South Bow Corp (Form: 40FR12B, Received: 10/01/2024 13:40:52)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 40-F

[Check one]

☑	REGISTRATION STATEMENT PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934

☐	ANNUAL REPORT PURSUANT TO SECTION 13(a) or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended:

Commission File Number:

SOUTH BOW CORPORATION

(Exact name of Registrant as specified in its charter)

Not applicable

(Translation of Registrant’s name into English (if applicable)

Canada

(Province or other jurisdiction of incorporation or organization)

4612

N/A

(Primary Standard Industrial

Classification Code Number (if applicable))

(I.R.S. Employer Identification

Number (if applicable))

707 5th Street SW

Calgary, Canada T2P 0Y3

(855) 669-8437

(Address and telephone number of Registrant’s principal executive offices)

South Bow USA Services Inc.

700 Louisiana Street, Suite 800

Houston, Texas, 77002-2700

(832) 320-5201

(Name, address (including zip code) and telephone number (including area code) of agent for service in the United States)

copies to:

Lori M. Muratta

South Bow Corporation

707 5th Street SW

Calgary, Canada T2P 0Y3

(832) 320-5201

Andrew J. Ericksen

White & Case, LLP

609 Main Street, Suite 2900

Houston, Texas 77002

(713) 496-9700

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of each class

Trading

symbol

Name of each exchange on which registered

Common shares (including common share purchase rights)

SOBO

New York Stock Exchange

Securities registered or to be registered pursuant to Section 12(g) of the Act.

None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.

None

(Title of Class)

For Annual Reports indicate by check mark the information filed with this Form:


☐ Annual information form		☐ Audited annual financial statements

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report:

Not applicable.

Indicate by check mark whether the Registrant (1) has filed all reports to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to filing requirements for the past 90 days.

Yes ☐ No ☒

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter ) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).

Yes ☐ No ☐

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 12b-2 of the Exchange Act. ☐

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

DOCUMENTS FILED AS PART OF THIS REGISTRATION STATEMENT

The following documents have been filed as part of this Registration Statement on Form 40-F as Exhibits hereto:


Exhibits		Documents

99.1		Notice of Meeting and Management Information Circular (the “Information Circular”), dated April 10, 2024, containing the Audited Financial Statements of South Bow Corporation and the Audited Combined Carve-out Financial Statements for the Liquids Pipeline Business of TC Energy Corporation and management’s discussion and analysis thereon and a description of the Registrant’s common shares (incorporated by reference to Exhibit 99.1 of the Form 6-K of TC Energy Corporation filed with the Securities and Exchange Commission on April 16, 2024 (Commission File No. 1-31690).

99.2		Annual Information Form of TC Energy Corporation for the year ended December 31, 2023 (incorporated by reference to Exhibit 13.1 to the Form 40-F of TC Energy Corporation filed with the Securities and Exchange Commission on February 16, 2024 (Commission File No. 1-31690, the “Form 40-F”)).

99.3		Management’s Discussion and Analysis of TC Energy Corporation for the year ended December 31, 2023 (incorporated by reference to Exhibit 13.2 of the Form 40-F).

99.4		Audited Consolidated Financial Statements, and the related notes thereto, of TC Energy Corporation for the year ended December 31, 2023, and the auditors’ reports thereon (incorporated by reference to Exhibit 13.3 of the Form 40-F).

99.5		Management’s Discussion and Analysis of Financial Condition and Results of Operations of TC Energy Corporation for the three months period ended March 31, 2024 (incorporated by reference to Exhibit 13.1 to the Form 6-K of TC Energy Corporation filed with the Securities and Exchange Commission on May 3, 2024 (Commission File No. 1-31690)).

99.6		Unaudited Condensed Consolidated Financial Statements of TC Energy Corporation for the three months period ended March 31, 2024 (incorporated by reference to Exhibit 13.2 to the Form 6-K of TC Energy Corporation filed with the Securities and Exchange Commission on May 3, 2024 (Commission File No. 1-31690)).

99.7		Management’s Discussion and Analysis of Financial Condition and Results of Operations of TC Energy Corporation for the six months period ended June 30, 2024 (incorporated by reference to Exhibit 13.1 to the Form 6-K of TC Energy Corporation filed with the Securities and Exchange Commission on August 1, 2024 (Commission File No. 1-31690)).

99.8		Unaudited Condensed Consolidated Financial Statements of TC Energy Corporation for the six months period ended June 30, 2024 (incorporated by reference to Exhibit 13.2 to the Form 6-K of TC Energy Corporation filed with the Securities and Exchange Commission on August 1, 2024 (Commission File No. 1-31690)).

99.9		Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Liquids Pipelines Business of TC Energy Corporation for the three months period ended March 31, 2024.

99.10		Unaudited Condensed Combined Carve-Out Financial Statements for the Liquids Pipelines Business of TC Energy Corporation for the three months period ended March 31, 2024.

99.11		Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Liquids Pipelines Business of TC Energy Corporation for the six months period ended June 30, 2024.


99.12		Unaudited Condensed Combined Carve-Out Financial Statements for the Liquids Pipelines Business of TC Energy Corporation for the six months period ended June 30, 2024.

99.13		Unaudited Condensed Financial Statements of South Bow Corporation for the three months period ended March 31, 2024.

99.14		Unaudited Condensed Financial Statements of South Bow Corporation for the six months period ended June 30, 2024.

99.15		Consent of KPMG LLP (TC Energy Corporation).

99.16		Consent of KPMG LLP (South Bow Corporation).

99.17		Certificate and Articles of Incorporation of South Bow Corporation.

99.18		By-laws of South Bow Corporation.

99.19		News Release of TC Energy Corporation dated August 28, 2024 (incorporated by reference to Exhibit 99.1 to the Form 6-K of TC Energy Corporation filed with the Securities and Exchange Commission on August 29, 2024 (Commission File No. 1-31690)).

99.20		News Release of TC Energy Corporation dated October 1, 2024.

99.21		News Release of South Bow Corporation dated October 1, 2024.

OFF-BALANCE SHEET ARRANGEMENTS

We have no off-balance sheet arrangements required to be disclosed in this Registration Statement on Form 40-F.

UNDERTAKING AND CONSENT TO SERVICE OF PROCESS

A. Undertaking

The Registrant undertakes to make available, in person or by telephone, representatives to respond to inquiries made by the Commission staff, and to furnish promptly, when requested to do so by the Commission staff, information relating to: the securities registered pursuant to Form 40-F; the securities in relation to which the obligation to file an annual report on Form 40-F arises; or transactions in said securities.

B. Consent to Service of Process

A Form F-X signed by the Registrant and its agent for service of process is being filed with the Commission together with this Registration Statement on Form 40-F.

Any change to the name or address of the agent for service of process of the Registrant shall be communicated promptly to the Commission by an amendment to the Form F-X referencing the file number of the relevant registration statement.

SIGNATURES

Pursuant to the requirements of the Exchange Act, the Registrant certifies that it meets all of the requirements for filing on Form 40-F and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized.


Date: October 1, 2024	SOUTH BOW CORPORATION

	By:	/s/ Lori M. Muratta
		Name: Lori M. Muratta
		Title: Senior Vice-President and General Counsel

Exhibit 99.9

Management’s discussion and analysis

June 12, 2024

On July 27, 2023, the Board of Directors of TC Energy Corporation (TC Energy or the Parent) approved a proposed reorganization of TC Energy into two independent, investment-grade, publicly listed companies (the spinoff Transaction). On June 4, 2024, TC Energy shareholders approved the spinoff Transaction. Pursuant to the spinoff Transaction, TC Energy’s Liquids Pipelines business will be transferred to South Bow Corporation (South Bow) by way of a plan of arrangement under the Canada Business Corporations Act.

Under the spinoff Transaction, common shareholders of TC Energy as of the record date established for the spinoff Transaction will receive, in exchange for each TC Energy share held, one new TC Energy share and 0.2 of a South Bow common share.

This management’s discussion and analysis (MD&A) has been prepared in respect of the assets and liabilities comprising the Liquids Pipelines business of TC Energy. It discusses our business, operations, financial position, risks and other factors for the three months ended March 31, 2024 and should be read with the accompanying unaudited financial statements of South Bow and unaudited Condensed combined carve-out financial statements of the Liquids Pipelines business for the three months ended March 31, 2024, which have been prepared in accordance with U.S. GAAP.

This MD&A should also be read in conjunction with the audited financial statements of South Bow for the period from incorporation on December 15, 2023 to December 31, 2023 and the audited Combined carve-out financial statements for the Liquids Pipelines business for the years ended December 31, 2023, 2022 and 2021.

Basis of Presentation

The unaudited Condensed combined carve-out financial statements for the Liquids Pipelines business have been prepared on a carve-out basis and reflect the historical results of TC Energy’s Liquids Pipelines business. The Condensed combined carve-out financial statements are not necessarily indicative of results that would have been realized if the Liquids Pipelines business had been operated separately as a stand-alone company during the periods presented, nor will they necessarily be indicative of future results of the Liquids Pipelines business as they will exist upon completion of the spinoff Transaction.

About This Document

As at the date hereof, South Bow has not carried on any active business. Pursuant to the spinoff Transaction, South Bow will become an independent, public corporation. Unless otherwise indicated, the disclosure in this MD&A has been prepared assuming the spinoff Transaction will be completed.

Throughout this MD&A, the terms we, us and our mean the Liquids Pipelines business. All information is as of June 12, 2024 and all amounts are in Canadian dollars, unless noted otherwise.

FORWARD-LOOKING INFORMATION

We disclose forward-looking information to help the reader understand management’s assessment of our future plans and financial outlook and our future prospects overall.

Statements that are forward looking are based on certain assumptions and on what we know and expect today and generally include words like anticipate, expect, believe, may, will, should, estimate or other similar words.

Forward-looking statements in this MD&A include information about the following, among other things:

•

our financial and operational performance

•

expectations about strategies and goals for growth and expansion

•

expected cash flows and future financing options available, including portfolio management

•

expectations about South Bow following the completion of the spinoff Transaction

•

expectations regarding the size, timing, conditions and outcome of ongoing and future transactions, including the spinoff Transaction

2 | Liquids Pipelines Business First Quarter 2024

•

expected access to and cost of capital

•

expected costs and schedules for planned projects, including projects under construction

•

expected capital expenditures, contractual obligations, commitments and contingent liabilities, including environmental remediation costs

•

expected regulatory processes and outcomes

•

expected outcomes with respect to legal proceedings, including arbitration and insurance claims

•

the expected impact of future tax and accounting changes

•

expected industry, market and economic conditions, including their impact on our customers and suppliers.

Forward-looking statements do not guarantee future performance. Actual events and results could be significantly different because of assumptions, risks or uncertainties related to our business or events that happen after the date of this MD&A.

Our forward-looking information is based on the following key assumptions and subject to the following risks and uncertainties:

Assumptions

•

realization of expected benefits from acquisitions, divestitures and the spinoff Transaction

•

regulatory decisions and outcomes

•

planned and unplanned outages and the use of our pipelines

•

integrity and reliability of our assets

•

anticipated construction costs, schedules and completion dates

•

access to capital markets, including portfolio management

•

expected industry, market and economic conditions, including the impact of these on our customers and suppliers

•

inflation rates, commodity and labour prices

•

interest, tax and foreign exchange rates

•

nature and scope of hedging.

Risks and uncertainties

•

realization of expected benefits from acquisitions, divestitures and the spinoff Transaction

•

the terms, timing and completion of the spinoff Transaction, including the timely receipt of all necessary approvals

•

that market or other conditions are no longer favourable to completing the proposed spinoff Transaction

•

business disruption during the period prior to or directly following the proposed spinoff Transaction

•

our ability to successfully implement our strategic priorities and whether they will yield the expected benefits

•

our ability to implement a capital allocation strategy aligned with maximizing shareholder value

•

the operating performance of our pipelines and storage assets

•

amount of capacity sold and rates achieved in our business

•

production levels within supply basins

•

construction and completion of capital projects

•

cost and availability of, and inflationary pressures on, labour, equipment and materials

•

the availability and market prices of commodities

•

access to capital and insurance markets on competitive terms

•

interest, tax and foreign exchange rates

•

performance and credit risk of our counterparties

•

regulatory decisions and outcomes of legal proceedings, including arbitration and insurance claims

•

our ability to effectively anticipate and assess changes to government policies and regulations, including those related to the environment

•

our ability to realize the value of tangible assets and contractual recoveries

•

competition in the business in which we operate

•

unexpected or unusual weather

Liquids Pipelines Business First Quarter 2024 | 3

•

acts of civil disobedience

•

cyber security and technological developments

•

sustainability-related risks

•

impact of energy transition on our business

•

economic conditions in North America as well as globally

•

global health crises, such as pandemics and epidemics, and the impacts related thereto

•

recovery of costs resulting from unexpected pollution or environmental events related to our operations.

You can read more about these factors and others in this MD&A and our 2023 MD&A.

As actual results could vary significantly from the forward-looking information, you should not put undue reliance on forward-looking information and should not use future-oriented information or financial outlooks for anything other than their intended purpose. We do not update our forward-looking statements due to new information or future events unless we are required to by law.

FOR MORE INFORMATION

You can find more information about the Liquids Pipelines business in our 2023 MD&A, as well as disclosure documents filed by TC Energy, which are available under TC Energy’s profile on SEDAR+ (www.sedarplus.ca).

NON-GAAP MEASURES

This MD&A references the following non-GAAP measures:

•

comparable EBITDA

•

comparable EBIT

•

comparable earnings

•

funds generated from operations

•

comparable funds generated from operations.

We believe such non-GAAP measures improve our ability to compare results between reporting periods and enhance understanding of our operating performance. These measures do not have any standardized meaning as prescribed by GAAP and therefore may not be comparable to similar measures presented by other entities. Discussions throughout this MD&A on the factors impacting comparable earnings are consistent with the factors that impact net income (loss), except where noted otherwise. Discussions throughout this MD&A on the factors impacting comparable earnings before interest, taxes, depreciation and amortization (comparable EBITDA) and comparable earnings before interest and taxes (comparable EBIT) are consistent with the factors that impact earnings, except where noted otherwise.

Comparable measures

We calculate comparable measures by adjusting certain GAAP measures for specific items we believe are significant but not reflective of our underlying operations in the period. Except as otherwise described herein, these comparable measures are calculated on a consistent basis from period to period and are adjusted for specific items in each period, as applicable.

Our decision not to adjust for a specific item in reporting comparable measures is subjective and made after careful consideration. We adjust for the following items:

•

gains or losses on sales of assets or assets held for sale

•

valuation allowances and adjustments resulting from changes in legislation and enacted tax rates

•

unrealized fair value adjustments related to risk management activities

•

legal, contractual, bankruptcy and other settlements

•

impairment of plant, property and equipment, equity investments and other assets

•

acquisition, integration and restructuring costs.

4 | Liquids Pipelines Business First Quarter 2024

We exclude from comparable measures the unrealized gains and losses from changes in the fair value of derivatives related to commodity price risk management activities. These derivatives generally provide effective economic hedges but do not meet the criteria for hedge accounting. These changes in fair value are recorded in net income. As these amounts do not accurately reflect the gains and losses that will be realized at settlement, we do not consider them reflective of our underlying operations.

In third quarter 2023, TC Energy announced plans to separate into two independent, investment-grade, publicly listed companies through the spinoff Transaction. Separation costs related to the spinoff Transaction recognized in our results primarily include internal costs and external fees related to separation activities. These items have been excluded from comparable measures as we do not consider them reflective of our ongoing underlying operations.

The following table identifies our non-GAAP measures against their most directly comparable GAAP measures:


Comparable measure		GAAP measure

comparable EBITDA		earnings (losses)

comparable EBIT		earnings (losses)

comparable earnings		net income (loss)

funds generated from operations		net cash provided by operations

comparable funds generated from operations		net cash provided by operations

Comparable EBITDA and comparable EBIT

Comparable EBITDA represents earnings (losses) adjusted for specific items described in the Comparable measures section above, excluding charges for depreciation and amortization. We use comparable EBITDA as a measure of our earnings from ongoing operations as it is a useful indicator of our performance. Comparable EBIT represents earnings (losses) adjusted for specific items and is an effective tool for evaluating trends. Refer to the Financial results section for a reconciliation to earnings (losses).

Comparable earnings

Comparable earnings represents Net income adjusted for specific items described in the Comparable measures section above. Comparable earnings is comprised of earnings (losses), Interest expense, Interest income and other and Income tax (expense) recovery, adjusted for specific items. Refer to the Financial highlights section for reconciliations to Net income.

Funds generated from operations and comparable funds generated from operations

Funds generated from operations reflects net cash provided by operations before changes in operating working capital. The components of changes in working capital are disclosed in our 2023 Combined carve-out financial statements. We believe funds generated from operations is a useful measure of our operating cash flows because it excludes fluctuations from working capital balances, which do not necessarily reflect underlying operations in the same period, and is used to provide a consistent measure of the cash-generating ability of our business. Comparable funds generated from operations is adjusted for the cash impact of specific items described in the Comparable measures section above. Refer to the Financial Condition section for a reconciliation to Net cash provided by operations.

Liquids Pipelines Business First Quarter 2024 | 5

Financial highlights


	three months ended March 31
(millions of $)	2024		2023
Income
Revenues		734		555
Net income (loss)		150		130
Comparable EBITDA¹		404		316
Comparable earnings¹		155		179
Cash flows
Net cash provided by operations		160		293
Comparable funds generated from operations		252		308
Capital spending²		17		13
Proceeds from sales of assets, net of transaction costs		13		63

1	Comparable EBITDA, comparable earnings and comparable funds generated from operations are all non-GAAP measures. Additional information on Earnings (losses), the most directly comparable GAAP measure, can be found in the Earnings and Net Income table set forth below.

2	Capital spending reflects cash flows associated with our Capital expenditures and Contributions to equity investments. Refer to the Financial condition – Cash (used in) provided by investing activities section for additional information.


	three months ended March 31
(millions of $)	2024			2023
Earnings (losses)		315			177
Interest expense		(128	)		(30	)
Interest income and other		10			17

Income (loss) before income taxes		197			164
Income tax (expense) recovery		(47	)		(34	)

Net income (loss)		150			130

Net income (loss) increased by $20 million for the three months ended March 31, 2024, compared to the same period in 2023. The following specific items were recognized in Net income (loss) and were excluded from comparable earnings:

2024 results

•

a $4 million after-tax charge for the three months ended March 31, 2024 incurred due to separation costs related to the spinoff Transaction (2023 – nil).

2023 results

•

a $49 million after-tax charge as a result of the FERC Administrative Law Judge initial decision on Keystone issued in February 2023 in respect of a tolling-related complaint pertaining to amounts recognized from 2018 to 2022 which consists of a one-time, pre-tax charge of $57 million and accrued pre-tax carrying charges of $6 million

•

after-tax preservation and other costs for Keystone XL pipeline project assets of $4 million for the three months ended March 31, 2023, which could not be accrued as part of the Keystone XL asset impairment charge.

6 | Liquids Pipelines Business First Quarter 2024

Net income in each period included unrealized gains and losses from changes in our risk management activities, all of which we exclude along with the above noted items, to arrive at comparable earnings. A reconciliation of Net income (loss) to comparable earnings is shown in the following table.

RECONCILIATION OF NET INCOME (LOSS) TO COMPARABLE EARNINGS


	three months ended March 31
(millions of $)	2024		2023
Net income (loss)		150		130
Specific items (net of tax):
Liquids Pipelines business separation costs		4		—
Keystone regulatory decisions		—		49
Keystone XL preservation and other		—		4
Risk management activities		1		(4	)

Comparable earnings		155		179

COMPARABLE EBITDA TO COMPARABLE EARNINGS

Comparable EBITDA represents earnings (losses) adjusted for the specific items described above and excludes charges for depreciation and amortization. For further information on our reconciliation of comparable EBITDA to earnings (losses) refer to the Financial results section.


	three months ended March 31
(millions of $)	2024			2023
Comparable EBITDA		404			316
Depreciation and amortization		(83	)		(82	)
Interest expense included in comparable earnings		(128	)		(24	)
Interest income and other		10			17
Income tax (expense) recovery included in comparable earnings		(48	)		(48	)

Comparable earnings		155			179

Comparable earnings – 2024 versus 2023

Comparable earnings decreased by $24 million for the three months ended March 31, 2024 compared to the same period in 2023 and was primarily the net effect of:

•

changes in comparable EBITDA described in the Financial Results section

•

higher interest expense due to long-term debt issuances to affiliates in third quarter 2023.

Liquids Pipelines Business First Quarter 2024 | 7

Financial Results

The following is a reconciliation of comparable EBITDA and comparable EBIT (our non-GAAP measures) to earnings (losses) (the most directly comparable GAAP measure).


	three months ended March 31
(millions of $)	2024			2023
Keystone Pipeline System		389			301
Intra-Alberta pipelines¹		17			17
Other		(2	)		(2	)

Comparable EBITDA		404			316
Depreciation and amortization		(83	)		(82	)

Comparable EBIT		321			234
Specific items:
Liquids Pipelines business separation costs		(5	)		—
Keystone regulatory decisions		—			(57	)
Keystone XL preservation and other		—			(5	)
Risk management activities		(1	)		5

Earnings (losses)		315			177

Comparable EBITDA denominated as follows:
Canadian dollars		99			91
U.S. dollars		226			166
Foreign exchange impact		79			59

Comparable EBITDA		404			316

1	Intra-Alberta pipelines include Grand Rapids and White Spruce.

Earnings increased by $138 million for the three months ended March 31, 2024 compared to the same period in 2023 and included the above specific items which have been excluded from our calculation of comparable EBITDA and comparable EBIT. Refer to the Financial Highlights section for additional information on specific items.

Higher U.S. dollar-denominated earnings for the three months ended March 31, 2024 had a positive impact on the Canadian dollar equivalent earnings from our U.S. operations compared to the same period in 2023.

Comparable EBITDA increased by $88 million for the three months ended March 31, 2024 compared to the same period in 2023 primarily due to the effect of:

•

higher uncontracted volumes and rates on the Keystone Pipeline System

•

higher contracted volumes on the U.S. Gulf Coast section of the Keystone Pipeline System.

Depreciation and amortization was consistent for the three months ended March 31, 2024 compared to the same period in 2023.

8 | Liquids Pipelines Business First Quarter 2024

FOREIGN EXCHANGE

Certain of our entities generate all or most of their earnings in U.S. dollars and, since we report our financial results in Canadian dollars, changes in the value of the U.S. dollar against the Canadian dollar directly affect our comparable EBITDA and may also impact comparable earnings. If our U.S. operations continue to grow, this exposure would increase. A portion of the U.S. dollar-denominated comparable EBITDA exposure is naturally offset by U.S. dollar-denominated amounts below comparable EBITDA within Depreciation and amortization, Interest expense and other income statement line items.

The components of our financial results denominated in U.S. dollars are set out in the table below. Comparable EBITDA is a non-GAAP measure.

Pre-tax U.S. dollar-denominated income and expense items


	three months ended March 31
(millions of US$)	2024			2023
Comparable EBITDA		226			166
Depreciation and amortization		(48	)		(47	)
Interest expense on long-term debt to affiliates		(64	)		(17	)

		114			102
Average exchange rate - U.S. to Canadian dollars		1.35			1.35

OTHER INCOME STATEMENT ITEMS

Interest Expense


	three months ended March 31
(millions of $)	2024			2023
Interest expense on long-term debt to affiliates
Canadian dollar-denominated		(37	)		—
U.S. dollar-denominated		(64	)		(17	)
Foreign exchange impact		(23	)		(6	)

		(124	)		(23	)
Other interest and amortization expense		(4	)		(1	)

Interest expense included in comparable earnings		(128	)		(24	)
Specific item:
Keystone regulatory decisions		—			(6	)

Interest expense		(128	)		(30	)

Interest expense increased by $98 million for the three months ended March 31, 2024 compared to the same period in 2023 and included accrued carrying charges of $6 million for the three months ended March 31, 2023 as a result of a pre-tax charge related to the FERC Administrative Law Judge initial decision on Keystone. This decision was issued in February 2023 in respect of a tolling-related complaint pertaining to amounts recognized from 2018 to 2022. These carrying charges have been removed from our calculation of Interest expense included in comparable earnings.

Interest expense included in comparable earnings increased by $104 million for the three months ended March 31, 2024 compared to the same period in 2023 primarily due to the net effect of:

•

long-term debt to affiliates issuances in third quarter 2023.

•

higher effective interest rates in 2024 compared to 2023.

Liquids Pipelines Business First Quarter 2024 | 9

Interest Income and Other


	three months ended March 31
(millions of $)	2024		2023
Interest income and other		10		17

Interest income and other decreased by $7 million for the three months ended March 31, 2024 compared to the same period in 2023 primarily due to lower cash pooling balances with affiliates, partially offset by higher cash balances.

Income tax (expense) recovery


	three months ended March 31
(millions of $)	2024			2023
Income tax (expense) recovery included in comparable earnings		(48	)		(48	)
Specific items:
Liquids Pipelines business separation costs		1			—
Keystone regulatory decisions		—			14
Keystone XL preservation and other		—			1
Risk management activities		—			(1	)

Income tax (expense) recovery		(47	)		(34	)

Income tax expense included in comparable earnings was consistent for the three months ended March 31, 2024 compared to the same period in 2023.

Income tax expense increased by $13 million for the three months ended March 31, 2024 compared to the same period in 2023 primarily due to higher earnings subject to tax in 2024 and favourable U.S. state tax rate changes in 2023.

10 | Liquids Pipelines Business First Quarter 2024

Outlook

We expect our 2024 comparable EBITDA to be consistent with 2023.

We continue to monitor developments in energy markets, our construction projects and regulatory proceedings for any potential impacts on the above outlook.

Our expected total capital expenditures for 2024 as outlined in 2023 MD&A remain materially unchanged. Our 2024 capital program is focused on normal course maintenance capital expenditures.

Capital program

Our capital program consists of long-life infrastructure assets supported by long-term commercial arrangements with creditworthy counterparties and/or regulated business models.

Our capital program consists of approximately $354 million of secured projects that represent commercially supported, committed projects that are either under construction or are preparing to commence the permitting stage.

During the three months ended March 31, 2024, approximately $5 million of maintenance capital expenditures were incurred.

All projects are subject to cost and timing adjustments due to factors including weather, market conditions, route refinement, land acquisition, permitting conditions, scheduling and timing of regulatory permits, as well as other potential restrictions and uncertainties, including inflationary pressures on labour and materials. Amounts exclude capitalized interest, where applicable.

Secured projects

Estimated and incurred project costs referred to in the following table include 100 per cent of the capital expenditures related to our wholly-owned projects and our share of equity contributions to fund projects within our equity investments.


(millions of $)	Expected in-service date		Estimated project cost		Project costs incurred at March 31, 2024
Recoverable maintenance capital expenditures		2024-2026		353		5
Non-recoverable maintenance capital expenditures		2024-2026		1		—

Total secured projects				354		5

Financial condition

Historically, our business has generated positive cash flows from operations. Following the spinoff Transaction, our capital structure and sources of liquidity will change from our historical practices. Our ability to fund our operating needs will depend on our ability to continue to generate positive cash flow from operations, and on our ability to obtain debt financing on acceptable terms or to issue equity. Based upon our history of generating positive cash flows, we believe our existing cash and cash generated from operations will be sufficient to service our current obligations. Management believes that our cash balances and funds provided by operating activities, along with expected borrowing capacity and access to capital markets, taken as a whole, provide adequate liquidity to meet all of our current and long-term obligations when due, including third-party debt that we expect to incur in connection with the spinoff Transaction to refinance our long-term debt to affiliates and to fund capital expenditures.

At March 31, 2024, our current assets totaled $4.6 billion and current liabilities amounted to $3.5 billion, providing us with a working capital surplus of $1.1 billion compared to $0.8 billion at December 31, 2023. We consider these working capital levels to be normal for our business.

Liquids Pipelines Business First Quarter 2024 | 11

CASH PROVIDED BY OPERATING ACTIVITIES


	three months ended March 31
(millions of $)	2024		2023
Net cash provided by operations		160		293
Increase (decrease) in operating working capital		88		(38	)

Funds generated from operations		248		255
Specific items:
Liquids Pipelines business separation costs, net of current income tax		4		—
Keystone regulatory decisions, net of current income tax		—		49
Keystone XL preservation and other, net of current income tax		—		4

Comparable funds generated from operations		252		308

Net cash provided by operations

Net cash provided by operations decreased by $133 million for the three months ended March 31, 2024 compared to the same period in 2023 primarily due to timing of working capital changes.

Comparable funds generated from operations

Comparable funds generated from operations, a non-GAAP measure, helps us assess the cash generating ability of our businesses by excluding the timing effects of working capital changes as well as the cash impact of our specific items.

Comparable funds generated from operations decreased by $56 million for the three months ended March 31, 2024 compared to the same period in 2023 primarily due to higher interest expense, partially offset by increased comparable EBITDA.

CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES


	three months ended March 31
(millions of $)	2024			2023
Capital spending
Capital expenditures		(17	)		(13	)
Keystone XL contractual recoveries		2			2
Proceeds from sale of assets, net of transaction costs		13			63
Deferred amounts and other		—			(3	)

Net cash (used in) provided by investing activities		(2	)		49

Net cash (used in) provided by investing activities decreased by $51 million for the three months ended March 31, 2024 compared to the same period in 2023 primarily due to lower proceeds from the sale of Keystone XL assets.

CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES


	three months ended March 31
(millions of $)	2024			2023
Distributions on Class C interests		(1	)		(41	)
Parent’s net investment contributions (distributions), net		196			(306	)

Net cash (used in) provided by financing activities		195			(347	)

Net cash (used in) provided by financing activities increased by $542 million for the three months ended March 31, 2024 compared to the same period in 2023 primarily due to Parent’s net investment contributions in 2024 compared to Parent’s net investment distributions in 2023.

12 | Liquids Pipelines Business First Quarter 2024

CREDIT FACILITIES

At March 31, 2024, we had a total of $100 million of TransCanada Keystone Pipelines Limited Partnership revolving and non-revolving credit facilities, of which $100 million of short-term borrowing capacity remains available.

On May 1, 2024, we entered into additional $250 million and US$500 million revolving credit facilities with an affiliate.

CONTRACTUAL OBLIGATIONS

Capital expenditure commitments at March 31, 2024 have increased by approximately $7 million from those reported at December 31, 2023, reflecting new contractual commitments.

In February 2024, the Company entered into a 13-year lease contract for its Calgary office space. The total commitment for base rent under the lease contract is $32 million with payments starting in 2025.

There were no other material changes to our contractual obligations in first quarter 2024 or to payments due in the next five years or thereafter. Refer to 2023 MD&A for additional information about our contractual obligations.

Liquids Pipelines Business First Quarter 2024 | 13

Financial risks and financial instruments

We are exposed to various financial risks and have strategies, policies and limits in place to manage the impact of these risks on our earnings and cash flows and, ultimately, shareholder value.

Risk management strategies, policies and limits are designed to ensure our risks and related exposures are in line with our business objectives and risk tolerance.

Refer to our 2023 Liquids Pipelines business carve-out MD&A for additional information about the risks we face in our business which have not changed materially since December 31, 2023, other than as noted within this MD&A.

INTEREST RATE RISK

We utilize debt issued to affiliates to finance our operations which exposes us to interest rate risk. We rely on TC Energy for funding and management of our interest rate risk.

FOREIGN EXCHANGE RISK

Certain of our entities generate all or most of their earnings in U.S. dollars and, since we report our financial results in Canadian dollars, changes in the value of the U.S. dollar against the Canadian dollar directly affect our comparable EBITDA and may also impact comparable earnings. If our U.S. dollar-denominated operations continue to grow, this exposure increases. A portion of this risk is offset by interest expense on our U.S. dollar-denominated debt.

COUNTERPARTY CREDIT RISK

Our exposure to counterparty credit risk includes cash and cash equivalents, accounts receivable, environmental provision and certain contractual recoveries, available-for-sale assets and the fair value of derivative assets.

At times, our counterparties may endure financial challenges resulting from commodity price and market volatility, economic instability and political or regulatory changes. In addition to actively monitoring these situations, there are a number of factors that reduce our counterparty credit risk exposure in the event of default, including:

•

contractual rights and remedies together with the utilization of contractually-based financial assurances

•

the competitive position of our assets and the demand for our services

•

potential recovery of unpaid amounts through bankruptcy and similar proceedings.

We review financial assets carried at amortized cost for impairment using the lifetime expected loss of the financial asset at initial recognition and throughout the life of the financial asset. We use historical credit loss and recovery data, adjusted for our judgment regarding current economic and credit conditions, along with reasonable and supportable forecasts to determine any impairment, which is recognized in Plant operating costs and other. We had no significant credit losses and no significant amounts past due or impaired, as well as no significant credit risk concentrations at March 31, 2024 and December 31, 2023.

LIQUIDITY RISK

Liquidity risk is the risk that we will not be able to meet our financial obligations as they come due. We have relied on TC Energy for funding and management of our liquidity risk; however, South Bow will be responsible to manage liquidity risk following completion of the spinoff Transaction.

14 | Liquids Pipelines Business First Quarter 2024

RELATED PARTY TRANSACTIONS

TC Energy is responsible for providing certain administrative and operating services (corporate expenses) necessary to operate our business. As such, the allocation of corporate expenses attributable to us are considered related party transactions. Allocated corporate expenses are capitalized or expensed based on the nature of the underlying expenditure. We also incur operating costs with TC Energy’s subsidiaries for costs that are not allocated but are direct costs to us that are capitalized or expensed based on the nature of the underlying expenditure. The allocated corporate expenses and direct operating costs as well as interest expense on Long-term debt due to affiliates and interest income with affiliates were as follows:


	three months ended March 31
(millions of $)	2024		2023
Allocated Corporate Expenses
Plant operating costs and other		36		54
Plant, property and equipment		1		1
Equity investments¹		1		6

		38		61
Direct Operating Costs
Plant operating costs and other		46		30
Plant, property and equipment		2		1
Equity investments²		1		2

		49		33
Interest Income with Affiliates		—		15
Interest Expense on Long-Term Debt Due to Affiliates		124		25

1	For the three months ended March 31, 2024, $1 million (2023 – $5 million) impacted Income from equity investments.

2	For the three months ended March 31, 2024, $1 million (2023 – $2 million) impacted Income from equity investments.

The outstanding balances with affiliates at March 31, 2024 and December 31, 2023 were as follows:


(millions of $)	March 31, 2024		December 31, 2023		Affected line item on the Condensed combined carve-out balance sheet
(millions of $)	March 31, 2024		December 31, 2023
Due to affiliates		230		137	Payable to affiliates
Due from affiliates		3		4	Accounts receivable
Long-term debt to affiliates		8,018		7,879	Long-term debt to affiliates

Refer to our Condensed combined carve-out financial statements, Note 6, Keystone environmental provision, for discussion of insurance recoveries from TC Energy’s wholly-owned captive insurance subsidiary.

FINANCIAL INSTRUMENTS

With the exception of Long-term debt to affiliates, our derivative and non-derivative financial instruments are recorded on the Condensed combined carve-out balance sheet at fair value or amounts that approximate fair value. In addition, fair value accounting is not required for other financial instruments that qualify for certain accounting exemptions.

Derivative instruments

We use derivative instruments to reduce volatility associated with fluctuations in commodity prices. Derivative instruments are recorded at fair value.

The majority of derivative instruments have been entered into as economic hedges to manage our exposure to market risk and are classified as held-for-trading. Changes in the fair value of held-for-trading derivative instruments are recorded in net income in the period of change. This may expose us to increased variability in reported operating results since the fair value of the held-for-trading derivative instruments can fluctuate significantly from period to period.

Liquids Pipelines Business First Quarter 2024 | 15

Balance sheet presentation of derivative instruments

The balance sheet presentation of the fair value of derivative instruments were as follows:


(millions of $)	March 31, 2024			December 31, 2023
Other current assets		942			696
Other long-term assets		6			—
Accounts payable and other		(972	)		(728	)
Other long-term liabilities		(7	)		—

		(31	)		(32	)

Unrealized and realized gains (losses) on commodity derivative instruments


	three months ended March 31
(millions of $)	2024		2023
Derivative Instruments Held for Trading¹
Unrealized gains (losses) in the period		1		4
Realized gains (losses) in the period		140		112

1	Realized and unrealized gains and losses on held-for-trading derivative instruments used to purchase and sell liquids are included on a net basis in Revenues.

For further details on our non-derivative and derivative financial instruments, including classification assumptions made in the calculation of fair value and additional discussion of exposure to risks and mitigation activities, refer to Note 7, Risk management and financial instruments, of our Condensed combined carve-out financial statements.

Other information

CRITICAL ACCOUNTING ESTIMATES AND ACCOUNTING POLICY CHANGES

When we prepare financial statements that conform with U.S. GAAP, we are required to make estimates and assumptions that affect the timing and amounts we record for our assets, liabilities, revenues and expenses because these items may be affected by future events.

We base the estimates and assumptions on the most current information available, using our best judgment. We also regularly assess the assets and liabilities themselves. Refer to 2023 MD&A for critical accounting estimates information.

Accounting changes

Our significant accounting policies have remained unchanged since December 31, 2023 other than as described in Note 2, Accounting changes, of our Condensed combined carve-out financial statements. A summary of our significant accounting policies is included in the audited Combined carve-out financial statements for the year ended December 31, 2023.

16 | Liquids Pipelines Business First Quarter 2024

Quarterly results

SELECTED QUARTERLY FINANCIAL DATA


	2024		2023								2022
(millions of $)	First		Fourth		Third		Second		First		Fourth		Third		Second
Revenues		734		733		715		702		555		624		710		713
Net income (loss)		150		140		121		204		130		238		198		180
Comparable earnings		155		129		170		208		179		206		183		179

FACTORS AFFECTING QUARTERLY FINANCIAL INFORMATION

Quarter-over-quarter revenues and earnings are affected by:

•

regulatory decisions

•

newly constructed assets being placed in service

•

acquisitions and divestitures

•

demand for uncontracted transportation services

•

marketing activities and commodity prices

•

developments outside of the normal course of operations

•

certain fair value adjustments

•

foreign exchange rates.

FACTORS AFFECTING FINANCIAL INFORMATION BY QUARTER

In first quarter 2024, comparable earning also exclude:

•

a $4 million after-tax charge incurred due to Liquids Pipelines business separation costs related to the spinoff Transaction.

In fourth quarter 2023, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $4 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge

•

a $4 million after-tax gain on the sale of Keystone XL project assets and adjustment to the estimate for contractual and legal obligations related to termination activities

•

a $3 million after-tax charge for accrued carrying charges related to the FERC Administrative Law Judge initial decision on Keystone

•

a $2 million after-tax charge for separation costs incurred related to the spinoff Transaction.

In third quarter 2023, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $3 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge.

In second quarter 2023, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $3 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge

•

a $1 million after-tax charge related to Focus Project costs.

Liquids Pipelines Business First Quarter 2024 | 17

In first quarter 2023, comparable earnings also excluded:

•

a $49 million after-tax charge as a result of the FERC Administrative Law Judge initial decision issued in February 2023 in respect of a tolling-related complaint pertaining to amounts recognized from 2018 to 2022

•

preservation and other costs for Keystone XL pipeline project assets of $4 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge.

In fourth quarter 2022, comparable earnings also excluded:

•

a $20 million after-tax charge due to the CER decision on Keystone issued in December 2022 in respect of a tolling-related complaint pertaining to amounts reflected in 2021 and 2020

•

preservation and other costs for Keystone XL pipeline project assets of $8 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge

•

a $90 million after-tax gain on the sale of Keystone XL project assets and reduction to the estimate for contractual and legal obligations related to termination activities.

In third quarter 2022, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $3 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge.

In second quarter 2022, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $3 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge.

18 | Liquids Pipelines Business First Quarter 2024

Glossary


Accounting terms

U.S. GAAP / GAAP		U.S. generally accepted accounting principles

Government and regulatory bodies terms

CER		Canada Energy Regulator
FERC		Federal Energy Regulatory Commission (U.S.)

Liquids Pipelines Business First Quarter 2024 | 19

Exhibit 99.10

Condensed combined carve-out statement of income and comprehensive income


	three months ended March 31
(unaudited - millions of Canadian $)	2024			2023
Revenues		734			555
Income (Loss) from Equity Investments		17			14
Operating and Other Expenses
Plant operating costs and other		215			178
Commodity purchases resold		108			101
Property taxes		30			31
Depreciation and amortization		83			82

		436			392
Financial Charges
Interest expense		128			30
Interest income and other		(10	)		(17	)

		118			13

Income (Loss) before Income Taxes		197			164

Income Tax Expense (Recovery)
Current		40			7
Deferred		7			27

		47			34

Net Income (Loss)		150			130

Foreign currency translation adjustments		114			2

Comprehensive Income (Loss)		264			132

See accompanying Notes to the Condensed combined carve-out financial statements.

20 | Liquids Pipelines Business First Quarter 2024

Condensed combined carve-out statement of cash flows


	three months ended March 31
(unaudited - millions of Canadian $)	2024			2023
Cash Generated from Operations
Net income (loss)		150			130
Depreciation and amortization		83			82
Deferred income taxes		7			27
(Income) loss from equity investments		(17	)		(14	)
Distributions received from operating activities of equity investments		27			31
Unrealized (gains) losses on financial instruments		(1	)		(4	)
Other		(1	)		3
(Increase) decrease in operating working capital		(88	)		38

Net cash provided by operations		160			293

Investing Activities
Capital expenditures		(17	)		(13	)
Proceeds from sales of assets, net of transaction costs		13			63
Keystone XL contractual recoveries		2			2
Deferred amounts and other		—			(3	)

Net cash (used in) provided by investing activities		(2	)		49

Financing Activities
Distributions on Class C Interests		(1	)		(41	)
Parent’s net investment contributions (distributions), net		196			(306	)

Net cash (used in) provided by financing activities		195			(347	)

Effect of Foreign Exchange Rate Changes on Cash and Cash Equivalents		7			—

Increase (Decrease) in Cash and Cash Equivalents		360			(5	)
Cash and Cash Equivalents - Beginning of period		347			5

Cash and Cash Equivalents - End of period		707			—

See accompanying Notes to the Condensed combined carve-out financial statements.

Liquids Pipelines Business First Quarter 2024 | 21

Condensed combined carve-out balance sheet


(unaudited - millions of Canadian $)		March 31, 2024		December 31, 2023
ASSETS
Current Assets
Cash and cash equivalents			707		347
Accounts receivable			2,229		1,775
Inventories			362		211
Environmental provision recovery			162		186
Contractual recoveries			85		83
Other current assets			1,074		851

			4,619		3,453
Plant, Property and Equipment	net of accumulated depreciation of $3,627 and $3,478, respectively		11,297		11,128
Equity Investments			1,067		1,073
Other Long-Term Assets			261		234

			17,244		15,888

LIABILITIES
Current Liabilities
Accounts payable and other			3,253		2,602
Payable to affiliates			230		137

			3,483		2,739
Other Long-Term Liabilities			165		146
Long-Term Debt to Affiliates			8,018		7,879
Deferred Income Tax Liabilities			1,411		1,373

			13,077		12,137
PARENT’S NET INVESTMENT
Parent’s net investment			3,361		3,059
Accumulated other comprehensive income (loss)			806		692

			4,167		3,751

			17,244		15,888

Commitments, Contingencies and Guarantees (Note 8)

Variable Interest Entities (Note 9)

Subsequent Event (Note 11)

See accompanying Notes to the Condensed combined carve-out financial statements.

22 | Liquids Pipelines Business First Quarter 2024

Condensed combined carve-out statement of changes in parent’s net investment


	three months ended March 31
(unaudited - millions of Canadian $)	2024		2023
Parent’s Net Investment
Balance at beginning of period		3,059		9,336
Net income (loss)		150		130
Contributions (distributions), net		152		(310	)

Balance at end of period		3,361		9,156

Accumulated Other Comprehensive Income (Loss)
Balance at beginning of period		692		845
Foreign currency translation adjustments		114		2

Balance at end of period		806		847

Total Parent’s Net Investment		4,167		10,003

See accompanying Notes to the Condensed combined carve-out financial statements.

Liquids Pipelines Business First Quarter 2024 | 23

Notes to Condensed combined carve-out financial statements

(unaudited)

1. BACKGROUND AND BASIS OF PRESENTATION

On July 27, 2023, TC Energy Corporation (TC Energy or the Parent) announced plans to separate into two independent, investment-grade, publicly listed companies through the proposed spinoff of its Liquids Pipelines business (the spinoff Transaction) and on November 8, 2023 TC Energy communicated that the name of the new Liquids Pipelines business will be South Bow Corporation (South Bow). Under the spinoff Transaction, common shareholders of TC Energy as of the record date established for the spinoff Transaction will receive, in exchange for each TC Energy share, one new TC Energy share and 0.2 of a South Bow common share. The Canadian and U.S. tax rulings as well as shareholders’ approval have been received and subject to receipt of the remaining approvals and conditions of the spinoff Transaction, TC Energy expects that the effective date will occur between late third quarter and mid fourth quarter 2024.

These Condensed combined carve-out financial statements primarily represent the group of liquids pipeline assets, which has been operated as a part of TC Energy and reflect the Condensed combined carve-out balance sheets, Condensed combined carve-out statements of income and comprehensive income, Condensed combined carve-out statements of cash flows and Condensed combined carve-out statements of changes in parent’s net investment in the Liquids Pipelines business (the Company).

The Company has historically operated as part of TC Energy and not as a separate entity. The Condensed combined carve-out financial statements have been prepared for the proposed spinoff of the Company and have been derived from the consolidated financial statements and accounting records of TC Energy, including the historical cost basis of assets and liabilities comprising the Company, as well as the historical revenues, direct costs and allocations of indirect costs attributable to the operations of the Company using the historical accounting policies applied by TC Energy.

These Condensed combined carve-out financial statements of the Company have been prepared by management in accordance with U.S. GAAP. The accounting policies applied are consistent with those outlined in the Company’s annual audited Combined carve-out financial statements for the year ended December 31, 2023. Capitalized and abbreviated terms that are used but not otherwise defined herein are identified in the audited Combined carve-out financial statements for the year ended December 31, 2023.

These Condensed combined carve-out financial statements reflect adjustments, all of which are normal recurring adjustments that are, in the opinion of management, necessary to reflect fairly the financial position and results of operations for the respective periods. These Condensed combined carve-out financial statements do not include all disclosures required in the annual financial statements and should be read in conjunction with the audited Combined carve-out financial statements for the year ended December 31, 2023.

Earnings for interim periods may not be indicative of results for the fiscal year primarily due to fluctuations in throughput volumes on the Keystone Pipeline System and marketing activities.

In addition to the factors mentioned above, revenues and earnings are impacted by fluctuations in foreign exchange rates, mainly related to the Company’s U.S. dollar-denominated operations.

24 | Liquids Pipelines Business First Quarter 2024

Use of Estimates and Judgments

In preparing these Condensed combined carve-out financial statements, the Company is required to make estimates and assumptions that affect both the amount and timing of recording assets, liabilities, revenues and expenses since the determination of these items may be dependent on future events. The Company uses the most current information available and exercises careful judgment in making these estimates and assumptions. In the opinion of management, these Condensed combined carve-out financial statements have been properly prepared within reasonable limits of materiality and within the framework of the Company’s significant accounting policies included in the audited Combined carve-out financial statements for the year ended December 31, 2023.

2. ACCOUNTING CHANGES

Future Accounting Changes

Income Taxes

In December 2023, the FASB issued new guidance to enhance the transparency and decision usefulness of income tax disclosures through improvements to the rate reconciliation and income taxes paid information. The guidance also includes certain other amendments to improve the effectiveness of income tax disclosures. This new guidance is effective for the annual period beginning January 1, 2025. The guidance is applied prospectively with retrospective application permitted. Early adoption is permitted for annual financial statements not yet issued. The Company has determined that this guidance will not have a material impact on its Condensed combined carve-out financial statements.

Segment Reporting

In November 2023, the FASB issued new guidance to improve disclosures about a public entity’s reportable segments and address requests from investors for additional, more detailed information about a reportable segment’s expenses. The guidance is effective for annual periods beginning January 1, 2024 and interim periods beginning January 1, 2025. Early adoption is permitted and the guidance is applied retrospectively. The Company is currently assessing the impact of the standard on its Condensed combined carve-out financial statements.

3. SEGMENTED INFORMATION

three months ended March 31, 2024

Keystone
Pipeline System

All other
segments

Total

(unaudited - millions of Canadian $)

Revenues

728

734

Income (loss) from equity investments

Plant operating costs and other

(211

)

(215

)

Commodity purchases resold

(108

)

—

(108

)

Property taxes

(30

)

—

(30

)

Depreciation and amortization

(82

)

(83

)

Earnings (Losses)

301

315

Interest expense

(128

)

Interest income and other

Income (Loss) before Income Taxes

197

Income tax (expense) recovery

(47

)

Net Income (Loss)

150

Capital Spending¹

Capital expenditures

1	Included in Investing activities in the Condensed combined carve-out statement of cash flows.

Liquids Pipelines Business First Quarter 2024 | 25


three months ended March 31, 2023	Keystone Pipeline System			All other segments			Total
(unaudited - millions of Canadian $)	Keystone Pipeline System			All other segments			Total
Revenues		550			5			555
Income (loss) from equity investments		1			13			14
Plant operating costs and other		(175	)		(3	)		(178	)
Commodity purchases resold		(101	)		—			(101	)
Property taxes		(31	)		—			(31	)
Depreciation and amortization		(81	)		(1	)		(82	)

Earnings (Losses)		163			14			177

Interest expense								(30	)
Interest income and other								17

Income (Loss) before Income Taxes								164
Income tax (expense) recovery								(34	)

Net Income (Loss)								130

Capital Spending¹
Capital expenditures		13			—			13

1	Included in Investing activities in the Condensed combined carve-out statement of cash flows.

Total Assets by Segment


(unaudited - millions of Canadian $)	March 31, 2024		December 31, 2023
Keystone Pipeline System		15,905		14,340
All other segments		1,339		1,548

		17,244		15,888

4. REVENUES

Disaggregation of Revenues

The following table summarizes total Revenues for the three months ended March 31, 2024 and 2023:


three months ended March 31	2024						2023
(unaudited - millions of Canadian $)	Keystone Pipeline System		All other segments		Total		Keystone Pipeline System		All other segments		Total
Revenues from contracts with customers
Capacity arrangements and transportation		586		6		592		433		5		438
Other		3		—		3		1		—		1

		589		6		595		434		5		439
Other revenues¹						139						116

						734						555

Other revenues primarily relate to the Company’s marketing activities and financial instruments. These arrangements are not in the scope of the revenue from contracts with customer guidance. Refer to Note 7, Risk management and financial instruments, for additional information on financial instruments.

26 | Liquids Pipelines Business First Quarter 2024

For the three months ended March 31, 2024, three major customers accounted for $213 million, $108 million and $59 million in revenues, each representing more than 10 per cent of total revenues from contracts with customers (2023 – four customers, $169 million, $82 million, $50 million and $47 million, respectively).

Contract Balances


(unaudited - millions of Canadian $)	March 31, 2024		December 31, 2023		Affected line item on the Condensed combined carve-out balance sheet
(unaudited - millions of Canadian $)	March 31, 2024		December 31, 2023
Receivables from contracts with customers		416		445	Accounts receivable
Short-term contract liabilities¹		23		22	Accounts payable and other
Long-term contract liabilities		22		22	Other long-term liabilities

1	During the three months ended March 31, 2024, $4 million (2023 – $4 million) of revenues were recognized that were included in contract liabilities at the beginning of the period.

Contract liabilities represent unearned revenue for contracted services.

Future Revenues from Remaining Performance Obligations

As at March 31, 2024, future revenues from long-term pipeline capacity arrangements and transportation extending through 2044 are approximately $9.2 billion, of which approximately $0.9 billion is expected to be recognized during the remainder of 2024.

5. INCOME TAXES

Effective Tax Rates

The effective income tax rates were 24 per cent and 21 per cent for the three months ended March 31, 2024 and 2023, respectively. The increase in effective income tax rate was primarily due to favourable U.S. state tax rate adjustments in 2023.

6. KEYSTONE ENVIRONMENTAL PROVISION

In December 2022, a pipeline incident occurred in Washington County, Kansas on the Keystone Pipeline System. At December 31, 2023, the Company had accrued a life-to-date environmental liability of $794 million, before expected insurance recoveries and not including potential fines and penalties which continue to be indeterminable. For the three months ended March 31, 2024, amounts paid for the environmental remediation liability were $57 million (2023 – $181 million). The remaining balance reflected in Accounts payable and other and Other long-term liabilities on the Company’s Condensed combined carve-out balance sheet was $67 million and $10 million, respectively at March 31, 2024 (December 31, 2023 – $122 million and $9 million, respectively).

The expected recovery of the remaining estimated environmental remediation costs recorded in Environmental provision recovery was $162 million, including $37 million from TC Energy’s wholly-owned captive insurance subsidiary, and $34 million in Other long-term assets at March 31, 2024 (December 31, 2023 – $186 million, including $36 million from TC Energy’s wholly-owned captive insurance subsidiary, and $33 million, respectively). For the three months ended March 31, 2024, the Company received $28 million (2023 – $102 million, including $7 million from TC Energy’s wholly-owned captive insurance subsidiary) from its insurance policies related to the costs for environmental remediation.

7. RISK MANAGEMENT AND FINANCIAL INSTRUMENTS

Risk Management Overview

The Company has exposure to various financial risks and has strategies, policies and limits in place to manage the impact of these risks on its earnings and cash flows.

Liquids Pipelines Business First Quarter 2024 | 27

Counterparty Credit Risk

The Company’s exposure to counterparty credit risk includes its cash and cash equivalents, accounts receivable, environmental provision and certain contractual recoveries, available-for-sale assets and the fair value of derivative assets.

Market events causing disruptions in global energy demand and supply may contribute to economic uncertainties impacting a number of the Company’s customers. While the majority of the Company’s credit exposure is to large creditworthy entities, the Company maintains close monitoring and communication with those counterparties experiencing greater financial pressures. Refer to the audited Combined carve-out financial statements for the year ended December 31, 2023 for more information about the factors that mitigate the Company’s counterparty credit risk exposure.

The Company reviews financial assets carried at amortized cost for impairment using the lifetime expected loss of the financial asset at initial recognition and throughout the life of the financial asset. The Company uses historical credit loss and recovery data, adjusted for management’s judgment regarding current economic and credit conditions, along with reasonable and supportable forecasts to determine any impairment, which is recognized in Plant operating costs and other.

At March 31, 2024, the Company had no significant credit losses, and there were no significant credit risk concentrations or amounts past due or impaired.

The Company has significant credit and performance exposure to financial institutions that hold cash. The Company’s portfolio of financial sector exposure consists primarily of highly-rated investment grade, systemically important financial institutions.

Non-Derivative Financial Instruments

Fair value of non-derivative financial instruments

Available-for-sale assets are recorded at fair value which is calculated using quoted market prices where available. Certain non-derivative financial instruments included in Cash and cash equivalents, Accounts receivable, Environmental provision recovery, Contractual recoveries, Other current assets, Other long-term assets, Accounts payable and other, Payable to affiliates and Other long-term liabilities have carrying amounts that approximate their fair value due to the nature of the item or the short time to maturity and are classified in Level II of the fair value hierarchy.

Credit risk has been taken into consideration when calculating the fair value of non-derivative financial instruments.

Balance sheet presentation of non-derivative financial instruments

The following table details the fair value of non-derivative financial instruments, excluding those where carrying amounts approximate fair value, and would be classified in Level II of the fair value hierarchy:

March 31, 2024

December 31, 2023

(unaudited - millions of Canadian $)

Carrying
amount

Fair
value

Carrying
amount

Fair
value

Long-term debt to affiliates

(8,018

)

(8,133

)

(7,879

)

(8,138

)

Available-for-sale assets summary

The following tables summarize additional information about the Company’s LMCI restricted investments that were classified as available-for-sale assets:


(unaudited - millions of Canadian $)	March 31, 2024		December 31, 2023
Fair values of fixed income securities^1,2
Maturing within 1 year		—		1
Maturing within 1-5 years		—		—
Maturing within 5-10 years		13		—
Maturing after 10 years		86		102

		99		103

1	Available-for-sale assets are recorded at fair value and included in Other long-term assets on the Company’s Condensed combined carve-out balance sheet.

2	Classified in Level II of the fair value hierarchy.

28 | Liquids Pipelines Business First Quarter 2024


	three months ended March 31
(unaudited - millions of Canadian $)	2024			2023
Net unrealized gains (losses)¹		(5	)		6
Net realized gains (losses)^1,2		(1	)		(2	)

Unrealized and realized gains (losses) arising from changes in the fair value of LMCI restricted investments impact the subsequent amounts to be collected through tolls to cover future pipeline abandonment costs. As a result, the Company records these gains and losses within Other long-term assets and liabilities.

2	Realized gains (losses) on the sale of LMCI restricted investments are determined using the average cost basis.

Derivative Instruments

Fair value of derivative instruments

The fair value of commodity derivatives has been calculated using quoted market prices where available. In the absence of quoted market prices, third-party broker quotes or other valuation techniques have been used. The fair value of options has been calculated using the Black-Scholes pricing model. Credit risk has been taken into consideration when calculating the fair value of derivative instruments. Unrealized gains and losses on derivative instruments are not necessarily representative of the amounts that will be realized on settlement.

Even though the derivatives are considered to be effective economic hedges, they do not meet the specific criteria for hedge accounting treatment and are accounted for at fair value with changes in fair value recorded in net income in the period of change. This may expose the Company to increased variability in reported earnings because the fair value of the derivative instruments can fluctuate significantly from period to period.

Balance sheet presentation of derivative instruments

The balance sheet classification of the fair value of held-for-trading, commodity derivative instruments was as follows:


(unaudited - millions of Canadian $)	March 31, 2024			December 31, 2023
Derivatives Assets
Other current assets		942			696
Other long-term assets		6			—

		948			696

Derivative Liabilities
Accounts payable and other		(972	)		(728	)
Other long-term liabilities		(7	)		—

		(979	)		(728	)

Total Derivatives^1,2		(31	)		(32	)

1	Fair value equals carrying value.

2	Includes purchases and sales.

The majority of derivative instruments held for trading have been entered into for risk management purposes and all are subject to TC Energy’s risk management strategies, policies and limits. These include derivatives that have not been designated as hedges or do not qualify for hedge accounting treatment but have been entered into as economic hedges to manage the Company’s exposures to market risk.

Liquids Pipelines Business First Quarter 2024 |29

Notional and maturity summary

The maturity and notional amount or quantity outstanding related to the Company’s liquids commodity derivative instruments was as follows:


(unaudited)	March 31, 2024		December 31, 2023
Net sales (purchases)¹		12		(7	)
Maturity dates		2024-2025		2024

1	Volumes are in MMBbls.

Unrealized and Realized Gains (Losses) on Commodity Derivative Instruments


	three months ended March 31
(unaudited - millions of Canadian $)	2024		2023
Derivative Instruments Held for Trading¹
Unrealized gains (losses) in the period		1		4
Realized gains (losses) in the period		140		112

1	Realized and unrealized gains and losses on held-for-trading derivative instruments used to purchase and sell liquids are included on a net basis in Revenues.

Offsetting of derivative instruments

The Company enters into commodity derivative contracts with the right to offset in the normal course of business as well as in the event of default. The Company has no master netting agreements; however, similar contracts are entered into containing rights to offset. The Company has elected to present the fair value of derivative instruments with the right to offset on a gross basis on the Condensed combined carve-out balance sheet. The following tables show the impact on the presentation of the fair value of derivative instrument assets and liabilities had the Company elected to present these contracts on a net basis:

at March 31, 2024

Gross derivative
instruments

Amounts available
for offset¹

Net amounts

(unaudited - millions of Canadian $)

Derivative instrument assets

948

(939

)

Derivative instrument liabilities

(979

)

939

(40

)

1	Amounts available for offset do not include cash collateral pledged or received.


at December 31, 2023	Gross Derivative Instruments			Amounts Available for Offset¹			Net Amounts
(unaudited - millions of Canadian $)	Gross Derivative Instruments			Amounts Available for Offset¹			Net Amounts
Derivative instrument assets		696			(681	)		15
Derivative instrument liabilities		(728	)		681			(47	)

1	Amounts available for offset do not include cash collateral pledged or received.

With respect to the derivative instruments presented above, the Company provided cash collateral of $79 million and no letters of credit at March 31, 2024 (December 31, 2023 – $92 million and nil, respectively) to its counterparties. At March 31, 2024, the Company held no cash collateral and $75 million in letters of credit (December 31, 2023 – nil and $4 million, respectively) from counterparties on asset exposures.

Credit-risk-related contingent features of derivative instruments

Derivative contracts entered into to manage market risk often contain financial assurance provisions that allow parties to the contracts to manage credit risk. These provisions may require collateral to be provided if a credit-risk-related contingent event occurs, such as a downgrade in the Company’s credit rating to non-investment grade. The Company may also need to provide collateral if the fair value of its derivative financial instruments exceeds pre-defined exposure limits.

Based on contracts in place and market prices at March 31, 2024, the Company had no derivative instruments with credit-risk-related contingent features in a net liability position for which no collateral was provided (December 31, 2023 – less than $1 million). Should the fair value of derivative instruments exceed pre-defined contractual exposure limit thresholds, additional collateral may need to be provided. The Company has sufficient liquidity in the form of cash and TC Energy’s support to meet these contingent obligations should they arise.

30 | Liquids Pipelines Business First Quarter 2024

Fair Value Hierarchy

The Company’s financial assets and liabilities recorded at fair value have been categorized into three categories based on a fair value hierarchy.


Levels		How Fair Value Has Been Determined
Level I		Quoted prices in active markets for identical assets and liabilities that the Company has the ability to access at the measurement date. An active market is a market in which frequency and volume of transactions provides pricing information on an ongoing basis.

Level II		This category includes commodity derivatives where fair value is determined using the market approach. Inputs include yield curves and broker quotes from external data service providers.

Level III		This category includes long-dated transactions in certain markets where liquidity is low and the Company uses the most observable inputs available or alternatively long-term broker quotes or negotiated commodity prices that have been contracted for under similar terms in determining an appropriate estimate of these transactions. There is uncertainty caused by using unobservable market data which may not accurately reflect possible future changes in fair value.

The fair value of the Company’s derivative assets and liabilities measured on a recurring basis, including both current and non-current portions, were categorized as follows:

at March 31, 2024

(unaudited - millions of Canadian $)

Quoted prices in
active markets
(Level I)

Significant other
observable inputs
(Level II)¹

Significant
unobservable
inputs
(Level III)¹

Total

Derivative instrument assets

918

—

948

Derivative instrument liabilities

(950

)

(29

)

—

(979

)

(32

)

—

(31

)

1	There were no transfers from Level II to Level III for the three months ended March 31, 2024.


at December 31, 2023 (unaudited -millions of Canadian $)	Quoted prices in active markets (Level I)			Significant other observable inputs (Level II)¹			Significant unobservable inputs (Level III)¹		Total
	Quoted prices in active markets (Level I)			Significant other observable inputs (Level II)¹			Significant unobservable inputs (Level III)¹		Total
Derivative instrument assets		668			28			—		696
Derivative instrument liabilities		(695	)		(33	)		—		(728	)

		(27	)		(5	)		—		(32	)

1	There were no transfers from Level II to Level III for the year ended December 31, 2023.

Liquids Pipelines Business First Quarter 2024 |31

8. COMMITMENTS, CONTINGENCIES AND GUARANTEES

Commitments

The Company has long-term crude oil transportation agreements as well as other purchase obligations, all of which are transacted at market prices and in the normal course of business. Purchases under these contracts for the three months ended March 31, 2024 were $14 million (2023 – $13 million).

Capital expenditure commitments at March 31, 2024 increased by $7 million from those reported at December 31, 2023 reflecting new contractual commitments.

Contingencies

The Company is aware of a potential dispute with customers regarding the Company’s entitlement to contractual recoveries in an amount that may be material. At this time, formal legal proceedings have not commenced and the final outcome of this matter cannot be reasonably estimated.

In addition to the above and the proceedings disclosed in the Variable Toll Disputes section in the audited Combined carve-out financial statements for the year ended December 31, 2023, the Company is subject to various other legal proceedings, arbitrations and actions arising in the normal course of business. The amounts involved in such other proceedings are not reasonably estimable as the final outcome of such legal proceedings cannot be predicted with certainty. It is the opinion of management that the ultimate resolution of such proceedings and actions will not have a material impact on the Company’s combined financial position or results of operations.

Equity Investments Option Rights

The spinoff Transaction will trigger certain option rights to purchase the Company’s ownership interest in the equity investments, which may or may not be exercised by the Company’s respective partners or shareholders, as applicable. The option rights are triggered once TC Energy enters into certain spinoff agreements or upon closing of the spinoff Transaction. As at March 31, 2024, no triggering events had occurred.

On April 10, 2024, the option rights for Port Neches Link LLC and HoustonLink Pipeline were triggered. Subsequent to March 31, 2024, respective partners of HoustonLink Pipeline Company, LLC and Port Neches Link LLC either notified the Company that they did not elect to exercise the option right to acquire the offered ownership interest or, alternatively, did not exercise the option right to acquire the offered ownership interest within the time period provided in the applicable limited liability agreement.

Guarantees

The Company and its partners in certain jointly-owned entities have either: i) jointly and severally; ii) jointly or iii) severally guaranteed the financial performance of these entities. Such agreements include guarantees which are primarily related to construction services and the payment of liabilities. For certain of these entities, any payments made by the Company under these guarantees in excess of its ownership interest are to be reimbursed by its partners.

The carrying value of these guarantees has been recorded in Other long-term liabilities on the Condensed combined carve-out balance sheet. Information regarding the Company’s guarantees were as follows:

Term

March 31, 2024

December 31, 2023

(unaudited - millions of Canadian $)

Potential
exposure¹

Carrying
value

Potential
exposure¹

Carrying
value

Grand Rapids

to 2043

1	The Company’s share of the potential estimated current and contingent exposure.

32 | Liquids Pipelines Business First Quarter 2024

9. VARIABLE INTEREST ENTITIES

Consolidated VIEs

A portion of the Company’s assets are held through VIEs in which the Company holds a 100 per cent voting interest, the VIE meets the definition of a business and the VIE’s assets can be used for general corporate purposes. The consolidated VIEs whose assets cannot be used for purposes other than for the settlement of the VIE’s obligations, or are not considered a business, were as follows:


(unaudited - millions of Canadian $)	March 31, 2024		December 31, 2023
ASSETS
Current Assets
Cash and cash equivalents		2		2
Accounts receivable		3		3

		5		5
Plant, Property and Equipment		175		172

		180		177

LIABILITIES
Current Liabilities
Accounts payable and other		47		43

		47		43
Other Long-Term Liabilities		10		10

		57		53

Non-Consolidated VIEs

The carrying value of these non-consolidated VIEs and the maximum exposure to loss as a result of the Company’s involvement with these VIEs are as follows:


(unaudited - millions of Canadian $)	March 31, 2024		December 31, 2023
Balance Sheet Exposure
Equity investments		939		949
Off-Balance Sheet Exposure
Guarantees		56		56

Maximum Exposure to Loss		995		1,005

Liquids Pipelines Business First Quarter 2024 |33

10. RELATED PARTY TRANSACTIONS

TC Energy is responsible for providing the Company’s administrative and operating services (corporate expenses) necessary to operate the Liquids Pipelines business. As such, TC Energy’s determination and classification of allocated corporate expenses incurred by TC Energy to the Company are considered related party transactions. Allocated corporate expenses are capitalized or expensed based on the nature of underlying expenditure. The Company also incurs operating costs with TC Energy’s subsidiaries for costs that are not allocated but are direct costs to the Company that are capitalized or expensed based on the nature of underlying expenditure. The allocated corporate expenses, direct operating costs, interest expense on Long-term debt due to affiliates and interest income with affiliates were as follows:


	three months ended March 31
(unaudited - millions of Canadian $)	2024		2023
Allocated Corporate Expenses
Plant operating costs and other		36		54
Plant, property and equipment		1		1
Equity investments¹		1		6

		38		61
Direct Operating Costs
Plant operating costs and other		46		30
Plant, property and equipment		2		1
Equity investments²		1		2

		49		33
Interest Income with Affiliates		—		15
Interest Expense on Long-Term Debt Due to Affiliates		124		25

1	For the three months ended March 31, 2024, $1 million (2023 – $5 million) impacted Income from equity investments.

2	For the three months ended March 31, 2024, $1 million (2023 – $2 million) impacted Income from equity investments.

The outstanding balances with affiliates at March 31, 2024 and December 31, 2023 were as follows:


(unaudited - millions of Canadian $)	March 31, 2024		December 31, 2023		Affected line item on the Condensed combined carve-out balance sheet
(unaudited - millions of Canadian $)	March 31, 2024		December 31, 2023
Due to affiliates		230		137	Payable to affiliates
Due from affiliates		3		4	Accounts receivable
Long-term debt to affiliates		8,018		7,879	Long-term debt to affiliates

Refer to Note 6, Keystone environmental provision, for discussion of insurance recoveries from TC Energy’s wholly-owned captive insurance subsidiary.

11. SUBSEQUENT EVENTS

On May 1, 2024, in preparation for the spinoff Transaction, the Parent completed an internal restructuring where the Company’s marketing business was transferred by the Parent to the Company’s new marketing companies. As a consideration for this transfer, these marketing companies paid $189 million to the Parent, before post-closing adjustments. As the marketing business was already included in the combined carve-out financial statements, the consideration paid results in a reduction in Parent’s net investment in second quarter 2024.

On May 1, 2024, the Company entered into additional $250 million and US$500 million revolving credit facilities with an affiliate.

34 | Liquids Pipelines Business First Quarter 2024

Exhibit 99.11

Management’s discussion and analysis

July 31, 2024

Under the spinoff Transaction, common shareholders of TC Energy as of the record date to be established for the spinoff Transaction will receive, in exchange for each TC Energy share held, one new TC Energy share and 0.2 of a South Bow common share.

This management’s discussion and analysis (MD&A) has been prepared in respect of the assets and liabilities comprising the Liquids Pipelines business of TC Energy. It discusses our business, operations, financial position, risks and other factors for the three and six months ended June 30, 2024 and should be read with the accompanying unaudited financial statements of South Bow and unaudited Condensed combined carve-out financial statements of the Liquids Pipelines business for the three and six months ended June 30, 2024, which have been prepared in accordance with U.S. GAAP.

Basis of Presentation

About This Document

Throughout this MD&A, the terms we, us and our mean the Liquids Pipelines business. All information is as of July 31, 2024 and all amounts are in Canadian dollars, unless noted otherwise.

FORWARD-LOOKING INFORMATION

We disclose forward-looking information to help the reader understand management’s assessment of our future plans and financial outlook and our future prospects overall.

Forward-looking statements in this MD&A include information about the following, among other things:

•

our financial and operational performance

•

expectations about strategies and goals for growth and expansion

•

expected cash flows and future financing options available, including portfolio management

•

expectations about South Bow following the completion of the spinoff Transaction

2 | Liquids Pipelines Business Second Quarter 2024

•

expectations regarding the size, timing, conditions and outcome of ongoing and future transactions, including the spinoff Transaction

•

expected access to and cost of capital

•

expected costs and schedules for planned projects, including projects under construction such as the Blackrod Connection project

•

expected capital expenditures, contractual obligations, commitments and contingent liabilities, including environmental remediation costs

•

expected regulatory processes and outcomes

•

expected outcomes with respect to legal proceedings, including arbitration and insurance claims

•

the expected impact of future tax and accounting changes

•

expected industry, market and economic conditions, including their impact on our customers and suppliers.

Our forward-looking information is based on the following key assumptions and subject to the following risks and uncertainties:

Assumptions

•

realization of expected benefits from acquisitions, divestitures and the spinoff Transaction

•

regulatory decisions and outcomes

•

planned and unplanned outages and the use of our pipelines

•

integrity and reliability of our assets

•

anticipated construction costs, schedules and completion dates

•

access to capital markets, including portfolio management

•

expected industry, market and economic conditions, including the impact of these on our customers and suppliers

•

inflation rates, commodity and labour prices

•

interest, tax and foreign exchange rates

•

nature and scope of hedging.

Risks and uncertainties

•

realization of expected benefits from acquisitions, divestitures and the spinoff Transaction

•

the terms, timing and completion of the spinoff Transaction, including the timely receipt of all necessary approvals

•

that market or other conditions are no longer favourable to completing the proposed spinoff Transaction

•

business disruption during the period prior to or directly following the proposed spinoff Transaction

•

our ability to successfully implement our strategic priorities and whether they will yield the expected benefits

•

our ability to implement a capital allocation strategy aligned with maximizing shareholder value

•

the operating performance of our pipelines and storage assets

•

amount of capacity sold and rates achieved in our business

•

production levels within supply basins

•

construction and completion of capital projects

•

cost and availability of, and inflationary pressures on, labour, equipment and materials

•

the availability and market prices of commodities

•

access to capital and insurance markets on competitive terms

•

interest, tax and foreign exchange rates

•

performance and credit risk of our counterparties

•

regulatory decisions and outcomes of legal proceedings, including arbitration and insurance claims

•

our ability to effectively anticipate and assess changes to government policies and regulations, including those related to the environment

Liquids Pipelines Business Second Quarter 2024 | 3

•

our ability to realize the value of tangible assets and contractual recoveries

•

competition in the business in which we operate

•

unexpected or unusual weather

•

acts of civil disobedience

•

cyber security and technological developments

•

sustainability-related risks

•

impact of energy transition on our business

•

economic conditions in North America as well as globally

•

global health crises, such as pandemics and epidemics, and the impacts related thereto

•

recovery of costs resulting from unexpected pollution or environmental events related to our operations.

You can read more about these factors and others in this MD&A and our 2023 MD&A.

FOR MORE INFORMATION

NON-GAAP MEASURES

This MD&A references the following non-GAAP measures:

•

comparable EBITDA

•

comparable EBIT

•

comparable earnings

•

funds generated from operations

•

comparable funds generated from operations.

Comparable measures

4 | Liquids Pipelines Business Second Quarter 2024

Our decision not to adjust for a specific item in reporting comparable measures is subjective and made after careful consideration. We adjust for the following items:

•

gains or losses on sales of assets or assets held for sale

•

valuation allowances and adjustments resulting from changes in legislation and enacted tax rates

•

unrealized fair value adjustments related to risk management activities

•

legal, contractual, bankruptcy and other settlements

•

impairment of plant, property and equipment, equity investments and other assets

•

acquisition, integration and restructuring costs.

Separation costs related to the spinoff Transaction recognized in our results primarily include internal costs and external fees related to separation activities. These items have been excluded from comparable measures as we do not consider them reflective of our ongoing underlying operations.

The following table identifies our non-GAAP measures against their most directly comparable GAAP measures:


Comparable measure		GAAP measure
comparable EBITDA		earnings (losses)
comparable EBIT		earnings (losses)
comparable earnings		net income (loss)
funds generated from operations		net cash provided by operations
comparable funds generated from operations		net cash provided by operations

Comparable EBITDA and comparable EBIT

Comparable earnings

Funds generated from operations and comparable funds generated from operations

Funds generated from operations reflects net cash provided by operations before changes in operating working capital. The components of changes in working capital are disclosed in our Combined carve-out financial statements for the year ended December 31, 2023. We believe funds generated from operations is a useful measure of our operating cash flows because it excludes fluctuations from working capital balances, which do not necessarily reflect underlying operations in the same period, and is used to provide a consistent measure of the cash-generating ability of our business. Comparable funds generated from operations is adjusted for the cash impact of specific items described in the Comparable measures section above. Refer to the Financial Condition section for a reconciliation to Net cash provided by operations.

Liquids Pipelines Business Second Quarter 2024 | 5

Financial highlights


	three months ended June 30				six months ended June 30
(millions of $)	2024		2023		2024		2023
Income
Revenues		758		702		1,492		1,257
Net income (loss)		121		204		271		334
Comparable EBITDA¹		327		360		731		676
Comparable earnings¹		98		208		253		387
Cash flows
Net cash provided by operations		131		55		291		348
Comparable funds generated from operations		157		318		409		626
Capital spending²		27		11		44		24
Proceeds from sales of assets, net of transaction costs		18		—		31		63

1	Comparable EBITDA, comparable earnings and comparable funds generated from operations are all non-GAAP measures. Additional information on Earnings (losses), the most directly comparable GAAP measure, can be found in the Earnings and Net Income table set forth below.

2	Capital spending reflects cash flows associated with our Capital expenditures and Contributions to equity investments. Refer to the Financial condition – Cash (used in) provided by investing activities section for additional information.


	three months ended June 30						six months ended June 30
(millions of $)	2024			2023			2024			2023
Earnings (losses)		271			272			586			449
Interest expense		(128	)		(26	)		(256	)		(56	)
Interest income and other		8			14			18			31

Income (loss) before income taxes		151			260			348			424
Income tax (expense) recovery		(30	)		(56	)		(77	)		(90	)

Net income (loss)		121			204			271			334

Net income (loss) decreased by $83 million and $63 million for the three and six months ended June 30, 2024 compared to the same periods in 2023. The following specific items were recognized in Net income (loss) and were excluded from comparable earnings:

2024 results

•

an after-tax charge of $7 million and $11 million for the three and six months ended June 30, 2024 incurred due to separation costs related to the spinoff Transaction (2023 – nil).

2023 results

•

after-tax preservation and other costs for Keystone XL pipeline project assets of $3 million and $7 million for the three and six months ended June 30, 2023, which could not be accrued as part of the Keystone XL asset impairment charge

•

a $1 million after-tax charge related to Focus Project costs. The Focus Project was launched by TC Energy to identify opportunities to improve safety, productivity and cost-effectiveness.

6 | Liquids Pipelines Business Second Quarter 2024

RECONCILIATION OF NET INCOME (LOSS) TO COMPARABLE EARNINGS


	three months ended June 30					six months ended June 30
(millions of $)	2024			2023		2024			2023
Net income (loss)		121			204		271			334
Specific items (net of tax):
Liquids Pipelines business separation costs		7			—		11			—
Keystone regulatory decisions		—			—		—			49
Keystone XL preservation and other		—			3		—			7
Focus Project costs		—			1		—			1
Risk management activities		(30	)		—		(29	)		(4	)

Comparable earnings		98			208		253			387

COMPARABLE EBITDA TO COMPARABLE EARNINGS


	three months ended June 30						six months ended June 30
(millions of $)	2024			2023			2024			2023
Comparable EBITDA		327			360			731			676
Depreciation and amortization		(84	)		(82	)		(167	)		(164	)
Interest expense included in comparable earnings		(128	)		(26	)		(256	)		(50	)
Interest income and other		8			14			18			31
Income tax (expense) recovery included in comparable earnings		(25	)		(58	)		(73	)		(106	)

Comparable earnings		98			208			253			387

Comparable earnings – 2024 versus 2023

Comparable earnings decreased by $110 million and $134 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 and was primarily the net effect of:

•

changes in comparable EBITDA described in the Financial Results section

•

higher interest expense due to long-term debt issuances to affiliates in third quarter 2023.

Liquids Pipelines Business Second Quarter 2024 | 7

Financial Results

The following is a reconciliation of comparable EBITDA and comparable EBIT (our non-GAAP measures) to earnings (losses) (the most directly comparable GAAP measure).


	three months ended June 30						six months ended June 30
(millions of $)	2024			2023			2024			2023
Keystone Pipeline System		313			345			702			646
Intra-Alberta pipelines¹		18			18			35			35
Other		(4	)		(3	)		(6	)		(5	)

Comparable EBITDA		327			360			731			676
Depreciation and amortization		(84	)		(82	)		(167	)		(164	)

Comparable EBIT		243			278			564			512
Specific items:
Liquids Pipelines business separation costs		(9	)		—			(14	)		—
Keystone regulatory decisions		—			—			—			(57	)
Keystone XL preservation and other		—			(5	)		—			(10	)
Focus Project costs		—			(1	)		—			(1	)
Risk management activities		37			—			36			5

Earnings (losses)		271			272			586			449

Comparable EBITDA denominated as follows:
Canadian dollars		96			91			195			182
U.S. dollars		169			200			395			366
Foreign exchange impact		62			69			141			128

Comparable EBITDA		327			360			731			676

1	Intra-Alberta pipelines include Grand Rapids and White Spruce.

Earnings decreased by $1 million and increased by $137 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 and included the above specific items which have been excluded from our calculation of comparable EBITDA and comparable EBIT. Refer to the Financial Highlights section for additional information on specific items.

A stronger U.S. dollar for the three and six months ended June 30, 2024 had a positive impact on the Canadian dollar equivalent earnings from our U.S. operations compared to the same periods in 2023. Refer to the Foreign exchange section for additional information.

Comparable EBITDA decreased by $33 million and increased by $55 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to the net effect of:

•

lower margins from liquids marketing activities, primarily in second quarter 2024, in part due to the commencement of incremental WCSB egress capacity

•

higher contribution from uncontracted volumes on the Keystone Pipeline System in 2024 compared to 2023 as a result of Milepost 14 incident-related capacity impacts in 2023

•

higher throughput on the U.S. Gulf Coast section of the Keystone Pipeline System driven by an increase in contracted volumes.

Depreciation and amortization was generally consistent for the three and six months ended June 30, 2024 compared to the same periods in 2023.

8 | Liquids Pipelines Business Second Quarter 2024

FOREIGN EXCHANGE

The components of our financial results denominated in U.S. dollars are set out in the table below. Comparable EBITDA is a non-GAAP measure.

Pre-tax U.S. dollar-denominated income and expense items


	three months ended June 30						six months ended June 30
(millions of $)	2024			2023			2024			2023
Comparable EBITDA		169			200			395			366
Depreciation and amortization		(49	)		(50	)		(97	)		(97	)
Interest expense on long-term debt to affiliates		(65	)		(19	)		(129	)		(36	)

		55			131			169			233
Average exchange rate – U.S. to Canadian dollars		1.37			1.34			1.36			1.35

OTHER INCOME STATEMENT ITEMS

Interest Expense


	three months ended June 30						six months ended June 30
(millions of $)	2024			2023			2024			2023
Interest expense on long-term debt to affiliates
Canadian dollar-denominated		(38	)		—			(75	)		—
U.S. dollar-denominated		(65	)		(19	)		(129	)		(36	)
Foreign exchange impact		(23	)		(7	)		(46	)		(13	)

		(126	)		(26	)		(250	)		(49	)
Other interest and amortization expense		(2	)					(6	)		(1	)

Interest expense included in comparable earnings		(128	)		(26	)		(256	)		(50	)
Specific item:
Keystone regulatory decisions		—			—			—			(6	)

Interest expense		(128	)		(26	)		(256	)		(56	)

Interest expense increased by $102 million and by $200 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 and included accrued carrying charges of $6 million for the first quarter 2023 as a result of a pre-tax charge related to the FERC Administrative Law Judge initial decision on Keystone. This decision was issued in February 2023 in respect of a tolling-related complaint pertaining to amounts recognized from 2018 to 2022. These carrying charges have been removed from our calculation of Interest expense included in comparable earnings.

Interest expense included in comparable earnings increased by $102 million and $206 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to the net effect of:

•

long-term debt to affiliates issuances in third quarter 2023

•

higher effective interest rates in 2024 compared to 2023.

Liquids Pipelines Business Second Quarter 2024 | 9

Interest Income and Other

three months ended June 30

six months ended June 30

(millions of $)

2024

2023

2024

2023

Interest income and other

Interest income and other decreased by $6 million and $13 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to lower cash pooling balances with affiliates, partially offset by higher cash balances.

Income tax (expense) recovery


	three months ended June 30						six months ended June 30
(millions of $)	2024			2023			2024			2023
Income tax (expense) recovery included in comparable earnings		(25	)		(58	)		(73	)		(106	)
Specific items:
Liquids Pipelines business separation costs		2			—			3			—
Keystone regulatory decisions		—			—			—			14
Keystone XL preservation and other		—			2			—			3
Risk management activities		(7	)					(7	)		(1	)

Income tax (expense) recovery		(30	)		(56	)		(77	)		(90	)

Income tax expense decreased by $26 million and $13 million for the three and six months ended June 30, 2024 compared to the same periods in 2023. The income tax impacts on specified items referenced throughout the MD&A have been removed from our calculation of Income tax expense included in comparable earnings.

Income tax expense included in comparable earnings decreased by $33 million and $33 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to higher earnings subject to tax in 2023 and favourable U.S. state tax rate changes in 2023.

10 | Liquids Pipelines Business Second Quarter 2024

Outlook

We expect our 2024 comparable EBITDA to be consistent with 2023.

We continue to monitor developments in energy markets, our construction projects and regulatory proceedings for any potential impacts on the above outlook.

Our expected total capital expenditures for 2024 as outlined in the 2023 MD&A increased due to costs associated with the Blackrod Connection project. Our 2024 capital program is focused on normal course maintenance capital expenditures and constructing the Blackrod Connection project.

Capital program

Our capital program consists of long-life infrastructure assets supported by long-term commercial arrangements with creditworthy counterparties and/or regulated business models.

Our capital program consists of approximately $459 million of secured projects that represent commercially supported, committed projects that are either under construction or are preparing to commence the permitting stage. The estimated costs of the Blackrod Connection project are included within this amount.

During the six months ended June 30, 2024, approximately $32 million of maintenance capital expenditures were incurred.

Secured projects


(millions of $)	Expected in-service date		Estimated project cost		Project costs incurred at June 30, 2024
Blackrod Connection Project		2026		250		6
Recoverable maintenance capital expenditures		2024-2026		207		32
Non-recoverable maintenance capital expenditures		2024-2026		2		—

Total secured projects				459		38

Recent developments

Final FERC Decision

In 2019 and 2020, three Keystone customers initiated complaints before FERC and the CER regarding certain costs within the variable toll calculation. In February 2023, FERC released its initial decision in respect of the complaint, which addressed previously charged tolls between 2018 and 2022. On July 25, 2024, FERC released its Order on Initial Decision (Order) in respect of the complaint and as a result, we recognized an additional estimated liability of $25 million in second quarter 2024. We continue to assess the impact of this Order, with amounts to be finalized upon submission of a compliance filing in third quarter 2024.

Blackrod Connection Project

The Blackrod Connection project is now supported by long-term committed contracts. The expected total capital cost of the project is approximately $250 million with a targeted in-service date of early 2026.

TC Energy Indemnified Liquids Liabilities

At closing of the spinoff Transaction, TC Energy and South Bow will enter into a Separation Agreement providing that TC Energy expects to indemnify South Bow for 86% of total net liabilities and costs associated with the Milepost 14 incident and the existing variable toll disputes on the Keystone Pipeline System (excluding any future impacts to the variable toll) subject to a maximum liability to South Bow of $30 million for those two matters. Any amounts that may ultimately be payable in respect of these liabilities and costs above the current accrued amount are indeterminable at this time.

Keystone XL NAFTA Claim

In 2021, TC Energy filed a Request for Arbitration to formally initiate a legacy North American Free Trade Agreement (NAFTA) claim to recover economic damages resulting from the revocation of the Presidential Permit for the Keystone XL pipeline project. The United States objected on the basis that the transition provisions under the United States-Mexico-Canada Agreement (USMCA) that protect investments made while NAFTA was in force apply only in connection with actions taken before July 1, 2020, when USMCA replaced NAFTA. The arbitral Tribunal adjudicating the claim issued a split decision on July 12, 2024 in which the majority of the panel agreed with the United States position and concluded that it did not have jurisdiction to hear TC Energy’s claim. TC Energy is currently assessing the decision to determine whether there are grounds to change it.

Liquids Pipelines Business Second Quarter 2024 | 11

Financial condition

At June 30, 2024, our current assets totaled $3.6 billion and current liabilities amounted to $2.7 billion, providing us with a working capital surplus of $0.9 billion compared to $0.8 billion at December 31, 2023. We consider these working capital levels to be normal for our business.

CASH PROVIDED BY OPERATING ACTIVITIES


	three months ended June 30				six months ended June 30
(millions of $)	2024		2023		2024		2023
Net cash provided by operations		131		55		291		348
Increase (decrease) in operating working capital		18		260		106		222

Funds generated from operations		149		315		397		570
Specific items:
Liquids Pipelines business separation costs, net of current income tax		7		—		11		—
Keystone regulatory decisions, net of current income tax		—		—		—		49
Keystone XL preservation and other, net of current income tax		—		3		—		7
Current income tax expense on risk management activities		1		—		1		—

Comparable funds generated from operations		157		318		409		626

Net cash provided by operations

Net cash provided by operations increased by $76 million and decreased by $57 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to changes in funds generated from operations and timing of working capital changes.

Comparable funds generated from operations

Comparable funds generated from operations decreased by $161 million and $217 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to changes in comparable EBITDA and higher interest expense.

12 | Liquids Pipelines Business Second Quarter 2024

CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES


	three months ended June 30						six months ended June 30
(millions of $)	2024			2023			2024			2023
Capital spending
Capital expenditures		(27	)		(11	)		(44	)		(24	)
Proceeds from sale of assets, net of transaction costs		18			—			31			63
Keystone XL contractual recoveries		3			3			5			5
Deferred amounts and other		2			5			2			2

Net cash (used in) provided by investing activities		(4	)		(3	)		(6	)		46

Net cash (used in) provided by investing activities decreased by $1 million for the three months ended June 30, 2024 compared to the same period in 2023 primarily due to higher capital expenditures offset by higher proceeds from the sale of Keystone XL assets.

Net cash (used in) provided by investing activities decreased by $52 million for the six months ended June 30, 2024 compared to the same period in 2023 primarily due to lower proceeds from the sale of Keystone XL assets and higher capital expenditures.

CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES


	three months ended June 30						six months ended June 30
(millions of $)	2024			2023			2024			2023
Distributions on Class C interests		(1	)		(1	)		(2	)		(42	)
Parent’s net investment contributions (distributions), net		(364	)		(51	)		(168	)		(357	)

Net cash (used in) provided by financing activities		(365	)		(52	)		(170	)		(399	)

Net cash (used in) provided by financing activities decreased by $313 million and increased by $229 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to higher Parent’s net investment distributions for the three months ended June 30, 2024 and lower Parent’s net investment distributions for the six months ended June 30, 2024.

CREDIT FACILITIES

At June 30, 2024, we had total revolving credit facilities of $250 million and US$500 million (December 31, 2023 – $100 million and nil, respectively) with an outstanding balance of nil (December 31, 2023 – nil).

CONTRACTUAL OBLIGATIONS

Capital expenditure commitments at June 30, 2024 have increased by approximately $47 million from those reported at December 31, 2023 reflecting commitments for development of the Blackrod project and other contractual commitments.

There were no other material changes to our contractual obligations in second quarter 2024 or to payments due in the next five years or thereafter. Refer to 2023 MD&A for additional information about our contractual obligations.

Liquids Pipelines Business Second Quarter 2024 | 13

Financial risks and financial instruments

We are exposed to various financial risks and have strategies, policies and limits in place to manage the impact of these risks on our earnings and cash flows and, ultimately, shareholder value.

Risk management strategies, policies and limits are designed to ensure our risks and related exposures are in line with our business objectives and risk tolerance.

INTEREST RATE RISK

We utilize debt issued to affiliates to finance our operations which exposes us to interest rate risk. We rely on TC Energy for funding and management of our interest rate risk.

FOREIGN EXCHANGE RISK

Certain of our entities generate all or most of their earnings in U.S. dollars and, since we report our financial results in Canadian dollars, changes in the value of the U.S. dollar against the Canadian dollar directly affect our comparable EBITDA and may also impact comparable earnings. If our U.S. dollar-denominated operations continue to grow, this exposure increases. A portion of this risk is offset by interest expense on our U.S. dollar-denominated debt.

COUNTERPARTY CREDIT RISK

•

contractual rights and remedies together with the utilization of contractually-based financial assurances

•

the competitive position of our assets and the demand for our services

•

potential recovery of unpaid amounts through bankruptcy and similar proceedings.

LIQUIDITY RISK

14 | Liquids Pipelines Business Second Quarter 2024

RELATED PARTY TRANSACTIONS


	three months ended June 30				six months ended June 30
(millions of $)	2024		2023		2024		2023
Allocated Corporate Expenses
Plant operating costs and other		45		56		81		110
Plant, property and equipment		2		1		3		2
Equity investments¹		1		6		2		12

		48		63		86		124
Direct Operating Costs
Plant operating costs and other		39		34		85		64
Plant, property and equipment		1		1		3		2
Equity investments²		—		2		1		4

		40		37		89		70
Interest Income with Affiliates		—		14		—		29
Interest Expense on Long-Term Debt Due to Affiliates		126		25		250		50

1	For the three and six months ended June 30, 2024, $1 million and $2 million, respectively (2023 – $5 million and $10 million, respectively) impacted Income from equity investments.

2	For the three and six months ended June 30, 2024, nil and $1 million, respectively (2023 – $2 million and $4 million, respectively) impacted Income from equity investments.

The outstanding balances with affiliates at June 30, 2024 and December 31, 2023 were as follows:


(millions of $)	June 30, 2024		December 31, 2023		Affected line item on the Condensed combined carve-out balance sheet
Due to affiliates		109		137	Payable to affiliates
Due from affiliates		49		4	Accounts receivable
Long-term debt to affiliates		8,083		7,879	Long-term debt to affiliates

At June 30, 2024, we had $250 million and US$500 million (December 31, 2023 – $100 million and nil, respectively) of revolving credit facilities with an affiliate. At June 30, 2024, no amounts were drawn against the facilities.

FINANCIAL INSTRUMENTS

Liquids Pipelines Business Second Quarter 2024 | 15

Derivative instruments

We use derivative instruments to reduce volatility associated with fluctuations in commodity prices. Derivative instruments are recorded at fair value.

Balance sheet presentation of derivative instruments

The balance sheet presentation of the fair value of derivative instruments were as follows:


(millions of $)	June 30, 2024			December 31, 2023
Other current assets		502			696
Other long-term assets		33			—
Accounts payable and other		(497	)		(728	)
Other long-term liabilities		(35	)		—

		3			(32	)

Unrealized and realized gains (losses) on commodity derivative instruments

three months ended June 30

six months ended June 30

(millions of $)

2024

2023

2024

2023

Derivative Instruments Held for Trading¹

Unrealized gains (losses) in the period

Realized gains (losses) in the period

147

161

287

273

1	Realized and unrealized gains and losses on held-for-trading derivative instruments used to purchase and sell liquids are included on a net basis in Revenues.

Other information

CRITICAL ACCOUNTING ESTIMATES AND ACCOUNTING POLICY CHANGES

Accounting changes

16 | Liquids Pipelines Business Second Quarter 2024

Quarterly results

SELECTED QUARTERLY FINANCIAL DATA


	2024				2023								2022
(millions of $)	Second		First		Fourth		Third		Second		First		Fourth		Third
Revenues		758		734		733		715		702		555		624		710
Net income (loss)		121		150		140		121		204		130		238		198
Comparable earnings		98		155		129		170		208		179		206		183

FACTORS AFFECTING QUARTERLY FINANCIAL INFORMATION

Quarter-over-quarter revenues and earnings are affected by:

•

regulatory decisions

•

newly constructed assets being placed in service

•

acquisitions and divestitures

•

demand for uncontracted transportation services

•

marketing activities and commodity prices

•

developments outside of the normal course of operations

•

certain fair value adjustments

•

foreign exchange rates.

FACTORS AFFECTING FINANCIAL INFORMATION BY QUARTER

In second quarter 2024, comparable earning also exclude:

•

a $7 million after-tax charge incurred due to Liquids Pipelines business separation costs related to the spinoff Transaction.

In first quarter 2024, comparable earning also exclude:

•

a $4 million after-tax charge incurred due to Liquids Pipelines business separation costs related to the spinoff Transaction.

In fourth quarter 2023, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $4 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge

•

a $4 million after-tax gain on the sale of Keystone XL project assets and adjustment to the estimate for contractual and legal obligations related to termination activities

•

a $3 million after-tax charge for accrued carrying charges related to the FERC Administrative Law Judge initial decision on Keystone

•

a $2 million after-tax charge for separation costs incurred related to the spinoff Transaction.

In third quarter 2023, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $3 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge.

Liquids Pipelines Business Second Quarter 2024 | 17

In second quarter 2023, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $3 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge

•

a $1 million after-tax charge related to Focus Project costs.

In first quarter 2023, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $4 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge.

In fourth quarter 2022, comparable earnings also excluded:

•

a $20 million after-tax charge due to the CER decision on Keystone issued in December 2022 in respect of a tolling-related complaint pertaining to amounts reflected in 2021 and 2020

•

preservation and other costs for Keystone XL pipeline project assets of $8 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge

•

a $90 million after-tax gain on the sale of Keystone XL project assets and reduction to the estimate for contractual and legal obligations related to termination activities.

In third quarter 2022, comparable earnings also excluded:

•

preservation and other costs for Keystone XL pipeline project assets of $3 million after tax, which could not be accrued as part of the Keystone XL asset impairment charge.

18 | Liquids Pipelines Business Second Quarter 2024

Glossary


General terms and terms related to our operations

WCSB		Western Canadian Sedimentary

basin Accounting terms

U.S. GAAP / GAAP		U.S. generally accepted accounting principles

Government and regulatory bodies terms

CER		Canada Energy Regulator
FERC		Federal Energy Regulatory Commission (U.S.)

Liquids Pipelines Business Second Quarter 2024 | 19

Exhibit 99.12

Condensed combined carve-out statement of income and comprehensive income


	three months ended June 30						six months ended June 30
(unaudited - millions of Canadian $)	2024			2023			2024			2023
Revenues		758			702			1,492			1,257
Income (Loss) from Equity Investments		16			18			33			32
Operating and Other Expenses
Plant operating costs and other		249			215			464			393
Commodity purchases resold		144			122			252			223
Property taxes		26			29			56			60
Depreciation and amortization		84			82			167			164

		503			448			939			840
Financial Charges
Interest expense		128			26			256			56
Interest income and other		(8	)		(14	)		(18	)		(31	)

		120			12			238			25

Income (Loss) before Income Taxes		151			260			348			424

Income Tax Expense (Recovery)
Current		63			23			103			30
Deferred		(33	)		33			(26	)		60

		30			56			77			90

Net Income (Loss)		121			204			271			334

Foreign currency translation adjustments		5			(150	)		119			(148	)

Comprehensive Income (Loss)		126			54			390			186

See accompanying Notes to the Condensed combined carve-out financial statements.

20 | Liquids Pipelines Business Second Quarter 2024

Condensed combined carve-out statement of cash flows


	three months ended June 30						six months ended June 30
(unaudited - millions of Canadian $)	2024			2023			2024			2023
Cash Generated from Operations
Net income (loss)		121			204			271			334
Depreciation and amortization		84			82			167			164
Deferred income taxes		(33	)		33			(26	)		60
(Income) loss from equity investments		(16	)		(18	)		(33	)		(32	)
Distributions received from operating activities of equity investments		17			14			44			45
Unrealized (gains) losses on financial instruments		(35	)		(4	)		(36	)		(8	)
Other		11			4			10			7
(Increase) decrease in operating working capital		(18	)		(260	)		(106	)		(222	)

Net cash provided by operations		131			55			291			348

Investing Activities
Capital expenditures		(27	)		(11	)		(44	)		(24	)
Proceeds from sales of assets, net of transaction costs		18			—			31			63
Keystone XL contractual recoveries		3			3			5			5
Deferred amounts and other		2			5			2			2

Net cash (used in) provided by investing activities		(4	)		(3	)		(6	)		46

Financing Activities
Distributions on Class C Interests		(1	)		(1	)		(2	)		(42	)
Parent’s net investment contributions (distributions), net		(364	)		(51	)		(168	)		(357	)

Net cash (used in) provided by financing activities		(365	)		(52	)		(170	)		(399	)

Effect of Foreign Exchange Rate Changes on Cash and Cash Equivalents		5			—			12			—

Increase (Decrease) in Cash and Cash Equivalents		(233	)		—			127			(5	)
Cash and Cash Equivalents - Beginning of period		707			—			347			5

Cash and Cash Equivalents - End of period		474			—			474			—

See accompanying Notes to the Condensed combined carve-out financial statements.

Liquids Pipelines Business Second Quarter 2024 | 21

Condensed combined carve-out balance sheet


(unaudited - millions of Canadian $)		June 30, 2024		December 31, 2023
ASSETS
Current Assets
Cash and cash equivalents			474		347
Accounts receivable			2,097		1,775
Inventories			255		211
Environmental provision recovery			133		186
Contractual recoveries			86		83
Other current assets			591		851

			3,636		3,453
Plant, Property and Equipment	net of accumulated depreciation of $3,719 and $3,478, respectively		11,357		11,128
Equity Investments			1,068		1,073
Other Long-Term Assets			303		234

			16,364		15,888

LIABILITIES
Current Liabilities
Accounts payable and other			2,553		2,602
Payable to affiliates			109		137

			2,662		2,739
Other Long-Term Liabilities			196		146
Long-Term Debt to Affiliates			8,083		7,879
Deferred Income Tax Liabilities			1,421		1,373

			12,362		12,137
PARENT’S NET INVESTMENT
Parent’s net investment			3,191		3,059
Accumulated other comprehensive income (loss)			811		692

			4,002		3,751

			16,364		15,888

Commitments, Contingencies and Guarantees (Note 8)

Variable Interest Entities (Note 9)

Subsequent Event (Note 11)

See accompanying Notes to the Condensed combined carve-out financial statements.

22 | Liquids Pipelines Business Second Quarter 2024

Condensed combined carve-out statement of changes in parent’s net investment


	three months ended June 30						six months ended June 30
(unaudited - millions of Canadian $)	2024			2023			2024			2023
Parent’s Net Investment
Balance at beginning of period		3,361			9,156			3,059			9,336
Net income (loss)		121			204			271			334
Contributions (distributions), net		(291	)		(55	)		(139	)		(365	)

Balance at end of period		3,191			9,305			3,191			9,305

Accumulated Other Comprehensive Income (Loss)
Balance at beginning of period		806			847			692			845
Foreign currency translation adjustments		5			(150	)		119			(148	)

Balance at end of period		811			697			811			697

Total Parent’s Net Investment		4,002			10,002			4,002			10,002

See accompanying Notes to the Condensed combined carve-out financial statements.

Liquids Pipelines Business Second Quarter 2024 | 23

Notes to Condensed combined carve-out financial statements

(unaudited)

1. BACKGROUND AND BASIS OF PRESENTATION

On July 27, 2023, TC Energy Corporation (TC Energy or the Parent) announced plans to separate into two independent, investment-grade, publicly listed companies through the proposed spinoff of its Liquids Pipelines business (the spinoff Transaction) and on November 8, 2023, TC Energy communicated that the name of the new Liquids Pipelines business will be South Bow Corporation (South Bow). Under the spinoff Transaction, common shareholders of TC Energy as of the record date to be established for the spinoff Transaction will receive, in exchange for each TC Energy share, one new TC Energy share and 0.2 of a South Bow common share. The Canadian and U.S. tax rulings as well as shareholders’ approval have been received and subject to receipt of the remaining approvals and conditions of the spinoff Transaction, TC Energy expects that the effective date will occur in early-fourth quarter 2024.

Earnings for interim periods may not be indicative of results for the fiscal year primarily due to fluctuations in throughput volumes on the Keystone Pipeline System and marketing activities.

In addition to the factors mentioned above, revenues and earnings are impacted by fluctuations in foreign exchange rates, mainly related to the Company’s U.S. dollar-denominated operations.

On May 1, 2024, in preparation for the spinoff Transaction, the Parent completed an internal restructuring where the Company’s marketing business was transferred by the Parent to the Company’s new marketing companies. The total consideration for this transfer was $140 million. As the marketing business was already included in the combined carve-out financial statements, the consideration resulted in a reduction in Parent’s net investment in second quarter 2024.

24 | Liquids Pipelines Business Second Quarter 2024

Use of Estimates and Judgments

2. ACCOUNTING CHANGES

Future Accounting Changes

Income Taxes

In December 2023, the FASB issued new guidance to enhance the transparency and decision usefulness of income tax disclosures through improvements to the rate reconciliation and income taxes paid information. The guidance also includes certain other amendments to improve the effectiveness of income tax disclosures. This new guidance is effective for the annual period beginning January 1, 2025. The guidance is applied prospectively with retrospective application permitted. Early adoption is permitted for annual financial statements not yet issued. The Company does not expect this guidance to have a material impact on the Company’s combined carve-out financial statements.

Segment Reporting

In November 2023, the FASB issued new guidance to improve disclosures about a public entity’s reportable segments and address requests from investors for additional, more detailed information about a reportable segment’s expenses. The guidance is effective for annual periods beginning January 1, 2024 and interim periods beginning January 1, 2025. Early adoption is permitted and the guidance is applied retrospectively. The Company does not expect this guidance to have a material impact on the Company’s combined carve-out financial statements.

Liquids Pipelines Business Second Quarter 2024 | 25

3. SEGMENTED INFORMATION


three months ended June 30, 2024
(unaudited - millions of Canadian $)	Keystone Pipeline System			All other segments			Total
Revenues		752			6			758
Income (loss) from equity investments		3			13			16
Plant operating costs and other		(247	)		(2	)		(249	)
Commodity purchases resold		(144	)		—			(144	)
Property taxes		(26	)		—			(26	)
Depreciation and amortization		(82	)		(2	)		(84	)

Earnings (Losses)		256			15			271

Interest expense								(128	)
Interest income and other								8

Income (Loss) before Income Taxes								151
Income tax (expense) recovery								(30	)

Net Income (Loss)								121

Capital Spending¹
Capital expenditures		22			5			27

1	Included in Investing activities in the Condensed combined carve-out statement of cash flows.


three months ended June 30, 2023
(unaudited - millions of Canadian $)	Keystone Pipeline System			All other segments			Total
Revenues		696			6			702
Income (loss) from equity investments		4			14			18
Plant operating costs and other		(214	)		(1	)		(215	)
Commodity purchases resold		(122	)		—			(122	)
Property taxes		(29	)		—			(29	)
Depreciation and amortization		(81	)		(1	)		(82	)

Earnings (Losses)		254			18			272

Interest expense								(26	)
Interest income and other								14

Income (Loss) before Income Taxes								260
Income tax (expense) recovery								(56	)

Net Income (Loss)								204

Capital Spending¹
Capital expenditures		10			1			11

1	Included in Investing activities in the Condensed combined carve-out statement of cash flows.

26 | Liquids Pipelines Business Second Quarter 2024


six months ended June 30, 2024
(unaudited - millions of Canadian $)	Keystone Pipeline System			All other segments			Total
Revenues		1,480			12			1,492
Income (loss) from equity investments		7			26			33
Plant operating costs and other		(458	)		(6	)		(464	)
Commodity purchases resold		(252	)		—			(252	)
Property taxes		(56	)		—			(56	)
Depreciation and amortization		(164	)		(3	)		(167	)

Earnings (Losses)		557			29			586

Interest expense								(256	)
Interest income and other								18

Income (Loss) before Income Taxes								348
Income tax (expense) recovery								(77	)

Net Income (Loss)								271

Capital Spending¹
Capital expenditures		34			10			44

1	Included in Investing activities in the Condensed combined carve-out statement of cash flows.


six months ended June 30, 2023
(unaudited - millions of Canadian $)	Keystone Pipeline System			All other segments			Total
Revenues		1,246			11			1,257
Income (loss) from equity investments		5			27			32
Plant operating costs and other		(389	)		(4	)		(393	)
Commodity purchases resold		(223	)		—			(223	)
Property taxes		(60	)		—			(60	)
Depreciation and amortization		(162	)		(2	)		(164	)

Earnings (Losses)		417			32			449

Interest expense								(56	)
Interest income and other								31

Income (Loss) before Income Taxes								424
Income tax (expense) recovery								(90	)

Net Income (Loss)								334

Capital Spending¹
Capital expenditures		23			1			24

1	Included in Investing activities in the Condensed combined carve-out statement of cash flows.

Liquids Pipelines Business Second Quarter 2024 | 27

Total Assets by Segment


(unaudited - millions of Canadian $)	June 30, 2024		December 31, 2023
Keystone Pipeline System		14,641		14,340
All other segments		1,723		1,548

		16,364		15,888

4. REVENUES

Disaggregation of Revenues

The following tables summarizes total Revenues for the three and six months ended June 30, 2024 and 2023:

three months ended June 30

2024

2023

(unaudited - millions of Canadian $)

Keystone
Pipeline
System

All other
segments

Total

Keystone
Pipeline
System

All other
segments

Total

Revenues from contracts with customers

Capacity arrangements and

568

574

530

536

Other revenues¹

184

—

184

166

—

166

752

758

696

702

For the three months ended June 30, 2024, three major customers accounted for $211 million, $113 million and $62 million in revenues, each representing more than 10 per cent of total revenues from contracts with customers (2023 – four customers, $218 million, $104 million, $59 million and $59 million, respectively).


six months ended June 30	2024						2023
(unaudited - millions of Canadian $)	Keystone Pipeline System		All other segments		Total		Keystone Pipeline System		All other segments		Total
Revenues from contracts with customers
Capacity arrangements and transportation		1,154		12		1,166		963		11		974
Other		3		—		3		1		—		1

		1,157		12		1,169		964		11		975
Other revenues¹		323		—		323		282		—		282

		1,480		12		1,492		1,246		11		1,257

For the six months ended June 30, 2024, three major customers accounted for $424 million, $221 million and $121 million in revenues, each representing more than 10 per cent of total revenues from contracts with customers (2023 – four customers, $387 million, $186 million, $109 million and $106 million, respectively).

28 | Liquids Pipelines Business Second Quarter 2024

Contract Balances


(unaudited - millions of Canadian $)	June 30, 2024		December 31, 2023		Affected line item on the Condensed combined carve-out balance sheet
Receivables from contracts with customers		404		445	Accounts receivable
Short-term contract liabilities¹		24		22	Accounts payable and other
Long-term contract liabilities		22		22	Other long-term liabilities

1	During the six months ended June 30, 2024, $8 million (2023 – $8 million) of revenues were recognized that were included in contract liabilities at the beginning of the period.

Contract liabilities represent unearned revenue for contracted services.

Future Revenues from Remaining Performance Obligations

As at June 30, 2024, future revenues from long-term pipeline capacity arrangements and transportation extending through 2044 are approximately $9.0 billion, of which approximately $0.6 billion is expected to be recognized during the remainder of 2024.

5. INCOME TAXES

Effective Tax Rates

The effective income tax rates were 22 per cent and 21 per cent for the six months ended June 30, 2024 and 2023, respectively. The increase in effective income tax rate was primarily due to favourable U.S. state tax rate adjustments in 2023.

6. KEYSTONE ENVIRONMENTAL PROVISION

In December 2022, a pipeline incident occurred in Washington County, Kansas on the Keystone Pipeline System. At December 31, 2023, the Company had accrued a life-to-date environmental liability of $794 million, before expected insurance recoveries and not including potential fines and penalties which continue to be indeterminable. For the six months ended June 30, 2024, amounts paid for the environmental remediation liability were $75 million (2023 – $433 million). The remaining balance reflected in Accounts payable and other and Other long-term liabilities on the Company’s Condensed combined carve-out balance sheet was $50 million and $10 million, respectively at June 30, 2024 (December 31, 2023 – $122 million and $9 million, respectively).

The expected recovery of the remaining estimated environmental remediation costs recorded in Environmental provision recovery was $133 million, including $7 million from TC Energy’s wholly-owned captive insurance subsidiary, and $35 million in Other long-term assets at June 30, 2024 (December 31, 2023 – $186 million, including $36 million from TC Energy’s wholly-owned captive insurance subsidiary, and $33 million, respectively). For the six months ended June 30, 2024, the Company received $58 million including $30 million from TC Energy’s wholly-owned captive insurance subsidiary (2023 – $201 million, including $7 million from TC Energy’s wholly-owned captive insurance subsidiary) from its insurance policies related to the costs for environmental remediation.

Liquids Pipelines Business Second Quarter 2024 | 29

7. RISK MANAGEMENT AND FINANCIAL INSTRUMENTS

Risk Management Overview

The Company has exposure to various financial risks and has strategies, policies and limits in place to manage the impact of these risks on its earnings and cash flows.

Counterparty Credit Risk

At June 30, 2024, the Company had no significant credit losses, and there were no significant credit risk concentrations or amounts past due or impaired.

Non-Derivative Financial Instruments

Fair value of non-derivative financial instruments

Credit risk has been taken into consideration when calculating the fair value of non-derivative financial instruments.

Balance sheet presentation of non-derivative financial instruments

June 30, 2024

December 31, 2023

(unaudited - millions of Canadian $)

Carrying
amount

Fair
value

Carrying
amount

Fair
value

Long-term debt to affiliates

(8,083

)

(8,126

)

(7,879

)

(8,138

)

30 | Liquids Pipelines Business Second Quarter 2024

Available-for-sale assets summary

The following tables summarize additional information about the Company’s LMCI restricted investments that were classified as available-for-sale assets:


(unaudited - millions of Canadian $)	June 30, 2024		December 31, 2023
Fair values of fixed income securities^1,2
Maturing within 1 year		—		1
Maturing within 1-5 years		—		—
Maturing within 5-10 years		—		—
Maturing after 10 years		104		102

		104		103

1	Available-for-sale assets are recorded at fair value and included in Other long-term assets on the Company’s Condensed combined carve-out balance sheet.

2	Classified in Level II of the fair value hierarchy.


	three months ended June 30					six months ended June 30
(unaudited - millions of Canadian $)	2024		2023			2024			2023
Net unrealized gains (losses)¹		—		(1	)		(5	)		5
Net realized gains (losses)^1,2		—		(1	)		(1	)		(3	)

2	Realized gains (losses) on the sale of LMCI restricted investments are determined using the average cost basis.

Derivative Instruments

Fair value of derivative instruments

Liquids Pipelines Business Second Quarter 2024 | 31

Balance sheet presentation of derivative instruments

The balance sheet classification of the fair value of held-for-trading, commodity derivative instruments was as follows:


(unaudited - millions of Canadian $)	June 30, 2024			December 31, 2023
Derivatives Assets
Other current assets		502			696
Other long-term assets		33			—

		535			696

Derivative Liabilities
Accounts payable and other		(497	)		(728	)
Other long-term liabilities		(35	)		—

		(532	)		(728	)

Total Derivatives^1,2		3			(32	)

1	Fair value equals carrying value.

2	Includes purchases and sales.

Notional and maturity summary

The maturity and notional amount or quantity outstanding related to the Company’s liquids commodity derivative instruments was as follows:


(unaudited)	June 30, 2024			December 31, 2023
Net purchases¹		(28	)		(7	)
Maturity dates		2024-2025			2024

1	Volumes are in MMBbls.

Unrealized and Realized Gains (Losses) on Commodity Derivative Instruments

three months ended June 30

six months ended June 30

(unaudited - millions of Canadian $)

2024

2023

2024

2023

Derivative Instruments Held for Trading¹

Unrealized gains (losses) in the period

Realized gains (losses) in the period

147

161

287

273

1	Realized and unrealized gains and losses on held-for-trading derivative instruments used to purchase and sell liquids are included on a net basis in Revenues.

32 | Liquids Pipelines Business Second Quarter 2024

Offsetting of derivative instruments

at June 30, 2024

(unaudited - millions of Canadian $)

Gross derivative
instruments

Amounts available
for offset¹

Net amounts

Derivative instrument assets

535

(517

)

Derivative instrument liabilities

(532

)

517

(15

)

1	Amounts available for offset do not include cash collateral pledged or received.


at December 31, 2023
(unaudited - millions of Canadian $)	Gross Derivative Instruments			Amounts Available for Offset¹			Net Amounts
Derivative instrument assets		696			(681	)		15
Derivative instrument liabilities		(728	)		681			(47	)

1	Amounts available for offset do not include cash collateral pledged or received.

With respect to the derivative instruments presented above, the Company provided cash collateral of $51 million and no letters of credit at June 30, 2024 (December 31, 2023 – $92 million and nil, respectively) to its counterparties. At June 30, 2024, the Company held no cash collateral and less than $1 million in letters of credit (December 31, 2023 – nil and $4 million, respectively) from counterparties on asset exposures.

Credit-risk-related contingent features of derivative instruments

Based on contracts in place and market prices at June 30, 2024, the Company had no derivative instruments with credit-risk-related contingent features in a net liability position for which no collateral was provided (December 31, 2023 – less than $1 million). Should the fair value of derivative instruments exceed pre-defined contractual exposure limit thresholds, additional collateral may need to be provided. The Company has sufficient liquidity in the form of cash and TC Energy’s support to meet these contingent obligations should they arise.

Liquids Pipelines Business Second Quarter 2024 | 33

Fair Value Hierarchy

The Company’s financial assets and liabilities recorded at fair value have been categorized into three categories based on a fair value hierarchy.


Levels		How Fair Value Has Been Determined

Level I		Quoted prices in active markets for identical assets and liabilities that the Company has the ability to access at the measurement date. An active market is a market in which frequency and volume of transactions provides pricing information on an ongoing basis.

Level II		This category includes commodity derivatives where fair value is determined using the market approach. Inputs include yield curves and broker quotes from external data service providers.

Level III		This category includes long-dated transactions in certain markets where liquidity is low and the Company uses the most observable inputs available or alternatively long-term broker quotes or negotiated commodity prices that have been contracted for under similar terms in determining an appropriate estimate of these transactions. There is uncertainty caused by using unobservable market data which may not accurately reflect possible future changes in fair value.

The fair value of the Company’s derivative assets and liabilities measured on a recurring basis, including both current and non-current portions, were categorized as follows:


at June 30, 2024 (unaudited - millions of Canadian $)	Quoted prices in active markets (Level I)			Significant other observable inputs (Level II)¹			Significant unobservable inputs (Level III)¹		Total
Derivative instrument assets		509			26			—		535
Derivative instrument liabilities		(497	)		(35	)		—		(532	)

		12			(9	)		—		3

1	There were no transfers from Level II to Level III for the six months ended June 30, 2024.


at December 31, 2023 (unaudited - millions of Canadian $)	Quoted prices in active markets (Level I)			Significant other observable inputs (Level II)¹			Significant unobservable inputs (Level III)¹		Total
Derivative instrument assets		668			28			—		696
Derivative instrument liabilities		(695	)		(33	)		—		(728	)

		(27	)		(5	)		—		(32	)

1	There were no transfers from Level II to Level III for the year ended December 31, 2023.

34 | Liquids Pipelines Business Second Quarter 2024

8. COMMITMENTS, CONTINGENCIES AND GUARANTEES

Commitments

The Company has long-term crude oil transportation agreements as well as other purchase obligations, all of which are transacted at market prices and in the normal course of business. Purchases under these contracts for the three and six months ended June 30, 2024 were $18 million and $32 million, respectively (2023 – $16 million and $29 million, respectively).

Capital expenditure commitments at June 30, 2024 increased by $47 million from those reported at December 31, 2023 reflecting development of the Blackrod Connection project and new contractual commitments.

Contingencies

In addition to the above potential dispute and the proceedings disclosed in the Variable Toll Disputes section in the audited Combined carve-out financial statements for the year ended December 31, 2023, the Company is subject to various other legal proceedings, arbitrations and actions arising in the normal course of business. The amounts involved in such other proceedings are not reasonably estimable as the final outcome of such legal proceedings cannot be predicted with certainty. It is the opinion of management that the ultimate resolution of such proceedings and actions will not have a material impact on the Company’s combined financial position or results of operations.

Equity Investments Option Rights

On April 10, 2024, the option rights for Port Neches Link LLC and HoustonLink Pipeline were triggered. The respective partners of Port Neches Link LLC and HoustonLink Pipeline Company, LLC either notified the Company that they did not elect to exercise the option right to acquire the offered ownership interest or, alternatively, did not exercise the option right to acquire the offered ownership interest within the time period provided in the applicable limited liability agreement. As at June 30, 2024, no other triggering events had occurred.

Guarantees

Liquids Pipelines Business Second Quarter 2024 | 35

June 30, 2024

December 31, 2023

(unaudited - millions of Canadian $)

Term

Potential
exposure¹

Carrying
value

Potential
exposure¹

Carrying
value

Grand Rapids

to 2043

1	The Company’s share of the potential estimated current and contingent exposure.

9. VARIABLE INTEREST ENTITIES

Consolidated VIEs


(unaudited - millions of Canadian $)	June 30, 2024		December 31, 2023
ASSETS
Current Assets
Cash and cash equivalents		2		2
Accounts receivable		7		3

		9		5
Plant, Property and Equipment		182		172

		191		177

LIABILITIES
Current Liabilities
Accounts payable and other		47		43

		47		43
Other Long-Term Liabilities		10		10

		57		53

Non-Consolidated VIEs

The carrying value of these VIEs and the maximum exposure to loss as a result of the Company’s involvement with these VIEs are as follows:


(unaudited - millions of Canadian $)	June 30, 2024		December 31, 2023
Balance Sheet Exposure
Equity investments		938		949
Off-Balance Sheet Exposure
Guarantees		56		56

Maximum Exposure to Loss		994		1,005

36 | Liquids Pipelines Business Second Quarter 2024

10. RELATED PARTY TRANSACTIONS


	three months ended June 30				six months ended June 30
(unaudited - millions of Canadian $)	2024		2023		2024		2023
Allocated Corporate Expenses
Plant operating costs and other		45		56		81		110
Plant, property and equipment		2		1		3		2
Equity investments¹		1		6		2		12

		48		63		86		124
Direct Operating Costs
Plant operating costs and other		39		34		85		64
Plant, property and equipment		1		1		3		2
Equity investments²		—		2		1		4

		40		37		89		70
Interest Income with Affiliates		—		14		—		29
Interest Expense on Long-Term Debt Due to Affiliates		126		25		250		50

1	For the three and six months ended June 30, 2024, $1 million and $2 million, respectively (2023 – $5 million and $10 million, respectively) impacted Income from equity investments.

2	For the three and six months ended June 30, 2024, nil and $1 million, respectively (2023 – $2 million and $4 million, respectively) impacted Income from equity investments.

The outstanding balances with affiliates at June 30, 2024 and December 31, 2023 were as follows:


(unaudited - millions of Canadian $)	June 30, 2024		December 31, 2023		Affected line item on the Condensed combined carve-out balance sheet
Due to affiliates		109		137	Payable to affiliates
Due from affiliates		49		4	Accounts receivable
Long-term debt to affiliates		8,083		7,879	Long-term debt to affiliates

At June 30, 2024, the Company had $250 million and US$500 million (December 31, 2023 – $100 million and nil, respectively) of revolving credit facilities with an affiliate. At June 30, 2024, no amounts were drawn against the facilities.

Refer to Note 6, Keystone environmental provision, for discussion of insurance recoveries from TC Energy’s wholly-owned captive insurance subsidiary.

Liquids Pipelines Business Second Quarter 2024 | 37

11. SUBSEQUENT EVENT

In 2019 and 2020, three Keystone customers initiated complaints before FERC and the CER regarding certain costs within the variable toll calculation. In February 2023, FERC released its initial decision in respect of the complaint, which addressed previously charged tolls between 2018 and 2022. On July 25, 2024, FERC released its Order on Initial Decision (Order) in respect of the complaint and as a result, the Company recognized an additional estimated liability of $25 million in second quarter 2024. The Company continues to assess the impact of this Order, with amounts to be finalized upon submission of a compliance filing in third quarter 2024.

38 | Liquids Pipelines Business Second Quarter 2024

Exhibit 99.13

South Bow Corporation

Condensed Financial Statements

(unaudited)

As at and for the three months ended March 31, 2024


		South Bow Corporation Condensed Financial Statements		1

Condensed Statement of income


(unaudited)	Three months ended March 31, 2024
Revenues		—
Expenses		—

Income before income taxes		—
Income tax expense		—

Net income		—

The accompanying Notes to the condensed financial statements are an integral part of these statements.


2		South Bow Corporation Condensed Financial Statements

Condensed Balance sheet


(unaudited)	March 31, 2024		December 31, 2023
	March 31, 2024		December 31, 2023
Assets		—		—
Liabilities and Shareholder’s Equity		—		—

The accompanying Notes to the condensed financial statements are an integral part of these statements.


		South Bow Corporation Condensed Financial Statements		3

Condensed Statement of changes in equity


(unaudited)	Three months ended March 31, 2024
Retained earnings, beginning of period		—

Retained earnings, end of period		—

The accompanying Notes to the condensed financial statements are an integral part of these statements.


4		South Bow Corporation Condensed Financial Statements

Notes to condensed financial statements (unaudited)

1. DESCRIPTION OF SOUTH BOW CORPORATION’S BUSINESS

South Bow Corporation (South Bow or the Company) was incorporated under the Canada Business Corporations Act on December 15, 2023, for the purpose of spinning out TC Energy Corporation’s (TC Energy) Liquids Pipelines business, along with certain related assets, into a separate publicly traded company. As a result of the proposed spin-off transaction, the Company will consolidate the financial results of TC Energy’s Liquids Pipelines business at a future date when the Liquids Pipelines business is contributed to the Company. South Bow’s registered office is located at 450 – 1 Street SW, Calgary, Alberta, Canada, T2P 5H1. For the period from the date of incorporation to March 31, 2024, South Bow did not conduct any business activities other than those required for its formation and matters contemplated by the Plan of Arrangement.

These condensed financial statements have been prepared on the basis of accounting principles applicable to a going concern, which assumes that South Bow will continue for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of business as they come due. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but is not limited to, twelve months from the end of the reporting period.

On July 27, 2023, TC Energy announced plans to separate into two independent, investment-grade, publicly listed companies through the spinoff of its Liquids Pipelines business (the Transaction). On June 4, 2024, TC Energy shareholders approved the Transaction. Under the spinoff Transaction, common shareholders of TC Energy as of the record date established for the spinoff Transaction will receive, in exchange for each TC Energy share, one new TC Energy share and 0.2 of a South Bow common share. The Canadian and U.S. tax rulings have been received and subject to receipt of the remaining approvals and conditions of the spinoff Transaction, TC Energy expects that the effective date will occur between late third quarter and mid fourth quarter 2024.

2. ACCOUNTING POLICIES

The Company’s condensed financial statements have been prepared by management in accordance with U.S. generally accepted accounting principles. The accounting policies applied are consistent with those outlined in the Company’s audited financial statements for the period ended December 31, 2023.

3. SHARE CAPITAL

The Company is authorized to issue an unlimited number of common shares and an unlimited number of preferred shares. The Company had no shareholders or shares outstanding as at March 31, 2024 and December 31, 2023. The Company has appointed executive members of TC Energy’s Liquids Pipelines business as Officers and Directors of South Bow.


		South Bow Corporation Condensed Financial Statements		5

Exhibit 99.14

South Bow Corporation

Condensed Financial Statements

(unaudited)

As at and for the three and six months ended June 30, 2024


		South Bow Corporation Condensed Financial Statements		1

Condensed Statement of income


(unaudited)	Three months ended June 30, 2024		Six months ended June 30, 2024
Revenues		—		—
Expenses		—		—

Income before income taxes		—		—
Income tax expense		—		—

Net income		—		—

The accompanying Notes to the condensed financial statements are an integral part of these statements.


2		South Bow Corporation Condensed Financial Statements

Condensed Balance sheet


(unaudited)	June 30, 2024		December 31, 2023
Assets		—		—
Liabilities and Shareholder’s Equity		—		—

The accompanying Notes to the condensed financial statements are an integral part of these statements.


South Bow Corporation Condensed Financial Statements		3

Condensed Statement of changes in equity


(unaudited)	Three months ended June 30, 2024		Six months ended June 30, 2024
Retained earnings, beginning of period		—		—

Retained earnings, end of period		—		—

The accompanying Notes to the condensed financial statements are an integral part of these statements.


4		South Bow Corporation Condensed Financial Statements

Notes to condensed financial statements (unaudited)

1. DESCRIPTION OF SOUTH BOW CORPORATION’S BUSINESS

South Bow Corporation (South Bow or the Company) was incorporated under the Canada Business Corporations Act on December 15, 2023, for the purpose of spinning out TC Energy Corporation’s (TC Energy) Liquids Pipelines business, along with certain related assets, into a separate publicly traded company. As a result of the proposed spin-off transaction, the Company will consolidate the financial results of TC Energy’s Liquids Pipelines business at a future date when the Liquids Pipelines business is contributed to the Company. South Bow’s registered office is located at 450 – 1 Street SW, Calgary, Alberta, Canada, T2P 5H1. For the period from the date of incorporation to June 30, 2024, South Bow did not conduct any business activities other than those required for its formation and matters contemplated by the Plan of Arrangement. These unaudited condensed financial statements should be read in conjunction with the audited financial statements of South Bow Corporation for the period from incorporation on December 15, 2023 to December 31, 2023.

On July 27, 2023, TC Energy announced plans to separate into two independent, investment-grade, publicly listed companies through the spinoff of its Liquids Pipelines business (the Transaction). On June 4, 2024, TC Energy shareholders approved the Transaction. Under the spinoff Transaction, common shareholders of TC Energy as of the record date to be established for the spinoff Transaction will receive, in exchange for each TC Energy share, one new TC Energy share and 0.2 of a South Bow common share. The Canadian and U.S. tax rulings have been received and subject to receipt of the remaining approvals and conditions of the spinoff Transaction, TC Energy expects that the effective date will occur between late third quarter and mid fourth quarter 2024.

2. ACCOUNTING POLICIES

3. SHARE CAPITAL

The Company is authorized to issue an unlimited number of common shares and an unlimited number of preferred shares. The Company had no shareholders or shares outstanding as at June 30, 2024 and December 31, 2023. The Company has appointed executive members of TC Energy’s Liquids Pipelines business as Officers and Directors of South Bow.


South Bow Corporation Condensed Financial Statements		5

Exhibit 99.15

Consent of Independent Registered Public Accounting Firm

The Board of Directors of TC Energy Corporation

We consent to the use of:

•

our report dated February 15, 2024 on the consolidated financial statements of TC Energy Corporation (“TC Energy”) which comprise the consolidated balance sheets as of December 31, 2023 and 2022, the related consolidated statements of income, comprehensive income, cash flows, and equity for each of the years in the three-year period ended December 31, 2023, and the related notes; and

•

our report dated February 15, 2024 on the effectiveness of TC Energy’s internal control over financial reporting as of December 31, 2023

each of which is included in the Annual Report on Form 40-F of TC Energy for the fiscal year ended December 31, 2023 and incorporated by reference in the registration statement on Form 40-F of South Bow Corporation dated October 1, 2024.

We also consent to the use of:

•

our report dated April 10, 2024 on the combined carve-out financial statements for the Liquids Pipelines Business of TC Energy which comprise the combined carve-out balance sheets as of December 31, 2023 and 2022, the related combined carve-out statements of income, comprehensive income, cash flows and changes in parent’s net investment for each of the years in the three-year period ended December 31, 2023, and the related notes

which is included in the Notice of Meeting and Management Information Circular of TC Energy dated April 10, 2024 and incorporated by reference in the registration statement on Form 40-F of South Bow Corporation dated October 1, 2024.

/s/ KPMG LLP

Chartered Professional Accountants

Calgary, Canada

October 1, 2024

Exhibit 99.16

Consent of Independent Registered Public Accounting Firm

The Board of Directors of South Bow Corporation

We, KPMG LLP, consent to the use of our report dated April 10, 2024 on the financial statements of South Bow Corporation (the “Corporation”) which comprise the balance sheet as of December 31, 2023, the statements of income and changes in equity for the period from incorporation on December 15, 2023 to December 31, 2023, and the notes to the financial statements, including a summary of significant accounting policies, which is included in the Notice of Meeting and Management Information Circular of TC Energy Corporation dated April 10, 2024 and incorporated by reference in the registration statement on Form 40-F of the Corporation dated October 1, 2024.

/s/ KPMG LLP

Chartered Professional Accountants

Calgary, Canada

October 1, 2024

Exhibit 99.17

LOGO


Certificate of Incorporation		Certificat de constitution
*Canada Business Corporations Act*		*Loi canadienne sur les sociétés par actions*

South Bow Corporation

Corporate name / Dénomination sociale

1560903-8

Corporation number / Numéro de société

I HEREBY CERTIFY that the above-named

corporation, the articles of incorporation of which

are attached, is incorporated under the Canada

Business Corporations Act.

JE CERTIFIE que la société susmentionnée, dont

les statuts constitutifs sont joints, est constituée

en vertu de la Loi canadienne sur les sociétés par

actions.

/s/ Hantz Prosper

Hantz Prosper

Director / Directeur

2023-12-15

Date of Incorporation (YYYY-MM-DD)

Date de constitution (AAAA-MM-JJ)

LOGO

Form 1

Articles of Incorporation

Formulaire 1

Statuts constitutifs

Canada Business Corporations

Act (s. 6)

Loi canadienne sur les sociétés

par actions (art. 6)


1				Corporate name
				Dénomination sociale South Bow Corporation
2				The province or territory in Canada where the registered office is situated
				La province ou le territoire au Canada où est situé le siège social AB
3				The classes and any maximum number of shares that the corporation is authorized to issue
				Catégories et le nombre maximal d’actions que la société est autorisée à émettre See attached schedule / Voir l’annexe ci-jointe
4				Restrictions on share transfers
				Restrictions sur le transfert des actions None
5				Minimum and maximum number of directors
				Nombre minimal et maximal d’administrateurs Min. 3 Max. 13
6				Restrictions on the business the corporation may carry on
				Limites imposées à l’activité commerciale de la société None
7				Other Provisions
				Autres dispositions See attached schedule / Voir l’annexe ci-jointe
8				Incorporator’s Declaration: I hereby certify that I am authorized to sign and submit this form.
				Déclaration des fondateurs : J’atteste que je suis autorisé à signer et à soumettre le présent formulaire.


		Name(s) - Nom(s)		Original Signed by - Original signé par

		Jeffrey J. Bakker		Jeffrey J. Bakker
				Jeffrey J. Bakker

Misrepresentation constitutes an offence and, on summary conviction, a person is liable to a fine not exceeding $5000 or to imprisonment for a term not exceeding six months or both (subsection 250(1) of the CBCA).

Faire une fausse déclaration constitue une infraction et son auteur, sur déclaration de culpabilité par procédure sommaire, est passible d’une amende maximale de 5 000 $ et d’un emprisonnement maximal de six mois, ou l’une de ces peines (paragraphe 250(1) de la LCSA).

You are providing information required by the CBCA. Note that both the CBCA and the Privacy Act allow this information to be disclosed to the public. It will be stored in personal information bank number IC/PPU-049.

Vous fournissez des renseignements exigés par la LCSA. Il est à noter que la LCSA et la Loi sur les renseignements personnels permettent que de tels renseignements soient divulgués au public. Ils seront stockés dans la banque de renseignements personnels numéro IC/PPU-049.

IC 3419 (2008/04)

SCHEDULE

AUTHORIZED CAPITAL

The Corporation is authorized to issue an unlimited number of Common Shares and an unlimited number of Preferred Shares. The rights, privileges, restrictions and conditions attached to the Common Shares and Preferred Shares are as follows:

1.	Common Shares

The rights of the holders of the Common Shares are equal in all respects and include the following rights:

(a)

to vote at all meetings of shareholders of the Corporation, except meetings at which only holders of a specified class of shares are entitled to vote;

(b)

subject to the rights, privileges, restrictions and conditions attaching to any other class or series of shares of the Corporation, to receive any dividend declared by the Corporation on the Common Shares; and

(c)

subject to the rights, privileges, restrictions and conditions attaching to any other class or series of shares of the Corporation, to receive the remaining property of the Corporation upon dissolution.

2.	Preferred Shares

(a)

The Preferred Shares may be issued from time to time in one or more series with such rights, restrictions, privileges, conditions and designations attached thereto as shall be fixed from time to time before issuance by any resolution or resolutions providing for the issue of the shares of any series which may be passed by the board of directors of the Corporation and confirmed and declared by articles of amendment. Reference to one class or series of shares ranking on a parity with another class or series of shares shall mean ranking on a parity with respect to payment of dividends and distribution of assets in the event of liquidation, dissolution or winding-up of the Corporation whether voluntary or involuntary to the extent of their respective rights in that connection.

(b)

The Preferred Shares of each series shall rank on a parity with the Preferred Shares of every other series, provided, however, that when in the case of any of such shares any cumulative dividends or amounts payable on a return of capital are not paid in full in accordance with their respective terms, the Preferred Shares of all series shall participate ratably in respect of such dividends (including all unpaid accumulated dividends which for such purpose shall be calculated as if the same were accruing up to the date of payment) in accordance with the sums which would be payable on said shares if all such dividends were declared and paid in full in accordance with their respective terms, and on any return of capital in accordance with the sums which would be payable on such return of capital if all sums so payable were paid in full in accordance with their respective terms, and provided further that in the event of there being insufficient assets to satisfy in full all such claims as aforesaid, the claims of the holders of the said shares with respect to return of capital shall first be paid and satisfied and any assets remaining thereafter shall be applied towards the payment and satisfaction of claims in respect of dividends as aforesaid.

(c)

The Preferred Shares shall be entitled to preference over the Common Shares of the Corporation and any other shares of the Corporation ranking junior to the said Preferred Shares with respect to payment of dividends and distribution of assets in the event of liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, to the extent fixed in the case of each respective series, and may also be given such other preferences over the Common Shares of the Corporation and any other shares of the Corporation ranking junior to the said Preferred Shares as may be fixed in the case of each such series.

SCHEDULE

OTHER PROVISIONS

Authorization to Appoint Additional Directors. The directors may, within the maximum number permitted by the articles, appoint one or more additional directors, who shall hold office for a term expiring not later than the close of the next annual meeting of the shareholders, but the total number of directors so appointed may not exceed one third of the number of directors elected at the previous annual meeting of shareholders.

Exhibit 99.18

SOUTH BOW CORPORATION

BY-LAW NUMBER 1

A By-law relating generally to

the transaction of the business

and affairs of

South Bow Corporation

BE IT ENACTED as a by-law of South Bow Corporation as follows:

ARTICLE 1

INTERPRETATION

1.1

Definitions. In this by-law and all other by-laws and ordinary and special resolutions of the Corporation, unless the context otherwise requires:

(a)

“Act” means the Canada Business Corporations Act and any act that may be substituted therefor, and the regulations promulgated thereunder, as from time to time in effect;

(b)

“Applicable Securities Laws”: (i) means the applicable securities legislation of each relevant province and territory of Canada, as amended from time to time, the rules, regulations and forms made or promulgated under any such statute and the published national instruments, multilateral instruments, policies, bulletins and notices of the securities commission and similar regulatory authority of each province and territory of Canada; and (ii) all applicable securities legislation in the United States, including, without limitation, the United States Securities Act of 1933, the United States Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder, and any applicable state securities laws.

(c)

“articles” means the articles of incorporation, amalgamation or arrangement, as applicable, of the Corporation, as from time to time amended or restated;

(d)

“board” means the board of directors of the Corporation;

(e)

“Corporation” means the corporation, “South Bow Corporation”; and

(f)

“meetings of shareholders” includes an annual or special meeting of shareholders or of any class or classes of shareholders.

1.2

Interpretation. Subject to paragraph 1.1 of this by-law, words and expressions defined in the Act have the same meanings when used herein; words importing the singular include the plural and vice versa; words importing any gender include any other gender; and words importing persons include individuals, bodies corporate, partnerships, trusts and unincorporated organizations.

1.3

Subordination. This by-law and all other by-laws are subordinate to and should be read subject to the Act, the articles of the Corporation and any other applicable law.

ARTICLE 2

REGISTERED OFFICE

2.1

Registered Office. The registered office of the Corporation shall be at such place in the City of Calgary, in the Province of Alberta, as the board may from time to time determine.

2.2

Trade Name. The Corporation may carry on business as or identify itself by South Bow.

ARTICLE 3

DIRECTORS

3.1

Powers and Quorum. The board shall manage the business and affairs of the Corporation. A majority of the directors shall constitute a quorum.

3.2

Number of Directors. Subject to the Act, Applicable Securities Laws, applicable stock exchange requirements and any minimum and maximum number of directors specified in the articles, the number of directors to be elected at any meeting of shareholders shall be the number of directors then in office, or such other number as has been determined from time to time by resolution of the board of directors.

3.3

Election and Term. The directors shall be elected at each annual meeting of shareholders to hold office until the next annual meeting or until their respective successors are elected or appointed. At any annual meeting every retiring director shall, if qualified, be eligible for re-election.

3.4

Vacancies. Subject to the Act, where a vacancy occurs in the board, and a quorum of directors remains, the directors remaining in office may appoint a qualified person to fill the vacancy for the remainder of the term.

3.5

Advance Notice of Nominations of Directors.

(a)

Subject to the Act and the articles of the Corporation, only persons who are nominated in accordance with the following procedures shall be eligible for election as directors of the Corporation. Nominations of persons for election to the board may be made at any annual meeting of shareholders, or at any special meeting of shareholders if one of the purposes for which the special meeting was called was the election of directors, called:

(i)

by or at the direction of the board, including pursuant to a notice of meeting;

(ii)

by or at the direction or request of one or more shareholders pursuant to a proposal made in accordance with the provisions of the Act, or a requisition of the shareholders made in accordance with the provisions of the Act; or

(iii)

by any person (a “Nominating Shareholder”):

(A)

who, at the close of business on the date of the giving of the notice provided for below in this paragraph 3.5 and on the record date for notice of such meeting, is entered in the securities register as a holder of one or more shares carrying the right to vote at such meeting or who beneficially owns shares that are entitled to be voted at such meeting, and

(B)

who complies with the notice procedures set forth below in this paragraph 3.5.

(b)

In addition to any other applicable requirements, for a nomination to be made by a Nominating Shareholder, the Nominating Shareholder must have given timely notice thereof in proper written form to the corporate secretary of the Corporation at the principal executive offices of the Corporation in accordance with this paragraph 3.5.

(c)

To be timely, a Nominating Shareholder’s notice to the corporate secretary of the Corporation must be given:

(i)

in the case of an annual meeting of shareholders, not less than 30 days before the date of the annual meeting of shareholders; provided, however, that in the event that the annual meeting of shareholders is to be held on a date that is less than 50 days after the date (the “Notice Date”) on which the first public announcement of the date of the annual meeting was made, notice by the Nominating Shareholder may be given not later than the close of business on the tenth day following the Notice Date;

(ii)

in the case of a special meeting (which is not also an annual meeting) of shareholders called for the purpose of electing directors (whether or not called for other purposes), not later than the close of business on the fifteenth day following the day on which the first public announcement of the date of the special meeting of shareholders was made; and

(iii)

in the case of an annual meeting of shareholders or a special meeting of shareholders called for the purpose of electing directors (whether or not called for other purposes) where notice-and-access is used for delivery of proxy related materials, not less than 40 days before the date of the annual meeting of shareholders or the special meeting of shareholders (but in any event, not prior to the Notice Date); provided, however, that in the event that the annual meeting of shareholders or special meeting of shareholders is to be held on a date that is less than 50 days after the date (the “Notice Date”) on which the first public announcement of the date of the annual meeting or special meeting was made, notice by the Nominating Shareholder may be given not later than the close of business on the tenth day following the Notice Date for an annual meeting, and not later than the close of business on the fifteenth day following the Notice Date for a special meeting.

(d)

To be in proper written form, a Nominating Shareholder’s notice to the corporate secretary of the Corporation must set forth:

(i)

as to each person whom the Nominating Shareholder proposes to nominate for election as a director:

(A)

the name, age, business address and residential address of the person;

(B)

the principal occupation or employment of the person, both present and within the five years preceding the notice;

(C)

whether the person is a resident Canadian within the meaning of the Act;

(D)

the class or series and number of shares in the capital of the Corporation which are owned beneficially or of record by the person or under the control or direction of the person as of the record date for the meeting of shareholders (if such date shall then have been made publicly available and shall have occurred) and as of the date of such notice; and

(E)

any other information relating to the person that would be required to be disclosed in a dissident’s proxy circular in connection with solicitations of proxies for election of directors pursuant to the Act and Applicable Securities Laws; and

(ii)

as to the Nominating Shareholder giving the notice, any proxy, contract, arrangement, understanding or relationship pursuant to which such Nominating Shareholder has a right to vote any shares of the Corporation and any other information relating to such Nominating Shareholder that would be required to be made in a dissident’s proxy circular in connection with solicitations of proxies for election of directors pursuant to the Act and Applicable Securities Laws.

The Corporation may require any proposed nominee to furnish such other information as may be required by the Act, Applicable Securities Laws, or the rules of any stock exchange on which the Corporation’s shares are listed to determine the eligibility of such proposed nominee to serve as a director of the Corporation.

(e)

No person shall be eligible for election as a director of the Corporation unless nominated in accordance with the provisions of this paragraph 3.5; provided, however, that nothing in this paragraph 3.5 shall be deemed to preclude discussion by a shareholder (as distinct from the nomination of directors) at a meeting of shareholders of any matter in respect of which it would have been entitled to submit a proposal pursuant to the provisions of the Act. The chair of the meeting shall have the power and duty to determine whether a nomination was made in accordance with the procedures set forth in the foregoing provisions and, if any proposed nomination is not in compliance with such foregoing provisions, to declare that such defective nomination shall be disregarded.

(f)

For purposes of this paragraph 3.5, “public announcement” means disclosure in a press release reported by a national news service in Canada, or in a document publicly filed by the Corporation under its profile on the System for Electronic Data Analysis and Retrieval + at www.sedarplus.ca.

(g)

Notwithstanding any other provision of this by-law, notice given to the corporate secretary of the Corporation pursuant to this paragraph 3.5 may only be given by personal delivery or by email, and shall be deemed to have been given and made only at the time it is served by personal delivery (at the address of the principal executive offices of the Corporation) or email (at such email address as stipulated from time to time by the corporate secretary of the Corporation for purposes of this notice) to the corporate secretary; provided that if such delivery or electronic communication is made on a day which is not a business day or later than 5:00 p.m. (Calgary time) on a day which is a business day, then such delivery or electronic communication shall be deemed to have been made on the subsequent day that is a business day.

(h)

Notwithstanding the foregoing, the board may, in its sole discretion, waive any requirement in this paragraph 3.5.

3.6

Meetings. Meetings of the board may be held at any place within or outside Canada. Meetings may be called by the chair, vice chair, the chief executive officer, the president or any two directors.

3.7

Meetings by Telephone or Electronic Facility. Subject to the requirements of the Act, any director may participate in a meeting of the board by means of a telephonic, electronic or other communication facility that permits all persons participating in the meeting to communicate adequately with each other during the meeting. Each director so participating shall be deemed to be present at such meeting and such meeting shall be deemed to be held at the place specified in the notice calling such meeting and, in the absence of any such specification, at the place where or from which the chair of the meeting shall have presided.

3.8

Resolution in Lieu of Meeting. A resolution in writing, signed by all the directors entitled to vote on that resolution at a meeting of directors or a committee of directors, is as valid as if it had been passed at a meeting of directors or committee of directors.

3.9

Notices. Notice of the time and place for holding a meeting shall be given to every director not less than 48 hours before the meeting is to be held; provided that notice shall not be required if the meeting is held immediately following an annual meeting of shareholders.

3.10

Voting. At all meetings of the board every matter shall be decided by a majority of the votes cast. In case of an equality of votes, the chair of the meeting shall not be entitled to a second or casting vote.

3.11

Remuneration of Directors. The directors shall be paid such remuneration for their services as the board may from time to time determine. The remuneration, if any, payable to a director who is also an officer or employee of the Corporation or who serves it in any professional capacity shall, unless the board otherwise directs, be in addition to such person’s salary as an officer or employee or to such person’s professional fees, as the case may be. The directors may also be paid their reasonable out-of-pocket expenses incurred in attending meetings of the directors, shareholders or committees of the board or otherwise in the performance of their duties.

ARTICLE 4

COMMITTEES

4.1

Executive or Planning Committee. The directors may appoint from among their number an executive or planning committee and delegate to the executive or planning committee any powers of the board, subject to any restrictions imposed from time to time by the board or by the Act. Meetings of the executive or planning committee may be held at any place within or outside Canada.

4.2

Audit Committee. The directors shall appoint from among their number an audit committee to be composed of not fewer than three directors, who shall not be officers or employees of the Corporation or any affiliate of the Corporation. The audit committee shall have the duties provided in the Act and may exercise such other duties and perform such other functions as may be determined by the board.

4.3

Other Committees. Subject to the Act, the directors may from time to time appoint such other committees with such duties as it may deem advisable.

4.4

Procedure. Subject to the Act and any restrictions imposed by the board, each committee shall have the power to fix its quorum at not less than a majority of its members, to elect its chair and to regulate its procedure.

ARTICLE 5

OFFICERS

5.1

Appointment. The board shall appoint a chief executive officer, a chief financial officer and a corporate secretary and shall elect or appoint a chair of the board who may serve in a non-executive capacity. The board may appoint a president, a vice chair, one or more executive, senior, assistant and/or other vice presidents, a treasurer and a controller and such other officers as the board may determine, including one or more assistants to any of the officers so appointed. No person may hold the office of chair or vice chair unless that person is a director. The same person may hold more than one office, provided that the chief financial officer shall not be the chief executive officer on a permanent basis.

5.2

Chief Executive Officer. The chief executive officer shall have the general supervision of the business and affairs of the Corporation, subject to the direction of the board. In addition, the chief executive officer shall have the power to appoint an assistant controller, an assistant treasurer, an assistant corporate secretary and such division or business unit presidents and/or division or business unit vice presidents and such other divisional or business unit officers as the chief executive officer considers appropriate. Any such division or business unit presidents and division or business unit vice presidents are not, and shall not be, unless otherwise designated by the board, officers of the Corporation.

5.3

Chief Financial Officer. The chief financial officer shall (a) be responsible for keeping proper accounting records in compliance with the Act; (b) be responsible for the deposit of money, the safekeeping of securities and the disbursement of funds of the Corporation; and (c) have such other powers and duties as the board may specify.

5.4

Chief Operating Officer. The board may designate an officer as the chief operating officer. The chief operating officer shall have the general supervision of the operations of the Corporation, subject to the direction of the chief executive officer.

5.5

Chair. The chair shall preside at all meetings of the board and of shareholders and shall have such other powers and duties as the board may prescribe. If and whenever the chair is unable to act, the chair’s powers and duties shall devolve upon the vice chair, if appointed, or failing the vice chair, the chief executive officer.

5.6

Corporate Secretary. The corporate secretary shall attend and be the secretary of all meetings of the board and shareholders; shall give or cause to be given notices of such meetings; and shall be the custodian of the corporate seal and of the records and contracts, documents and other instruments of the Corporation except when some other person has been designated for that purpose by the board.

5.7

Other Powers and Duties. Every officer, except the chief executive officer and the chair, shall have such powers and duties as the board or the chief executive officer may prescribe in addition to the powers and duties provided by this by-law. Any of the powers and duties of an officer to whom an assistant has been appointed may be exercised and performed by such assistant, unless the board or the chief executive officer otherwise directs.

5.8

Term of Office. Every officer appointed by the board shall hold office during the pleasure of the board.

ARTICLE 6

PROTECTION OF DIRECTORS AND OFFICERS

6.1

Limitation of Liability. No director or officer of the Corporation shall be liable for the acts, receipts, neglects or defaults of any other director or officer or any employee or for any liability or expense sustained or incurred by the Corporation in the execution of the duties of such director’s office, provided that nothing herein contained shall relieve any director or officer of any liability in contravention of the Act or any other applicable statute.

6.2

Indemnity and Insurance. Subject to the limitations contained in the Act but without limit to the right of the Corporation to indemnify any person under the Act or otherwise, the Corporation shall indemnify a director or officer, a former director or officer, and may indemnify an individual who acts or acted at the Corporation’s request as a director or officer or in a similar capacity of another entity, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by the individual in respect of any civil, criminal or administrative, investigative or other proceeding in which the individual is involved because of that association with the Corporation or other entity, if the individual:

(a)

acted honestly and in good faith with a view to the best interests of the Corporation, or as the case may be, to the best interests of the other entity for which the individual acted as director or officer or in a similar capacity at the Corporation’s request; and

(b)

in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the individual had reasonable grounds for believing that the individual’s conduct was lawful.

Subject to the limitations contained in the Act, the Corporation may purchase and maintain such insurance for the benefit of such persons referred to in this section as the board may from time to time determine.

ARTICLE 7

SHARES

7.1

Share Certificates. Share certificates shall be signed by the chair, the vice chair, the president or a vice president and by the corporate secretary or an assistant secretary and need not be under the corporate seal. Share certificates representing shares in respect of which a transfer agent has been appointed shall be countersigned manually by or on behalf of such transfer agent. The

facsimile signature of such officers or, in the case of share certificates representing shares in respect of which a transfer agent has been appointed, of both of such officers, may be mechanically reproduced thereon. Share certificates so signed shall continue to be valid notwithstanding that one or both of the officers whose signature is mechanically reproduced thereon no longer holds office at the date of issue thereof.

7.2

Transfer Agent and Registrar. The board may appoint or remove a transfer agent or a registrar and one or more branch transfer agents or registrars for the shares of the Corporation.

ARTICLE 8

MEETING OF SHAREHOLDERS

8.1

Meetings. Meetings of shareholders shall be held at such place within or outside Canada as specified in the Corporation’s articles at such time and on such day as the board may determine. To the extent permitted by the Act, meetings of shareholders may be held entirely by means of a telephonic, electronic or other communication facility, including teleconferencing, video conferencing, computer link, webcasting and other similar means and any such meeting shall be deemed to be held at the registered office of the Corporation.

8.2

Notice of Meetings and Documentation. Notice of the time and place of a meeting of shareholders shall be sent not less than 21 days and not more than 60 days before the meeting to each shareholder entitled to vote at the meeting, to each director and to the auditor of the Corporation. Where there is more than one person registered as a shareholder in respect of any share or shares, such notice may be given to whichever of such persons is named first in the securities register of the Corporation and any notice so given shall be sufficient notice to all of them.

Notice of shareholder meetings or any notices or documents intended for shareholders may be given by any means permitted under the articles or by-laws of the Corporation or any other applicable law. In the event that it is impossible or impracticable for any reason whatsoever to give notice as otherwise permitted under the laws governing the Corporation, notice may be given by advertisement published once in a newspaper in such cities or places as the directors may from time to time determine.

8.3

Record Date of Notice. The board may fix in advance a record date preceding the date of any meeting of shareholders by not more than 60 days and not less than 21 days for the determination of the shareholders entitled to notice of, and vote at, the meeting, provided that notice of any such record date is given not less than 7 days before such record date in the manner provided in the Act. If no record date is so fixed, the record date for the determination of the shareholders entitled to notice of, and to vote at, the meeting shall be the close of business on the day immediately preceding the day on which the notice is given.

8.4

Quorum. Two persons present and each entitled to vote thereat and representing either in their own right or by proxy or as the duly authorized representative of a corporate shareholder 25 per cent of the issued shares of the Corporation carrying voting rights at such time shall constitute a quorum at any meeting of shareholders.

8.5

Proxies. A shareholder entitled to vote at a meeting of shareholders may by means of a proxy appoint a proxyholder or one or more alternate proxyholders, who are not required to be shareholders, to attend and act at the meeting in the manner and to the extent authorized by the proxy and with the power conferred by the proxy. An instrument of proxy shall conform to the requirements of the Act and any requirements established by the board or shall be otherwise acceptable to the chair of the meeting at which the instrument of proxy is to be used. The decision of the chair of the meeting on any question regarding the validity or invalidity of any instruments of proxy and any questions as to the admission or rejection of a vote shall be conclusive and binding upon the shareholders. The chair of the meeting shall have the right to waive or extend any proxy deposit deadlines in his or her sole discretion.

8.6

Persons Entitled to be Present. The only persons entitled to attend a meeting of shareholders shall be those entitled to vote thereat and such others who, although not entitled to vote thereat, are entitled or required to attend under the Act, the articles, the by-laws or applicable laws. Any other person may be permitted to attend a meeting of shareholders by the chair of the meeting or with the consent of the meeting.

8.7

Voting. Subject to the Act, the articles and any other applicable law, every matter at a meeting of shareholders shall be decided by a show of hands unless a ballot is required by the chair or demanded by any person entitled to vote. Upon a show of hands every person entitled to vote shall have one vote. After a vote by a show of hands has been taken the chair may still require or any person entitled to vote may still demand a ballot thereon. Whenever a vote by show of hands has been taken, unless a ballot is required or demanded, a declaration by the chair of the meeting that the vote upon the matter has been carried or carried by a particular majority or not carried and an entry to that effect in the minutes of the meeting shall be prima facie evidence of the result of the vote.

8.8

Electronic Voting. The board may determine that, in combination with other voting means, any vote of shareholders may also be held, in accordance with any regulations under the Act, by means of telephonic, electronic or other communication facility, if the Corporation makes available such a communication facility.

8.9

Votes to Govern. Unless otherwise required by the Act, the articles or any other applicable law, every matter at a meeting of shareholders shall be decided by a majority of the votes cast on the matter. In case of an equality of votes, either upon a show of hands or upon a poll, the chair of the meeting of shareholders shall not be entitled to a second or casting vote.

8.10

Ballots. If a ballot is required by the chair of the meeting or demanded by any person entitled to vote, a ballot upon the matter shall be taken in such manner as the chair of the meeting shall direct.

8.11

Scrutineers. At any meeting of the shareholders, one or more persons, who may be shareholders, may be appointed to serve as scrutineers at the meeting either by a resolution of the meeting or by the chair.

8.12

Adjournment. The chair of any meeting of shareholders may, and if so directed by the meeting must, adjourn the meeting from time to time and from place to place. The reconvened meeting following the adjournment shall be duly constituted if a quorum is present and if it is held in accordance with the terms of the adjournment. If there is no quorum present at the reconvened meeting following the adjournment, the original meeting shall be deemed to have terminated forthwith after its adjournment.

8.13

Inquiries. The board or the chair of any meeting of shareholders may, but need not, at any time (including prior to, at, or subsequent to the meeting), ask questions of, and request the production of evidence from, a shareholder (including a beneficial owner), the transfer agent or such other person as the board or the chair considers appropriate for the purposes of determining a person’s share ownership position as at the relevant record date and authority to vote. For greater certainty, the board or the chair may, but need not, at any time:

(a)

inquire into the legal or beneficial share ownership of any person as at the relevant record date and the authority of any person to vote at the meeting; and

(b)

request from that person production of evidence as to such share ownership position and the existence of the authority to vote.

Any such inquiry or request by the board or the chair shall be responded to as soon as reasonably possible.

ARTICLE 9

NOTICES

9.1

Giving of Notice. Any notice or other document to be given or sent by the Corporation to a shareholder, director or officer or to the auditor of the Corporation or any other person may be given or sent by prepaid mail or by any electronic or other communication facility, or may be delivered personally to, the person to whom it is to be given or sent at the person’s latest address as shown in the records of the Corporation or its transfer agent or in any notice filed in accordance with the provisions of the Act. The board may establish, by resolution, procedures to give, deliver or send a notice or other document to the shareholders, directors, the auditor or other persons by any means permitted under the laws governing the Corporation or pursuant to the articles or by-laws of the Corporation. The accidental omission to give notice to any shareholder, director or officer or to the auditor or other persons or the non-receipt of any notice or any error in a notice not affecting the substance thereof shall not invalidate any action taken at any meeting called by such notice or otherwise founded thereon. Any notice with respect to any shares registered in more than one name may, if more than one address appears on the books of the Corporation in respect of such joint holding, be given the joint shareholders at any such address.

Subject to applicable laws, a notice or other document shall be deemed to have been given, delivered or sent:

(a)

when it is delivered personally or to the address recorded in the records or security register of the Corporation;

(b)

when it has been deposited in a post office or post office letter box; or

(c)

when it has been dispatched or delivered for dispatch by means of electronic or other communication facilities.

ARTICLE 10

DIVIDENDS AND OTHER RIGHTS

10.1

Dividends. Subject to the Act, the board may from time to time declare dividends payable to the shareholders according to their respective rights and interests in the Corporation.

10.2

Record Date for Dividends and other Rights. For the purpose of determining the persons entitled to receive payment of any dividend or for any other purpose except the right to receive notice of or to vote at a meeting of shareholders, the board may fix in advance a date preceding the date for the particular action by not more than 60 days for the determination of such persons. Notice of such date shall be given not less than 7 days prior to such date:

(a)

by advertisement in a newspaper distributed in the place where the Corporation has its registered office and in each place in Canada where it has a transfer agent or where a transfer of its shares may be recorded; and

(b)

by written notice to each stock exchange in Canada on which the shares of the Corporation are listed for trading.

If no record date is so fixed, the record date for the determination of the shareholders entitled to receive payment of any dividend or for any other purpose except the right to receive notice of or to vote at a meeting of shareholders shall be at the close of business on the day on which the board passes the resolution relating thereto.

ARTICLE 11

GENERAL

11.1

Financial Year. The financial year of the Corporation shall end on the 31^st day of December unless and until changed by the board.

11.2

Corporate Seal. The corporate seal shall bear the name of the Corporation and may bear such insignia as may be approved from time to time by the board.

11.3

Execution of Instruments. Contracts, documents and other instruments requiring execution by the Corporation may be signed on behalf of the Corporation by such directors and officers of the Corporation as are authorized by the board from time to time. The board may, by resolution, establish certain protocols and authorities for the signing of contracts, documents and other instruments on behalf of the Corporation. In the absence of any specific board authority, the chief executive officer, as to any instruments pertaining solely to a division, business unit or sub-unit, may designate any divisional or business unit officers or employees to execute instruments, either solely, with another, or generally or specifically, on behalf of such division or business unit. Any signing officer may affix the corporate seal to any instrument requiring the same.

11.4

Banking. The bank accounts of the Corporation shall be kept with such banks or trust companies as the board may from time to time determine and the board may appoint the chief financial officer and treasurer to determine such banks or trust companies from time to time. The board may appoint any person or persons as authorized signatories on any such bank accounts as it may from time to time determine.

ARTICLE 12

DIVISIONS AND BUSINESS UNITS

12.1

Creation and Consolidation of Divisions and Business Units. The board may cause the business and operations of the Corporation or any part thereof to be divided or to be segregated into one or more divisions or business units upon such basis, including without limitation, character or type of operation, geographical territory, product manufactured or service rendered, as the board may consider appropriate in each case. The board may also cause the business and operations of any such division or business unit to be further divided into sub-units and the business and operations of any such divisions, business units or sub-units to be consolidated upon such basis as the board may consider appropriate in each case.

12.2

Name of Division or Business Units. Any division, business unit or their sub-units may be designated by such name as the board may from time to time determine and may transact business, enter into contracts, sign cheques and other documents of any kind and do all acts and things under such name. Any such contract, cheque or document shall be binding upon the Corporation when signed in accordance with paragraph 11.3 as if it had been entered into or signed in the name of the Corporation.

ARTICLE 13

EFFECTIVE DATE AND REPEAL

13.1

Effective Date. This by-law shall come into force upon the date of the approval of the by-law by the board.

13.2

Repeal. The by-laws of the Corporation heretofore enacted are repealed. The repeal of such by-laws shall be without prejudice to any action taken or right acquired or obligation incurred thereunder. All directors, officers and other persons acting under any repealed by-law shall continue to act as if elected or appointed under the provisions of this by-law. All resolutions with continuing effect of the board, committees of the board and shareholders shall continue in effect except to the extent inconsistent with this by-law.

[Remainder of page intentionally left blank]

The foregoing by-law was approved by the directors of the Corporation effective October 1, 2024 and was confirmed without variation by the shareholders of the Corporation effect October 1, 2024.

/s/ Lori M. Muratta

Lori M. Muratta

Senior Vice-President and General Counsel

/s/ Kevin B. Engel

Kevin B. Engel

Vice-President, Corporate Finance

Exhibit 99.20


NewsRelease

TC Energy completes spinoff of its Liquids Pipelines business, South Bow

Corporation; TC Energy to issue third quarter results on Nov. 7

•

Company solidifies its position as an industry-leading natural gas infrastructure and power and energy solutions company

•

Third quarter 2024 results to be issued on Nov. 7, 2024

•

Will demonstrate strategic vision and outlook at Investor Day on Nov. 19, 2024

CALGARY, Alberta – Oct. 1, 2024 – News Release – TC Energy Corporation (TSX, NYSE: TRP) (TC Energy or the Company) today announced that it has completed the spinoff of its Liquids Pipelines business into South Bow Corporation (South Bow).

“Today is a pivotal moment for TC Energy’s future, one that delivers progress on a strategic priority and our commitment to shareholders to maximize the value of our assets,” said François Poirier, TC Energy’s President and Chief Executive Officer. “We are uniquely positioned as a highly focused natural gas infrastructure and power and energy solutions company. We will continue to deliver enduring shareholder value, while playing a critical role in meeting growing industry and consumer demand for more secure, affordable and sustainable energy across North America and globally.”

As a standalone entity, TC Energy is positioned to achieve greater success by executing a tailored strategy to fully capture the incremental value of its unique opportunity set. Focused on long-term energy fundamentals and capital discipline, the Company will maintain its regulated, low-risk and utility-like portfolio.

“On behalf of TC Energy, I wish the team at South Bow all the best, and I am excited for the unique opportunities that lie ahead for them,” said François. “Growing energy demand requires all forms of energy, and South Bow is well-placed to deliver resilient supply to the strongest demand markets in North America.”

The TC Energy common shares will resume “regular way” trading on the TSX and the NYSE on Oct. 2, 2024, under the designation TRP. The South Bow common shares will commence “regular way” trading under the designation SOBO on the TSX on Oct. 2, 2024, but will not trade “regular way” on the NYSE until one trading day after the U.S. Securities and Exchange Commission (SEC) declares South Bow’s registration statement on Form 40-F effective. TC Energy currently expects that the South Bow common shares will commence “regular way” trading on the NYSE on or about Oct. 8, 2024. Estimated proportionate allocation of adjusted cost base between TC Energy common shares and South Bow common shares is expected to be posted on the TC Energy and South Bow websites when available during fourth quarter 2024. Please refer to the document titled South Bow Listing Process – Q&A on the TC Energy and South Bow websites for further details about “due bill” and “if, as and when issued” trading, as well as other important information relating to the completion of the spinoff.

Third quarter 2024 financial results to be issued on Nov. 7, 2024

TC Energy will hold a teleconference and webcast on Nov. 7, 2024, to discuss its third quarter financial results.

François Poirier, TC Energy President and Chief Executive Officer, Sean O’Donnell, Executive Vice-President and Chief Financial Officer, and other members of the executive leadership team will discuss the financial results and Company developments at 6:30 a.m. MST / 8:30 a.m. EST.

Members of the investment community and other interested parties are invited to participate by calling 1-844-763-8274 (Canada/U.S.) or 1-647-484-8814 (international). No passcode is required. Please dial in 15 minutes prior to the start of the call. Alternatively, participants may pre-register for the call here. Upon registering, you will receive a calendar booking by email with dial in details and a unique PIN. This process will bypass the operator and avoid the queue. Registration will remain open until the end of the conference call. Upon registering, you will receive a calendar booking by email with dial in details and a unique PIN. This process will bypass the operator and avoid the queue. Registration will remain open until the end of the conference call.

A live webcast of the teleconference will be available on TC Energy’s website at TC Energy – Events and presentations or via the following URL: https://www.gowebcasting.com/13687. The webcast will be available for replay following the meeting.

A replay of the teleconference will be available two hours after the conclusion of the call until midnight EST on Nov. 14, 2024. Please call 1-855-669-9658 (Canada/U.S. toll free) or 1-412-317-0088 (International toll) and enter passcode 8801413#.

TC Energy intends to host Investor Day on Nov. 19, 2024

TC Energy’s senior leadership team will demonstrate the Company’s 2025 strategic priorities, long-term strategic outlook and growth objectives. Interested parties, please refer to TC Energy’s website at TC Energy – Events and presentations for more information once available.

About TC Energy

We’re a team of 7,000+ energy problem solvers working to safely move, generate and store the energy North America relies on. Today, we’re delivering solutions to the world’s toughest energy challenges – from innovating to deliver the natural gas that feeds LNG to global markets, to working to reduce emissions from our assets, to partnering with our neighbours, customers and governments to build the energy system of the future. It’s all part of how we continue to deliver sustainable returns for our investors and create value for communities.

TC Energy’s common shares trade on the Toronto (TSX) and New York (NYSE) stock exchanges under the symbol TRP. To learn more, visit us at TCEnergy.com.

FORWARD-LOOKING INFORMATION

This release contains certain information that is forward-looking and is subject to important risks and uncertainties (such statements are usually accompanied by words such as “anticipate”, “expect”, “believe”, “may”, “will”, “should”, “estimate”, “intend” or other similar words). Forward-looking statements in this document may include, but are not limited to, statements on expectations with respect to: the timing with respect to expected “regular way” trading of TC Energy common shares and South Bow common shares on the TSX and the NYSE following the closing of the spinoff, the effectiveness of South Bow’s Form 40-F and timing thereof, the expected timing and posting of proportionate adjusted cost base allocation on TC Energy and South Bow’s websites, the expected industry and consumer demand for sustainable energy and TC Energy’s role in delivering it, the ability of TC Energy to maintain its regulated, low-risk and utility-like portfolio and TC Energy’s strategic priorities and long-term outlook, including its focus on long-term energy fundamentals capital discipline, and long-term shareholder value, and the ability of South Bow to meet growing energy demand. Forward-looking statements in this document are intended to provide TC Energy security holders and potential investors with information regarding TC Energy and its subsidiaries, including management’s assessment of TC Energy’s and its subsidiaries’ future plans and financial outlook. All forward-looking statements reflect TC Energy’s beliefs and assumptions based on information available at the time the statements were made and as such are not guarantees of future performance. As actual results could vary significantly from the forward-looking information, you should not put undue reliance on forward-looking information and should not use future-oriented information or financial outlooks for anything other than their intended purpose. We do not update our forward-looking information due to new information or future events, unless we are required to by law. For additional information on the assumptions made, and the risks and uncertainties which could cause actual results to differ from the anticipated results, refer to the most recent Quarterly Report to Shareholders and Annual Report filed under TC Energy’s profile on SEDAR+ at www.sedarplus.ca and with the U.S. Securities and Exchange Commission at www.sec.gov.

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Media Inquiries:

Media Relations

media@tcenergy.com

403-920-7859 or 800-608-7859

Investor & Analyst Inquiries:

Gavin Wylie / Hunter Mau

investor_relations@tcenergy.com

403-920-7911 or 800-361-6522

Exhibit 99.21


				NEWS RELEASE

LOGO

SOUTH BOW CORPORATION LAUNCHES AS INDEPENDENT COMPANY

CALGARY, Alberta – Oct. 1, 2024 – South Bow Corporation (South Bow) is launching as an independent company after completing its planned separation from TC Energy Corporation (TC Energy). South Bow’s common shares will commence trading on the Toronto Stock Exchange (TSX) on Oct. 2, 2024, and are expected to commence trading on the New York Stock Exchange (NYSE) on or about Oct. 8, 2024, under the ticker symbol SOBO.

“Today is an exciting day for South Bow as we start a new chapter of safely and reliably delivering energy and forging progress as a critical North American energy infrastructure company,” said Bevin Wirzba, South Bow’s President and Chief Executive Officer. “We are confident that as a standalone, publicly traded company, we will unlock significant value from our unrivalled market position. Supported by strong business fundamentals and a robust backdrop for crude oil supply and demand, we are focused on creating long-term value for our customers, communities, employees, and shareholders.”

“On behalf of South Bow’s leadership team and board of directors, I want to thank our team of founders for their tremendous efforts and dedication in getting us to this new beginning. It is a privilege to launch this company and celebrate this milestone alongside them,” added Wirzba.

South Bow is a liquids pipelines company that connects resilient Canadian crude oil supply to the strongest demand and refining markets in the U.S. Midwest and Gulf Coast through its strategic corridor, high-quality contractual framework, and investment-grade financial position. South Bow plans to take a disciplined approach to capital allocation to deliver a compelling return to shareholders, prioritizing strengthening its financial position and pursuing low-risk, modest capital investments that enhance and expand its pre-capitalized corridor. South Bow intends to pay a strong and sustainable base dividend that is underpinned by a stable cash flow profile.

South Bow intends to declare its inaugural dividend on Nov. 7, 2024. The dividend is expected to be paid on Jan. 31, 2025 to shareholders of record on Dec. 31, 2024. Dividends are subject to the discretion and approval of South Bow’s board of directors.

South Bow common shares were distributed on Oct. 1, 2024 to TC Energy shareholders of record on Sept. 25, 2024, who received one South Bow common share for every five TC Energy common shares owned.

Forward-looking information and statements

This news release contains certain forward-looking statements and forward-looking information (collectively, forward-looking statements), including forward-looking statements within the meaning of the “safe harbor” provisions of applicable securities legislation, that are based on South Bow’s current expectations, estimates, projections, and assumptions in light of its experience and its perception of historical trends. All statements other than statements of historical facts may constitute forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as, “anticipate”, “will”, “expect”, “estimate”, “potential”, “future”, “outlook”, “strategy”, “maintain”, “ongoing”, “intend”, and similar expressions suggesting future events or future performance.

LOGO

In particular, this news release contains forward-looking statements, including certain financial outlooks, pertaining to, without limitation, the following: statements regarding South Bow’s business strategy, areas of focus, and actions taken in relation thereto; expectations about current and future industry activities and market conditions, including their expected impact on South Bow; expectations about future demand for South Bow’s infrastructure and services; South Bow’s capital structure and allocation, including future actions that may be taken with respect thereto and expectations regarding future cash flows and uses thereof; expectations regarding South Bow’s commercial agreements and development opportunities, including the expected timing and benefit thereof; competitive conditions and South Bow’s ability to position itself competitively in the industry; expectations regarding the declaration and payment of dividends South Bow intends to pay to shareholders, including expected dividend payment dates; and expected dates when South Bow’s common shares will commence trading on the TSX and NYSE.

The forward-looking statements are based on certain assumptions that South Bow has made in respect thereof as at the date of this news release regarding, among other things: oil and gas industry development activity levels and the geographic region of such activity; that favourable market conditions exist and that South Bow has and will have available capital to fund its capital expenditures and other planned spending; prevailing commodity prices, interest rates, inflation levels, carbon prices, tax rates, and exchange rates; the ability of South Bow to maintain current credit ratings; the availability of capital to fund future capital requirements; future operating costs; asset integrity costs; that all required regulatory and environmental approvals can be obtained on the necessary terms in a timely manner; prevailing regulatory, tax, and environmental laws and regulations; and the expectation that South Bow will satisfy the conditions to listing its common shares on the TSX and NYSE in a timely manner.

Although South Bow believes the assumptions and other factors reflected in these forward-looking statements are reasonable as of the date hereof, there can be no assurance that these assumptions and factors will prove to be correct and, as such, forward-looking statements are not guarantees of future performance. Forward-looking statements are subject to a number of known and unknown risks and uncertainties that could cause actual events or results to differ materially, including, but not limited to: the regulatory environment and related decisions and requirements; the impact of competitive entities and pricing; reliance on third parties to successfully operate and maintain certain assets; the strength and operations of the energy industry; weakness or volatility in commodity prices; non-performance or default by counterparties; actions taken by governmental or regulatory authorities; the ability of South Bow to acquire or develop and maintain necessary infrastructure; fluctuations in operating results; adverse general economic and market conditions; the ability to access various sources of debt and equity capital on acceptable terms; and adverse changes in credit. The foregoing list of assumptions and risk factors should not be construed as exhaustive. For additional information on the assumptions made, and the risks and uncertainties which could cause actual results to differ from the results implied by forward-looking statements, refer to South Bow’s alternative annual information form dated Sept. 30, 2024, available under South Bow’s SEDAR+ profile at www.sedarplus.ca and, from time to time, in South Bow’s public disclosure documents, available at www.sedarplus.ca, www.sec.gov, and through South Bow’s website at www.southbow.com.

The forward-looking statements contained in this news release speak only as of the date hereof. South Bow does not undertake any obligation to publicly update or revise any forward-looking statements or information contained herein, except as required by applicable laws. All forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

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LOGO

About South Bow

South Bow safely operates 4,900 kilometres (3,045 miles) of crude oil pipeline infrastructure, connecting Alberta crude oil supplies to U.S. refining markets in Illinois, Oklahoma, and the U.S. Gulf Coast through our unrivalled market position. We take pride in what we do – providing safe and reliable transportation of crude oil to North America’s highest demand markets. Based in Calgary, Alberta, South Bow is the spinoff company of TC Energy, with Oct. 1, 2024 marking South Bow’s first day as a standalone entity. To learn more, visit www.southbow.com.

Contact information


Investor Relations		Media Relations
Martha Wilmot		Katie Stavinoha
investor.relations@southbow.com		communications@southbow.com

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