3 July 2018
Middlefield Canadian Income PCC
(the "Company" or "MCT")
(a protected cell company incorporated in Jersey with registration number 93546)
Middlefield Canadian Income - GBP PC (the "Fund")
Significant Positive Development At Largest Investee Company
Major Public Approval for Enbridge
Middlefield Canadian Income PCC (LON: MCT, "MCT") is a London listed investment company investing in a broadly diversified portfolio comprised of primarily Canadian and US equity income securities with the objective of providing shareholders with a high level of dividends as well as capital growth over the longer term.
MCT is pleased to provide the following positive update on Enbridge Inc. (TSX: ENB, NYSE: ENB) ("Enbridge"), which is currently it's largest portfolio holding of approximately 5% of the Fund. On 28 June 2018, Enbridge announced that it was granted approval from the State of Minnesota's Public Utility Commission ("PUC") for Enbridge's proposed replacement of the Line 3 oil pipeline. The PUC approval is a major step forward for Enbridge's Line 3 proposal, one of North America's most significant pipeline projects under construction with a total capital cost of USD$9 billion. The Line 3 pipeline currently carries approximately 350,000 boepd, but with further output expected from Canada's oil sands, the replacement is expected to more than double the capacity to over 750,000 boepd, significantly benefiting both Enbridge and Canada's oil producers, who currently suffer discounted prices due to limited pipeline transportation.
Enbridge is MCT's largest current holding and is North America's largest energy infrastructure company with dominant, integrated crude oil and natural gas transportation platforms. Enbridge is well positioned in the North American pipeline industry with high barriers to entry due to significant cost and major regulatory restrictions making it difficult for competitors to construct additional capacity.
Commenting on this positive development, Dean Orrico, President, Middlefield International Limited said:
"We are delighted by the news that Enbridge has been granted this approval which represents a major positive development in the proposed Line 3 project. We believe that the proposed project will drive increased cash flow to support dividends payable by Enbridge after project completion over the next 18 to 24 months and note that the market has responded favourably to the developments with a 10% increase in the equity price of Enbridge since 27 June 2018. Enbridge is currently the largest portfolio holding of MCT and represents an ideal stock to support our investment strategy of providing investors with access to a diversified portfolio of primarily Canadian equities providing long term, reliable income. To date, our investment in Enbridge has seen a price appreciation of 11% with the potential for additional upside as the company continues to execute on its other strategic objectives. Enbridge also pays a dividend of approximately 6% per annum with management forecasting dividend increases of 10% per annum over the next three years. The performance of Enbridge validates our investment strategy and supports the positive view of the North American pipelines sector which also includes other MCT holdings such as Pembina Pipeline Corporation (TSX:PPL, NYSE:PBA)."
For further information:
Middlefield International Limited 0123 7094016
Dean Orrico
Canaccord Genuity Limited 0207 523 8000
Andrew Zychowski
Helen Goldsmith
Buchanan Communications 0207 466 5000
Charles Ryland
Henry Wilson
