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Hardly a day goes by without demoralizing news from Canada’s oil patch. From a strangely low price for heavy crude to a back-up in inventories to a call for production cuts, a lot of grief has been weighing on energy stocks this year.

But it’s not all grim. Some companies are performing well within the difficult operating environment. One stand-out winner: Calgary-based Gibson Energy Inc., which has seen its share price rally 29 per cent since the end of May.

That’s a remarkable move given that the iShares S&P/TSX Capped Energy Index ETF, an exchange-traded fund that tracks the energy sector, has declined 19 per cent over the same period.

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Why has Gibson been zigging when the energy sector has been zagging? It largely comes down to what Gibson does: It’s an infrastructure company that provides 12 million barrels of above-ground storage at terminals in Hardisty and Edmonton.

This is a growth area. Oil producers rely on storage prior to exporting crude along pipelines or by truck and rail. And storage is particularly valuable right now, when oil producers are having trouble shipping their crude to U.S. refineries.

Pipeline-expansion plans, including the Keystone XL and Trans Mountain Expansion, have been delayed by court rulings and regulatory roadblocks, at a time when producers are increasing their output as new projects come online.

As a result, exporters face bottlenecks and oil inventories are rising. The price of Western Canadian Select (WCS), the name for the diluted bitumen produced in the oil sands, is trading at a fraction of global benchmarks, such as West Texas intermediate (WTI) crude.

The spread between WCS and WTI, averaging between US$17 and US$18 a barrel over the past decade, has widened to about US$40 a barrel – a perplexing discount that is hurting oil producers. Even Suncor Energy Inc., whose diverse operations limit the company’s exposure to WCS, has seen its share price fall 19 per cent since the end of July.

But Gibson is largely insulated from these market gyrations, and it noted earlier this month that the wide discount between WCS and WTI actually helps parts of its operations in the short-term. It is also appealing to investors with a giant 6.1-per-cent dividend yield, rising profits and bold expansion plans.

In mid-October, the company announced it will build two 500,000-barrel storage tanks at the Hardistry Terminal, and believes it has the ability to expand by two to four additional tanks each year over the next several years.

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Meanwhile, Gibson is generating improving financial results. In its third-quarter results, released on Nov. 6, net income after adjusting for discontinued operations rose to $6.8-million from a loss of $5.4-million in the third quarter of 2017. EBITDA (earnings before interest, taxes, depreciation and amortization) rose to $144-million from $58-million in the prior year. Revenue from continuing operations increased 64 per cent.

Robert Kwan, an analyst at RBC Dominion Securities, responded by raising his expectation of where the shares will be trading in 12 months – a novelty in the struggling energy sector. His new target price is $24, up from $22, implying gains of about 12 per cent.

There are risks, of course. While the glut of Western Canadian Select oil is driving demand for storage and helping Gibson right now, a prolonged slump in the oil patch could weigh on production levels and reduce the need for its storage services.

This threat is real. Cenovus Energy Inc. and Canadian Natural Resources Ltd. are asking for industrywide production cuts. But if you want to bet that the oil will continue to flow amid continuing delays with pipeline construction, Gibson looks like a good bet: You get the energy exposure without the energy headaches.

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