best dollars that we spent, that is obviously in our base case program. To your second question about the post-2030 Bruce contribution, in my opening remarks, the comment was Bruce unlocks $2 billion to $3 billion of investment capacity that we will bring back into Gasco and [indiscernible] beginning in the early 2030s. That is a gross number.

So to answer your question specifically, when the Bruce C decision is ultimately made, designing that program to ensure that Bruce can self-fund Bruce C and still bring capital back so that we can continue to fund what you've heard about this morning between Tina and Greg's businesses and that growth outlook. That is the plan as it stands today that we will bring money back from Bruce independent of Bruce C to fund the 2030 version of the programs that you've heard today.

Just to double confirm the numbers and the path ahead, you're moving from 6 to 7 capacity to 8 to 10. As you get to 2030 plus, does that go to 10 to 13 then? Or is that some of that Bruce [indiscernible] Bruce capacity [indiscernible].

That's a question we have a lot of fun with, Ben. The answer is we'll see, right? We're talking today about an incredible new opportunity in PES, right? We've got to deliver on that to be able to make decisions about capital allocation into the 2030s. And in this same kind of 2-year window, we're going to know a lot more about Bruce C. But look, fundamentally, there's a tremendous amount of optionality in terms of capital availability and opportunity in the 2030-plus time frame, and that's really what we're so excited about. The best projects are going to win at the end of the day.

And I might add to that, Ben. I think you're asking how big could this get? And remember, we have 2 guideposts we'll never lose sight of. And the most important one is our human capacity. When you think about the fact that we are now ready to step up above the $6 billion to $7 billion range on an annual cadence in that 8 to 10 area. Once the MCR program at Bruce is done, that frees up a whole bunch of capacity within Bruce Power. So the numbers could get very large.

We could actually be in excess of $10 billion a year in a scenario where Bruce Power is proceeding with Bruce C. To see us within the TC family on the pipeline and non-Bruce Power side go above 10. We're going to take this a step at a time and just make sure that we're always executing with excellence. But again, we're going to leverage the capacity of the Bruce management team to every extent possible. And if that gives us growth well above the top end of the range in the 30s, that's great.

Your next question comes from Jeremy Tonet with JPMorgan.

We've seen a lot of Appalachian production growth create opportunities for TC [indiscernible] moving gas around in-basin in Ohio or moving it over to Chicago with some of the newer projects here. Just wondering if you could speak a bit more to the opportunity set as you see it. Could some of this Appalachian production, more of it make its way down to the Gulf Coast or hit other markets? And what opportunities could this present for TC here?

Yes, Jeremy, thanks for the question. We're advantaged in our Appalachian position, specifically on our Columbia Gas system. We are the #1 operator in that region. We transport about 20% just on Columbia gas of all the Appalachia supply. We can move that gas to more than 10 states and beyond. We see a lot of liquidity in that region with our TCO pool. We have over 285 Bcf of storage in that region. So our footprint is highly advantaged to bring that supply to market.

A great example of that is our Crossroads project, where we are now connecting the Midwest corridor through Crossroads, Columbia, ANR, Crossroads, Northern Border, where now we have a greater reach of that production, that supply. And so we're really excited about how we're able to now create more of a header system across the Midwest that can advantage us even further with our incumbency.

As far as getting gas to the Gulf Coast, we certainly stand ready to do that given our Columbia gas and our Columbia Gulf assets. Right now, the growth that we're focused on is in the Midwest region. But with our Columbia Gulf system, there's opportunities to expand that service further when the market is ready for that.

And just to add to that, Jeremy, what you've seen us do this year with Appalachia supply and Crossroads is we've built 2 major arteries of egress out of the Appalachian Basin into markets that we have not had really tremendous access to in the past. So we've talked about the growth potential and upside potential on the Appalachia system. You can see us bringing in additional volumes on Crossroads and through that whole path here over the course of the next year as well.

Great. Thank you for that. It was a little bit choppy on my side. I didn't quite catch all of it. But maybe just pivoting to Mexico, if you might be able to just provide an update there on those assets and whether any monetization could make sense in the future.

Jeremy, I'll start on the opportunity set, and then we'll pivot to the other part of the question. As we continue to support CFE in their build-out of generation infrastructure and supporting plan Mexico, we're continuing to advance opportunities to connect our existing assets through, say, small-scale laterals or very capital-efficient projects to ensure we can get that gas to the generation market. You'll see us looking to leverage our base system, not building new systems, but optimizing what we have and ensuring that we're able to support the government's objectives and grow our systems alongside that.

And Jeremy, it's Sean. I'll take the second part of your question about capital rotation. I mean, obviously, you saw our announcement on the mature Guadaljara asset, very high value for mature assets. And I'll say, look, generically, this isn't specific to Mexico. Generically, we look at those opportunities across our entire system. Sell for high-value multiples against a really competitive lower build multiple. That just -- that always makes sense when the market is there. But importantly, look, the plan that we just put out, our 5% to 7% with $30 billion to $42 billion of capital, that does not, as currently laid out, require any capital rotation or M&A of any type. But of course, we always are on the look for kind of high-value rotation opportunities where they exist.

Your next question comes from Robert Catellier with CIBC.

Just wanted to check a couple of things on the power side first. You may have touched on this, but there was a bit of an echo. So my understanding what you're seeing in terms of the large increase in the origination part of the portfolio is really the market sort of adjusted to your risk preferences rather than a change in strategy there. And I think you touched on this a little bit, but can you just walk us through your confidence in having access to equipment and quality construction crews in order to execute on that plan?

Yes. I'll start, Robert, and then ask Greg to provide some context on sort of the diversity of customers we're looking at and then also on the supply chain side. But you're right, our risk preferences have not changed. What's happened is that the markets appetite and willingness to enter into the type of long-term contracts that fit now within our risk preferences has evolved. Part of that is because the various states, provinces and utility commissions are coming out with very clear criteria on what a data center needs to provide in order to get approved.

And one of them in various terminologies is bring your own power. And so less of a reliance on eventually connecting to the grid and just signing a shorter-term contract with an independent power provider and more that, that is the permanent solution. And so on that basis, they're willing to sign longer-term contracts. And so the risk profile of the market has gravitated towards our fairway.

Yes. And if I can add, Francois, we touched a little bit on it, but really, what we offer is that speed to market and reliable backstop. And I think that's really where the market is going. When you think about the footprint that we have and where we're able to offer that gas and power solution is creating those very selective opportunities where we can get the returns with the contracted cash flows. So I think that's important.

And then as we think about the capability or the capacity of the organization, remember, we've been in power for 30 years. We have a large project team supply chain. We're one of the largest purchasers of equipment across North America. We've been working on this for a couple of years, highly confident in how we're thinking about approaching the market and being able to execute against that pipeline.

Okay. That makes a lot of sense. And then just you sort of partly answered this next one, but with the midterm elections done now, what is your initial take on the practical implications for project execution on the ground level? Obviously, change -- both commerce -- chambers of Congress have switched over to Democrat. But I think just as importantly, there's some new Democratic governors. So how do you see that impacting the way forward in terms of specifically power, but also on the pipeline side?

Yes. Thanks for that, Robert. And it shouldn't surprise you that one of the first things we assess as we look to evaluate the capital investment opportunity is permitting risk. It's a core competency of ours. It's something that is a very high priority in our very early triage of projects. So when you look at where we are supporting utilities in the United States with pipeline projects, we are in states where the PUCs have been very proactive in establishing very large customer rate categories, where there is support for data centers.

We've stayed away from some other states like Texas, for example, where there's been a little bit more of a variance. And our first look at where we have new elected officials, whether it's within the Senate or the House of Representatives or at the governor level, we see in every instance actually, where we've chosen to participate pretty constructive points of view. In fact, in some cases, where Democrats -- the Democrat candidate prevailed, he or she had a more constructive view towards data centers than the Republican counterpart. So all told, we've been very deliberate about where we actually want to allocate capital and focus a great deal on permeability, and we still feel very good about the portfolio that we're developing.

Your next question comes from Aaron MacNeil with TD Cowen.

Sean, you framed the midpoint as requiring, I think, 15% conversion of that $40 billion origination portfolio. Should investors view growth in the pending approval bucket as the sort of key leading indicator that you're tracking towards 7%? Or is there a better metric we should watch? And when would that need to become visible to support the upper end by 2031?

That's a great question, Aaron. Look, in our pending bucket, you heard Greg today say, look, he's got between $5 billion and $1 billion of power projects that could sanction very quickly, right? So I'd tell you that's probably a leading indicator, number one. The rest of pending is, by and large, in the GasCo business. So I think it's going to be a -- it's a little bit of both, like that pending bucket is at $6 billion is a really important kind of first step in 2027 for us.

And then I think just to put a little bit of pressure on Greg, it's 1 or 2 announcements here in the next couple of quarters, I think that's really the litmus test for whether that $15 billion business development opportunity has the speed and acceleration and size that we hope it does.

Okay. Great. Maybe that's a good segue over to Greg. Just following up on this power discussion. You've talked about behind the meter increasingly becoming a permanent solution. How much of that almost 4 gigawatts is specific to Alberta? And are you actively pursuing sort of dedicated behind-the-meter generation for Alberta data centers? And if so, how advanced are those discussions commercially?

Yes. Thanks. Happy to provide a bit more support around that. Obviously, Alberta is a big market for us given the complementary solutions we have around gas storage. We already have a power portfolio there. We're quite ingrained in the market. So we see a lot of opportunities. But that's not our only market. We do have multiple projects across Canada. As I mentioned, some are grid connected, some will be behind the meter. We get comfortable behind the meter, where we do have the contractual protections and the offtaker where we're comfortable in doing that.

The importance of that is the speed to market. And I think that's what we're seeing as customers that require the speed to market, and it's an opportunity where we can really step in -- so not to provide percentages on where we are in Alberta versus the rest of Canada, but I would just leave you with -- we have a very diverse pipeline, which, to Sean's challenge, I'm very comfortable that we'll see some of those announcements coming through this quarter and into next year.

And if I might add, Aaron, as I said before, we've been very strategic in forming alliances with various supply chain providers. And as we announce our projects over the ensuing quarters, we'll be able to shed more light on that work. And I think it's work that you will find very accretive to value for our shareholders.

Your next question comes from Theresa Chen with Barclays.

I'd like to touch on today's FID of the American Midwest expansion on Northern Border, which follows the FID of a separate Bakken residue egress expansion to enter service later this decade. In light of these developments, can you shed some more color on how you expect these expansions to alter regional flow dynamics, including the share of AECO versus Bakken residue gas on Northern Border?

Thanks, Theresa. I'll add some color on that. As I mentioned, with our cross projects, we have another project, the American Midwest project that allows us to bring gas into the Northern Border system, move that from an East to West perspective. So it's going to provide another supply solution for that part of the system and where we see significant utility growth needs on -- in those states there.

As we look at Northern Border long term and even many of our systems, we could see header system type of projects where you can get gas from either end of the system. So for example, on Northern Border, we've got Bakken egress. We've got WCSB egress. We'll now have Appalachia supply coming into Northern border off of the Crossroads project. And so I think it's going to provide our customers with a lot of optionality on how to source supply. And the great news is we have the incumbency position there where we've connected all these systems to make sure we have -- we're able to optimize and execute efficiently in order to meet the customers' needs.

And going back to your growth outlook, when we think about the $40 billion plus of projects in origination stage, how much potential upside do you see relative to your base case 15% conversion ratio? And given the momentum, if commercialization efforts ultimately progress at an accelerated pace, do you foresee any need to tap into alternate funding sources, including external options?

Theresa, it's Sean. I'll take that one. Look, in the $40 billion bucket, as Greg mentioned, we have looked at a lot in power, right? That $15 billion is a very well-informed number relative to the market opportunity. And what I'll tell you about that plan is it is designed to be internally funded with internal cash flow even at the high end. And that's an important consideration. This is an internally funded plan. No equity, no M&A, no capital rotation needed to achieve this plan if we can deliver as expected.

But look, what could drive external funding? In a scenario where our conversion ratio is 25%, 30%, 50% and it accelerates forward, if Greg's business, the speed to market value and the opportunity capture allows us to do -- capture better economic opportunity faster, we will do that. And it's a very simple calculation for us is lease cost funding, dollar per share accretion. And that's really the difference of what the next 5 years is going to be about is opportunity drives capital strategy, and it's not capital constraining anything at any point, all within, as Francois said, our 4.75. So it's a really exciting framework, and we'll keep a close eye on that. And you should keep a close eye on the FIDs here over the next year because that will really tell you what the back -- the next kind of 2 or 3 years are really going to define the answer to your question.

Your next question comes from Maurice Choy with RBC Capital Markets.

Just want to follow up on that last comment, and thank you, Sean, for confirming that the high end $10 billion is all internally funded. Can I just quickly ask, how much of this $8 billion to $10 billion is effectively locked in already? And what assumptions have you made to get to the $10 billion, be that AI or otherwise?

Sure. Of the $8 billion to $10 billion, how much is locked in already? To be fair, what is locked in is sanctioned. What is highly likely is our $6 billion of pending, so call it $30 billion for all intents and purposes, locked in. And that $40 billion is we're constantly moving and high-grading these projects. And like I said, Greg has got to beat on upwards of $1 billion that are pending, but really high likelihood. And Tina, of course, has much more than that in origination that is, I think we would call highly confident.

So that's -- there's a huge opportunity set at $40 billion to draw the best projects forward into a couple of billion dollars per year to get to the $8 billion to $10 billion. And I'm sorry, I'm going to ask you to repeat the second part of your question just so I get it right.

Sorry just so I clarify, what I meant was if you delivered the $30 billion, does that mean $8 billion or $9 billion of your funding capacity is locked in? And assuming that's the bridge to $10 billion, is that all AI initiatives?

Okay. Sorry. So the second part of your question, let me start with, look, as we're building investment capacity, the way we think about this is Look, we're looking at nearly $12.5 billion of EBITDA next year. And really, what I would encourage you to look at is look at our secured capital table as we are putting capital into service every year. And Page 15 of our disclosure shows you exactly kind of what we have every year. It's a very steady cadence of capital going into service every year from now through 2031 and a couple of particularly strong years. That drives the balance sheet capacity. That drives our ability to then reinvest kind of in the growth. All of that, that's the major driver.

And now you are hearing about other elements of we've got, as Tina mentioned, on the pipeline business, the capacity optimization, the AI optimization, those are real numbers, right? And you heard Francois in his comments today, it was $100 million realized this year. We're going to double that next year. And we expect that to continue to be, look, an important, but not nearly as large as the in-service capital. but we will scale all of those programs over the next 5 years to deliver that investment capacity.

Understood. And if I could finish off with a more big picture question on the growth drivers that you have. Be that 2 years ago when you had Investor Day or even last year, LNG was the biggest driver of North America's natural gas demand through to 2035. And today, you shared that 2/3 of your project funnel are tied to certain power demand. How would you characterize your LNG connectivity as a growth driver for you moving forward relative to your power demand opportunity set?

Thanks, Maurice. As you take a step back, over the last several years from 2022 to 2026, we placed in service about $17 billion of projects to support LNG growth, about 8.8 Bcf per day. So we've been very active in supporting the LNG export market. Additionally, we have a project that went into service just November 1, our Gillis Access Extension project, again, supporting LNG access to the Gulf Coast. We have our Cedar project off of our Coastal GasLink project that's under construction right now, and we will be supporting more West Coast LNG export.

We just announced Phase 2, which will be doubling the capacity of the pipeline to support LNG Canada. So we are very active in supporting that demand. As we look forward, we will continue to optimize our systems to -- given the connectivity that we have there and the infrastructure to support LNG demand, but we also see a very large opportunity set in front of us on the power side.

Your next question comes from Keith Stanley [Audio Gap] Wolfe Research.

On the new power opportunities, can you say are you looking more at combined cycles or smaller-sized turbines that you maybe build a little more quickly? What's the bigger piece of the mix? And how soon could you theoretically have the first power projects come online from a supply chain perspective?

Keith, it's Francois. I'll take this one just to relieve some pressure on Greg. Look, that's commercially sensitive information. We've got a very interesting supply chain strategy and strategic alliances that we have formed. We believe it is a significant competitive advantage. And I appreciate the question very much, but we're going to keep our supply chain strategy to ourselves until we're ready to announce the projects. And as Greg said, we could potentially be announcing 1 or 2 projects in excess of $1 billion as early as before the end of 2026.

Okay. Great. And then on the mix piece, is that something that's maybe less sensitive on combined cycle versus smaller scale, what you're looking at?

That's correct.

Okay. The second one is on Crossroads. So you're at 1.4 Bcf a day. Is there -- with the current project configuration in diameter, is there a potential to upsize that project further if you found incremental demand? Or is it pretty fully baked at 1.4.

Keith, yes, there is definitely opportunity to upsize that system. And with very limited capital and capital efficiency opportunities, we can increase the capacity of that project from 1.4 Bcf per day to over 2 Bcf per day. And over and above that, we can obviously continue to do things like looping and other more specific targeted efforts.

Additionally, when you think about Crossroads, it has market attached to it as well as market that's downstream. So the more market that comes on the Crossroads system, we could actually have even more efficiencies in how we could support that. So we have a great opportunity to upsize that project as the market transpires.

Ladies and gentlemen, this concludes the question-and-answer session. And if there are any further questions, please contact Investor Relations at TC Energy. I will now turn the call over to Francois Poirier for any closing remarks.

Thank you for your thoughtful questions today and for joining us. Please reach out to our Investor Relations team if you have any further questions, and we really look forward to continuing our conversation and updating you on our progress. With the opportunities in front of us, I've never been more confident and excited about our future. Thanks, and have a great day.

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

Thank you for standing by. This is the conference operator. Welcome to the TC Energy Second Quarter 2026 Results Conference Call. [Operator Instructions] The conference call is being recorded. [Operator Instructions] I would now like to turn the conference over to Mr. Gavin Wylie, Vice President, Investor Relations. Please go ahead.

Thank you. I'd like to welcome you to TC Energy's Second Quarter 2026 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 operational and financial highlights.

A copy of the slide presentation is available on our website under the Investors section. Following their remarks, we'll take questions from the investment community. We ask that you please limit yourself to 2 questions. And if you're a member of the media, please contact our media team. 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 and Exchange Commission.

Finally, we'll refer to certain non-GAAP measures that may not be comparable to similar measures presented by other entities. A reconciliation is contained in the appendix of this presentation. With that, I'll now turn the call to Francois.

Thanks, Gavin, and good morning, everyone. I'd like to begin today with an update on the strong momentum we continue to see across our businesses. We're capitalizing on the competitive advantages afforded by our incumbent footprint in some of the highest growth markets in North America and converting strong demand into high-return growth projects.

Our consistent focus on safety and execution excellence is the foundation that delivers reliable service, it wins new business, and it ultimately drives higher financial performance that continues to create long-term shareholder value. Through the first half of 2026, we've made meaningful progress on our development pipeline. We placed approximately $2 billion of assets into service, largely on time and on budget or better, and we expect to place approximately $3.5 billion into service by the end of the year. Including approximately $700 million of new natural gas pipeline projects we announced this quarter, we've now sanctioned $3 billion of growth projects at a weighted average unlevered after-tax IRR of approximately 12%.

Our late-stage pending approval bucket now stands at approximately $7 billion, up $1 billion from last quarter. This portfolio reflects multiple projects in advanced stages of commercial discussions with large anchor customers and now includes our Crossroads project, where we have executed precedent agreements subject to Board approval with multiple anchor customers and are in advanced discussions with several other potential shippers. We continue to evaluate opportunities to expand the project scope with additional shippers and expect to sanction the project in the fourth quarter of this year.

Looking further out, we have over $20 billion of additional projects in advanced stages of origination that align with our targeted 5 to 7x build multiple range, further supporting our long-term growth visibility. Collectively, this progress reinforces our ability to grow our capital investments while maintaining our disciplined approach to project execution, risk-adjusted returns and balance sheet strength. Our expanding capital backlog is anchored by fundamental demand growth driven by the next wave of LNG, accelerating power and data center load, LDC reliability and connectivity between low-cost supply and high-value markets, each aligning to a strategic pillar of our portfolio.

Our latest outlook now points to an approximately 51 Bcf per day of incremental North American natural gas demand by 2035, and that's a 40% increase over 2025 levels and represents an 11 Bcf a day increase from our original outlook. Accelerating power demand accounts for more than half of this increase and now represents approximately 16 Bcf per day of incremental growth through 2035. Importantly, nearly 70% of this demand growth is concentrated in the U.S. Heartland, Alberta and Mexico, regions where TC Energy has a strong incumbent position and significant existing infrastructure.

Additionally, customers are increasingly prioritizing supply diversity and reliability. And by 2035, more than 60% of North American natural gas production will originate from TC Energy connected basins, primarily Appalachia and the WCSB. So why are we growing our backlog and capturing growth? In the majority of premium markets we serve, we are the incumbent, often the largest provider, and that allows us to develop cost competitive expansions, converting this strong fundamental backdrop into our growing capital backlog. Our extensive footprint and our integrated storage capability and long-standing customer relationships allow us to develop innovative commercial solutions that meet evolving customer needs.

Today's project announcements are a clear example of these advantages in action, reflecting growing demand from natural gas-fired power generation and data center development. The 2 U.S. projects on our Columbia system were sanctioned at a weighted average build multiple of approximately 5.8x, demonstrating the quality of our opportunity set. And in Canada, we continue to serve growing customer demand through our multiyear growth program with the latest expansion project on our NGPL system.

Across our systems, we continue to see high-quality, low-risk and highly executable opportunities with more to come. Fundamentals in Canada are strengthening and customer demand continues to validate our strategy. Our outlook calls for over 8 Bcf per day of additional Canadian natural gas demand through 2035, driven by NextWave LNG, including Coastal GasLink Phase 2, industrial growth and evolving power and data center load. Our extensive natural gas franchise is uniquely positioned to capture this growth with the NGTL system serving as the primary conduit connecting Western Canadian supply to expanding markets within Alberta and across North America.

The market signals we're seeing today reinforce this view. Our recent 2029 Greater Edmonton area offering closed fully subscribed and our 2030 to 2032 intra-Alberta offering saw record amounts of participation by data center developers. Given the strong customer interest, we are exploring opportunities to expand this offering to better meet customer demand. With additional receipt and export offerings currently in market, we will look to convert visible demand into incremental projects across our Canadian assets. Our focus is straightforward: understand customer demand, invest where the market is growing at competitive returns and continue to deliver low-risk repeatable performance.

On to Bruce Power. We are seeing similar momentum in Ontario power markets where power demand is expected to grow significantly over the coming decades. Against this backdrop, Bruce Power continued execution excellence is strengthening its ability to competitively serve this growing demand. As a testament to this, Bruce Power returned Unit 3 to service following its major component replacement more than 7 months ahead of the ISO schedule and approximately 15% below the cost of Unit 6. The result was driven by a strong focus on innovation and a repeatable stage build approach, capturing learnings from each refurbishment to improve productivity, reduce risk and enhance execution certainty.

Disciplined upfront planning and design maturity continue to improve cost, schedule and execution certainty across the program. New technologies and automation have already provided meaningful productivity gains, including our Unit 4 recently achieving the most efficient CAN-DUDfuel on record. The Bruce Power story continues to resonate strongly, and I'd encourage anyone looking for a deeper dive to review the Bruce Power investor teach-in available on our website.

And with that, I'll turn it over to Sean to walk through the numbers.

Thanks, Francois. Good morning, everybody. As we walk through the second quarter financial results, I'll also touch on how our strong asset performance, continued project delivery excellence and commercial optimization are each contributing to the upper end of our 2026 EBITDA outlook range.

Overall, TC delivered a 12% year-over-year growth in comparable EBITDA, marking another solid quarter of contributions by each of our business units. Our natural gas pipeline business has performed extremely well with daily average flows up 3% across our 3-country network as compared to this same quarter last year, driven by strong customer utilization and high levels of operational availability. In Power and Energy Solutions, Bruce Power achieved 99% availability in an exceptionally strong quarter following the return of Unit 3 in June from its major component replacement outage that Francois mentioned.

On the right-hand side, you'll see that each business increased its comparable EBITDA contribution compared to the same quarter last year. In Canada Gas, EBITDA increased by $38 million or 4%, primarily due to higher flow-through depreciation on the NGTL and Canadian Mainline systems, along with higher incentive earnings on the NGTL system. In the U.S., EBITDA increased by $129 million or 12% due to additional contract sales and higher earnings from ANR and Columbia Gas.

In our Mexico business, EBITDA increased by $90 million or 28%, driven by higher earnings related to the May 25 in-service date of Southeast Gateway as well as higher earnings from Cert. Finally, in Power and Energy Solutions, EBITDA increased by $60 million or 20% due to higher contributions from Bruce Power, reflecting the early return of Unit 3, strong availability and an annual price increase. Overall, it was a great quarter, supported by high system availability and performance across our pipeline assets and a particularly strong contribution from Bruce Power.

Turning to our comparable EBITDA outlook. We are now targeting the upper end of our 2026 range of $11.6 billion to $11.8 billion, reflecting the strong operational performance our teams have delivered year-to-date and our high degree of confidence in our execution plans for the balance of the year. Looking ahead to 2028, we continue to target comparable EBITDA of $12.6 billion to $13.1 billion, representing an approximate 6% annualized midpoint growth from our 2025 results.

On the right-hand side of the page, we've highlighted several of the key financial tailwinds that are contributing to both our 2026 and 2028 outlook, including many of the same drivers that we benefited from in 2025. The key drivers include continued strong asset availability, expected rate case schedules, disciplined project execution and continued commercial and technical innovation and optimizations across the portfolio.

As Francois highlighted, the depth of our project backlog continues to grow, which is extending the visibility of our development pipeline well beyond 2030. We introduced a new feature to our net capital expenditure outlook this quarter. So we'll walk through the key data points for you to understand where the project backlog stands.

First, as Francois mentioned, we sanctioned approximately $3 billion of growth projects year-to-date, including today's announcements. Second, we've grown our pending approval bucket in gray to approximately $7 billion, up from $6 billion last quarter. And finally, our $20-plus billion backlog of projects in origination, we've added the gray hash bars to our annual capital outlook to provide greater visibility into potential timing of these projects and a new pie chart to the right to highlight the demand drivers that are influencing the current composition of this segment of our project backlog. It's worth highlighting on the pie chart that nearly 2/3 of our origination backlog is associated with power generation.

That's consistent with our year-over-year increased natural gas demand outlook that Francois mentioned earlier on Slide 6. As a general statement on FID timing, I'd say that we're looking to advance opportunities as early as possible, but expect that the sustained growth in our investment pace to occur in 2029, 2030 and beyond. While some of the FID time lines on our origination pipeline will remain dynamic, our approach to underwriting will remain disciplined. Any annual increase in our pacing of capital allocation will be underpinned by strong risk-adjusted returns, continued outstanding performance by our project delivery teams on cost and schedule and our commitment to maintaining our balance sheet strength and our 4.75x leverage target. Finally, we released this year's report on sustainability. Report provides a comprehensive overview of our sustainability performance and progress in support of our strategic priorities.

A few highlights I'd like to draw your attention to. TC has reduced methane emissions intensity by 24% since 2019, while increasing throughput by 20% and growing our comparable EBITDA in our natural gas business by 57% over the same time frame. Our report provides details on the planned pathways to further advance our methane intensity target of a 40% to 55% reduction by 2035 from 2019 levels in a manner that supports asset competitiveness and strong financial performance. And finally, to evidence the effectiveness of our early and deep engagement with indigenous communities and their meaningful community and economic participation in our projects, I'm pleased to share that we've invested $5.4 billion with indigenous and native American businesses from 2021 through 2025. I encourage you to visit the report on our website to learn more.

With that, I'll pass the call back to Francois.

Thanks, Sean. We continue to see the benefits of our disciplined strategy and clear set of strategic priorities. Across the business, we've delivered strong performance with second quarter comparable EBITDA increasing 12% year-over-year. And today, we now expect to be at the upper end of our 2026 comparable EBITDA outlook range. Additionally, the quarter's achievements from the return of Bruce Power Unit 3 more than 7 months ahead of schedule to the sanctioning of approximately $3 billion of growth projects year-to-date, further reinforces our confidence in the outlook for the business. I'd like to leave you with this.

Our confidence is driven not only by the scale of the opportunities we see ahead, but by our ability to consistently execute. With safety, operational and project execution excellence, we will continue to find innovative commercial solutions to meet evolving customer needs, increase the return on our existing assets. secure new capital projects and consistently deliver solid financial performance.

Operator, we're now ready to take questions.

[Operator Instructions] And our first question for today will come from Theresa Chen with Barclays.

Would you elaborate on what you're seeing in terms of demand from your customers in Alberta, in particular, whether it be data center related or just looking at the numerous large-scale WCS crude egress projects that are currently under development, supporting robust outlook for oil sands production growth and incremental demand for natural gas as well or from a demand pull perspective on LNG exports, how are these dynamics impacting your ability to negotiate creative tolling structures with Canadian producers given already constrained gas takeaway capacity?

This is Francois. I'll just say at a very high level, then I'll pass it on to Tina dynamic in Alberta is similar to the dynamic across our footprint. And as you saw, we've increased our outlook to 51 Bcf a day of growth across the continent by 2035. A growing portion of that gas demand is coming from power generation. And lots of that opportunity is certainly in Alberta, but also in the U.S. Heartland. And of course, we have strong incumbency in both those regions.

So over to you, Tina.

Yes. Thanks, Francois. Theresa, specific to your question about Canada, we are seeing growth across multiple sectors. Francois mentioned in his opening remarks about 8 to 10 Bcf of incremental demand. For us to address that demand, we have approximately half a dozen service offerings in the market totaling about 1 Bcf per day of capacity, spanning both receipt and delivery sides of NGTL and covering intra-Alberta and export points. So these offerings serve as a really helpful marker on the demand signal and directly inform our conversations on our next phase of growth for NGTL. Near-term demand targeted through the 2029 Greater Edmonton area offering, we saw a very strong market uptake on that, and we have 2030 to 2032 phased expansion that's going to unlock over 1 Bcf of intra-basin and egress opportunities.

So we're seeing strong interest in the offerings with demand across both egress and intra-basin, and we're using this market data to inform our discussions on the next phase of growth across Canada.

And maybe turning to the Heartland in the U.S. Congratulations on the precedent agreements on Crossroads, and we look forward to FID in the fourth quarter. Would you be able to share any color at this point related to the ultimate size and perhaps relevant economics on the project and maybe subsequent expansion opportunities within the same corridor given the outsized interest you're seeing currently?

Theresa, this is Tina again. We are -- as we mentioned, we are really pleased to have signed a precedent agreement with a large anchor customers for our Crossroads expansion, expect to sanction that in the fourth quarter of this year. We're seeing significant market activity taking place across the Midwest region, which is supportive of broader investment thesis for us. We're seeing about 5 to 6 Bcf of demand growth across the Midwest, representing about a 2 Bcf year-over-year growth expectation out through 2035.

We're the largest operator across several Midwest states, including Ohio, Wisconsin, Michigan, Indiana, and our footprint provides really strong delivery presence into those key demand centers. And from a competitive standpoint, incumbency and integration really matter in this market. So with our Columbia and our Crossroads, Northern Border, Great Lakes systems together give us a highly advantaged footprint. From the perspective of the Crossroads expansion, we would progress that through the next phase of discussions and sanctioning, and that will fall within our 5 to 7x build multiple.

The next question will come from Praneeth Satish with Wells Fargo.

Just on the backlog changes. So you increased the pending project backlog by about $1 billion this quarter and then the potential backlog by $5 billion. I guess, can we assume that the increase to the pending project backlog is basically the Crossroads project? And then the $5 billion increase to the origination backlog, I mean, that's quite significant. Any more detail you can provide in terms of the type of projects being added? I think, Sean, you mentioned 2/3 is power gen. But any more clarity in terms of the split between U.S., NGTL, Bruce Power and Mexico that you can share?

Yes. Praneeth, it's Sean. I'll take that. Thank you for a good question. We've got a lot of growth capital showing up in a lot of slides. Let me break it down for you a little bit.

On your pending approval question, the way to think about that on Page 7, we show about $700 million that's been sanctioned. So $700 million moved from pending into sanctioned. And then when you go back to '13, you've seen that our pending has moved up. And yes, that is round numbers largely crossroads. And I would tell you it's going to be slightly north of $1 billion, but round numbers, you're exactly right.

To the second part of your question on the potential project inventory, what we're calling origination in our new chart on Page 13. Yes, look, we felt it important to include actually on the slide this quarter because it is growing quite quickly. As you noted, $20 billion this year on origination in years, as you can see on the hatch bar chart and then a large portion of that is falling outside of 2030 and beyond. The largely power, as we said, 2/3. And then geographically, the way -- the rule of thumb I would give you on that $20 billion is about 2/3 of that is U.S. within that customer segment bar charts. And then to Francois's comments earlier, we have quite a bit of activity across NGTL on both the producer and the demand side. So about 1/3 of that capital is right now penciled for the Canadian markets.

Got it. That's very helpful. And then maybe switching gears. You've talked about using AI to optimize your pipeline network, which I think is is actually one of the more compelling AI use cases that we've seen so far in midstream. Can you give us an update, I guess, on that initiative at large and the results that you've seen so far? How much of the system is currently covered by the pilot that you're doing? What are the benefits that you're realizing today? And then how should we think about potentially scaling that pilot across the rest of your system? Can those gains be kind of linearly applied and the time frame to get there?

Praneet, it's Francois. I'll take that one. I appreciate the question, something we're really excited about ourselves. Look, we have proof-of-concept initiatives going across the organization. I would say, on a fairly small segments of pipe, 100 kilometers here, 100 kilometers there type of thing. No, you cannot linearly extrapolate because we picked some of the lowest-hanging fruit areas where we thought there would be a greater potential.

Maybe a little bit of color on how we're doing this. Our teams across the company compete for the capital to implement AI solutions in their regions. So they have to present business cases. They have to commit to outcomes and then they get an allocation of capital. That's a good, strong fundamental way with accountabilities to deliver outcomes to figure out what the potential is. We're really at the very front end of that process. It takes time to have people sort of understand that's how we want to do things. And so we only have a near-term target for 2026 of $100 million of AI-related incremental EBITDA, and we're on track for achieving that this year, about halfway there with 2 quarters behind us. We expect to be able to articulate that potential in more detail hopefully by our November time frame all the way out to, let's say, 2030, but we need to let this process where the teams provide the business cases and compete for capital inform that for us. So it's still a little bit early to provide that kind of detail, but stay tuned. Our intention when we do provide that detail is to do it with lots of supporting proof points and information.

The next question will come from Aaron MacNeil with TD Cowen.

You've launched several NGTL and Alberta area open seasons ahead of establishing a long-term framework for future growth investments. When customers are bidding in these projects today, are they effectively underwriting projects based on a tentative new regulatory and return construct? Or is the ultimate return framework for those investments still to be determined?

It's still to be determined. The open seasons, Aaron, we're undertaking are to gauge at a much more detailed and granular fashion the level of demand for service and broken down specifically into different regions and service areas. as Tina mentioned, we're seeing more demand, and we're actually looking to potentially upsize some of the intra-Alberta offerings that we're undertaking. We are in parallel with that, having discussions with our customers about an investment framework. And it's still in the early stages of those discussions, but we hope to have some progress to report by the end of the year.

Okay. Great. You touched on the free cash flow inflection at Bruce Power at the update a few weeks ago. But based on your internal forecasting, what level of annual growth capital do you believe TC Energy could fund organically in 2029 and 2030 while sort of maintaining your targeted leverage metrics? And how should investors think about the funding plan if all those opportunities in your pipeline come to fruition?

Aaron, it's Sean. I'll take that question, a good one, and thank you for pulling forward the Bruce teaching, and that's an important hinge here to understand the growth capital in Gasco. I would -- let me describe the framework that we're using a 3-part framework, and we can drill into it a little bit.

Funding growth capital, 3-part framework. First one is, look, the commitment to the 4.75 leverage or better, that's a firm commitment, right? And our organic deleveraging plan over the last couple and the next couple of years are going to set us up very well for that 29, 30 kind of ramp on growth capital that you're seeing. And it brings us really to the timing of that funding need. could be 29, could be 30, but I think you're also getting a sense for what kind of the 30s are going to look like. And let me now hinge back to that Bruce slide. The critical years for the Bruce MCR program are 2031 and 2032 when the final 2 units complete their MCR program.

So -- and what Bruce unlocks for us is another $2 billion to $3 billion a year of growth capital, right? So that 2031, 2032 is an incredibly powerful addition from Bruce. So we've got this 2- or 3-year window between 2029 and call it, 2030 or 2031 that we're really solving for to support Tina and Greg. And the hierarchy of funding sources as we look at that 3-year window, 29 to 31 before Bruce really kicks in is -- obviously, it's just compounding the EBITDA gains that we're delivering quarter-over-quarter for you, that in parallel with driving the best projects into our sanction buckets, the best build multiples obviously create the best amount of cash flow. And look, if we have such growth in that 29, 30, 31 window that there is a funding gap, we've got a couple of levers that we can pull, right? Obviously, from a -- whether it be capital rotation or any other kind of capital market. But what we are -- we have 2 or 3 years to solve for, how tall does that growth capital go, how many years before the Bruce cash flow kicks in? And then ultimately, what is the lowest cost of capital the year before on a dollar per share basis. That's the framework.

And I think, like I said, over the next year or 2 as we really see what '29 and '30 are going to look like, that's the amount of time we have to solve for that least cost, best dollar per share funding solution.

The next question will come from Jeremy Tonet with JPMorgan.

Just wanted to come back to Canada -- Canadian growth opportunities, if I could. It seems like there's a lot of opportunities as you outlined here. But just wondering if you could walk us through how it competes for capital, a lot of attractive opportunities in the U.S. The economics seem a bit better than what has been achieved in Canada historically. I just wondering the scope, the potential for improvements on either ROE, equity layer or otherwise, so that would attract your capital into Canada versus the U.S. as far as future growth projects are concerned.

Thanks, Jeremy. Look, we're in the middle of these conversations with our shippers. We're doing a lot of listening. So I don't want to front-run any discussions we're having with them. What I will say is that it is a lower risk supportive regulatory framework in Canada than we have in the U.S. in terms of protections around capital cost of debt, billing determinants, et cetera. And we also know that if we want higher returns, we're going to have to earn it. So we're working with our customers to talk through ways like through ancillary services or any cost savings that we're able to materialize can be shared to create a win-win. What's important here is to keep our focus on delivering to our customers what they need, which is growth intra-basin and growth to export points. And I do want and prefer to see some balance in our capital allocation from a geographic basis. It's not simply where does the highest IRR project discretely come from.

You want some portfolio diversification for economic diversification from economies, from regulatory regimes, from policy environments. So we do keep that balance in mind in addition to the specific return of specific projects. So all those things go into the discussion, and we're doing a lot of listening right now.

Understood. Appreciate the thoughts. And continuing on the lines of geographic diversification. I was wondering if we could go south 2 borders. And any thoughts you could share with regards to the strategy in Mexico going forward as far as the amount of exposure you want to have in the country, growth opportunities there and whether any type of Mexican monetization in the future still makes sense.

Jeremy, it's Sean. I'll take that one. Look, I think part of what we're seeing in the Mexico portfolio, candidly, not dissimilar to what we're seeing in the U.S. at this point, major trunk lines all built. We're seeing CFE in the last 2 years bring more generation online than they arguably have in over a decade. There's 10 gigawatts of gas-fired gen. I think 5 are commissioned already, more pending this year, 3 gigawatts on our system. So as we've been talking about, that gas-fired -- largely gas-fired power market is growing into the pipeline capacity that we have built for it, we and others. So I think you just have that maturation cycle right now on gen growing into the pipe, but you're certainly seeing capital market and other kind of investors and strategics entering the space. So we like exactly what we have.

We're not seeing any other materially large kind of investments being required anytime soon, but certainly kind of growing into the portfolio. So I'll kind of leave it at that because it's operating exactly as designed and exactly as we've kind of included in guidance in our outlook.

The next question will come from Rob Hope with Scotia Bank.

So it's good to see another increase in the pending approval backlog as well as the increase in the origination that you noted in the prepared remarks. You also did comment that the timing of FIDs is dynamic. Can you speak to how these projects are marching towards FID decisions just given the fact that we are seeing a number of kind of changing dynamics out there in the market and potentially some upside in these projects. So how are these projects kind of working through the funnel? And is the target still to have $8 billion of projects sanctioned this year?

Rob, it's Francois. I'll take that, and I'll maybe take the back half of that question first. We typically sanction $3 billion to $4 billion a year of new projects. And we're halfway through the year, and we're already at the bottom end of that range. when you throw in the potential and our expectation of sanctioning Crossroads in the fourth quarter, which will be a sizable project on its own, plus some of the other irons we have in the fire in the U.S. and in Canada, there's a very good chance that we're going to be in that $6 billion to $8 billion of sanctioned capital for 2026, which would be a great outcome and achieve our stretch goals. With respect to the first part of your question...

I'm sorry.

Yes, I'll take that first part. I think your question was related to what's required to get to sanctioning. And you think of the projects in origination, we talked already about Canada and some of the demand growth we're seeing there. In the U.S., we have under origination, as we've talked about before, about $14 billion of capital, 10 to 11 Bcf of capacity centered around power generation, data center demand, coal-to-gas conversions, et cetera. And we go through a rigorous process to sanction our projects, detailed conversations with our customers, ensuring we drive the highest value for our shareholders. The Crossroads expansion is next up, I believe, for sanctioning. We did talk today about our Central Virginia capacity project and our Clark project, which are important projects for us on our Columbia Gas and our Columbia Gulf systems. We are looking forward to developing more of those across the next couple of quarters and go through our process with discipline before we announce the projects.

Yes. Sorry about that, Rob, in answering the second part of the question, I lost the thread on the first part, so Tina helped me out there.

Not a problem. And then just maybe as a follow-up, like we're seeing across the industry, everyone's growth expectations tilt higher. Can you maybe just provide kind of your views on supply chain contractor availability and just the status of the market, could we be entering into a bit more of a constrained supply chain?

So I'll take that. We are actively monitoring all of our supply chain resources, be it actual equipment, contractor selection, human resources internally and externally. We take a very strategic approach to the supply chain process. To date for our pipeline projects, we have all of our pipeline equipment secured for everything that's been sanctioned to date. We are negotiating with many of our suppliers to ensure that all of our equipment is available in time for our projects to be in service based on the announcements that we put out.

We take a very proactive approach to our contractor market as well in developing strategic alliances that allow us to keep some of our very top-tier contractors working from project to project. So we're very confident in our ability to execute our projects in light of the supply chain challenges, and we do not see any issues related to our in-service dates and having supply chain situations that would impact those dates.

The next question will come from John Mackey with Goldman Sachs.

Sean, you touched on this earlier, but I just want to focus on the strong 2Q results and the '26 guidance commentary. I know it's early, but any tailwinds you can talk about when framing up the 2028 guide that you have out there?

John, yes, thanks for the question. Look, the ingredients on the tailwinds are fundamentally the same kind of year in and year out. It's a little bit hard to capture how much operating leverage we are getting out of every piece of equipment across 94,000 kilometers pipe 650 base storage. And when teams have availability that high and you've got the fundamental demand growth and a little bit of volatility in the market, this footprint is just -- candidly, it delivers and over-delivers in different ways in different years.

So that's what I would tell you is the biggest tailwind. The other element that we're starting to see is we touched on commercial optimization and innovation. We -- look, we enjoy our 20-year take-or-pay contracts, but we're also seeing kind of on the innovation front is customer demand opportunities are shifting very rapidly. So when a customer sees a money-making opportunity, but they need to time shift or shape shift some of that 20-year take-or-pay stat contract, we've got capacity to move. We can move capacity. We can move regions in support of customer value capture opportunities and kind of take our fair share. And you're seeing that a little bit of that even in 2026, coupled with some weather in the first quarter. So those are really 2 big ones that are kind of driving EBITDA. And then as we get to '28, a couple of the other ones beyond the standard rate cases that we talked about that we generally had a pretty good track record on the last 2 years. The big one is just the continued projects simple, sounds simple, on time and at these 5 to 7 build multiples, that's a very powerful lever, right? And obviously, how much EBITDA per dollar invested we're driving.

And so far, so good, right, on our '26 campaign, which is going to start showing up in '28 and potentially driving to the higher end if Tina's teams continue to do what they do. So that's kind of -- that's the high level on top of what Francois described is some of the technology and AI innovation that certainly is showing green shoots as well for us.

Understood. So we spent a ton of time talking about Canada so far, but I want to ask one more. Now that you guys are seeing, let's say, a different type of customer coming in on the data center side, is there an opportunity for TC to invest outside of the NGTL regulatory framework, I guess, meaning specifically an ability to kind of capture potentially higher return type projects?

Thanks, John. I'll start with that, and then I'll ask Greg to provide some commentary. Yes, the answer is yes. To the extent there's an opportunity to competitively meet a data center customers' needs through a short lateral that can be developed by our unregulated arm in a faster time line at an attractive toll that helps them develop their project on the pace that they've dictated for their strategy, those types of situations can present themselves. The other thing that's interesting is we're seeing with many of the regions in North America have bring your own power policies or large consumer rate classes to make sure that there's no inflationary impacts on other classes of customers.

We're seeing a trend from data centers to longer PPAs and take-or-pay contracts for power that are starting to migrate to what I would call within the fairway of our risk preferences. So I don't think you should expect us to necessarily sanction tens of billions of dollars of behind-the-meter power projects, but there is an opportunity for us, particularly in Alberta. And perhaps I'll ask Greg to provide a little bit more detail.

Sure. Appreciate it, Francois. And I appreciate the question, John.

In Alberta, just as a reminder, we have a very unique footprint as we start looking at -- we have the power, we've been in the market for over 30 years. We have gas storage. We have unregulated gas. We have regulated gas. So when you think of a couple of weeks ago at Stampede, I haven't seen so many tech companies sponsoring the events, and we saw the first large data center announcement.

That's the benefit of our footprint. And I think as we start to see more people coming, we have the lowest priced gas across North America. This will give us some of those opportunities to work across the verticals and figure out ways to Francois's point, how we're going to optimize the system and get our risk return levels where we compete with capital against the gas business.

The next question will come from Maurice Choy with RBC capital markets.

I wonder if you could just take us back to the high level where you've laid out that power generation and supply access has led to this revised 51 Bcf a day. When you look back at your original 40 Bcf a day estimate about 2 years ago, what has surprised you the most? And would there have been any initiatives you felt you would have pursued that perhaps you could pursue right now?

Thanks for the question, Roy. This is Tina. We have increased our demand forecast from last year to this year. I think it was 46 Bcf last year, 51 Bcf per day this year over the next 10 years. And that's primarily driven by LNG feed gas. We're seeing an increase there of about 28 Bcf per day. in power generation, 16 Bcf per day in the industrial sector, 4 Bcf per day of increase. The upside to our last forecast is primarily driven by the power generation sector. We now expect North American gas-fired generation to rise from prior outlooks of 54 Bcf per day to 60 Bcf per day by 2035. And there are a number of factors playing into that demand growth, including accelerated data center demand of about 15 Bcf, broader base electrification and coal conversions. And so a key element of that demand growth picture is that the demand is not uniform. What's important here is that demand favors the U.S. Heartland, Western Canada and Mexico, where we have incumbent positions of about 60% of the incremental demand growth is set to occur in states and provinces where we operate.

And similarly, on the supply side, by 2035, about 60% of gas supply is expected to come from TC connected basins, notably a combined incremental 18 Bcf out of Appalachia and WCSB. So all this directly translates into the depth of our origination activities and our backlog.

Maurice, it's Sean. I'll tack on to the front part of that question. Would we have done anything differently 2 years ago than today? And the answer to that is no. I think when you just break up Tina's point about all of that was LNG. Were we going to get into the LNG business seeing that growth? No. Were we going to serve the LNG business? Yes. I think power is sometimes the question. And for us, and hopefully explained today when we show our $20 billion backlog, when we're building at 5 to 7x in the core business with teams that are the best in the business doing that, that has been and remains the best value creation opportunity that we think we offer shareholders. So kind of staying the course and staying focused. Same strategy, same answers today as they would have been 2 years ago. Hopefully, that makes sense.

That make sense. Maybe I can finish off with a question on just the broad theme of data centers. There's obviously been a lot of headlines about stakeholder pushbacks on data centers in various parts of the U.S. Just at a very high level, have you seen any impact on how your customers approach signing pipeline deals with you?

I'll take that one, Maurice. I think it's fair to say that, as I mentioned before, with some of the policies from PUCs and governments in various jurisdictions around bring your own power or different rate categories to make sure there isn't cross-subsidization of rates. The market, the data center developers, the hyperscalers are learning as they go along.

Obviously, energy provision is a very important gating item for them to implement their strategies. When we look at the U.S. Heartland, for example, approximately 15 states. There are only 2 or 3 that actually have explored putting a pause on data center development. In 2 of those states, those were rejected. And in the third, it's under consideration, but doesn't seem to be carrying lots of momentum. So I would say that data center issue you mentioned is region-specific. And as we look at our footprint, we haven't seen it slow down the growth of our development pipeline. The comment earlier that was referred to about sanctioning projects is dynamic is because our customers, the utilities have to themselves be dynamic to compete for load and make sure that they're being responsive to stakeholders' considerations and questions as they go through.

Oftentimes, that might impact the timing of sanctioning as opposed to whether or not a project will be sanctioned. So lots in there to unpack, but I think for us, it really hasn't slowed down our view on our long-term growth prospects.

The next question will come from Robert Catellier with CIBC.

It's been a constructive call. I just wanted to follow up on Bruce a bit. I noticed in the press release, you had that additional funding for the impact assessment and the predevelopment work, which I think is not only appropriate but necessary. My question here is, is that enough to get you to FID? And maybe you can refresh us on time lines for the technology decision and the ultimate FID.

Sure. I'll take that directly, Robert, it's Greg. First, I actually wanted to give a shout out while I have the mic. We had great performance of our teams, both at Bruce and our power team from an operational perspective. You would have seen the announcement that Unit 3 came on early to Francois's comments. But I also wanted to add because this will lead into the Bruce conversation, we continue to see Unit 6 post refurbishment running at less than 1%, which is world-class and world-leading.

So this is the type of performance that really gives us comfort as we start to look at Bruce expansion and the value of our Bruce management team. The next tranche of funding of $300 million is going to cover us effectively until we get closer to the end of the decade. You mentioned a couple of the pieces of work that we're doing. This is pre-FEED activities. This is technology selection, early engineering and external engagement and consultation. We'll look to continue the technology selection piece of that looking into next year likely before you start to see a selection on there. But overall, still very excited about the opportunity. This is the best nuclear site in Canada. We have the skilled labor and supply chain locked up. It's over 95% Canadian. So continue to really focus on bringing that project forward and across the line.

I think on Unit 6, I mean 1% off-line time, correct?

Sorry, I just missed that.

Yes, I think you said it's operating at 1%. I think you mean that as the outage time.

Yes...

The forced outage...

2023. sorry, I just want to go back to the question that Theresa started us off with about egress options in Canada. I think it's safe to say policy is encouraging for oil sands production growth, although that is yet to fully materialize. My ask of you is what do you think is possible should we, as a nation, be successful in growing oil sands production and what that would mean for egress requirements for natural gas. Presumably, oil sands production is going to lead to more onsite drilling and associated gas. And it seems like that could be a bottleneck in the whole flywheel. So what do you think is going to be required longer term for egress coming out of Canada to accommodate the oil sands?

Robert, it's Francois. I'll take that. I wouldn't necessarily point to egress by LNG only as the source of absorbing associated gas. As we saw with the advent of data centers in the province, there's lots of in-country load growth potential. And of course, we have coming out of NGTL, we call our U.S. pipes, the catchersmit for that gas in the Pacific Northwest through Northern Border into the Midwest and then into Ontario and points east.

So I would foresee us expanding all of our systems in all directions and be able to accommodate the incremental associated gas to produce the condensate that's necessary for increased oil sands production. Case in point, our mainline settlement was approved recently by the regulator. That will add about 350 million cubic feet a day of capacity for a $200 million capital investment, which is extremely efficient. And that's just one proof point or example of how we're going to be able to move gas through the whole system to absorb incremental production. Of course, we would love to see more LNG export off the West Coast. We're encouraged with developments on LNG Canada Phase 2. From the sidelines, reading what's happening on the Seailisms project is also encouraging. And I would hope to see more to come, the next wave of LNG export beyond those projects in the 2030s.

Yes, I agree. I wasn't suggesting it was just LNG. I think it's going to have to be all of the above.

The next question will come from Ben Pham with BMO capital.

I wanted to go back to the $20 billion plus projects in origination. And I'm wondering how do you think that pie chart will evolve in the coming years in terms of the size of the opportunity and the mix of the demand drivers?

Ben, it's Sean. I'll take that. In terms of what will that pie chart look like, right, as just quarter-over-quarter, we verbally were kind of seeing a $15 billion number just earlier this year, and we felt compelled to show you now the $20 billion plus, just given how much capital formation we're starting to see in the early 2030s. Look, we're hopeful, right, that, that number still continues to grow. The fundamentals, particularly in Tina's business on the pipeline side are certainly suggestive of this new normal of what we're seeing on a run rate. I'd say it's probably a little bit early to kind of call what exactly that number is on a sustained basis or a plateaued basis, but I do think the breakdown that we're showing you is certainly a power-dominated kind of portfolio in the post 2030. So give us another quarter or 2, but we're going to attempt to kind of refine this for you as best we can as the dynamic element that we mentioned kind of firms up here over the next 6 to 12 months.

Got it. And Sean, you also mentioned looking at factoring the Bruce Power inflection that bridge in the late decade, looking at sources of capital to bridge that. I'm curious maybe to ask then, are you able to rank order your sources of capital today, you think about hybrids, partnerships, even common equity? And then to that point, how do you think about the balancing of prefunding this rising CapEx versus waiting and assessing at a future point in time?

Yes. This is my favorite thing to work on, Ben, for team and Greg with funding growth capital. Look, the hierarchy that we described, look, at the end of the day is ultimately -- we have a dollar per share cap that we measure absolutely everything against. And the the benefit of what we're seeing kind of in the market right now, set EBITDA side. That's obviously our top priority in terms of hierarchy. As you start to look at capital rotation or investment grades or hybrids or anything else, all of those capital markets are -- and I'll throw private credit in there. They're incredibly constructive, right? We're at all-time tights on every market that we're in. And increasingly, you're seeing even private credit in the 5%, 6 kind of percent range inside of our hybrids, certainly well inside of our common. So it's just that -- we have a lot of options and a lot of levers in a couple of years to kind of figure that out.

So that's exactly -- we're going to take our time and watch that $20 billion pie chart develop and kind of a year ahead, probably no rush, no forcing function to have us do anything sooner than absolutely necessary to support the growth capital, particularly '29 and '30. So I think 2028 will really be the year where you start to see us kind of put things in motion depending on what '29 and '30 and then Bruce and '31 look like, what that balancing capital solve might look like.

Ladies and gentlemen, this concludes the question-and-answer session. If there are any further questions, please contact Investor Relations at TC Energy. I would now like to turn the call over to Mr. Gavin Wiley for any closing remarks. Please go ahead.

Operator, thank you very much, and thank you for everyone for participating this morning with your great questions. We may not have gotten through all the questions, so please do reach out to the Investor Relations team. We're always happy to help. Again, thank you for your interest in TC Energy, and we look forward to our next update in early November. Thank you.

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

Good morning. My name is John Lowe, and I'm the Chair of the Board of TC Energy Corporation. I'd like to extend a warm welcome to our 2026 Annual Meeting of Common Shareholders. We sincerely appreciate your participation in our meeting today. I'd like to start today with an acknowledgment of the indigenous ancestral lands on which TC Energy operates across North America and affirm our commitment to understanding how the histories, cultures, and rich traditions of the peoples of these lands have been shaped by the past, how they influence our presence and what we can learn to prosper together in the future. We are committed to working with the original keepers of the land to advance shared ownership and prosperity. Joining and presenting with me are Francois Poirier, President and Chief Executive Officer; and Jane Brindle, Vice President, Law and Corporate Secretary.

Jane will be acting as our secretary for this meeting and assisting with the moderation of any questions you submit. Also available to answer relevant questions are Brad Owen and Petre Kotev from KPMG, our independent external auditor. Before we begin, I need to note that certain statements made in this meeting contain forward-looking information that are subject to important risks and uncertainties. For more information on these risks and uncertainties, please refer to our 2025 annual report and the Management Information Circular dated March 5, 2026. I will now call the meeting to order and open the online balloting. For our agenda today, registered common shareholders and appointed proxyholders who have registered for this meeting are entitled to participate in our online platform. Questions from shareholders and proxyholders may be submitted using the messaging icon on your screen.

Please submit your questions as soon as possible to allow us to address them at the most appropriate point in our meeting. Guests, including those of you who are not registered shareholders nor are appointed proxyholders, are invited to view and listen to the meeting. As outlined in the Management Information Circular, the purpose of this meeting is for TC Energy common shareholders to receive the 2025 consolidated financial statements and auditor's report to elect the directors, to appoint the auditors and to consider and approve on an advisory basis TC Energy's approach to executive compensation. The meeting will proceed in the following manner. First, Jane will provide some additional instructions on how shareholders and proxy holders may vote and participate in our meeting today.

Next, we will appoint Computershare Trust Company of Canada as our scrutineers for the meeting and confirm that a quorum to conduct business has been met. We will then address each item of business set forth in the Management Information Circular and answer questions, if any, related to such formal items of business. For the purposes of our meeting today, Jane or I will be moving and seconding each motion. We are each duly appointed proxyholders. Next, the voting results will be announced. Finally, after the formal business of the meeting has concluded, Francois will provide an update on the business and will have an opportunity to answer shareholder questions. I'll now pass the meeting over to Jane to review the process for voting and asking questions.

Thank you, John. I will now provide some additional guidance on how to use our online platform. If you are a registered shareholder or a duly appointed proxy holder, you will be able to vote on each item of business. The online balloting is already open. To vote, click on the balloting button on the navigation bar, and simply select your voting choice from the options shown on screen. A confirmation message will appear to show your vote has been received. If you wish to change your vote, simply click the cancel button and vote again. Online balloting will remain open throughout the meeting and while we discuss each item of business. Proxies held by management will be voted on the ballot as indicated in the proxies. If you have a question, select the messaging icon on your screen and to your name in question and click the send button.

We ask that you submit your questions early so we can address them at the appropriate time. We are committed to transparent communication at the meeting. Questions asked related to the business of the meeting will not be curated and will be presented as submitted, unedited and uncensored. Questions will be answered in the order received for each item of business. If the question is more general in nature and not specific to an item of business or the meeting itself, we will plan to answer them in the general question-and-answer period following the CEO's remarks. We may not have time to get to every question. However, if you include your contact information, we will endeavor to provide you with a written response.

Thank you, Jane. We will now move to appoint our scrutineers. In accordance with bylaw #1 of the company, I now appoint Stephen Bandola and Stephanie Tuss, representatives of Computershare Trust Company of Canada to act as scrutineers for this meeting. The preliminary report by the scrutineers indicates that a quorum has been met, and I would ask that they submit their final report on attendance when ready. Jane will now report on the mailing of the notice calling this meeting and advise us about the process the meeting will follow.

Thank you, John. The mailing of the notice of availability of meeting materials and the form of proxy commenced on March 31, 2026, to common shareholders of record in accordance with applicable law. An affidavit of mailing dated April 14, 2026, attesting to the mailing of the notice and form of proxy was delivered to us by our transfer agent Computershare Trust Company of Canada in advance of this meeting. Where required or requested, the Management Information Circular and the annual report were mailed to shareholders. These documents have also been made available on our website.

Thank you, Jane. As notice of the meeting has been given and a quorum has been confirmed, I hereby declare this meeting is duly called and constituted for the transaction of business. As a reminder, the balloting is open and you may vote on all items of business now or as we go through them. The first item of business is the tabling of TC Energy's 2025 annual report which includes the consolidated financial statements and the related auditor's report. It has been made available for review by shareholders in accordance with applicable law. The next item of business is the election of directors each of whom will hold office until the next Annual Meeting of Shareholders or until their successors are earlier elected or appointed.

The Board has set the number of directors to be elected today at 13. Our director nominees for this year are: Scott Bonham, Cheryl Campbell, Michael Culbert; William Johnson, Susan Jones, Dawn Madahbee Leach, Francois Poirier, Una Power, Mary Pat Salomone, Sim Vanaselja, Thierry Vandal, D Verma and myself, John Lowe. I now move to nominate the 13 individuals named and described in the circular to serve as directors of the company to hold office until the next Annual Meeting of Shareholders or until their successors are elected or appointed.

I second the motion.

We will now open the floor for any questions on this item of business. Jane, have we received any questions on this item?

No, John, we have not received any questions on this item of business.

We will now move on to the next item of business. I now move to appoint KPMG LLP chartered professional accountants as the auditors of the company until the next Annual Meeting of Shareholders and authorize the directors of TC Energy to fix their remuneration.

I second the motion.

We will now open the floor for any questions on this item of business. Jane, are there any questions on this item?

No, we have not received any questions on this item of business.

The next item is the approval on an advisory basis of an ordinary resolution approving TC Energy's approach to executive compensation. The text of the resolution is set out in the Management Information circular. While the vote is on an advisory basis and not binding, the Board will take the result of the vote into account when considering future compensation policies and decisions. I now move the resolution to accept on an advisory basis the company's approach to executive compensation.

I second the motion.

We will now open the floor for any questions on this item of business. Jane, are there any questions on this item?

No, John, we have not received any questions on this item of business.

Thank you. As we have now concluded each item of formal business, I will pause for a moment to allow shareholders to complete the online ballot.

[Voting]

The balloting is now closed. The Corporate Secretary has received the scrutineers' preliminary report on attendance and the results of the votes. Jane, would you please provide the results to the meeting?

The preliminary scrutineers' report on attendance at the meeting has now been received. It shows that 67.2% of the issued and outstanding shares of the company have voted on TC Energy's 2026 items of business. I have also received the preliminary reports of the scrutineers. The scrutineers' report indicates that each item of business has received the requisite number of votes to pass. The detailed results for each item of business will be filed on SEDAR+ on or before May 8, 2026.

Thank you, Jane. Based on the results, I declare that all items of business have passed. I now direct that the scrutineers' report on the ballots be annexed to the minutes of the meeting. As this now concludes our formal business, I move to conclude the meeting.

And I second the motion.

Thank you, Jane. As we conclude the formal business of the meeting, I want to reiterate the Board's confidence in the direction of the company. TC Energy is strongly positioned in a North America energy system that is growing in both scale and complexity supported by high-quality assets and people who know how to operate and lead through change. That confidence rests in large part with our employees, more than 6,500 across North America whose experience, judgment and commitment underpin our performance every day. I also want to thank my fellow directors for their counsel and stewardship and our shareholders for the trust you continue to place in this company. With that, we'll share a short video and then welcome Francois to speak about our performance, our priorities and how we're positioning TC Energy for the future.

[Presentation]

Thank you, John. Good morning, everyone, and thank you to our shareholders and stakeholders for being with us today and for the confidence you place in TC Energy. For 75 years, this company has been integral to the energy systems that serve North America, built across regions and through many periods of change. This experience has shaped how we operate today with a laser focus on safety and supported by a clear focused strategy that guides our decision-making. Today, North America's energy landscape has entered another period of significant change, defined by rising demand and increasing complexity. At the same time, geopolitical uncertainty has reinforced the importance of energy security, underscoring North America's opportunity to supply energy both continentally and globally, seizing that opportunity requires more than ambition.

It requires infrastructure, experience and the ability to execute. We are primed to deliver North America's energy advantage by safely and reliably connecting supply to demand and doing so at scale. Companies with a track record of investing with discipline, and adapting without losing focus on our best positioned to succeed in this evolving energy landscape. That is the TC Energy you see today. In 2025, that approach delivered another strong year of performance. As we enter 2026 with energy markets continuing to rapidly evolve, our commitment to shareholders remains resolute solid growth, low risk and repeatable performance. This year, we marked the 75th anniversary of TC Energy. 3/4 of a century of nation-building projects, and operating infrastructure essential to the North American energy market.

Over that time, we've grown into one of the largest and most integrated energy networks on the continent moving more than 30% of the natural gas used every day. That scale has built -- was built deliberately through long-term investments, a sustained focus on safety and operational excellence and generations of employees who understand how to deliver infrastructure designed to last. Our infrastructure is built for resiliency and one that becomes more important as demand continues to grow. That growth follows the same principle this company was founded on. We were born connecting the nation of Canada. Today, we're connecting North America. And increasingly, we're connecting energy from the continent to the world. The reality is clear, and it's one we are experiencing every day. Energy demand is rising.

Natural gas for electricity generation continues to grow, driven by data center development, population growth and power systems under increasing strain from extreme weather. Many jurisdictions rely on natural gas to support power generation and industrial activity while also achieving sustainability objectives. LNG exports add to that demand, connecting North America's natural gas to global markets, seeking to diversify supply and strengthen energy security. All this highlights one undeniable truth this demand is structural and it's long term. Our latest forecast anticipates natural gas demand rising by roughly 45 billion cubic feet per day by 2035. That increase alone is equivalent to the size of today's entire European gas market.

This question isn't whether the energy is needed. It's whether the required infrastructure can deliver it when and where it matters. That's where TC Energy plays a distinct role. Our natural gas network connects low-cost supply to major demand centers across the continent supported by deep experience in transmission, storage and power generation. Our power business anchored by Bruce Power, one of the world's largest operating nuclear facilities provides reliable non-emitting electricity supplies for roughly 30% of Ontario's electricity, supporting grid stability across the province. Together, our gas and power assets and the customer relationships behind them, support dependable energy delivery as demand continues to grow.

The demand we see across our footprint is exactly why execution matters and why our performance over the past year is so important. And 2025 was a defining year for the company. We operated safely executed projects with discipline and allocated capital in a way that generated solid risk-adjusted returns. At the core of that performance is our commitment to safety. I'm exceptionally proud of the team's work in 2025, delivering our best safety results in 5 years, which directly supports strong operational and financial outcomes. So as a result, we also saw strong utilization across our natural gas pipeline network with numerous system-wide flow records. Together, our strong safety performance, disciplined delivery and high utilization translated directly into solid financial performance. Comparable EBITDA grew 9% year-over-year, and we continued to strengthen our balance sheet.

Over the course of the year, we also delivered a significant portfolio of projects, bringing more than $8 billion of infrastructure projects into service on time and approximately 15% below budget. That will expand our footprint and reflects the range of communities we operate in. Canada reached a historic milestone with the first LNG shipment to global markets, made possible by our Coastal GasLink pipeline, which entered service in November of 2024. This milestone underscores the importance of our Canadian natural gas network in unlocking global market access. In the U.S., we completed the Virginia reliability and Wisconsin reliability projects. Together, these represent more than USD 1.2 billion in investment, generating over USD 1 billion in economic output and supporting thousands of jobs.

Not to be outdone, in Mexico, our Southeast Gateway project entered service, completed approximately 13% under budget through a first of its kind public-private partnership with the Comisión Federal de Electricidad, or CFE. And in our Power business, teams at Bruce Power continued to advance major component replacement work on schedule and on budget meeting Ontario's growing need for affordable nonemitting electricity. Delivered on time and under budget, all of these projects provide predictable long-term cash flows that contribute to our 5% to 7% 3-year comparable EBITDA growth outlook. During 2025, we were able to sanction projects at a weighted average after-tax internal rate of return of 12.5%, which represents an increase of about 400 basis points since 2020, all while maintaining our low-risk investment framework.

This performance gives us clear visibility to future disciplined capital investment into the next decade, reinforcing our strategy is working, again, delivering solid growth, low-risk and repeatable performance. Now the discipline that defined our performance in 2025 provides us with the conviction to strive for transformational growth as we enter 2026. Our strategic priorities remain unchanged. We are focused on: first, maximizing the value of our assets through safety and operational excellence, along with commercial and technological innovations. Second, executing safely on our selective portfolio of growth projects on time and on budget. And thirdly, maintaining the financial strength through disciplined capital allocation. That clarity, these 3 simple objectives matter. It allows us to allocate capital deliberately, execute consistently with excellence and respond to demand without stretching our balance sheet.

Last week, we reported our first quarter 2026 results, marking a strong and disciplined start to the year, amid continued global energy volatility. We delivered operational and safety excellence, performing when demand was highest across our natural gas assets. During the quarter, our systems set multiple all-time delivery records including through winter storm Fern. We advanced low-risk growth aligned with our strategy, announcing the Appalachia supply project, a USD 1.5 billion project that will strengthen our U.S. pipeline network and creates a new platform for us to serve a high-growth power and industrial corridor. At the same time, we strengthened long-term growth visibility entering into commercial agreements with LNG Canada, establishing a new framework to advance a proposed Coastal GasLink Phase II expansion.

Financially, we delivered a strong quarter, generating for the first time ever over $3 billion of comparable EBITDA, up 14% year-over-year from the first quarter. That disciplined approach to execution and capital deployment keeps us on track to meet our long-term target of 4.75x debt to EBITDA. Together, these results mark a solid start to 2026. But how we deliver results to us is just as important as the results themselves. We're a purpose-driven organization. We are proud to connect the world to the energy it needs, and this guides how we operate every day and our values shape the way we work and the way things get done safety in every step, personal accountability, one team and active learning these 4 values are reflected in the decisions made in the field in control rooms and in meeting rooms across the company.

That work is carried out by more than 6,500 employees across all 3 countries operating some of the most critical energy infrastructure on the continent. Their experience, their judgment and care are what allows us to operate complex infrastructure safely and reliably day in and day out. We do that work in partnership with indigenous rights holders with communities and other stakeholders across our footprint recognizing that infrastructure built to last depends on strong long-term relationships and mutual respect. This is how trust is earned over time, how credibility is sustained and how resilience is built into the way we work.

Together, these values position us to continue delivering reliable energy and contributing to a strong secure energy future. So thank you for your time and engagement today. North America is entering a period of profound change. One that brings both complexity and a generational opportunity. With over 75 years of experience and a disciplined strategy and a great team, we will continue to play a critical role in safely and reliably connecting the world to the energy it needs. So with that, I'll turn it back to Jane to begin the question-and-answer period. And John and I welcome your questions.

Thank you, Francois. Now we will take this opportunity to respond to any additional shareholder questions. We would ask you to keep your questions to approximately 1 minute each to provide enough time for all questions to be answered. We are committed to facilitating a productive and orderly meeting, where all participants engage in respectful dialogue. We have received a question from Gaagwiis, a duly appointed proxyholder who is on the line to ask his question. Gaagwiis, please go ahead.

Hello, everyone. I'm the President -- Vice President of the Coastal First Nations-Great Bear Initiative, and I've been formally appointed to address the AGM by a shareholder with over $30 million in assets under management. I just want to share that or reiterate a proposed crude oil pipeline through the northwestern Canada is making headlines. However, the federal government has repeatedly stated that no project would proceed without the support of affected First Nations or the province in which it is proposed. As the legally recognized rights and title holders under both Canadian and international law, we did not support this proposed oil pipeline, which could see over 200 oil tankers in our waters. And we, along with the province of British Columbia, have called on the federal government to uphold their oil tanker moratorium act in its entirety with no exceptions or carve-outs.

So there's no offer of equity and ownership that will change our position. And I just want to reiterate, in 2016 Enbridge reported costs of $656 million on a never built Northwestern pipeline with total impairment of $373 million before tax adjustments so we want to proactively save TC Energy and our investors from the other company's past mistakes and recognizing that the Board assesses decision-making quality through regular reviews of major projects and capital allocation decisions and a recent update to your health, safety, sustainability and environment committee charters are made to include oversight of all indigenous manners to be implemented this year. Can you -- can members of the Board, please describe how this oversight will be provided to ensure indigenous rights and titleholders positions on the proposed pipelines and tanker moratorium are respected? And when a related risk assessment would be disclosed to investors in your decision-making process?

John, this question centers on board oversight and governance. I'll ask you to address it, please.

Thank you for your question. As a reminder, TC Energy does not operate oil pipelines, but I think your question is broader than that. And I'll talk a little bit about the oversight but I think Francois will also address this as well. So as a Board, it's our responsibility to act in the best interest of our company and our shareholders. Strong governance and early engagement with rights holders are critical to responsible project development, risk management and long-term value creation. The full board maintains oversight of our indigenous engagement strategy, including the risks and opportunities associated with material projects and indigenous equity participation. In reviewing proposed projects, management provides a comprehensive assessment of all material risks, including potential impacts on indigenous peoples and relevant policy considerations to inform our decision-making.

We have further strengthened our board level oversight of indigenous relations by formalizing responsibility within the health, safety, sustainability and Environment Committee and increasing the cadence of updates from management including through standing reports and a dedicated annual discussion. Last year, we also added Dawn Madahbee Leach of the Aundeck Omni Kaning First Nation to our Board of Directors, strengthening our Board-level perspective on indigenous matters. So that summarizes our Board processes, but I'll turn it over to Francois to build on that.

Thank you, John and Gaagwiis, thank you very much for your question. Just a few principles as the leader of the company in terms of how we engage with rights holders, indigenous groups that are rights holders, not just stakeholders. First of all, equity participation is something that we believe when there is support from all stakeholders for a project is essential. We've made an equity investment option available to all 20 of the First Nations across the Coastal GasLink route. To date, 17 of the 20 nations have agreed to pursue this. We've actually extended the deadline for the investment to be made to afford each community the opportunity to raise financing for the purchase at effective a cost as possible. On our Ontario pump storage project in Ontario, we've been working very closely in partnership with the Saugeen Ojibway Nation.

From the early days of design, in fact, based on our discussions with our partners the SON, we made significant changes to the design of the project to address and benefit from their traditional knowledge. So I guess the other thing, as the leader of the company, that -- what I tell my team is if the first time you engage with the First Nation, it's to ask for something you've already lost. This is about building relationships and building trust. And everyone, every group needs to have the same information at the same time in order to make timely decisions. It's just not right for project proponents to retain information and then ask for feedback on very complex matters in very short time line. So we work very hard to accommodate those. The one thing I will say though, however, is we are at a very unique point in time in our country and in the world.

And there's an opportunity here for North America to play a more significant role in providing energy to the world. What that means is that our customers may not be in Canada, our customers may be anywhere around the world that we want to serve. And we -- the project proponents and all of our key rights holders and stakeholders, we don't dictate the time lines. So we have to work together, build alignment as quickly as we can and respect the time lines that are established by those who want to make an investment decision. So keeping all of that in mind, the key is for everyone to have an open mind, the key is to build trust as early as possible and also to be as transparent as possible. So Gaagwiis, I very much appreciate the question. And thank you for the group you represent who are shareholders in the company. We appreciate your end and their confidence in the company. So with that, I'll turn it back to Jane. Are there any other questions, Jane?

Thank you, Francois. No, we do not have any further questions.

Okay. All right. Sorry -- thank you for the thoughtful question, Gaagwiis. And thank you all for the discussion today. On behalf of the Board of Directors and our employees, thank you to our shareholders for your continued confidence in TC Energy. For more than 75 years, the company has delivered infrastructure that performed through cycles, guided by disciplined execution, a strong balance sheet and a long-term view of energy market dynamics. That focus continues to guide how we operate, how we invest and how we support the reliable delivery of energy that powers communities and economic growth across North America. We appreciate your engagement and look forward to updating you on our progress. Thank you.

Thank you for standing by. This is the conference operator. Welcome to the TC Energy First Quarter 2026 Results Conference Call.

[Operator Instructions]

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

Thank you. I'd like to welcome you to TC Energy's First Quarter 2026 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 is available on our website under the investor section. Following the remarks, we will take questions from the investment community. We ask that you please limit yourself to 2 questions. And if you are a member of the media, please contact our media team.

Today's remarks will include forward-looking statements that are subject to important risks and uncertainties. For more information, please see reports filed by TC Energy with Canadian securities regulators and with the U.S. Securities and Exchange Commission. Finally, we'll refer to certain non-GAAP measures that may not be comparable to similar measures presented by other entities. A reconciliation is contained in the appendix of this presentation.

With that, I'll now turn the call to Francois.

Thanks, Gavin, and good morning, everybody. We entered 2026 with strong momentum, delivering against a clear and consistent set of strategic priorities.

First and foremost, we had our best safety performance in 6 years. We generated over $3 billion of comparable EBITDA, up 14% year-over-year, demonstrating strong stable results amid ongoing market and geopolitical volatility. We reached settlement agreements with customers on our Canadian mainline, ANR and Great Lakes assets with outcomes largely in line with expectations, further supporting our comparable EBITDA outlook.

Today, I'm pleased to announce a strategic investment on our Columbia Gas system. The USD 1.5 billion Appalachia supply project, which extends our reach into a high-demand corridor and creates a scalable platform for future growth. Customer demand continues to validate our strategy with consecutive open seasons in Ohio and on our Crossroads system, seeing strong response, supporting incremental growth visibility.

In Canada, we reached an important milestone with new commercial agreements for Coastal GasLink Phase II under a disciplined risk allocation framework, while execution of the Bruce Power MCR program remains firmly on track. These outcomes reinforce our confidence in delivering on our 2026 comparable EBITDA outlook, maintaining disciplined capital spending and preserving balance sheet strength as we continue to deliver solid growth, low-risk and repeatable performance. The U.S. Heartland is one of the most strategically important regions in our portfolio and one where we have a clear competitive advantage. With over 27,000 miles of pipeline infrastructure, we operate more natural gas pipeline and storage in the region than any other company, offering unmatched access to low-cost supply and key demand markets.

Today, the heartland represents approximately 3/4 of our U.S. deliveries with natural gas demand expected to grow an additional 40% through 2035, driven by diversified demand from power generation, including data centers, LDCs and LNG exports. Our ANR system sits at the core of our Heartland footprint and exemplifies the strength of our incumbent position in the U.S. Midwest. Including our Heartland and Northwoods projects, we've announced nearly USD 3 billion of investment on ANR over the last 6 years, adding more than 1.1 Bcf per day of incremental capacity by leveraging existing rights of way and infrastructure.

On our Columbia Gas system, natural gas demand across the footprint has increased by approximately 50% and we expect an additional 4 Bcf a day of incremental demand by 2035. We expect this momentum to continue to unlock additional accretive growth opportunities, further reinforced by the strategic investments being made today in our Appalachia supply project. This project further extends our reach into this high-value, high-growth market.

The USD 1.5 billion expansion project on our Columbia Gas system is supported by a long-term 20-year take-or-pay contract backed by an investment-grade utility and is expected to deliver solid risk-adjusted returns and a 7.3x build multiple. The project will add 0.8 Bcf per day of capacity to support new power generation development with an anticipated in-service date of 2030. But importantly, the project will be capable of up to 2 Bcf a day of total capacity through future expansions, creating line of sight for capital-efficient growth projects relating to overall economic development, demand from data centers and as broader electrification continues to scale. This strategic investment reinforces the strength of the Columbia Gas system while positioning us for several potential follow-on accretive opportunities.

Accelerating power-related load growth is driving customer demand across our footprint and it's reflected in the results of our 2 most recent open seasons. As we noted in our fourth quarter earnings call, the Columbus, Ohio open season was approximately 3x oversubscribed. This strong response reflects Ohio's projected natural gas demand growth of more than 30% over the next decade, the largest increase nationally outside of LNG exporting states. Growth is being driven by power generation, industrial expansion and grid reliability needs, including significant incremental load from more than 40 new data centers, positioning Ohio as a top 5 U.S. data center market.

Our Crossroads open season received a similarly strong response with bids exceeding 2.5x the capacity offering. What's important is not just the level of demand we're seeing, but how we're well positioned to capture it. We are intentionally strengthening connections across our systems, linking assets with access to premium low-cost supply such as Columbia Gas to systems serving high-quality, long-duration demand such as ANR. In corridor expansion opportunities on established systems like Crossroads allow us to respond quickly to customer needs, deploy capital efficiently and meaningfully reduce execution risk.

Turning to Bruce Power. The MCR program continues to execute safely, reliably and with improving economics. We've seen successive MCR costs come down by applying lessons learned and using new tools like robotics for removal and installation activities. That execution excellence underpins the long-term visibility of cash flows from the asset.

By 2030, distributions will begin to meaningfully exceed capital spend. And by 2032, Bruce is expected to generate approximately $1 billion of annual free cash flow increasing to approximately $2 billion once the MCR program is complete in 2035. Strong execution reinforces confidence in the team's ability to deliver significant free cash flow growth from Bruce Power that creates further optionality supporting growth across our entire portfolio as well as the potential expansion of Bruce C.

And with that, I'll turn it over to Sean to walk through the numbers.

Thanks, Francois. Good morning, everybody. Turning to our first quarter performance. TC delivered 14% year-over-year growth in comparable EBITDA, marking a very strong start to 2026 from each of our 4 business units. Both our Canadian and U.S. natural gas pipeline businesses continued to perform exceptionally well, setting 7 new all-time delivery records during the quarter. The results underscore the strength of our footprint and the value that are highly contracted in Corridor assets provide to our customers.

In the Power and Energy Solutions business, Bruce Power achieved 88% availability in the quarter, which is in line with our plan and which also includes the planned outage on Unit 8. For full year '26, we continue to expect Bruce's availability to be in the low 90% range, which is consistent with 2025.

Our Alberta cogeneration fleet also delivered exceptional performance achieving 99.5% availability. On the right-hand side of the page, we summarize our quarterly EBITDA performance. I would highlight that this was a record quarter marking the first time that we generated more than $3 billion of comparable EBITDA from continuing operations in a single quarter. Growth was led by our Mexico and U.S. natural gas businesses who placed over $8 billion of new assets into service in 2025.

Canadian Natural Gas Pipelines benefited from higher flow-through depreciation and NGTL incentive earnings, while Power and Energy Solutions saw higher contributions from Bruce Power. These results reflect strong execution across each of our lines of business and reinforce the momentum that underpins our financial outlook for the portfolio this year.

Looking ahead, we are reaffirming both our 2026 and 2028 comparable EBITDA outlook, which reflects our customers' steady demand for access to our assets under our unique long-term low-risk take-or-pay and rate-regulated commercial constructs. For 2026, our comparable EBITDA outlook remains at $11.6 billion to $11.8 billion, which represents roughly a 7% actual to midpoint increase relative to an exceptional performance in 2025, and it represents an 8% actual to midpoint annualized increase relative to 2024.

Looking out to 2028. We continue to target comparable EBITDA of $12.6 billion to $13.1 billion, implying a 6% actual to midpoint 3-year annualized growth rate that is fully underpinned by sanctioned projects advancing towards in-service date.

Moving to the right-hand side of the page, we summarized several additional factors that could influence our EBITDA outlook over time. While our EBITDA is highly contracted, we have ongoing revenue enhancement initiatives and cost and capital optimization programs across the organization that are in flight, each of which have the potential to drive incremental upside. We've added a project execution dashboard to provide a unique level of visibility on the key projects that are driving EBITDA growth over the next few years.

Collectively, these projects account for the majority of our capital allocation and expected EBITDA growth. You'll note that we have a clear line of sight to our in-service date and our build multiples. Similar to 2025, where we placed over $8 billion of projects into service on time and 15% below budget. The team is carrying that momentum into 2026 where our projects are tracking on schedule and on or under budget. We're providing a lot of detail on this slide, but you'll note that the majority of investment activity is concentrated in the U.S. where we are seeing commercial and regulatory tailwinds that are supporting a weighted average build multiple of 6.2x.

Notwithstanding the attractive positioning of the portfolio today, Project execution continues to be a strong focus, given how critical it is to our continued growth. Strong execution is a direct reflection of the discipline embedded in our low-risk project selection process and the strength of our cross-functional project delivery capabilities. It is this consistency in our team's execution excellence year in and year out that is foundational to our ability to deliver the financial outlook we provide and also reinforces the confidence we have in both our near-term forecast and our longer-term growth trajectory.

I'll wrap this slide up by underscoring that the visibility we are sharing on our next wave of projects continues to validate the quality, repeatability and low-risk nature of our project backlog. It's that backlog and our team's ability to execute that underpin our EBITDA outlook and continued shareholder value proposition.

I'd like to turn to our investment outlook with our updated capital allocation dashboard. This chart further demonstrates the depth diversity and continued growth of our project portfolio through the end of the decade. With today's announcement of the Appalachia supply project, we converted approximately $2.2 billion of investment capital from pending approval into sanctioned. Last quarter, we also added over $2 billion of new high conviction, substantially derisked projects to our pending approval bucket, which continues to support near-term project announcements. Beyond the project portfolio on this slide, we have about $15 billion of additional projects in origination that are competing for capital allocation this decade.

To give you a sense for where some of this $15 billion backlog stands and our confidence in converting them to sanction capital over the next year or 2. Francois mentioned that we recently conducted 2 open seasons in the U.S. that were substantially oversubscribed, that we're extremely excited about. Similarly, in Canada, we've launched the first in a series of expected new offerings on NGTL, while continuing to advance parallel discussions on a new growth investment framework with customers.

I'll wrap this slide up with a few comments about how we are thinking about capital allocation going forward. Over the next couple of years, we will continue to look to optimize and bring forward capital to support up to $6 billion of annual net capital deployment. As we look out to the latter part of the decade, and are considering the project backlog we discussed, it is this high value largely in Carter opportunity set that will define our level of net investment. We remain committed to maintaining the balance sheet strength and our 4.75x leverage target, and we will continue to execute projects with excellence.

These guide rails are fundamental to our risk and capital allocation screening process, which supports the ability to exceed the $6 billion annual level, particularly as we near the conclusion of the Bruce MCR program post 2030, as Francois highlighted earlier. That is the scenario which is now in our planning window. That sets us up very well for continued EBITDA growth towards 2030 and beyond.

With that update, I'll pass the call back to Francois.

Thanks, Sean. We've got an exciting year ahead, and our strategic priorities remain clear and firmly in place. We'll continue to maximize the value of our assets through safety and operational excellence, while leveraging commercial and technological innovation. We will prioritize low-risk, high-return growth. More announcements are expected throughout this year. And thirdly, we will maintain our financial strength and agility to support long-term value creation.

Operator, we are now ready to take questions.

[Operator Instructions]

The first question comes from Praneeth Satish with Wells Fargo.

The first question comes from Aaron MacNeil with TD Cowen.

Appreciating the implication that the Appalachia supply project arguably has a bit of pre-spend for future growth. Can you give us a sense of what the economics of a fully loaded project that 2 Bcf might look like from a build multiple perspective? And then what needs to happen to get to 2 Bcf per day and when do you think that could happen by?

This is Tina Faraca. I'll kick off with the response to that question. We're really excited about announcing our Appalachia supply project this morning for many reasons over and above the headlines that we talked about. When we make capital allocation decisions, we look many years ahead and the scenarios around placing this line into service gives us a strong long-term growth trajectory. So the nature of these facilities in terms of pipeline extension and compressor modifications is an opportunity for us to leverage future opportunities in the region. The corridor that this project passes through is a high-growth power corridor for us. We see gas demand growing in that region of our footprint by about 4 Bcf through 2035. So it's important for us to look to the future as we develop the scope for this project.

As you look at the opportunity to increase the capacity of this project to up to 2 Bcf, that can be accomplished with minor facility modifications. And so as you kind of contemplate what that might look like, that this will be a very economic expansion for us going forward.

Makes sense. Maybe just switching gears to Canada. The slide deck as you've launched an open season on NGTL. Can you give us a bit more details there and how a project like that would compete for capital versus sort of the other opportunities across the portfolio?

Sure. We did launch an open season on NGTL. We are seeing increased demand across the system, including incremental load growth in the Greater Edmonton area, which is what's triggered the recent open season. And we've also seen just a step-up in general interest across NGTL that we're responding to as a result of the open seasons. Our goal is to aggregate that customer demand in the most efficient way to serve the market. We look at these investments from the lens of ensuring that they earn a competitive risk-adjusted return with the rest of the portfolio.

So you'll recall our NGTL settlement which runs through 2029, that enables an investment framework through incentive shared mechanisms to support competitive returns on invested capital for our multiyear growth plan. And as we look ahead for the next expansion beyond multiyear growth plan, we're discussing with our customers an opportunity for a new investment framework, which will continue to allow us to compete for capital in the market.

The next question comes from Jeremy Tonet with JPMorgan.

Just wanted to start with Appalachian supply, again, the project here. And just curious, when you mark the 2 Bcf of capital efficient expansions -- is 2 Bcf a specific point as far as capacity-wise for the system that you see? Or is it line of sight to customer interest. And when you talk about this being a platform for future growth, are you talking just moving to 2? Or are there other opportunities as well?

Yes, we marked the 2 Bcf based on a very economic expansion through just compression or minor modifications. It could be expanded beyond that with the pipeline or extensions. But it's in such a great high-growth corridor that not only can we serve growth along that corridor, we can extend that forward or to reach for additional opportunities.

Got it. That's helpful. And then I just wanted to turn to ANR real quick here. And as far as the settlement, I'm just wondering if you could share any thoughts on how that, I guess, compares to your guidance expectations, is there room for upside here from this? Or anything else, I guess, across your system as you're looking as more settlements could come into place in the future?

The outcome of that settlement in principle is a positive result for ANR. We're pleased to have received a unanimous agreement with our customers on all major issues. As reflected in the interim rate filing, we have settled with an increase over prefiled rates. The outcome of that settlement is consistent with estimates. We typically look at sort of a conservative approach, but that doesn't mean that that's not what we're expecting related to an outcome with our customers. So this remains, again, a settlement in principle and within our predictions.

The next question comes from Theresa Chen with Barclays.

Turning back to NGPL, given the clear need for incremental residue egress out of the area, can you elaborate on the new investment framework in discussion? And how has the framework and precedents established by the Canadian Mainline settlement informed your discussions with shippers on NGPL?

Theresa, it's Francois. I'll take this one. The mainline was -- and those terms are now out in public. It was really a win-win in that we were able to commit to adding roughly 300 million cubic feet a day of capacity over a 4-year period with a $200 million capital commitment, which obviously is a very efficient use of capital in exchange for being able to maintain the incentive programs that were established in the last settlement. This is effectively an extension of that original settlement.

A win-win in terms of shippers being able to see expansion of capacity, and we're able to have our Canadian projects compete for capital in our internal processes. So that was the signal in addition to in the very recent few months, a significant increase in demand for service on our NGTL system that urged us to enter into a dialogue with our customers on a new investment framework. So we're doing 2 things in parallel.

With the open seasons, we are gauging interest in capacity in 3 or 4 parts of the province at the same time as we're discussing a new investment framework. It's early days in terms of that conversation. But suffice it to say that on a risk-adjusted basis, what we have put on the table, we feel is a win-win and would compete for capital within our capital allocation framework.

And in the U.S., following the successful and highly oversubscribed Crossroads pipeline open season, what are the gating items to FID from here? And just taking a step back as the Midwest is increasingly becoming a focal point for data center build-out and is also experiencing a step-up in power demand growth more broadly. Can you elaborate more on your view of the magnitude of our opportunity size for your assets here and your relative competitive positioning?

Theresa, this is Tina. I'll start with Crossroads and then move maybe to the more broader discussion on the Midwest growth. As you have heard, we -- our open season was very successful we had interest that exceeded what we had advocated for by 2.5x.

So our focus is now shifting to thoughtfully developing that demand in a means that will drive a capital-efficient expansion for our customers and to try to get the largest size project we can in the most efficient way possible. So we're in the process of working with all of our customers who participated in that open season to refine the commitments and scope and there's, as I mentioned, certainly the potential to upsize based on current discussions, and we'll continue to target sanctioning that project in 2026 within our 5 to 7x build multiple range.

In terms of the Midwest, we are seeing incredible opportunities across that corridor, specifically in the power demand sector, we see about 5-plus Bcf per day of incremental gas demand across the Midwest corridor over the next 10 years. And from a competitive standpoint, our incumbency there is really a critical opportunity for us with our Columbia, ANR, Crossroads, Northern Border and Great Lakes system gave us a highly advantaged footprint in that region.

We're the #1 operator across several of those states. We have over 200 connections to electric and gas utilities in that Midwest corridor, specifically on ANR. So it really positions us well to capture that new demand. Additionally, we bring supply optionality that's becoming more and more important to our customers. We can access Appalachia, Gulf Coast, Mid-Continent, Bakken and WCSB supply to bring that diversity to our customers.

And then finally, our storage access is unparalleled in that region with over 532 Bcf of storage opportunities for our customers. So all in all, we're really excited about our opportunity for compete for that growth in that corridor.

The next question comes from Rob Hope with Scotiabank.

Can you speak to how your project development pipeline is progressing. So you sanctioned roughly $2 billion of projects this quarter and even with that appears like the project development pipeline has increased to over $21 billion. So can you just maybe help us understand how -- what the book-to-bill ratio is looking like for you?

Yes, Rob, it's Francois. I'll take this one. As we've said in the past, project development life cycles for pipeline lines is many years. It takes a good solid year to develop a project and then a couple of years typically to get your permits before you've got shovels in the ground. So we have pretty good visibility on what's coming for us down to the specific projects. We have within a 50 basis point plus or minus range, a very good sense of what the returns look like. And therefore, the EBITDA build multiple and I can tell you that everything in that pipeline, in aggregate, the full $21 billion is solidly within that 5 to 7x EBITDA build multiple and in that 12% on levered IRR after-tax range, consistent with what we've seen over the last couple of years.

It's true that the backlog is building, and that's because even with the projects that we've been working on for many months, if not years, our utility customers are coming back to us and saying, we want to upsize as a project to supply electricity gains credibility and is looking firmer and firmer that is attracting additional load, either from electrification with large or from additional data centers that want to benefit from the certainty of a project. So it's true that we see the momentum continuing. And it's not surprising that our backlog has grown even from what we had a quarter ago, which was fairly robust.

Appreciate that. And maybe a bit of a broader and longer-term question. Canada is looking to develop an electricity and nuclear strategy what would you look for in the strategy to help underpin future investment in Bruce C? And when should we think that discussions could kick off?

I'll start with a very high level, and I'll ask Greg to provide some detail. We're the only investor-owned owner and operator of nuclear in Canada. Bruce Power is best-in-class, they are INPO 1-rated reactors, which means top decile operating efficiency and safety performance you may have seen that we've entered into cooperation agreements with Alberta and Saskatchewan. And so we absolutely have ambitions over the next many decades because these projects take quite a bit of time to develop, to invest and allocate capital to nuclear across the country. That, of course, will come after we prosecute Bruce, and evaluate Bruce C.

So I'll turn that over to Greg.

Sure. Thanks. Appreciate the question, Rob. To me, it's quite flattering and kind of feather in the cap for a great management team at Bruce to be invited not only into some of the conversations around a federal strategy, but obviously, with the recent announcements in Saskatchewan, Alberta. And obviously, the experience and credibility that Bruce has built over the last couple of decades, the large-scale operator and seen some of the critical work delivery on the MCR program safely on time or under budget and ahead of schedule is really leading to them being the team to call on as we think about the next nuclear build in Canada.

Just to Francois' point, I just want to reiterate that like our immediate focus, obviously, is the safe delivery of the remaining MCR program and driving Bruce expansion is the next nuclear facility in Canada. We just believe given the existing footprint, infrastructure, the highly skilled labor that we have in place and the strong local support and you have an integrated Canadian supply chain, which just makes Bruce kind of that next project we'd like to see happen. But the longer-term prospects and optionality across Canada and having Bruce at the table is extremely important.

The next question comes from Praneeth Satish with Wells Fargo.

Sorry for the technical difficulties before. So you have $6 billion of late-stage projects now pending approval. I'm just wondering if you could talk conceptually about what's in the bucket there. I think last quarter, you said that Crossroads in Colombia gas are not in there. It sounds like that's still the case. And -- but Bruce Power MCRs are included. So if Crossroads and Columbia Gas are not in that bucket, does that imply just adding up the MCRs, does that imply you have another couple of billion of undisclosed U.S. gas projects that are close to FID?

Praneeth, this is Tina. Yes, our backlog continues to grow. You're correct. Those projects were not included in the pending capital. We're advancing those this year. based on our customer discussions and the increasing demand across our footprint.

As we look towards the end of this year, we're continuing to see growth in our power generation sector, which allows us to bring more and more of these advanced projects into that queue. So we are continuing to find opportunities, particularly in the Midwest corridor of our system, where power generation growth continues to exceed our expectations, but importantly, our footprint is allowing us to capture those opportunities.

Got you. And I guess, in light of all these projects, as you think about longer-term capital planning, particularly 2029, 2030, when a lot of the CapEx for these projects that you're sanctioning is going to hit, leverage should be lower, you're reaching that free cash flow inflection at Bruce. So given that backdrop, I guess, maybe if we can revisit how much flexibility you have to increased CapEx, maybe pulled forward some of the Bruce free cash flow. On our math, I mean, it seems like you could raise it by a couple of billion, but just trying to understand the range of outcomes.

I'll speak to capital allocation and then I'll ask Sean to talk about funding and impacts on leverage. We've -- we'll remind you all that the first criteria is around maintaining project execution excellence. That is a nonnegotiable as we contemplate growing our net capital spend beyond $6 billion. We've satisfied ourselves, our Board that we have the capability to do that with, I think, a fairly detailed and rigorous amount of planning and preparation. Obviously, having -- maintaining balance sheet strength is very important.

Toward the latter end of the decade, we will allow the opportunity set within those guardrails to drive the size of our capital program rather than a self-imposed $6 billion net capital limit. We feel that we're in a generational point in time where the returns are quite attractive. We're investing at very attractive returns and build multiples, and we want to make sure that we capture that for the benefit of our shareholders.

And over to you, Sean.

Yes. I think, Praneeth, the only thing I would add to that, thank you for kind of calling out Bruce, right? It is in our planning window now. So as you see this program, we'll have work for a decade to deliver the cash flow profile beginning in 2030. It's a ton of fun to think about what Bruce can help GasCo do in 2030 and beyond, and it's a fundamental game changer in just how we think about capital allocation within the guide rails that Francois just talked about. So 2030 and beyond, our degrees of freedom and optionality subject to team discipline and capability and high return projects is just a lot of fun.

Next question comes from Robert Catellier with CIBC.

A couple of things here on the NGL side. First, with the revised CGL framework, just walk through how that limits TC Energy's construction and cost exposure and what it means for some of the returns you might get if the project goes FID for CGL Phase II later in the decade?

Rob, this is Tina. I'll take that question. We entered into a new commercial agreement framework with LNG Canada and the partners. What will happen on that -- under that agreement is that LNG Canada is going to lead the project execution. As the execution manager and our team will provide technical advisory services. We're actively operationalizing that new execution model. In practice, what that means is that as the project executionally, LNG Canada will manage some of the cost and schedule activities, and that puts limits on our capital commitments and overall liability for construction cost and schedule risk. So this is consistent with our strategic objectives to produce project execution and capital allocation risk within our tolerance.

And Robert, your question on returns, as you know, we equity account for CGL. We own 35% of the equity. So we look at that project on a levered return basis, only our equity cash calls are included in the capital table given the project financing that is expected to be in place once we're -- we've got shovels in the ground. So on a levered basis, it is an extremely attractive returning project for TC, albeit a small project in the grand scheme of things.

Okay. Understood. And then turning to the U.S. Obviously, you have a pretty good market share there. Deliveries were up significantly year-over-year. But as you look to the next wave of U.S. LNG projects, what factors will determine whether you can continue to grow versus maintain your market share there? And what type of spare capacity do you have versus likely requirement for new builds?

Rob, you may be familiar that over the last several years, we've progressed several LNG export projects across our entire footprint. We've put in service about CAD 16 billion a project to provide natural gas transportation capacity to LNG export terminals with a total of over 7 Bcf per day. So we've, over the last several years, really developed a very strong approach to serving this corridor.

In the U.S., we have 2 projects -- well, 1 project underway with our Gillis Access extension projects that will be going into service later this year. And in Canada, we have our Cedar Link project that's in execution as well.

So we're continuing to develop solutions for the LNG export model. And as we look into the future, we have great connectivity, not only to the U.S. Gulf Coast, but to the West Coast of Canada. So we're well positioned to capture additional opportunities through expansion of those facilities.

Your next question comes from Spiro Dounis with Citi.

Wanted to go back to the $15 billion backlog and maybe a bit of a follow-up to Praneeth's question. So clearly, that backlog now 25% higher since the last update, seems to imply things are accelerating here. So I guess in the context of elevating your CapEx cadence later on in the decade, just curious how much of that $15 billion could potentially result in pre-2030 spending?

Thanks. I'll go ahead and answer that question. So the $15 billion backlog is primarily in the U.S. business for our pipeline facilities. As we look at the life cycle of a project, it typically takes, as Francois mentioned, several years from origination into in-service. So typically the largest spend on a project is the year that you're actually going into construction. So oftentimes, that spend is weighted towards the end of that cycle. And so that's kind of how we think of the spread of that capital. Most of our projects are now targeting anywhere from 29, 30, 31 types of in-service dates.

Great. That's helpful. And then a question just on the Canadian pipeline side, and you mentioned it there a little bit. But -- it sounds like that region is getting closer to competing for capital at a larger scale. And so I guess I'm curious how much of the Canadian expansion is in that $15 billion backlog. It sounds like not much. And I guess maybe another way to ask it is, what's the opportunity set there? How much could be added if this framework starts to be scaled up higher?

So very little of the NGTL expansion is in the $15 billion backlog. As I said earlier, Spiro, we're early days in our conversations with our customers around the new investment framework, and it would be premature to put it in our backlog based on our criteria. It could be several billion dollars. We've seen since the MOU between Canada and Alberta was announced, a significant uptick in interest in service. And that has been the catalyst for us. Kind of in between our typical annual demand assessments to come out with sort of a off-cycle service offering. So it's moved very quickly, and it could be quite meaningful subject to a new investment framework.

The next question comes from Maurice Choy with RBC Capital Markets.

Just wanted to start with a big picture question. You mentioned earlier the nonnegotiables on project execution, balance sheet strength and competitive returns. From your perspective at the very top, and as you think about times beyond the next 3 years, what are the areas of your business that you're seeing as being perhaps an emerging limiter to your durability of your growth?

Maurice, it's Francois. I'll take that one. It's certainly not demand, and it's not the return profile of the projects we're seeing. It's really human capital. As I said, we've gone through a very rigorous and detailed organizational readiness assessment in order to be able to execute on projects. We feel that we developed processes and mechanisms to have a good couple of years of visibility around where the points of tightness might be in terms of our people, in terms of contractors, supply chain for steel and compressors, et cetera.

So I would say that would be the one limit when you're looking into the 2030s. The other would be the permitting and policy environment. We're seeing some tailwinds there, both in Canada and the United States with respect to a desire of governments to accelerate infrastructure spending for affordability and also energy security purposes. So our base case right now is that those constraints will not present themselves, but we have to plan for all scenarios. We have to be disciplined. And the last line of defense will always be our ability to safely and efficiently deliver our projects on time and on budget and with an impeccable safety record.

And maybe as a quick follow-up. Is supply chain an area that you spend more time in? Or is it the fact that you're quite large, you've got a kind of scale and ability to demand?

Maurice, we do have to pay close attention to the supply chain. It is a bit tighter in the United States than it is in Canada. That's one of the reasons why Canada -- it seems like an attractive opportunity for us to deploy more capital. There's a bit more slack in capacity there. But we're taking different practices to manage supply chain risk. We're entering into strategic alliances and long-term agreements with OEMs.

We're contemplating doing that with construction firms as well, just to make sure that we have not only the project backlog, but the certainty in our ability to execute. So we do see the need for us to be a bit more strategic and do things a little differently than we have in the past. But it's a very high-quality problem, as I would say.

Understood. And if I could just finish off with a quick follow-up to one of Tina's earlier response on the Appalachia supply project. The initial phase is 7.3x build multiple, and you suggested that there should be better returns and economics for future phases. Is it fair to say that after all these phases are built, you'll probably be averaging down to within the 5 to 7x target range and potentially maybe even closer to the lower end of that range.

Thanks, Maurice. Yes, given the fact that we can very efficiently expand that new infrastructure up to 2 Bcf per day, you could -- you could quickly see how we could move that down towards the end of that 5 to 7x range.

The next question comes from Sam Burwell with Jefferies.

I wanted to clarify when the Appalachian supply project was only in the pending approval bucket for a quarter. I'm just curious if the PJM backstop procurement announcements have had just any bearing at all on sanctioning it any more quickly or if this was more fully baked and that was a nonfactor, but potentially PJM developments might be a tailwind for future project origination or just conversion converting backlog?

Yes, I'll start with just the market drivers there. that was not a consideration as part of this sanctioning the project as well as the development of the opportunity set could be a tailwind, certainly, but that wasn't the driver for the customer demand here.

Okay. Understood. And then the $200 million that you flagged for Canadian Mainline investment, just any color on how that exactly increases egress capacity out of Western Canada? Does that mostly address Eastern Canada? Just curious if there's anything we can read through and potentially sending more Canadian gas on into the U.S. on your pipeline systems on downstream.

Yes. Thanks, Sam. The capital that we are looking at for our mainline expansion supports primarily capacity from Empress to Emerson. So that enables us to feed expansions down stream of Emerson on the Northern Ontario line and into the Eastern Triangle. So that's where we're focused with that capital right now.

The next question comes from Ben Pham with BMO.

I had a question on your 3 different buckets of the backlog. You got the $23 billion secured, the $6 billion and the $15 billion. I know you've talked about this in your earlier remarks. But can you just find maybe a bit more context on what are project needs to achieve to fit in the $6 billion and then also the $15 billion plus in origination.

Yes. Ben, it's Sean. I'll take that one, just to echo a little bit of Francois's comments what has to be true for a project to compete for capital. Obviously, it's -- it's got to be a high-returning low-risk project and predominantly in corridor is what you're seeing in that -- in everything on that slide. And then the human capital internally as well as supply chain control and visibility, right? Those are really the guide rails as we talk about. And as we get into that 2030 and beyond, as Tina was mentioning, the 4.75 remains true in all years, and it gets even easier at the post 2030 kind of time period for that or better to be our metric given the cash flow profile. So that's really the triangulation, right? And in terms of the difference between pending and in our advanced business development, pending, we may not have contractually committed the capital, but in our minds, we've committed the capital. So it's a very, very high bar to make it into the pending bucket.

We haven't seen anything as of yet to fall out of the pending bucket other than to become a sanctioned project. And there is deal flow and opportunity set of conversations that are not even in the advanced business development, the $15 billion that we put there for projects to make it into that $15 billion number, we have to have had concrete conversations with customers where we have a good idea of what the capital commitment would be that it translates into a toll that's competitive. We may be in the process of bidding against our competitors.

Certainly, there is no certainty if you're in that $15 billion number that it will transpire. You would have had to win a bid but still be working through some of the details to make it into the pending bucket. So there's even another bucket that's more in the preliminary stages that's in addition to the $15 billion that's there.

So the $15 billion has a fair amount of substance in it. Obviously, with our Columbus, Ohio project and our Crossroads project, those are in that $15 billion and not yet in the pending despite the fact that we have had very robust open seasons. There's a lot of work that needs to be done after you've had an open season supporting through all the details of the contracts, making sure the credit provisions the delivery points that customers are asking for, looking at reaffirming capital cost given you have a much better sense of what the actual demand is.

So just a whole bunch of tailwinds in all 3 of those categories that give us a lot of confidence in our ability to extend our growth well into the next decade.

And it sounds like when you think about this fourth even bucket prospective that you have, it sounds like you have a multiyear runway of constant replenishment then on the $6 billion to $15 billion.

Very much so. As I said, it takes multiple years to develop and permit projects. We benefit from a very high degree of visibility many years into the future. So that is absolutely the case, Ben.

Okay. That's great. Maybe just my follow-up on NGTL, the new investment framework to clarify that. That doesn't require you to go back in the existing settlement and open it up. It's something that could be outside of that framework?

You're correct, Ben. That would be outside of the existing settlement, it would be specific to any new investments past the multiyear growth program.

Our next question comes from John Mackay with Goldman Sachs.

Maybe I'll do a quick one on the backlog, not to fall too far into semantics around pending approval versus origination, et cetera. But when you talk about that $15 billion, is there a general time frame for that, Francois, you mentioned kind of project cycling in cycling out. Would you be able to put a kind of number of quarters or a number of years around that $15 billion?

John, this is Tina. I'll talk maybe more about the timing for in-service, but these projects span various in-service dates anywhere from 2028 through 2031. So depending on where we're at in the discussions with the customers and the commitment for earlier in-service dates around that earlier '28, '29, '30 time frame would require sanctioning in the next year or 2. We look towards when those need to be sanctioned in order for us to need to start the development activities and move those into execution with our regulators. So hard to say, but we have a long runway of opportunities to sanction these projects over the next several quarters and several years.

All right. That's fair. A quick second one for me. You and a couple of your peers were talking about a lot of Midwest gas demand growth. Can you spend a second on where you see the gas supply coming from those. And more specifically, are you having conversations with Appalachia producers that are looking to effectively boost overall basin egress, get Marcellus production higher than it's been and move, I guess, effectively incremental production to the West?

Yes. Thanks, John. It's really been interesting with our customer discussions where supply optionality in that region is becoming more and more important. And that's why you're seeing projects like our Crossroads project becoming over 2.5x oversubscribed because customers are looking for optionality.

So in the Midwest, access -- our supply opportunities give us access to Appalachia, the Gulf Coast region, Mid-Continent, Bakken and the WCSB. So we're really well positioned to provide that optionality that the customers want. A couple of our projects into Wisconsin over the last several years have brought in more WCSB supply. Some of the producers are interested in that opportunity, but it's really the demand component of that, that's looking towards sanctioning projects here in the near term.

I know we're at the top of time, maybe just a quick clarification on that. On ASP specifically, is that bringing incremental Marcellus egress? Or is this just, I guess, you can say, improving connectivity to existing Marcellus/Utica supply?

Given the large amount of supply that's required for that project. We are the #1 transporter of Appalachia supply in the region. This project will allow for additional egress out of the basin.

Next question comes from Zack Van Everen with TPH.

Maybe going back to the last question a bit. I know you mentioned 4 Bcf of demand around your assets, but then mentioned 5 Bcf of demand in the Midwest. Do you guys have an internal total demand number for the Northeast. It seems like some of your peers as well as the producers keep increasing that to the, call it, 5 to 8 Bcf range. I was just curious if you guys had an internal number on a total demand?

Yes. When we -- Zack, this is Tina. Thanks for the question. The numbers continue to exceed our expectations. Our new forecasts are coming out soon and looking at those recently, we are seeing the power generation component that demand actually moving up into that 5 to 8x -- 5 to 8 Bcf range in that Midwest corridor.

Our facilities are primarily weighted towards the Midwest where a lot of that growth is. So as I mentioned before, we're the #1 operator across several Midwest states that allows us to advance that connectivity and serve that growing demand.

Got it. That makes sense. And then you mentioned diversity of supply. I'm curious if you're still seeing demand from the Gulf Coast, maybe down ANR or Columbia Gulf, or are most of these projects now in the Northeast is basically absorbing all of the incremental supply, there might not be a need for a longer haul project just because there's enough projects in the Northeast.

There certainly are lots of projects out there right now. But as I mentioned before, the supply optionality has really been an important component of our discussions with our customers and our ability to access not only all the Appalachian supply and the Mid-Continent supply, but our connectivity to the Gulf Coast in Haynesville is an important differentiator for us as well. So we are seeing our customers look to all supply basins right now that we are connected to, to provide them with supply optionality into the various regions that they're seeing their demand growth.

The next question comes from Keith Stanley with Wolfe Research.

On Crossroads, I wanted to follow up. Your competitor was also oversubscribed on their competing projects, open season in that area. So it feels like demand is overwhelming. Going forward, would you say you're competing with them for securing this demand in that area with binding agreement? Or do you see your project is mostly separate from them and a different set of customers you're negotiating with?

Thanks for that question. Keith, this is Tina. As I've mentioned before, we -- our competitive position in that region is very strong, and we're well positioned to compete for and win our fair share of opportunities in that region. Our connectivity to over 200 electric and gas utility city gates in that corridor gives us, I think, a substantial competitive edge.

However, where you're located and where you're connected is really important as well. And that, again, goes to our interconnectivity with all the electric and gas utilities in the region. The oversubscription of our project and some of our peers' projects, I think, is just translating into this increasing opportunity set for supply diversity across the region. But importantly, many of our customers are looking for some level of redundancy and perhaps even just some optionality. So I think there's room for more expansion in this corridor, but I'm very confident we're going to win our fair share.

Second question for the Graybar projects awaiting finalization, would you say they're fairly diversified across the asset base? Or are they very concentrated in this Heartland area you've been pointing to with Colombia and ANR.

I think you could say, Keith, there's a fair degree of diversification in that pending approval bucket.

Ladies and gentlemen, this concludes the question and answer session. If there are any further questions, please contact Investor Relations at TC Energy. I will now turn the call over to Gavin Wylie for any closing remarks. Please go ahead.

Well, thank you again for participating this morning. The great questions that we've been asked and for your interest in TC Energy. If we didn't get to your questions, as the operator mentioned, please do reach out to the Investor Relations team. We're always happy to help. And with that, we'll close out and look forward to our next update in late July. So thank you very much.

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

Thank you for standing by. This is the conference operator. Welcome to the TC Energy Fourth Quarter 2025 Results Conference Call. [Operator Instructions] And the conference is being recorded. [Operator Instructions]

I would now like to turn the conference over to Gavin Wylie, Vice President of Investor Relations. Please go ahead.

Thank you. I'd like to welcome you to TC Energy's Fourth Quarter 2025 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 is available on our website under the Investors section. Following remarks, we'll take questions from the investment community. Please limit yourself to two questions. And if you're a member of the media, please contact our media team.

Today's remarks will include forward-looking statements that are subject to important risks and uncertainties. For more information, please see reports filed by TC Energy with Canadian securities regulators and with the U.S. Securities Exchange Commission. Finally, we will refer to certain non-GAAP measures that may not be comparable to similar measures presented by other entities. A reconciliation is contained in the appendix of the presentation.

With that, I'll turn the call to Francois.

Thanks, Gavin, and good morning, everyone. 2025 was a defining year for TC Energy. We laid out a clear set of strategic priorities and we delivered. First, I'm exceptionally proud of the team's safety performance, our best in 5 years, and that is directly enabling our strong operational and financial results, reflected in our 9% year-over-year increase in comparable EBITDA.

Importantly, in less than 18 months since we spun off our Liquids business, we have replaced nearly all of its EBITDA with high-quality natural gas and power projects. On execution, we placed $8.3 billion of projects into service on schedule and over 15% under budget. That same focus is evident at Bruce Power, where Unit 3 remains on track for a return to service this year.

As we enter 2026, we're building on our strong base business performance, consistent execution and disciplined capital allocation that continues to deliver solid growth, low-risk and repeatable performance. Driven by LNG exports, rising power generation and increasing reliability needs for local distribution companies, we expect North American natural gas demand to increase by 45 Bcf per day from 2025 to 2035. This is equivalent, for context, to adding the entirety of the European gas market over the next 10 years and demand is materializing real time.

As the only major energy infrastructure company focused solely on natural gas and power across Canada, the U.S. and Mexico, we have an advantage to capture outsized value from our diversified portfolio. We serve 7 LNG facilities representing 30% of North American LNG feed gas across 3 countries. We serve 170 power plants positioned near high-growth markets like PJM and MISO. And we are approximate to 60% of projected U.S. data center growth. We are also the only midstream company to have a stake in the world-class nuclear facility, Bruce Power, in a market where electricity demand is expected to grow by 65% through 2050.

Our competitive position combined with this compelling backdrop is creating for us a broad set of opportunities across geographies, customers and each of our strategic growth pillars. In the fourth quarter, we advanced $5 billion of projects at various stages. We placed $2 billion of assets into service on time and under budget, and we expect to place approximately $4 billion into service this year. We continue to optimize our capital plan, shifting $0.5 billion of capital forward into 2026 to capture in-year EBITDA while creating capacity for higher return growth in the outer years.

We added $600 million of new projects in the fourth quarter, including additional NGTL expansion facilities and a brownfield U.S. compression expansion project at a 5x build multiple. We continue to advance commercial discussions with customers across a diverse set of high-quality opportunities moving roughly $2 billion of late-stage derisked opportunities into our pending approval bucket. With recent sanctioning and ongoing optimization of our opportunity set, our high conviction pending approval portfolio now sits at about $8 billion. Sean will walk you through how this will impact our capital spend through the end of the decade.

Outside pending approval, we see an additional $12 billion of projects in origination, supported in part by our recent nonbinding open season on Columbia Gas that was 3x oversubscribed. That $12 billion represents a relatively conservative view. It doesn't, for instance, include potential developments like Bruce C, where feasibility and early development work are progressing. Importantly, the projects we're pursuing are consistent with our targeted build multiple range of 5 to 7x.

Collectively, this progress reinforces our confidence in 2026 to fully allocate our $6 billion annual target in net capital expenditures through 2030. And I believe our opportunity set gives us the optionality to surpass this level of investment sanctioned this year for the latter part of the decade.

Wide-scale electrification, ongoing coal retirements and the rapidly growing energy needs of AI and data centers are driving a significant and sustained increase in North American electricity demand. Our strategy has been very intentional to capture this growth without increasing our risk exposure. Our primary focus is on brownfield and corridor expansions that leverage our existing footprint to primarily serve investment-grade utility customers, particularly in regions where we hold long-standing incumbent positions.

Notably, the majority of the 10 Bcf per day of expected growth in power demand is concentrated in markets that directly overlap our footprint. Recent project announcements like TCO Connector, Northwoods, Pulaski and Maysville, are all strong examples of this strategy and practice. Our resilience is anchored by long-term take-or-pay contracts that further benefit from a diverse and durable set of demand drivers. This low-risk strategy positions us well to deliver sustained value for our shareholders, and this same opportunity extends to Bruce Power, which I'll turn to next.

Bruce Power's top focus remains delivering the highest level of reliability, availability and safety performance across all 8 units. Alongside the major component replacement program, the team is executing a proactive targeted initiatives to strengthen the reliability of critical equipment. The net benefit of these initiatives is improving plant reliability and availability that has a meaningful financial impact. Every day a unit remains available, it leads to roughly $1 million per day of incremental revenue for TC Energy. And as shown in the chart on the right, Bruce Power's availability has steadily improved with expected availability in the low 90s percent range for 2026. As realized power prices also trend higher, we continue to strengthen our financial performance. And with that, I'll turn it over to Sean to walk through the numbers.

Thanks, Francois. Good morning, everybody. In the fourth quarter, TC delivered 13% year-over-year growth in comparable EBITDA. It was a solid quarter to end an exceptional year. Our pipeline businesses set new all-time high delivery records, a direct result of our team's outstanding focus on safety and operational excellence.

In our Power and Energy Solutions business, Bruce Power achieved 86% availability, which includes the planned outage on Unit 2 and is in line with our expected annual availability in the low 90% range for full year 2025. On the right-hand side, we show our comparable EBITDA bridge for the quarter. You'll see that we generated almost $3 billion in EBITDA.

Let me walk you through the components of how each business helped us get there. Starting with Canada Gas. EBITDA increased by $110 million due to higher incentive earnings and flow through depreciation on both the NGTL and Mainline systems. In the U.S., EBITDA increased by $188 million, primarily from our Columbia Gas settlement as well as additional contract sales and higher realized earnings related to our U.S. natural gas marketing business. In Mexico, EBITDA increased by $163 million, which was a 70% increase relative to last year due to the completion of Southeast Gateway. The increase from Southeast Gateway was partially offset by currency and tax items, which remain well managed within our overall financial hedging framework.

And finally, in our Power and Energy Solutions business, equity income from Bruce Power was lower quarter-over-quarter. That is primarily from Unit 4 being off-line for its MCR program at the same time, Unit 3 is off-line for its MCR program. We also saw lower availability due to planned maintenance outages which was partially offset by higher contract price.

In summary, it was a strong quarter due to high availability and EBITDA contributions from the assets our teams helped place into service in 2025. With the $4 billion in projects expected to go into service in 2026, including Bruce Unit 3's return to service, we continue to see strong EBITDA momentum heading into 2026.

Shifting to our investment outlook and our capital allocation dashboard. We have a few new features to highlight here in order to bridge you from our last call in November. In November, we shared that by the end of 2026, we expected to have fully allocated our $6 billion annual target through 2030, with project build multiples in the 5x to 7x range. We have made the progress we expected towards that objective.

In the past few months, we've added approximately $2 billion of high conviction derisked projects, which are shown in the gray bars. This brings our late-stage pending approval opportunity set to approximately $8 billion. That increase is net of the $600 million of new projects announced earlier today, along with ongoing optimization and high grading of our capital program.

As the pending approval bucket continues to grow, we have been successful in pulling forward capital by 1 to 2 years, as shown in the arrows on the top of the page. We are optimizing short-cycle maintenance capital into our 2026 plan, which earns an immediate return on and of our invested capital.

To give you a sense for other optimization opportunities that our teams are finding, we have pulled forward the in-service date of our NKY Gate Enhancement to late 2027 and have several other opportunities under evaluation. This not only adds EBITDA to our 2028 outlook, but also creates investment capacity for growth capital in the later part of the decade. Looking ahead, we will continue to evaluate similar NPV positive capital optimization opportunities where it makes sense to accelerate EBITDA and optimize balance sheet capacity that we can redeploy in future periods.

To wrap up the capital outlook, I'd like to highlight that the increase in our pending approval bucket, together with our $12 billion of additional opportunities in origination, we anticipate capital investment to not only approach our $6 billion target, but as Francois mentioned, to potentially surpass this level toward the latter part of the decade, consistent with our messaging in prior quarters.

Turning to our long-term financial outlook on Page 13. This chart, as we presented in November, continues to reflect the solid trajectory we see this year and looking towards 2028. We are reaffirming both our 2026 outlook with comparable EBITDA of $11.6 billion to $11.8 billion, as well as our 2028 outlook, where we are positioned to deliver comparable EBITDA of $12.6 billion to $13.1 billion. This sustained performance in the fourth quarter and this outlook both underscore the strength and repeatability of our base business.

Turning to the right-hand side. I'm pleased to share that our Board of Directors has declared a first quarter 2026 dividend of $0.8775 per common share, which is equivalent to $3.51 per share on an annualized basis. This results in a 3.2% year-over-year increase, which is within our 3% to 5% range, and represents the 26th consecutive year that TC Energy has delivered dividend growth to our shareholders. We continue to be proud to deliver this growth year after year as part of our total shareholder value proposition.

I will wrap up by summarizing why our portfolio is increasingly 1 of 1 amongst our peers. TC Energy is delivering strong total shareholder returns while operating one of the largest, most straightforward and focused capital backlogs in the sector. Perhaps most importantly, we're doing that with lower-than-average execution risk in the fastest-growing energy markets in North America. We have the largest portfolio of natural gas and power investment opportunities relative to our size through the end of the decade.

Importantly, our growth projects continue to be underpinned by long-term contracts regulated frameworks and strong counterparty quality. We're growing in the deepest growth markets, and we are growing in the right way with respect to our well-established risk preferences. We are deploying capital where we see the highest risk-adjusted returns, extracting more value from existing infrastructure, and remaining disciplined on project selection and capital allocation. As a result, TC Energy offers a compelling lower risk investment proposition, durable growth, execution strength and attractive risk-adjusted returns.

With that update, I'll pass the call back to Francois.

Thank you, Sean. Now as we begin 2026, our strategic priorities remain consistent with what drove success over the last 2 years. We will continue to, firstly, maximize the value of our assets through safety and operational excellence. And this year, we're adding -- we're going to do so while leveraging commercial and technological innovation, including the use of artificial intelligence.

Second, we're going to prioritize low risk, high return growth, including placing projects in-service on time and on budget or better. And based on what we're seeing in our project development pipeline, we expect this year to sanction $6 billion of net annual capital expenditures through 2030 and have visibility to increasing that level of investment for the latter part of the decade, and all consistent with targeted build multiples in the range of 5x to 7x. With a diverse set of high conviction late-stage projects, we expect continued durable growth with clear visibility to disciplined capital investment through the early part of the next decade.

And thirdly, we will maintain financial strength and agility to support long-term value creation. Building off the momentum from strong operational performance, consistent execution and disciplined capital allocation, I'm confident in our ability to continue to deliver solid growth, low risk and repeatable performance.

Operator, we're now ready to take questions.

[Operator Instructions] The first question today comes from Praneeth Satish with Wells Fargo.

Based on the recent open season announcement, it seems like average project sizes that you're looking at are getting larger. Please correct me if I'm wrong, but the projects now appear to be moving kind of well past the $1 billion mark. So in that context, I wanted to revisit balance sheet capacity, and I know you show capacity out through 2030 on the slide deck. But can you give us an early sense of what 2031 looks like? How much of that year is already committed? How much is pending, waiting for approval? And how much is true white space? Because I imagine most of the projects, once these large projects, if you sanction them today, will have 2031 in-service dates. So just trying to get a sense of that long-term balance sheet capacity.

Praneeth, this is Tina. I'll kick off and then turn it over to Francois. We are continuing to see a deep pipeline of opportunities of all scope and scale. And as you look at the projects that we have in origination, primarily focused on power generation opportunities, we've got about almost $12 billion in the pipeline of projects that run the gamut from, say, $200 million to over $1 billion.

The open seasons that you mentioned, our focus there is to really try to aggregate as much of the demand as possible so that we're not advancing multiple projects and able to bring larger scale projects into service. And so those open seasons that you mentioned, one, the Columbia open season, where we launched a 500 million a day open season with 1.5 Bcf of bids that came in. We're going to be working to aggregate that and determine what is the right path forward for that project.

On Crossroads, a great example of the value of steel in the ground. We have a pipeline there that capacity is about 250 million cubic feet a day, looking at expansion there of about 1.5 billion. So a lot of great opportunities we're progressing, but again, a wide range of scope and scale. Those open seasons, our approach to that is getting those across the finish line this year, so we can move into execution going forward.

And Praneeth, on the extension of our capital program, some of the projects we're pursuing are, as you mentioned, with 2031 and even 2032 in-service dates. Some of the projects that we've sanctioned, we're being asked by customers to move earlier, as they're being responsive to their data center customers and other customers. And some of the projects we're looking at are even shorter cycle than that.

So the beauty of our capital program is that we've got visibility and duration out several years, and it is starting to spill into the early 30s, and that just gives us more confidence in our ability to continue to deliver on that 5% to 7% compound annual growth of EBITDA.

Got you. That's helpful. And maybe just turning to the Crossroads project. I know you're an open season, but maybe if you could just talk about the strategic rationale there? Is it primarily data centers, coal-to-gas switching? And then we know of at least one other midstream operator that's targeting similar markets. So just any high-level color on the competitive dynamics. Yes, just trying to get -- and the other question here is given the scale of it, could this project create a pathway to additional projects over time?

Yes, Praneeth, the Crossroads expansion project is driven primarily by power generation requirements or gas for power generation that could take the form of data center demand, coal-to-gas or electrification. Several of our large electric utilities are looking for additional capacity to support some of the projects in the Midwest. Other customers are looking for more supply diversity. So looking at Appalachia supply and Mid-Con supply, et cetera. So it kind of -- it's taking all shapes and forms there. But the interest level has been really picking up in that area. And if you think about our footprint in the Midwest, I think it's really second to none. And you look at the growth in the Midwest, we're excited about capturing those opportunities.

Maybe to add to Tina's comments on that, Praneeth. It's a good reminder that we have 13 pipelines across the United States. A lot of our growth has been driven by our Columbia and ANR systems, but we are looking at growth projects across the entire fleet and the entire footprint of our projects in all 3 countries.

The next question comes from Theresa Chen with Barclays.

Also had a question related to one of your recently highly successful open season. On Columbia, Tina, your comments on how this project could evolve going forward. Can you just remind us what is the expansion capability on the system at this point? And what are the gating factors to upsizing the original scope?

Thanks, Theresa. We had advertised this open season as a 0.5 Bcf opportunity set. But because of the significant demand of 1.5 Bcf. We're looking what is the best way to optimize that capacity and try to satisfy as much of the demand as possible. What we want to do is look for that sweet spot where we are still competitive in the market and can address as many of the customer requirements as possible. So early days yet as we're continuing the negotiations with all of the customers, but the plan would be to sanction that project this year.

And Francois, when you mentioned the projects coming under budget by 15%, can you just talk about what has allowed this to happen? And to what extent is that repeatable with your current investments underway. And just as we think about spending and balance sheet capacity on a go-forward basis, I would love to get your thoughts here.

I appreciate the question, Theresa. We were obviously very prudent with project planning and having high-quality estimates for our projects. Clearly, we had a bit of a tailwind over the last few years as contractor capacity was a bit looser than we had anticipated during the planning process so that we had some tailwinds when we came to actually signing up some of those contracts.

So the combination of those things allowed us to deliver really impeccable execution, in addition to the fact that we had our own internal initiatives to look for value wherever we can, using AI and using best practices to make sure that we're being as competitive as possible.

I expect our execution to continue to be excellent going forward. And the double-edged sword of having large contingencies being returned to the mother ship, if you will, is that you've lost an opportunity to put in another growth project if the capital was held on to for the 3 or 4 years it takes between sanctioning and in service. So you're going to see us maybe challenge ourselves and be a little bit more aggressive and proactive in our estimation going forward. We want to make sure that we're not missing out an opportunity. It is such an opportunity-rich environment.

But having said that, we now, in our processes, invest a lot more capital upfront in developing higher-quality estimates, making sure that our project planning is far more advanced than we ever have in the past before we sanction something. So I fully expect our high-quality execution to continue in the future.

The next question comes from Rob Hope with Scotiabank.

So it's interesting to see how the shape of the capital expenditures through 2030 has changed since Q3 with a pretty good step-up in 2030. So when you think about the kind of, we'll call it, white space in '28 and around those years, how do you think about layering on short-duration projects? Or how quickly could you be comfortable in going above that $6 billion to $7 billion capital range in the outer years?

Yes. Thanks for that question, Rob. I'll start, and I'll ask Sean to provide some color. Part of the reason like in 2028, we have more white space than we had a quarter ago is that we took advantage of some optimization that is NPV positive to bring forward some of our maintenance capital on which we earn a return from '27 and 2028 into 2026, where we still had some spare capacity. That does 2 things. It brings forward EBITDA growth earlier into our growth delivery. But secondly, it creates capacity for additional growth projects in the future. So you're going to see us continually optimizing and smoothing out that portfolio.

Things are unfolding as we expected with respect to the sanctioning of projects. As we mentioned in prior quarters, the size of projects is increasing. So we had to go and reoptimize some of our projects as part of utility bid processes. The PUCs are providing more clarity around what they expect in terms of routing clarity in order to sanction projects. So the utilities themselves have been very prudently making sure that they can meet those requirements. But we see, for example, 2 sizable projects we're competing for that we expect to be awarded here over the next few weeks to a couple of months. So things are proceeding as planned.

Rob, it's Sean. I'll -- please, go ahead.

No, no, go please.

I was just going to tack on a little bit of the balance sheet. I'm sitting here next to Tina and Greg, and yes, there are projects. We're talking about kind of by weeks and months. And candidly, '25, '26, '27, we're given the balance sheet continued time to breathe. And it creates capacity. And like I said -- as Francois said, we're maybe a month away from having better visibility on that '28, but the balance sheet continues to appreciate that time for that optionality in '28.

Sorry, on to your question now.

Sorry. Maybe just in terms of kind of the $12 billion of additional projects in origination, based on the commentary that the Columbia project could be sanctioned this year, how do you think about the conversion of moving that into the pending approval? And could we see some of these $12 billion even being sanctioned in '26?

I think where we launch open seasons, typically, we're having conversation with potential customers before we even launch them. So we have a fair degree of confidence that there's market interest. The purpose of the nonbinding open seasons is to confirm that interest and allows us to optimize the size of the projects, as Tina mentioned. So when we talk about Ohio, when we talk about Crossroads, those are in that $12 billion bucket. They are not in the pending approval bucket, which is restricted to 90-plus percent probability projects. And we still expect projects like that to be sanctioned this year.

So that all together, when you put it all together, is what gives us confidence that not only are we going to fill all of the white space to $6 billion out to 2030, but there's a very good chance we're going to be looking to go above that $6 billion level, starting in '29 or more than likely '29, but possibly also '28.

The next question comes from Maurice Choy with RBC Capital Markets.

Just wanted to pick up on your early response on growth rate. You've accelerated $500 million capital this quarter. And it sounds like there are more opportunities like these to pull forward projects by 1 or 2 years. Would these generally lead to a higher growth rate than 5% to 7%? Or are these filling up white space and therefore meant to be supportive of your 5% to 7% rate?

Maurice, it's Sean. Good question. The $500 million that we're pulling forward, they will contribute to EBITDA. But I'll tell you, that's -- we're going to be in range. Those are healthy numbers, but not big enough to kind of move our range at this point in time.

But we need to pull forward more than $500 million in the coming quarters, at least in the ending year, would it be upgradable to some extent?

If we're successful in pulling together sizable dollars, then we'll revisit that, of course. But at this point, we are within range on the '28 and '27 pull forwards.

Got it. Makes sense. And then just to finish off, I wonder if you could just help us compare and contrast the characteristics of the $8 billion projects pending approval and the $12 billion that are in the origination. And specifically, what I'm hoping to understand is, by geography, gas versus nuclear, are the returns quite similar or are some of them green versus brownfield?

Maurice, it's Sean. I'll maybe kick that one off to make sure we were clear on the characterization of what is pending versus what we have in flight. As Francois said, what we have in plan for pending are what we characterize as 90% or more likely, very advanced, fully documented, typically requiring only management or Board-level approvals to sanction. That is the characterization of our pending. As it relates to kind of a heat map and distribution of the pending, maybe I'll turn that over to Tina to give you a sense for where those dollars are coming from.

Thanks, Sean. As we talked about earlier, given we're in 3 countries, and we have multiple pipelines spanning coast-to-coast, border-to-border, we're seeing opportunities across our entire portfolio in the U.S. in particular, where we see the bulk of the growth those opportunities are really focused primarily in the Midwest. But we are seeing, as we just noted, projects developing along our West Coast systems, our East Coast systems, really all over the map there.

In terms of your question on brownfield versus greenfield, our approach has always been to leverage our footprint wherever possible to produce the most economic, efficient build with minimal disruption. So this won't change going forward.

I noticed there's no mention about nuclear in any of these responses. And do these numbers have the remaining MCRs or even Bruce C in any of them?

So the MCRs are included in those numbers, but Bruce C is not. Bruce C is still in early stages of development. And so that would be upside to even the $12 billion of advanced projects in advanced BD.

The next question comes from Zack Van Everen with TPH.

Maybe starting on the power and data center side. I know your historical and continued plan has been to focus on the utility customers. I was curious if the more recent political push to keep utility rates flat, has changed any of those conversations and maybe push you guys more towards supplying gas to the mobile power solutions.

So I'll start at a high level here, Zack, and ask Tina to provide some proof points. As I talked about in my prepared remarks, particularly in the U.S., we really are focusing in front of the meter with our utility customers. To the extent a data center wants to get serviced directly for gas and is willing to provide a long-term contract that is consistent with what we get from the utility customers, we will, of course, contemplate those. We're not looking at any power project development and ownership behind the meter at this time.

But Tina, any additional color?

Yes. Our strategy is really working. We are continuing to have close collaborations with our utilities to develop those solutions that a reliable and cost-effective, and in most instances, serve more than one type of load, not just data center load. You mentioned some of the cost allocation issues, Zack, and there are jurisdictions such as Wisconsin that are tailoring their regulatory framework to better balance system reliability with cost recovery. So we're seeing a lot of utilities figuring it out to kind of say the phrase there, but there are opportunities with many of these utilities where those cost issues are being reconciled.

Got you. That makes sense. And then maybe one on Gulf Coast demand. We continue to see LNG facilities pull more and more from the Northeast as much as they can to the Gulf Coast. Was curious if you could remind us of the ability to expand ANR and/or Columbia Gulf and what that could look like as far as size and timeline if there is demand to expand those pipes?

We placed 8 LNG projects into service in the last few years, Zack. We've got 2 more that are under construction our [ Gap ] West project and on the East Coast of Canada, our Cedar project. So we've put in about almost 10 Bcf per day of LNG opportunities, primarily in the U.S.

What we're seeing right now is a lot of the growth in the Louisiana Gulf Coast has already contracted for much of their pipeline capacity, including on our projects. But to the extent there is an opportunity or a need for additional egress from Appalachia in particular, our pipes are well suited to do that with our Columbia Gulf and our ANR systems. At this time, we're not seeing that draw, but we stand ready to support that when it does show up.

The next question comes from Ben Pham with BMO.

I was wondering if you can comment on the stickiness of your 5 to 7x EBITDA build multiple on new projects. And particularly, what internal -- external factors do you need to see that to be sustained?

So when we look at, obviously, our pending approval projects, which are in the 90-plus percent category, even when you look at the advanced BD group of $12 billion, Ben, we're still looking in aggregate at a 5 to 7x EBITDA build multiple. So the return profiles that we've been able to sanction projects at in the last couple of years are sticking. And the general dynamic is that the utility space has continued to be very creative at finding more brownfield expansion capacity.

The data centers have learned that being flexible in their location to go where those efficient deliveries are available has helped us do that. And so we fully expect the return profile in aggregate to be in that 5 to 7x range. And it's got to do with our ability as a company to execute with excellence. We've been able to enter into strategic joint ventures with OEMs and sometimes even with contractors. And what's being reinforced here is the value of pipe in the ground and the value of incumbency has allowed us to continue to earn premium rates of return relative to history.

Okay. Got it. And maybe second question just going back to some of the questions on the balance sheet capacity. You mentioned the size of your projects increasing, customers looking to accelerate projects, but you need the balance sheet to [ debreath ] in the next couple of years. How are you guys thinking about the asset recycling equation of it? Just kind of where valuations are right now in the pipe sector. And then maybe also thoughts on JVs such as the Columbia one.

Ben, it's Sean. I'll take that one. As we talk about asset recycling, I'll just point you to Crossroads as an example, right? Probably a project nobody asked us about 2 years ago. And just the value of incumbency, the value of optionality, it gets better every quarter, right? So we're in the process of re-underwriting, have been for several months, re-underwriting every asset so that we know where the growth projects are, right? And are we best served to capture them? Or if over the next kind of couple of years, we want a capital rotate, we know exactly where the growth projects are on any asset we might want to rotate.

So it's just understanding the new dynamics, the new growth projects on every asset we have. And we've got a couple of years, right, probably before we have to make that FID decision above $6 billion towards $7 billion. So we've got time. And we're just -- we're tuning up our capital rotation inventory. It's quite simple, while we grow cash flow on those assets.

The next question comes from Aaron MacNeil with TD Cowen.

Maybe just to build on Ben's question or get some additional clarification. You've talked about the balance sheet capacity, potential uptick in spend in 2028 or 2029. What's your just higher level evolved thinking about how to finance a potential step-up in the spend profile? Like I guess, I'm getting a sense that you may be able to do that organically or should we still expect some form of external financing if it's equity or asset recycling?

Thanks for the question, Aaron. It's Francois. I'll take this one. It's very important for us as heavy deployers of capital to have efficient cost of capital. So we want every tranche of our capital structure to be investment grade. As you know, we're heavy users of hybrid and subordinated capital. So with the 2 notches below senior unsecured capital, we want to continue to maintain our credit rating in that BBB+ or equivalent range.

Right now, the long pole in the tent in terms of credit metrics is the 4.75x debt-to-EBITDA. So that's important to us. But as Sean mentioned, we've got time to get there. And the first way to get there is the dollar you don't spend is the best approach. So we're going to look to outperform and deliver our projects under budget as the first source.

The second source is getting more EBITDA out of your existing assets. And we're just at the front end of using technological innovation and to allow us to do that. We've got a couple of very promising pilot projects that have allowed us to monetize capacity in different parts of our system that we weren't even aware we had. There's obviously complex algorithms that allow us to be aware of capacity to sell in the short term when it's really very, very valuable.

So there are a number of things we can do through commercial innovation and technological innovation. We're going to do those first because obviously, growing cash flow without raising internal or external equity is going to be the most efficient way to do that. And we have a couple of years to pursue those before we have to make any decisions.

Okay. No, that makes a ton of sense. Maybe just switching gears to Canada. I can appreciate that it's not a focus of the quarter. But can you give us an update on the Canadian Mainline settlement that should happen later this year? And just given tightening fundamentals for Canadian Natural Gas egress even with LNG Canada Phase 1 ramping, is there any appetite to expand capacity on the system as part of that settlement? Is it in the $12 billion bucket? Maybe just any updates there would be helpful.

Yes, thanks. I'll take that question. The current Mainline settlement is in effect until the end of 2026. And this current settlement has really been a win-win as evidenced by the strong system flows we've had lower tolls for our customers and the returns we're seeing on the Mainline. We've been in discussions with our customers over the last several months on a post-2026 settlements with more meetings planned over the coming months, but we're very optimistic we're going to see an opportunity to extend that settlement as we continue those discussions.

Multiple factors that are taking into effect when we are in those discussions, including the ability to invest capital. And so as the settlement progresses and moves into actuation there, we'll give you more updates. But right now, our plan is to develop another win-win solution to meet the customers' needs.

The next question comes from Manav Gupta with UBS.

Like one question with a subpart. But basically, I'm trying to understand, can you -- right now, you obviously have one unit down at Bruce, but going past 2031, we see significant free cash flow inflection from Bruce as all units are up and running and life is extended by multiple decades. So if you can talk about the free cash flow inflection that happens post-2031 with all units of Bruce running.

And then the question we sometimes get from investors is if you do decide to move with Bruce C, that would be a significant spend, would you expect some kind of government support, government bonds, what would be the financing in place for -- if you would decide to move ahead with Bruce C?

Sure. Thanks, Manav. It's Greg Grant here. So just as it pertains to Bruce C. So I'll start there. We are continuing to work with some of our pre-FEED studies, includes technology selection, preconstruction work. And we do have funding in place for that. So that actually has been provided by the federal government, and we're currently working on our next tranche of funding from the ISO in Ontario. So that will kind of take our funding to the end of the decade, but it's self-perform funding through that mechanism.

Great point, as you talk about cash flow near the end of the decade, we had a great slide on the last quarter material that talked about that inversion point where we've been investing about $1 billion a year into Bruce. By the end of the decade, you'll see about $0.5 billion starting to come back, and then that's upwards of over $2 billion once the MCR program is complete.

So when you look at a nuclear construction project, that's going to take 10 to 15 years as you think about the next phase of Bruce C and the units we'd be adding. So $2 billion plus of cash flow and then a long construction period, you're actually going to be able to not only self-fund should we choose to and finance it within Bruce, but also pay distributions. So if you think we're well positioned within Bruce to handle the financing and deal with the expansion, but also just a great management team, and really excited about the opportunity as we see the support for nuclear in the province.

The next question comes from John Mackay with Goldman Sachs.

I want to go to the $6 billion to $7 billion kind of annual range you guys are talking about, is that -- particularly in the context of looking at 2030, which is already pretty full and some of these bigger projects, you might be FID-ing soon that could have some capital kind of hitting in 2030. Should we think of that $6 billion to $7 billion as a kind of average over several years, but you'd be willing to go above it in a single year if you're not able to move some of the timing around? Maybe just talk through some of those dynamics with, again, how much of 2030 specifically looks relatively full at this point?

I appreciate the question, John. As you've heard me say in many times in prior quarters, the first filter we run this through is our human capital and our ability to execute our projects on time and on budget. I can tell you that, that work is more or less complete. We just concluded Board meetings over the last few days, where we presented our human capital plan and execution plan and readiness to upsize our capital program with the Board. And I can tell you, we stand ready for a ramp-up in the size of our capital program going forward.

At this point, in terms of the individual bars in each year that are in the pending approval bucket, we haven't -- we don't really go through the optimization and smoothing out of our capital until it's been approved. So I wouldn't be too fussed by a peak in an individual year. We can smooth things out. We can move some capital forward, some capital back. And we still have room in my view, to add capital in the 2030 year, if required.

So as our cash flow grows and as our readiness and our human capital also grows, you're going to see the program steadily grow. And so starting in that '29 year likely and then in '30 and '31, you'll see us sustainably be above $6 billion, and I won't put any limitations on where it's going to go at this point. The opportunity set is there, and we're going to pursue what are generationally the highest returns I've seen in my 35 years in the business.

Next question comes from Keith Stanley with Wolfe Research.

I wanted to ask on the Crossroads pipeline. So you referenced it's 250 million cubic feet a day today. How would you expand that by 1.5 Bcf a day? Is that a lot of new build construction in looping? And then on the demand side of the project, is it primarily targeting Indiana demand in Northern Indiana? Or are you trying to get to the Chicago hub or somewhere else with it mainly?

Thanks, Keith. On the first question, what we would do is leverage our existing corridor to increase the capacity of that system. So again, we like our brownfield in corridor approach so primarily depending on the volume that we put under contract would be likely moving and/or compression along the existing corridor. That again will be dependent on the volume.

As far as the location, it's all of the above. We're seeing demand across that entire corridor but also outside of that corridor. So Crossroads can facilitate volumes into ANR or from ANR and facilitate volumes from Northern Border or to Northern Border. So it's a unique pipeline that will allow us to basically wheel capacity between multiple pipelines and not just focus on the market along that pipeline.

Got it. Second one, just -- sorry if I missed this, but the gray bar pending approval capital buckets, how much of that relates to negotiated rate pipeline projects versus more regulated investments like NGTL?

The most prevalent deals we are working on for -- in that bucket or in the U.S. And for the most part, those will be negotiated rate contracts given the size and the demand components of those. So the majority of that would be negotiated rate contracts.

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

I will now turn the call over to Gavin Wylie for any closing remarks.

Yes. Thanks, everybody, for participating this morning. As the operator mentioned, if there were any questions that we were unable to get to for the call, please do contact myself or the Investor Relations team. We'll be happy to walk through.

We thank you very much and appreciate your interest in TC Energy and look forward to our next update with our first quarter results. Thank you.

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

Thank you for standing by. This is the conference operator. Welcome to the TC Energy Third Quarter 2025 Results Conference Call. [Operator Instructions] The conference is being recorded. 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. I'd like to welcome you to TC Energy's Third Quarter 2025 Conference Call. Joining me are Francois Poirier, President and Chief Executive Officer; Sean O'Donnell, Executive Vice President and Chief Financial Officer; Tina Faraca, Executive Vice President and Chief Operating Officer, Natural Gas Pipelines; and Greg Grant, Executive Vice President and President, Power and Energy Solutions.

Our agenda for today will start with Francois and our strategic update. Tina and Greg will walk you through our business in more detail, and we'll wrap up with Sean's quarterly update and financial outlook before moving to Q&A.

A copy of the slide presentation is also available on our website under the Investors section. Following opening remarks, we'll take questions from the investment community. Please limit yourself to two questions. And if you're a member of the media, please contact our media team.

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 and Exchange Commission. Finally, we'll refer to certain non-GAAP measures that may not be comparable to similar measures presented by other companies. A reconciliation of these measures is contained in the appendix of the presentation. With that, I'll turn the call to Francois.

Thanks, Gavin, and good morning, everyone. I want to begin by expressing my sincere appreciation for our team's unwavering commitment to safety and operational excellence. These are the cornerstones of how we operate and the reason we continue to deliver strong results quarter after quarter. I'm proud to report that our safety incident rates continue to trend at 5-year lows.

And through the first 9 months of the year, comparable EBITDA has increased 8% year-over-year. We've successfully placed $8 billion of assets into service on schedule, and we're tracking approximately 15% under budget for those projects with 2025 in-service dates.

Today, I'm also pleased to announce an additional $700 million in new growth projects at a weighted average build multiple of 5.9x. This takes our total sanctioned projects up to $5.1 billion over the last 12 months, largely capitalizing on the extensive demand we're seeing for power generation and data centers.

Driven by exceptional project execution and capital optimization, we now expect 2025 net capital expenditures to be at the low end of our $5.5 billion to $6 billion range. When you combine that with our expected growth in comparable EBITDA, we have clear line of sight to achieving our long-term target of 4.75x debt-to-EBITDA, ensuring continued financial flexibility for future growth.

These strong results continue to demonstrate that our focused strategy is delivering solid growth, low risk and repeatable performance. Across North America, the policy environment is becoming increasingly supportive, enabling more timely and cost-effective delivery of our projects to further ensure our infrastructure projects can meet the unprecedented growth in demand. In Canada, recent developments are improving the regulatory environment for projects of national interest. This includes LNG Canada Phase 2, which is directly enabled by our Coastal GasLink pipeline.

In the U.S., recent actions to clarify NEPA's scope, accelerate agency review processes and implement FERC and Department of Energy permitting reforms are all supportive of streamlining the process and reducing delays, driving further demand for natural gas as a reliable, dispatchable power source. To be clear, this can be achieved without compromising core principles of safety, reliability and environmental protection.

And in Mexico, the economy is poised for significant expansion, driven by strong fundamentals and President Schein-baum's plan Mexico 2030, which aims to attract over $270 billion in investment through public-private partnerships. By 2030, the Mexican government plans to bring 8 gigawatts of new installed natural gas capacity online, and our assets are strategically positioned to support this necessary build-out.

So when you look across all three countries, policy tailwinds are enabling growth initiatives that reinforce the value of our incumbent network.

Over the past 12 months, our natural gas forecast has been revised 5 Bcf a day higher, now calling for 45 Bcf a day increase in natural gas demand by 2035. This is driven by electrification, LNG exports and the rapid expansion of data centers. Meeting the increase in demand, we've set 14 new natural gas pipeline flow records across our systems in 2025, further reflecting our focus on operational excellence.

Looking beyond North American demand and driven largely by global electrification, we are the only operator capable of delivering natural gas to every major LNG export shore line in Canada, the U.S. and Mexico. And today, as a result of that, we move approximately 30% of all feed gas bound for LNG export.

Now additionally, TC Energy is the only midstream peer with a significant interest in nuclear power generation. In Ontario, nuclear capacity requirements are expected to nearly triple by 2050, highlighting the long-term potential opportunity for Bruce Power and our power portfolio. As the outlook for natural gas and power demand continues to trend higher, TC Energy's extensive footprint is uniquely positioned to capture this growth.

The robust fundamentals we're seeing in energy demand has generated over $5 billion in new high-quality executable projects that we have sanctioned over the last 12 months without moving up the risk curve. We remain focused on predominantly brownfield in-corridor expansions that leverage our existing footprint, minimize execution risk and are underpinned by long-term contracts with utility and investment-grade customers. The three new projects announced today are prime examples of how our strategy is working.

Strategically located along our network, these investments are directly responding to accelerating incremental load growth, especially from data centers and power generation demand. Looking ahead, we expect the steady cadence of similarly high-quality project announcements to continue into 2026 with attractive EBITDA build multiples in the 5x to 7x range, further demonstrating our disciplined value-driven approach.

This next chart highlights the consistent upward trend in returns from our sanctioned capital program since 2020, all without compromising contract duration or taking on additional market risk. With the addition of the three new projects announced today, our sanctioned portfolio for the year now stands at an implied weighted average unlevered after-tax IRR of approximately 12.5%, a meaningful increase from 8.5% just a few years ago.

Looking ahead, we remain committed to our disciplined approach to capital allocation, ensuring that every dollar we invest is focused on maximizing returns and long-term value for our shareholders. So over the next decade, natural gas and electricity are expected to account for about 75% of the increase in final energy consumption, highlighting our role in the energy mix of the future.

We believe our portfolio is of one amongst our peers and highly aligned with the fastest-growing segments of the energy market. We are over 85% long-haul natural gas pipelines, almost entirely take-or-pay or cost of service commercial frameworks. We're one of the largest operators of natural gas storage, providing our customers with integrated pipe and storage solutions, which is a key competitive advantage. And we have over 30 years in the power business across multiple fuel types, including our ownership in one of the world's largest operating nuclear facilities, Bruce Power.

So these assets, combined with our low-risk business model and the momentum from powerful market and policy tailwinds position us to continue to capture accretive opportunities. After adjusting for company size, we are leading our peers in sanctioned natural gas and power capital opportunities, converting these into our project backlog that is further extending our growth visibility through the end of the decade and beyond. And with that, I'll turn it over to Tina to speak in more detail on this opportunity set.

Thanks, Francois. With over 94,000 kilometers of pipelines across North America, TC Energy's network is delivering reliable supply at scale. The competitiveness of our footprint and our extensive customer relationships position us to win our fair share of this growing market.

Natural gas demand from power generation continues to accelerate, propelled by widespread electrification, coal-to-gas conversions and the rapid expansion of data centers and AI infrastructure. In Alberta, our systems have seen an 80% increase in gas for power volumes over the past 5 years. And with the queue of data center interconnections tripling over the last year, we are working closely with customers to ensure our assets can meet the market's evolving demand.

In the U.S., approximately 40 gigawatts of coal-fired generation is expected to retire over the next decade with the majority of that capacity anticipated to be replaced by natural gas generation. Across the full landscape, the 170 gigawatts of current operational coal capacity equates to over 20 Bcf per day of potential natural gas demand. Additionally, our assets are strategically positioned in key power growth markets like PJM and MISO, where forecast for natural gas power capacity additions through the end of the decade have doubled compared to last year. Nearly 60% of U.S. data center growth is expected within reach of our asset footprint, and we're collaborating across the entire value chain to deliver the natural gas that powers this transformation.

And finally, in Mexico, our assets supply 20% of the nation's gas to power plants and will feed 80% of the new public tender natural gas generation projects entering service over the next 5 years. We have a 30-year relationship with the CFE, Mexico's national electricity provider. CFE is the primary driver behind the country's generation capacity expansion initiatives that we support through assets such as Southeast Gateway.

Our connectivity to low-cost supply, extensive footprint and market reach is the foundation for cost competitive system expansions. Additionally, our ability to deliver innovative commercial offerings is fundamentally rooted in the long-term customer relationships we've built across our footprint. It is these relationships that allow us to anticipate market opportunities and move quickly, bringing new projects into service and optimize capacity.

Our ability to sanction over $5 billion of high-quality executable projects in the last 12 months is a direct result of this collaborative approach. Today's announcements demonstrate our ongoing ability to capitalize on gas for power demand within our footprint. And what we are seeing today and the evolution over the past 18 months gives me confidence that our development queue will continue to grow with high-quality, low-risk and executable projects. We are at the forefront of natural gas pipeline growth.

Within our development portfolio, we are originating growth opportunities representing $17 billion of potential value. Our strategy is anchored by 4 growth pillars. First, power generation is the greatest source of North American natural gas demand, and it is accelerating, thanks to electrification, coal conversions and the surging energy needs of data centers. Our footprint along expanding power markets and our long-standing relationships with our utility customers has resulted in a pipeline of origination opportunities that exceeds 7 billion cubic feet per day that have not been sanctioned to date.

North American LNG is entering a new era with over 60 million tons per annum of U.S. export capacity reaching FID in 2025. And over the next decade, we expect more than 10 new facilities to come online. Our existing assets enable us to efficiently serve this expanding market through brownfield developments. Local Distribution Companies, or LDCs, account for 20% of our average daily demand, supplying energy to 80 million homes. And during peak periods such as extreme cold, demand can triple.

Our sizable natural gas storage portfolio and projects like our Southeast Virginia energy storage project, a template for future reliability initiatives play a critical role in ensuring reliable supply and resilience for our customers. By 2035, we expect that 60% of North American gas production will move through TC Energy connected basins, providing our pipeline long-term abundant low-cost supply. This strategic advantage allows us to respond swiftly to market shifts, supply migration and support the evolving needs of our customers.

We are growing our capabilities, harnessing technology and innovation to meet safety, reliability and regulatory standards while unlocking new commercial and operational potential. Every day, our teams process vast amounts of information, quickly draw insights and then make smart decisions that can translate into higher EBITDA contribution while mitigating risk.

Our approach to AI adoption is to break it down into focused initiatives to ensure faster execution. We have developed an integrity-focused AI platform that automates document verification and compliance workflows, cutting review times from hours to minutes and reducing risk across our asset base. And recent breakthroughs in the ability to reliably train AI with large volumes of data are allowing us to enhance safety and sustainability. Our pipeline blowdown emissions reduction program uses advanced methods and automation to minimize emissions during maintenance, supporting our environmental commitments and regulatory compliance.

Commercially, we are driving smarter decisions across capacity optimization and short-term marketing by using Agentic AI. We are also using advanced algorithms to recommend optimal pipeline configurations and available capacity on our U.S. assets in real time, improving throughput and reliability while maintaining safety and compliance. And we have developed a commercial intelligence platform to simplify access to external and third-party commercial information, overlaying it with our own data and capacity modeling to understand our customer needs and market conditions. This means we can respond to customer needs more quickly, optimize asset utilization and capture incremental revenue opportunities while maintaining transparency and governance. We are identifying opportunities to implement innovation and technology at scale across our organization, and we see a significant potential for our systems to be smarter and drive even stronger performance.

For projects being placed into service this year, I'm extremely pleased to report that our teams have delivered, and we are currently trending approximately 15% under budget. Over the past few years, we have developed a series of enhancements that have fundamentally improved our capital allocation and project development rigor, increasing capital efficiency and cost management across our capital programs. We have enhanced our project risk reviews prior to sanctioning, enabling capital allocation decisions to be grounded in robust validated project fundamentals, ensuring that risk funding is precisely targeted, estimates are more accurate and overall capital efficiency is significantly enhanced.

We have also strengthened our front-end project development discipline, allowing for deeper rights holder and stakeholder engagement and more thorough project analysis. This has resulted in high-quality estimates and risk assessments, driving more reliable cost projections and enabling us to manage risks with greater confidence and precision. The result, we have delivered 23 out of 25 of our sanctioned projects on or ahead of schedule while tracking 15% under budget for the year, fully aligned with our strategic priorities. Again, an exceptional job by all the respective teams. With that, I'll pass to Greg to update you on our Power and Energy Solutions business.

Thank you, Tina. As Francois noted, our portfolio is one of a kind, highly aligned with the fastest-growing segment of the energy market. Anchored by our position in nuclear power, our Power and Energy Solutions business is designed to deliver complementary solutions that drive incremental shareholder value.

Importantly, this portfolio is built for scalability. We can grow with market demand, adapt to evolving energy needs and capitalize on opportunities that allow us to deliver solid growth, low risk that are repeatable for decades to come. In the near term, our focus is on maximizing the value of our existing assets. At the core of this effort is the on-time, on-budget execution of our Major Component Replacement program, or MCR at Bruce Power. These extend reactor life until at least 2064, while improving the availability of our nuclear fleet.

As realized prices continue to rise and availability improves, with the completion of each unit's MCR, this performance is translating into incremental revenue and stronger financial results. By leveraging our expertise across natural gas and power, we're also capturing value through commercial marketing, system optimization while maximizing availability of our cogeneration fleet. Our 118 Bcf of nonregulated natural gas storage in Canada is a prime example of where we have the ability to generate incremental EBITDA in a highly dynamic market.

Looking ahead, we're positioned to build on the incumbency of our North American footprint, deep customer relationships core capabilities in natural gas transmission, storage and nuclear power. We have a strong foundation to scale our operations and deliver complementary solutions at the intersection of the molecule and the electron that will unlock incremental value across the energy chain.

The proposed Ontario pump storage project is a great example of the optionality we have in our portfolio. The 1,000-megawatt storage project will provide critical fast response reliability to the grid and complements our nuclear position in Ontario. By utilizing long-duration storage, we can store excess electricity during low demand periods and help meet peak needs. This reduces overall the capacity requirements across the province.

Looking to the next decade, Bruce Power is uniquely positioned for growth, in a market where electricity demand is expected to grow by 75% through 2050. With a brownfield site, greater than 90% Canadian-based supply chain and strong alignment from all levels of government, Bruce Power is uniquely positioned to support the required baseload expansion in the province. While a decision to advance a new build is still years away, we have initiated a federal impact assessment for the potential 4,800-megawatt [ Bruce C project ]. This early work creates the optionality for long-term expansion backed by Bruce Power's prudent management team and execution capabilities.

At the same time, we're building low-carbon capabilities to ensure that we're prepared to respond to market shifts and capitalize on strategic growth opportunities when market signals and customer demand emerges. These strategic investments in technologies and innovation not only create new opportunities, but have application in supporting emissions reduction in our natural gas infrastructure, enhancing the long-term value of our systems.

There are many attributes that make Bruce Power exceptional and unique. The Bruce Power team is best-in-class, and we're seeing that in project execution. The team continues to deliver on time, on budget across our replacement program. The MCR program replaces critical reactor components, extending operational life by at least 35 years per unit while simultaneously increasing availability. With a focus on enhancing both refurbishment efficiency and ongoing reliability, Bruce Power has been a pioneer in automation technologies. The team deployed the world's first robotic tooling machine on a reactor face, enabling skilled tradespeople to perform complex maintenance tasks safely, successfully and on schedule, all while minimizing radiation exposure.

As shown on the left-hand side, these innovations have transformed Bruce Power's operational performance. Units refurbished under the MCR will see increased availability, like Unit 6, which achieved over 99% availability in 2024 after the completion of its MCR. That's compared to a historical average of 84% before the program began. And the financial impact is clear. More megawatt hours made available, combined with increased realized prices that reflect our capital investment, inflation and some other factors will drive stronger financial performance for decades. Through innovation and disciplined execution, Bruce Power continues to be a leader in this space.

Today, we're investing approximately $1 billion annually in Bruce Power. This is expected to increase site capacity to over 7 gigawatts by 2033. All of this output is secured under a long-term power purchase agreement with Ontario's ISO through 2064. This provides visibility to predictable cash flows and long-term revenue.

As shown on the chart, the financial upside is very compelling. Equity income is expected to double from $750 million today to $1.6 billion by 2035. Over the same period, free cash flow is projected to grow substantially, generating nearly $8 billion in net distributions. This growing free cash flow gives us the flexibility to deploy capital where it creates the most value. whether that's capturing growth opportunities across the natural gas system, expanding our nuclear footprint, accelerating low-carbon initiatives or capitalizing on opportunities that enhance the complementary service offering across our footprint. We can leverage our scalable, differentiated portfolio to invest in areas aligned with long-term market trends and deliver repeatable performance. I'll pass to Sean now to walk through the numbers.

Thanks, Greg. Good morning, everybody. I'll start with a few of the operational and financial highlights achieved in the third quarter. Most notably, each pipeline business increased its average daily flows on their way to setting the 14 all-time high delivery records that Francois mentioned. I would highlight our U.S. natural gas business in particular, which saw LNG flows increase 15% this quarter as well as setting a new peak delivery record of 4 Bcf per day.

In Mexico, our network is tracking towards 100% availability year-to-date at the same time that Mexico's daily gas imports are averaging 4% higher in 2025 than 2024. Mexico also saw its highest peak import day of record in August for over 8 Bcf a day. We also had our first full quarter of EBITDA contribution from Southeast Gateway, driving our comparable results up 57% in the quarter.

In our Power and Energy Solutions business, Bruce Power achieved 94% availability, which includes the planned outages on Units 3 and 4 and is in line with our expected annual availability in the low 90% range for full year 2025.

Turning to the top of the EBITDA bridge on the right-hand side. You'll see that we generated $2.7 billion in comparable EBITDA in the quarter, which was a 10% increase year-over-year. The 10% growth reflects a 13% increase in our natural gas pipelines network, partially offset by an 18% reduction in our Power and Energy Solutions segment.

Let me walk you through the components of those changes, starting with Canada Gas, where EBITDA increased by $68 million due to higher incentive earnings, higher depreciation, higher income taxes on the NGTL system, partially offset by lower flow-through financial charges.

In the U.S., EBITDA increased by $60 million, primarily from our Columbia gas settlement, partially offset by higher O&M costs. We also continue to see incremental earnings from new customers and commercial innovations and monetizing available capacity on existing pipelines and the nine new projects that our teams placed into service this year.

Our Mexico business EBITDA increased primarily due to Southeast Gateway, which was partially offset by lower equity earnings from certain payoffs as a result of the strengthening peso.

Lastly, in our Power and Energy Solutions business, equity income from Bruce Power was lower quarter-over-quarter as we began the 2-unit MCR outage program earlier this year versus only a single unit being in its planned MCR outage in the third quarter of 2024. That said, execution of the dual MCR program is going very well, slightly ahead of schedule, as Greg mentioned. And our unregulated natural gas storage portfolio's EBITDA is benefiting from the increased volatility in storage spreads in Alberta.

Turning to our financial outlook. We are reaffirming our 2025 outlook for comparable EBITDA that we revised higher last quarter. As a reminder, we delivered year-over-year growth of 6% from 2023 to '24, and we remain on track to achieve 7% to 9% growth from 2024 to '25.

Looking ahead to 2026, we anticipate delivering another year of strong performance with year-over-year growth of 6% to 8%. This sustained performance underscores the strength and repeatability of our base business. With the inventory of growth projects over the next 3 years that Francois and Tina highlighted, we are positioned to deliver EBITDA growth of 5% to 7% with a 2028 comparable outlook of $12.6 billion to $13.1 billion of EBITDA.

On the right-hand side of the page, we're recapping some of the tailwinds that have been mentioned this morning that we're working on. We have several items supporting our 3-year outlook. We have multiple revenue-enhancing rate case outcomes in process and several more pending. We have increasingly supportive regulatory frameworks that could accelerate our project delivery time lines. We have multiple strategies for increasing asset availability, and we're working on technological and commercial innovations that each improve our capital efficiency across operations and project development. Any combination of those drivers will position us to maximize the value of our existing assets and our financial results.

Shifting to our investment outlook. We introduced this capital allocation dashboard at last year's Investor Day to demonstrate that TC has uniquely clear visibility on its growth drivers through the end of the decade. Over the past year, we sanctioned an additional $5.1 billion of primarily in-corridor brownfield projects, predominantly in the U.S. natural gas pipeline business unit. The steady momentum of project approvals, particularly in the U.S., demonstrates the attractiveness of our assets to utility, LNG and data center customers, which will position us for steady growth through the end of the decade and beyond.

By the end of next year, we expect to FID a series of projects that will fill out our $6 billion net annual investment allocation target through 2030, all with build multiples in the 5 to 7x range. This will be achieved through sanctioning the $6 billion of late-stage opportunities currently pending approval shown in the gray bars on the slide. And allocating the remaining only $3.5 billion of white space from a large portfolio of earlier-stage projects that are currently competing for internal capital.

Given the level of advanced activity in gas origination and the overall $17 billion of projects under review, we feel confident in our ability to fill this chart to the annual $6 billion level through the end of the decade. Our disciplined capital allocation framework enables growth by underwriting projects that deliver the highest possible risk-adjusted returns while also ensuring we preserve our financial strength and flexibility and our long-term leverage target of 4.75x.

From a sources and uses perspective, our 3-year plan requires approximately $31 billion in aggregate funding. About 80% of that funding is expected to come from operating cash flows, which is an improvement from last year's internal funding ratio of only 77%. The remaining 20% of our funding is expected to come from a combination of bond and hybrid issuances. The $6 billion in external funding is supported by the incremental annual EBITDA growth we expect to generate by 2028, which will create additional balance sheet capacity at or below our 4.75x leverage target. The key takeaway is that our strong operating cash flows and balance sheet capacity result in no equity issuance required to deliver this plan. With that update, I'll pass the call back to Francois.

Thanks, Sean. In summary, our strategy is working. As we look ahead, our focus remains squarely on the priorities that have proven successful. First, maximizing the value of our assets through safety and operational excellence while leveraging commercial and technological innovation; second, prioritizing low-risk, high-return growth, including placing projects in service on time and on budget or better and allocating our remaining net annual investment capacity through 2030 within our targeted build multiples range of 5 to 7x without moving up the risk curve. And third, maintaining that financial strength and agility to support long-term value creation through capital discipline and efficiency. With our asset base and strong momentum, I am confident we can deliver low-risk, repeatable growth into the next decade. Operator, we're now ready to take questions.

[Operator Instructions] Our first question comes from Praneeth Satish with Wells Fargo.

I think if we just zoom out for a second and think about EBITDA growth on a longer time frame than 2028, it would seem to me like the current mid-single-digit CAGR guidance can be sustained for a long time past 2028. The backlog is very large on the gas side, ROIC is increasing. And then when you get out to 2030, there's at least $1 billion to $2 billion per year of CapEx capacity that opens up with Bruce Power. So I know you aren't formally guiding past 2028, but can you maybe walk us through the puts and takes that shape your long-term EBITDA growth trajectory and how long that 5% to 7% CAGR can be maintained?

Praneeth, it's Sean. I'll take that question. Great question. You highlighted on Francois's Page 9, those IRRs going to kind of 12.5% right now, that is that's critical, right, for us to continue to see those types of return levels to be able to allocate capital in that '29 and '30 period. And I'll tell you a little bit of what's happening. Small to midsized projects were taking down very quickly, but projects are getting bigger and more complex. And that just -- that's where we want to wait to see. Can we continue to push returns and capital allocation up in the '29 to '30 time frame. So if these returns remain true, then I do think you'll see the same kind of midpoint of growth, if not potentially better, but the projects are just taking a little bit longer for us to have that degree of clarity.

Got it. That's helpful. And maybe if I could follow up on that. line of questioning here. So as leverage trends lower over the next few years, it seems like there's a lot of balance sheet capacity that opens up, especially as you get out to 2028. So I know you kind of reiterated the $6 billion per year of CapEx, but is there room to scale towards $7 billion or even $8 billion at some point over the next few years? Or should we kind of assume a more conservative leverage targets over time? Any update on kind of how you're thinking about that longer-term CapEx cadence?

Praneeth, it's Francois. I'll take this one. our goal is that 12 months from now, we've essentially filled up the project backlog at the $6 billion level through 2030 inclusively. I think the opportunity set we have will give us the opportunity at that point to consider going above that $6 billion level. A couple of really important criteria, which we are not going to lose sight of, however. First one is human capital. It's the most important consideration. We've made the progress we've made because we've executed our projects with excellence. So wanting to make sure that if and when we consider going above $6, we can continue to execute with the performance that we've demonstrated over the last 2 or 3 years.

Second is the 4.75 is going to continue to be a targeted cap for us irrespective of the size of our capital program. So we could make excellent progress on efficiencies, on technological innovation and commercial innovation that could allow us to go above six without looking to rotate capital or any other sources of funds. I would say though, as I said before, the opportunity set will absolutely allow us to go there. But I would say it's within those two caveats.

And then when you look at the lead time for projects, realistically, that's probably 2028 or 2029 before we could go there just with the time it takes to develop projects and then the time it takes to get them permitted.

And the next question comes from Robert Hope with Scotiabank.

Maybe to follow up on your commentary that the projects are becoming larger and more complex. Can you maybe add a little bit more color on what size of projects that you are now seeing and why they're more complex? And are you more willing to go for larger projects given the increasingly more favorable regulatory outlook in the U.S.

Thanks, Rob. This is Tina. We are really encouraged by the development pipeline that we have, primarily related to the growth in the power generation sector. Along our entire footprint, we see opportunities in scale of volumes that could be anywhere from just 0.5 Bcf all the way up to more than 1 Bcf, depending on the type a project we're pursuing. The value of our footprint is such that it allows us to capture all of these opportunities, whether they're on a smaller scale or the larger scale. The hyperscalers that we're working with behind the utilities do take more time just because of the supply chain constraints. But certainly, we continue to see those opportunities progress, and we'll pursue those as we see them advance. So the larger ones are taking a little bit more time, but we're able to capture some of the more single, doubles, triples along the way.

Yes. And I'll add a little bit to that, Rob. I appreciate the question. When we talk about increased size and complexity, we're not talking about SGP or CGL like multi-jurisdictional multibillion-dollar projects. These are still in-corridor expansions. The average size of our projects in our backlog right now is about $0.5 billion. You might see projects announced over the next year, creep up around that $1 billion level or maybe still a little bit north of that, but they are still in corridor in -- with existing customers and very straightforward from a construction execution standpoint. So we don't view, despite the larger size, any execution complexity increase. Simply, we've had a number of projects this year that we -- 6 months ago, we would have expected to have announced by now, but they're getting pushed out into next year because they're getting upsized. Demand is increasing so quickly that our utility customers are looking to increase the scope of our projects, and we just have to go back to the drawing board a little bit.

Appreciate that color. And then maybe continuing on the theme of the project backlog. So you have $17 billion of projects in the backlog, six are in advanced development. How do you expect that kind of overall size to progress over the next year as you're seeing increasing demand for your system? Are you seeing projects -- are you having to turn away projects just given the organizational requirements? Or could we see that backlog expand a little bit further over the next, we'll call it, 12 to 24 months?

Yes. We have -- just to be very clear, Rob, thank you for the question because it gives me the opportunity to point out that we have not turned down a single project because of balance sheet or capital. We still have even with our expectation of bringing in all of the pending projects to full sanctioning, we still have $3.5 billion of room under the $6 billion level. And as we talked about, with careful consideration of our human capital, we think we can go beyond that. So we're not capital constrained in that we're turning away projects. We simply want to make sure that we maintain our 4.75 level and that we're continuing to execute projects with excellence.

So the great thing, for example, if you look at our guidance for 2028 of $12.5 billion to $13.1 billion, with EBITDA growing the way it is, it's natural that our backlog and annual capital spend can grow along with it. So as I said, the opportunity set is definitely there for us to go there if we choose to. And based on the cadence of projects we expect to be announced regularly through 2026, I think at this time next year, we're going to be thinking long and hard about increasing that $6 billion level, starting in maybe '28 or '29.

And the next question comes from Theresa Chen with Barclays.

On the theme of gas to power for data centers, you've clearly chosen to stay focused on transmission, supporting your customers rather than competing with them in power generation despite your deep expertise in that space. What drove this strategic decision? And what are the key considerations behind it?

Thanks, Theresa. This is Tina. I'll focus on the U.S. because that's where we're seeing the majority of our data center growth right now. And the attractiveness and depth of our portfolio of data center projects, primarily accessed through our interconnections with key utility customers provides us with a low-risk, compelling return approach to capturing that data center growth. We're actually not seeing a big pull from customers to develop behind-the-meter projects in the U.S.

And in instances where we have seen those requested, there have been limiting factors, including contract term or requirements to procure long lead time items, just inconsistent with our risk preferences. And we have a deep pipeline now of those opportunities with our long-standing relationships with our key utility customers. Additionally, when we're working with those utility customers, we're not just solving the needs for their data center growth. It's all of the other electrification needs that they have, whether it's coal to gas conversion or economic development.

Got it. And in regards to Bruce C, can you walk us through the current status on the path to FID, the next key milestones, how you plan to manage cost and execution risk if the project proceeds? And on the heels of Greg's comments related to the technological advancements and use of robotics for the NCR program, it seems that you're incorporating additional efficiencies and innovative solutions in general here. But what are the key lessons from the NCR process that you'll be applying to Bruce if FID-ed?

Sure. Thanks, Theresa. Appreciate the question. It's Greg. We do continue to progress Bruce C. We actually just received the notice of commencement from the IAC here in August. As we talked about in the last quarter, there's still a lot of work to do when you think about moving towards FID in the early 2030s. But what the next step for us is we're actually working with the ISO and our next tranche of funding. As a reminder, we're currently using federal funding through Enercan and the next tranche will help provide us the funding as we move towards FID towards the end of the decade.

Nice for you to point out the Slide 19. I think there's many innovations that Bruce have been using both operationally and through the MCR program with the robotics that I talked about earlier. you'll see successive efficiencies being taken through all those lessons learned when you think about -- this is almost a decade-long plan. And the reason that we actually put robotics and other things in as we progress through Unit 3 was to be able to continue that over through all the success of MCR programs. So the team have been doing a great job on time and on budget. And what you'll continue to see is that time shrinking in terms of how long it's taken us to do the MCR program and get these units back online.

And the next question comes from Aaron MacNeil with TD Cowen.

The negotiated settlement on the Canadian Mainline expires in 2026. You mentioned several rate cases over the next several years. So I guess, just very simply, have toll increases or rate cases been contemplated in the 2028 guide? Or could we think about that as potential upside very much like we saw with Columbia earlier this year?

Yes. Thanks for the question, Aaron. We do have several rate cases in flight. As you're familiar, we have the ANR, the Great Lakes rate cases that we have just recently filed and are in settlement discussions. We had a successful settlement on the Columbia Gas system. We have a cadence going forward on other U.S. pipes. Specific to Canada Gas, we have the mainline settlement, which goes through the end of 2026. in our NGTL settlement that ends at the end of 2029. The projections for those rate cases or rate settlements include conservative estimates in our budgeting and forecasting. And each rate case is very different depending on the rate base, the capital investment, but you will see the proposed uplift on those rate cases already embedded into our forecast.

Okay. Understood. And then I wanted to dig in on the cost savings that you've realized on capital. As we look to the future and just given the broader investment in energy infrastructure across North America, are you starting to run into challenges or bottlenecks with contractors? Or can you speak to any other pressure points that we should be aware of or risks that you're actively mitigating? And ultimately, I guess I'm just wondering if this level of outperformance can be sustained.

Yes, thanks. Market pressures haven't really had a material impact yet, but we do see industry backlogs building, and we're continuously monitoring our suppliers and our contractors. Francois earlier highlighted our human capital, and that's one of our also top considerations when we're sanctioning and executing projects. This applies also to our contractors and skilled labor workforces.

We've been through these cycles before. We learn when it gets busy. It's increasingly important to retain top-tier suppliers, contractors, crews. And we're able to attract some of those top suppliers and contractors in two ways: one, through our long-term relationships and our contracting strategies that we deploy; and two, our portfolio. Our contractors like this long-term portfolio that we have, whether it's small, medium-sized in quarter projects and all of our maintenance capital, we're able to develop long-term relationships with them for that long-term backlog.

Yes. And I'll add to that, Aaron, it's Francois. With respect to outperforming plan going forward. Remember that the risk of our portfolio is decreasing. If you look over the last 2 or 3 years, we had CGL and Southeast Gateway in there. The small- to medium-sized projects are much more straightforward to execute. The predictability of cost estimates is very high because we know the right of way, we know the terrain. The time lines are quite predictable. So we do tend to take a more conservative approach in an inflationary environment to our costs. Projects we're putting into service now were sanctioned in 2022 and 2023. Remember, we were in a much higher inflationary environment back then. But I'm optimistic that we can continue that execution excellence with a recognition that we're in a generational time in terms of allowed rates of return or rates of returns on projects we sanction. And to some extent, we might be a little bit more aggressive in terms of our estimation simply because we want to be able to allocate more capital to growth.

Over the last few years, as we've been deleveraging any outperformance on projects, the proceeds have gone to accelerating our deleveraging. Going forward, the balance sheet is in good shape right now. We're more focused on growth. So we're going to want to allocate more capital. There are some great examples that our team, our supply chain team have been working with some of our key suppliers on long-term contracts, things like turbine maintenance, things like delivery of new equipment for new projects with the long backlog that Tina mentioned, we are a preferred customer that our contractors very much like to deal with. That means we get the A teams on our projects. And project execution is always about people and our human capital. And our team is very strong, and we get the strongest teams from our contractors, which leads to the results we've been getting, and we hope to continue those.

And the next question comes from Jeremy Tonet with JPMorgan.

Just wanted to turn to Slide 23, if I could revisit that. On the right-hand side, piling up tailwinds and headwinds for the guide here, if I recall correctly, it seems like there's a lot more tailwinds than headwinds at this point. So just wondering, is it fair to think that, that is the balance when you're thinking about the guide period?

Jeremy, it's Sean. I'll take that question. Candidly, I think you're right. We are feeling more tailwinds than headwinds at the moment, whether that be the jurisdiction regulatory reforms that Francois mentioned, the customer kind of demand pull on our systems, we're being asked to do more than we ever have been. And to Francois's point, we're able to drive kind of project IRRs up, and we're able to drive rate case outcomes higher than we've ever seen before. So it is a bit of an imbalance towards the tailwinds for the first time in a long time. But towards that -- outside of that 29 and 30, we've been asked a few times about why not 5 years guidance. We just want to maintain a few -- another year to make sure that all of these tailwinds remain durable through the end of the decade. But so far, so good.

Got it. That's helpful. So the 3-year guide looks really conservative here given that backdrop. So that's helpful to understand. And then just wanted to go to Mexico, I guess, there have been comments in the past with regards to potential for monetization there. I'm just wondering any updated thoughts you might be able to provide there.

Yes. I'll take that one as well, Jeremy. No updated thoughts, but just let us recap kind of where we've been on that one. Look, Mexico is a phenomenal business for us, right, putting SGP into service this year and kind of demonstrating the commercial viability of that. CFE has a major campaign underway, right, with their $20-some billion kind of power and transmission build-out and given that a couple of quarters to continue to develop. So we're still committed to looking at alternatives in 2026. We'll have USMCA, some clarity there by hopefully, June or July. We'll have progress on the CFE side with connecting a number of different power plants that will be served primarily by SGP and other assets. And we'll look at capital market and partnership opportunities starting in 2026 and hopefully have an update by mid to fall of 2026.

And the next question comes from Maurice Choy wit RBC.

I just want to come back to a comment earlier that Francois, you made about your ability to go above $6 billion without rotating capital. It doesn't sound like you need this program. But from everything you shared today, you're also not short of opportunities. So how do you see the company being more engaged on an active capital rotation program just from a financial discipline perspective, particularly for mature or derisked projects?

Thanks for the question, Maurice, and it gives me an opportunity to maybe be a bit clearer based on my prior response. What I wanted to indicate is that the first source of deleveraging is always growing your EBITDA. And before we consider capital rotation or any outside form of equity, we always look to improve the ROIC on our existing assets. So through commercial innovations and increasingly interesting technological innovation, the use of AI more specifically, we see an opportunity to accelerate EBITDA growth through optimization and efficiencies in our system. And I would like to see those carried out and run through before we consider any outside capital or deleveraging.

Obviously, we hold share count dearly. Our bias to the extent we need -- to the extent we want to grow our capital program above 6 and we decide that we do need some equity the bias will always be the capital rotation first. But first, let's see what we can do with the EBITDA. We've had some really good successes here in improving the efficiency of our systems, getting our OM&A down and getting the ROIC on our existing assets up. And that's what I meant by that comment.

That makes sense. And if I could just finish on the question about returns. On a forward-looking basis, you mentioned that you are expecting 5 to 7x build multiple. Compared to the Investor Day last year, has there been certain assets or project types that you're seeing evolving returns? Or have they broadly been quite steady over the past 12 months?

Maurice, it's Sean. The answer is the latter. We have seen the 5% to 7% guidance from Investor Day last year to this year, we have executed right in the middle of that range. So it is steady. The proof points are there, and they are why we're extending that guidance through '28 at this point.

Yes. And just to add to that, as we talked about our priorities for 2026 and our goal of filling out the slate of growth projects at the $6 billion level through 2030, along with that is at a 5 to 7x EBITDA build multiple. As you can imagine, our $17 billion BD pipeline, we have pretty good visibility on the returns of those projects. And so we think that, that outcome is very achievable. And the clear implication there is that we expect the build multiples to hold at the levels that you just referred to.

So just a quick follow-up. I think earlier, there was a mention, I believe, by Tina that just we've not seen a whole lot of cost pressures, but perhaps there may be some on the horizon if all the resources are directed towards data centers, for example. What you're saying is that even if costs globally goes up, your returns should hold. Is that fair?

Francois

Yes. Look, I think we compete with our peer company pipelines for projects, particularly in the U.S. My presumption is that if all competitors are impacted by the same inflationary environment, we're competing on a level playing field, and those costs will be reflected in all of our bids, and we expect to be able to hold our returns to deliver that 5 to 7x EBITDA build multiple.

And the next question comes from Manav Gupta with UBS.

You recently got an upgrade from S&P. They finally moved you to stable outlook versus negative. I know you had been working with them. Help us understand what that process was and finally, what pushed them to acknowledge that the outlook is actually stable and not negative.

Manav, it's Sean. I'll take that one. Look, without speaking to any particular agency, we've simply delivered on the plan that we introduced at Investor Day last year, right? Obviously, getting SGP done on time and on service and living within our $6 billion to $7 billion capital raise. Those were commitments that we made to the market. And to be fair, the agencies held us accountable and wanted to see a couple of quarters of performance under that new strategy. So we've delivered and better. So yes, we're grateful for recognition of that, but it was always kind of part of our plan and expectation to get to this point.

A number of question we are getting from investors is when you look at 2026, your guide is 6% to 8% and people feel it's slightly conservative. Help us understand what can get us closer to 8% versus the 6%, if you could talk a little bit about that.

Yes. Happy to take that one again, Manav, it's Sean. Look, we have a little over $8 billion going into service kind of driving that. So these are new assets. And as it relates to the optionality that we have with all of our assets, right, customer-driven events, weather-driven events, outperformance. -- it's -- we need a little bit of time with our new assets in particular, but we are seeing new counterparties come across all of our systems with really kind of commercially innovative strategies to express hedging across molecules to electrons. So with these new assets, in particular, we'll be conservative in how much more we can do from a new customer standpoint, but we look forward to having all the new inventory kind of up and running here by the end of the year.

And the next question comes from Olivia Foster with Goldman Sachs.

I wanted to go back to some of the comments which were made on improving IRRs across the footprint. Could you talk about specific drivers of the improved project returns we are seeing versus earlier this decade? And specifically, are there insights you can share on customer willingness to sign up for rates underpinning these improved project returns? And on the other hand, any balancing factors from project competition in regions where TC operates?

Olivia, this is Tina. I'll take that question. There are various factors that are driving our higher returns and our strong build multiples. One is our project execution capabilities. We've really have advanced our skill set, our governance are the way we advance our projects on early development. And so I feel like our project development and execution experience has really driven us a long way in executing on time and under budget at returns that are continuing to increase.

Second is the capacity in the market on the pipeline side continues to be more and more utilized. And so as we're working with our customers, the optionality in our systems requires expanding. And as we're working with them, they are highly valuing the new capacity as well as the security of supply. So we are able to negotiate, in some cases, returns that are providing us stronger options there. In addition, just the amount of growth across North America is really providing a big landscape for us to be able to select projects that have the highest return and strong build multiples. That's really the value of our footprint. Our footprint is a strategic advantage for us to find those low-risk, high-return opportunities that we can filter into our $6 billion to $7 billion capital.

Got it. That's clear. And for my second question, I wanted to ask a follow-up on one of Praneeth's questions, specifically on the leverage build and annual CapEx outlay. How much cushion specifically would you like to build under the 4.75 target on a run rate basis before we could see annual CapEx trend towards the higher end of the range? And then maybe this is a clarifying question as well, I'll tag on. But is TC contemplating moving towards the higher end of the $6 billion to $7 billion range or eventually moving above the upper end of the range over time?

Yes, Olivia, it's Sean. I'll take the first part of that question. Look, as it relates to having a specific target below 4.75, our objective is really capital efficiency. And as Francois mentioned, our per share metrics at 4.75 or below are really how we kind of triangulate balance of total shareholder return. So -- and we are being below $6 billion here for the next kind of couple of years, we are giving the balance sheet time to breathe. We could have gone to $6 billion, but we have chosen not to. We're not chasing projects in favor of giving -- lower return projects in favor of giving the balance sheet time to breathe. That's a critical takeaway.

As it relates to going from 6 to 7 or 7 to 8%, if the project returns are there, and it works within our -- that 12.5%, that glide path up that we're seeing, if that continues to be true and our teams can deliver on time and on budget, and it works at 4.75 or lower, those are the ingredients for both growth and continued preservation of balance sheet strength.

And the next question comes from Robert Kadller with CIBC.

Rob Catellier from CIBC. First of all, congratulations on your ongoing safety record. I just wanted to follow up a little bit with Tina, just on the project execution we've seen recently. You gave a whole host of reasons on how you got there. But I wondered if you could maybe highlight the one or two top reasons why you -- the projects are coming in on time and on budget recently.

Thanks for the question, Rob. I'd love to talk about our project execution teams because they have been delivering time and time again. Our human capital there is really the #1 driver, in my opinion, of why we're executing on time and on budget. We've really advanced our internal leadership execution skills, more due diligence on risk we are engaging our stakeholders much earlier in the process, in the development cycle. We are negotiating strong contractors with our third-party constructors to provide the A teams. All of that allows us to execute on time and on budget and drive that increasing returns on our invested capital.

And just to add to that, Rob, I really appreciate the question. We don't talk about culture enough on these types of calls and having a one-team approach to project execution, creating a psychologically safe environment where our teams feel comfortable identifying challenges early on so that we can manage them and manage risk. is critical to the high-quality execution on projects. So we've worked really hard on creating a strong culture with strong psychological safety, and it's definitely benefited us.

Yes. It sounds like you put in a really sustainable framework there that should benefit you for years to come. My second question was for Greg Grant on the power side. On Slide 18, there's a comment in the midterm bucket about exploring complementary services in high-demand power and energy solution markets. I wondered if you could give us a flavor of what you think the highest likelihood opportunities are there, in your opinion, as we stand here today and whether or not you're contemplating any behind-the-meter power in that bucket.

Sure. Yes. Thanks, Robert. Happy to talk a bit about that. We've talked about areas where we do have some of the complementary gas and power solutions. Obviously, we have to be quite strategic with our footprint on both the gas and power side. We've talked about we're not just trying to build out the power business on its own. Certainly, Alberta has been the one area that I've talked about in the past, just given we have that energy supply chain footprint, whether it goes from the gas storage all the way to the end of power.

So that's a natural area where we would be looking to potentially look to colocation and/or power solution. The one thing I just want to highlight, and I think Tina highlighted it earlier, we have a great pipeline of growth. And so we're going to be very selective. Some of the projects that we have seen are probably taking on a bit more risk than we would like to, especially given the footprint and the pipeline that we have. But certainly, in Alberta, when you see over 20 gigawatt queue on the data center front, whether we're developing it or we see other developers come in and build out some more demand, that's great for our existing footprint on the gas and power side.

And the next question comes from Sam Burwell with Jefferies.

Given the LNG build-out on the Gulf Coast, it seems like there's at least some opportunity to send more Canadian gas south. So are possible brownfield expansions on your system something that might make sense for you to pursue? And if so, how would those projects rank within your opportunity set?

Yes. Thanks for the question, Sam. This is Tina. Yes, LNG opportunities are continuing to evolve. It is a large market, as you know, from a demand perspective. If you think about it across our portfolio, we've placed 8 LNG projects into service over the last few years, primarily related to Gulf Coast projects. Recently, you're familiar, we have built our Coastal GasLink project to the West Coast, and we think there's great opportunity to continue to provide egress out of the WCSB to the West Coast for LNG exports there. As you think about coming down into the U.S., we certainly have a corridor there through our ANR pipeline system and other systems where we have had some expansions in the past to bring gas from Western Canada down to the Gulf Coast, and we'll continue to evaluate those as necessary. There are about 10 more LNG projects proposed along the Gulf Coast that we'll be looking for additional supply. But again, I think the West Coast of Canada and building that out is going to be an incredible opportunity for us to move that gas west.

Okay. Understood. So I guess on that point, I mean, any updates you can share on Coastal GasLink expansion?

Sure. We're excited to have Coastal GasLink in service and flowing gas, Train 1 and Train 2 now moving forward. We are working really closely with LNG Canada right now to evaluate the Phase 2, and we're supporting them in the development related to what would be necessary on the pipeline. So the FID does rest with them, but we are working jointly to evaluate what would be necessary to expand Coastal to get to the Phase 2.

And recall, Sam, that LNG Canada Phase 2 is part of the projects and the national interest that the federal government has identified. So from a permitting standpoint, I think that process is well underway with the major projects office. And really, the decision now rests with the proponent for the LNG facility.

And the next question comes from Ben Pham with BMO.

I appreciate the update. A couple of maintenance questions from me on the 5% to 7% EBITDA growth guidance. So there's a couple of questions earlier on this topic. But I'm wondering, could you provide the building blocks on that CAGR, that 5%? Like what amounts growth? What is rate cases? What is the efficiencies? And then what takes you to the 6% and the 7% or beyond?

Ben, it's Sean. Thanks for the question. Look, we maybe do a better job on that kind of offline, but just to give you a sense for it. there's another big chunk of that with capital coming into service kind of over the next 2 years, right? That's always our baseline, capital kind of coming into service. We could have up to a half a dozen rate cases kind of in flight during this plan. So that's probably the biggest driver of the range and what has to be true over the course of the next kind of couple of years. And then the smaller kind of bucket, but things that we've had real kind of demonstrable experience and results from asset availability, commercial and technology.

Those -- it's a small but kind of growing kind of influence on the growth. And you heard both Tina and Greg kind of mentioned we've got active robotics. We've got AI, we've got preventative maintenance that are all showing early signs of kind of cash flow productivity and contribution. So those are really the three big buckets, but happy to take that offline in more detail.

Okay. That's great. And maybe the other maintenance question that I had is on the dividend growth side, are you still expecting the ranges you've highlighted in the past on dividend growth?

Yes. So just to be clear for all the listeners, our 3% to 5% range is consistent. We are just given the returns that we're seeing in our new projects, right, well above our cost of capital, we are going to direct as much capital as we can into new projects, which implies we will keep the dividend growth at the low end of that range for the foreseeable future because the projects just warrant as much growth at 12.5% or better. That's the highest and best use of capital we see across the entire system.

Ladies and gentlemen, this concludes the question-and-answer session. If there are any further questions, please contact Investor Relations at TC Energy. I will now turn the call over to Gavin Wylie for any closing remarks.

I just wanted to say once again, thank you for attending the call this morning and for the great questions. As the operator stated, if we didn't get to your question or if there was anything that was outstanding, please feel free to contact us in the Investor Relations team. We're always happy to help. And of course, we look forward to providing you our next update likely in mid-February. Thank you.

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