Record Infrastructure and Marketing Performance
Gibson Energy (TSE:GEI) reported record third-quarter infrastructure and consolidated adjusted EBITDA, supported by contributions from its Chauvin pipeline system, higher utilization at Canadian terminals, and strong refining margins at Moose Jaw. President and Chief Executive Officer Curtis Philippon stated the company completed the operational integration of Chauvin and brought the final components of its Wink-to-Gateway project into service during the quarter.
Philippon described the period as a "great third quarter with record infrastructure and consolidated adjusted EBITDA and very strong marketing results." Senior Vice President and Chief Financial Officer Riley Hicks reported that infrastructure adjusted EBITDA rose to a record CAD 177 million in the third quarter, compared with CAD 154 million a year earlier. This result was CAD 8 million above the company’s previous record, which was set in the second quarter.
Hicks attributed the infrastructure results to a full quarter of Chauvin contributions, improved utilization across Canadian terminals, and record volumes moved to the Trans Mountain Expansion pipeline during the quarter. Philippon stated Gibson’s average utilization across its platforms increased from about 85% to more than 90% during 2026.
Wink-to-Gateway Completion and Chauvin Expansion Plans
The Wink-to-Gateway project, which was finalized during the quarter, included twinning the Harvest connection to Gateway and placing a new 100,000-barrel tank at Wink into service. These steps completed the integration and debottlenecking work between the assets, according to Hicks.
Looking ahead, Gibson has sanctioned an expansion of the Chauvin system, which is expected to increase capacity by about 50% when completed. The company plans to advance this work through 2027. Philippon noted that the Chauvin expansion is supported by strong commercial interest and could be followed by producer connections and laterals.
The Hardisty connection for Chauvin remains on track for completion in the first half of 2027. Philippon noted that Chauvin production in the Mannville remains strong and Gibson sees opportunities to bring additional barrels into the system. He stated the Chauvin expansion represents a roughly CAD 20 million capital project with a build multiple below five times. Including optimization efforts and the Hardisty connection, the acquisition multiple for Chauvin is expected to move into a range of six to seven times.
Marketing Results and Market Conditions
Marketing adjusted EBITDA totaled CAD 35 million in the third quarter, compared with CAD 7 million in the prior-year period. Hicks attributed the marketing increase primarily to exceptionally strong refining margins at Moose Jaw, where Gibson benefited from product diversification and favorable market conditions.
Gibson expects its marketing business to generate approximately CAD 80 million of adjusted EBITDA in 2026, above the CAD 0 million to CAD 40 million range outlined at the start of the year. Hicks said the marketing business had already exceeded the high end of the initial CAD 0 million to CAD 40 million range on a year-to-date basis.
However, Hicks said the usual seasonal slowdown at Moose Jaw will partly offset favorable refined-product market conditions in the fourth quarter. He noted that steep West Texas Intermediate backwardation and low inventory levels continue to limit traditional crude-storage opportunities, though volatility and wider heavy crude differentials may create other opportunities.
Hicks stated that profitable short-term heavy-crude storage requires contango in the Western Canadian Select curve to exceed backwardation in the WTI curve, noting such opportunities do not currently exist but may return over time. Gibson has hedged a portion of its distillate exposure into 2027 to provide more earnings visibility.
Hicks said distillates account for more than 40% of refinery output, with roughly half sold into the U.S., and that the company has hedged “quite a bit” of that portion while considering hedging 25% to 30% of feedstock costs.