TC Energy (TRP) Investor Update summary

Historic Indigenous equity partnership announcement

• Up to 72 First Nations and Métis groups from Alberta, British Columbia, and Saskatchewan will acquire a 5.34% equity stake in the NGTL and Foothills pipeline assets, supported by a CAD 1 billion loan guarantee from the Alberta Indigenous Opportunities Corporation (AIOC).

• This is the largest Indigenous equity partnership and loan guarantee in Canadian history, marking a significant step in economic reconciliation and Indigenous economic participation.

• The partnership provides Indigenous communities with new revenue streams, ownership in critical energy infrastructure, and a seat at the economic table.

• The AIOC's loan guarantee capacity was recently tripled to CAD 3 billion, enabling more opportunities for Indigenous economic involvement.

• The transaction is expected to close in Q3 2024, subject to community approvals and financing, with each community independently determining its participation.

Broader impacts and future opportunities

• The transaction is expected to drive generational prosperity, economic development, and community benefits for participating Indigenous groups.

• The partnership is viewed as a template for future deals, including potential involvement in other major energy projects like the Trans Mountain pipeline.

• The AIOC is open to supporting Indigenous participation in sectors beyond energy, such as agriculture, forestry, renewables, tourism, and transportation.

• Indigenous representation on TC Energy’s Indigenous Advisory Council will enhance trust, knowledge sharing, and influence in corporate decision-making.

• The agreement is not contingent on all communities participating, respecting each community's right to self-determination.

Financial and corporate strategy

• The CAD 1.65 billion enterprise value of the partnership helps TC Energy reduce debt while advancing reconciliation and corporate objectives.

• The NGTL and Foothills assets are critical infrastructure, connecting about 80% of Western Canadian Sedimentary Basin natural gas production to markets.

• These assets are federally rate-regulated, expected to provide predictable, long-term cash flows.

• The deal is structured to minimize risk to taxpayers while maximizing benefits for Indigenous communities.

• CIBC Capital Markets and TD Securities acted as financial advisors for TC Energy and the Indigenous partnership, respectively.