Good afternoon, ladies and gentlemen. Welcome to TransCanada's conference call. I would now like to turn the meeting over to Mr. David Moneta, Vice President, Investor Relations. Please go ahead, Mr. Moneta.
Thanks very much. Good afternoon, everyone. We're pleased you could join us today for an update on a number of strategic initiatives. Please note that a slide presentation will accompany our remarks. A copy of the presentation is available on our website at transcanada.com. It can be found in the investor section under the heading Events and Presentations. In accordance with securities laws, we will not hold a question and answer session today. Also, in connection with our common share offering, please note that this presentation does not contain all the information related to the offering. Before we begin, I'd like to remind you that our remarks today will include forward-looking statements that are subject to important risks and uncertainties. For more information on these risks and uncertainties, please see the reports filed by TC Energy with Canadian securities regulators and with the U.S. Securities and Exchange Commission.
Finally, during this presentation, we'll refer to certain non-GAAP measures such as comparable earnings before interest, taxes, depreciation, and amortization or comparable EBITDA, comparable earnings, comparable earnings per share, comparable funds generated from operations, and comparable distributable cash flow. These measures do not have any standardized meaning under GAAP, and as a result, they may not be comparable to similar measures presented by other entities. With me to discuss today's developments are Russ Girling, our President and Chief Executive Officer, and Don Marchand, Executive Vice-President, Strategy & Corporate Development and Chief Financial Officer. I'll now turn the call over to Russ for his comments.
Thanks, David. Good afternoon, everyone. Thank you very much for joining us. I'm very pleased to provide an update on a number of strategic initiatives that have been underway at TC Energy. Together, the actions are expected to add to our growth portfolio, be accretive to earnings per share, strengthen our financial position, and support an expected annual dividend growth rate at the upper end of our previous guidance of 8%-10% through 2020. Before I expand on these initiatives, I'd like to briefly comment on our third quarter results. Earlier today, we reported a net loss attributable to common shares of CAD 135 million, or CAD 0.17 per common share, which includes a CAD 656 million after-tax goodwill impairment charge related to our U.S. Northeast power business.
Excluding the goodwill impairment and certain other specific items, comparable earnings for the third quarter were CAD 622 million, or CAD 0.78 per share, an increase of CAD 182 million or CAD 0.16 per share over the same period last year. Comparable funds from operations of CAD 1.4 billion also increased substantially versus the third quarter of 2015. Turning to the strategic initiatives. First, we have advanced the monetization of our U.S. Northeast power business by entering two separate sales agreements. In total, we expect to realize approximately $3.7 billion when the monetization of the business, including our power marketing operation, is complete. These proceeds will be used to pay a portion of the $6.9 billion U.S. Columbia Bridge loan facility.
We also announced the decision to maintain our full ownership interest in a growing portfolio of natural gas pipeline assets in Mexico rather than sell a minority interest to fund a portion of the Columbia acquisition. This portfolio includes $3.8 billion of projects in construction or development that are expected to enter service by the end of 2018. Once completed, annual EBITDA from our Mexico business is expected to rise from $181 million in 2015 to approximately $575 million. In addition, we reached an agreement to acquire for cash all of the outstanding publicly held common units of Columbia Pipeline Partners LP, or CPPL, for $17 per common unit. This equates to a total investment of approximately $950 million. Finally, in conjunction with our decision to maintain our full ownership interest in Mexico, we announced a CAD 3.2 billion bought deal common share offering.
The offering is expected to close on November 16th. Proceeds will be used to repay a portion of the Columbia Bridge Loan facility. I'll elaborate on each of these developments in just a minute. Again, I wanted to comment on our quarter 2016 results. When compared to the same period last year, comparable earnings per share increased by 26%. Comparable funds generated from operations rose 23%. Comparable distributable cash flow improved by 8%. Our strong financial results reflect the July 1st acquisition of Columbia and continued solid performance from our large portfolio of high-quality energy infrastructure assets. Results include higher contributions from our natural gas pipelines, including ANR, NGTL, and Mexican pipelines, higher interest income and other, as well as higher contributions from U.S. Power and Bruce Power. This was partially offset by higher interest expenses and lower contributions in our liquids businesses.
Also today, our board of directors declared a quarterly dividend of CAD 0.565 per common share for the quarter ending December 31st, 2016, equivalent to CAD 2.26 per common share on an annualized basis. Turning now to the monetization of our new U.S. Northeast power business, where we expect to realize a total of approximately $3.7 billion from the business. First, we've agreed to sell the Ravenswood, Ironwood, Ocean State Power, and Kibby Wind facilities to Helix Generation LLC, an affiliate of LS Power Equity Advisors, for $2.2 billion. We also agreed to sell TC Hydro to Great River Hydro LLC, an affiliate of ArcLight Capital Partners, LLC, for $1.065 billion. These transactions are expected to close in the first half of 2017, subject to regulatory and other approvals, and will include closing adjustments.
The remainder of the monetization proceeds is attributed to the power marketing business, which is expected to be realized on a going-forward basis. Proceeds will be used to repay a portion of the Columbia Bridge loan facilities. The sales are expected to result in an approximate $1.1 billion after-tax net loss, which is comprised of a $656 million after-tax goodwill impairment charge recorded September 30th, 2016, an approximate $863 million after-tax net loss on the sale of the thermal and wind package to be recorded in the fourth quarter of 2016, and an approximate $443 million after-tax gain on the sale of the hydro package upon closing of that transaction, which is expected in 2017. Sale of our U.S. Northeast merchant business will serve to further enhance the stability and predictability of our earnings and cash flow streams going forward.
Following the sale, the proportion of earnings before interest, taxes, depreciation, and amortization, or EBITDA, is expected to come from regulated and long-term contracted assets, is expected to exceed 95%. Turning to Mexico. While we received credible binding bids for those assets, we've decided to maintain our full ownership interest in a growing portfolio of natural gas pipeline assets rather than sell a minority interest in the six pipelines. TransCanada currently owns and operates the Guadalajara and Tamazunchale natural gas pipelines and is investing US$3.8 billion to construct four additional pipelines and to fund our 60% interest in the Sur de Texas project. All of these projects are underpinned by 25-year U.S. dollar take-or-pay contracts with CFE. The Topolobampo and Mazatlán projects are substantially complete. We began collecting revenue on Topolobampo in July and expect to start receiving revenue on the Mazatlán project by the end of the year.
Once the remaining three projects enter service in 2017 and 2018, we expect our Mexican assets to generate approximately US$575 million of annual EBITDA, up from US$181 million in 2015. While it was our plan to sell a minority interest in the business, we determined that we would maximize short- and long-term shareholder value by retaining full ownership interest and instead accessing capital markets. This allows us to fully capture the future growth associated with the portfolio. It's expected to be accretive to earnings per share and is consistent with maintaining a simple corporate structure. With respect to our Master Limited Partnership strategic review, we reached an agreement to acquire, for cash, all of the outstanding publicly held units of CPPL at a price of US$17 per common unit for a total of US$950 million.
This represents an increase of US$1.25 or 8% per common unit when compared to the initial offer of $15.75 per common unit. The transaction is expected to close in the first quarter of 2017, subject to the receipt of CPPL unitholder approval. Common unitholders will continue to receive regularly quarterly distributions of $0.1975 per common unit, including a prorated distribution for any partial period to the closing date. The acquisition increases our interest in Columbia's principal assets to 100% and allows us to fully capture the growth associated with this large capital program. It is also expected to be accretive to earnings per share and has the added benefit of, again, simplifying our corporate structure. This completes our review of the strategic alternatives for our MLP holdings.
Going forward, TC PipeLines, LP remains a core element of TransCanada's strategy and is expected to play a role in meeting our future funding needs. The actions announced today build on the transformational acquisition of Columbia, which created one of North America's largest regulated natural gas transmission businesses and provided us with a new platform for growth. It was a rare opportunity to acquire premium natural gas pipeline and storage assets in one of North America's fastest-growing, lowest-cost supply basins. Columbia complements our overall strategy of owning and developing highly contracted and regulated assets that generate stable and predictable earnings and cash flow. Since July, we have made significant progress integrating Columbia's operations with our U.S. natural gas pipeline business, and we are well on track to realize the targeted $250 million of annualized benefits.
We also continue to advance approximately $7.7 billion of Columbia growth projects, which are largely expected to be in service by 2018, with certain modernization initiatives to be completed by 2020. I'll now turn the call over to Don to discuss our broader growth portfolio and our funding plan.
Thanks, Russ. Good afternoon, everyone. Columbia's $7.7 billion growth program brings our portfolio of near-term commercially secured projects to over CAD 25 billion and includes CAD 21 billion of natural gas pipeline projects, primarily related to Columbia, NGTL, and Mexico, CAD 2 billion of liquids pipeline projects in Grand Rapids and Northern Courier, and CAD 2 billion of power projects at Napanee and Bruce Power. They are all underpinned by regulated business models or long-term contracts. Approximately CAD 7.5 billion has been invested in these projects to date, with the remainder to be spent over the balance of the decade. As these projects are placed into operation over the next four years, they are expected to generate significant growth in earnings and cash flow. Turning now to our funding plans.
In conjunction with the company's decision to maintain our full ownership interest in our Mexican natural gas pipeline assets, we announced we have entered into a CAD 3.2 billion bought deal common share offering with a syndicate of underwriters led by TD, RBC, and BMO. We have also granted them an option to purchase up to an additional 5.475 million common shares at the same offering price of CAD 58.50 per common share at any time up to 30 days after close of the offering. Proceeds will be used to repay a portion of the Columbia Bridge Loan facilities. We also intend to prudently fund our ongoing capital program in a manner consistent with maintaining our financial strength.
Going forward, multiple attractive funding options are available to us, which include cash on hand of CAD 2.3 billion as of September 30th, predictable and growing internally generated cash flow, senior debt, preferred shares, hybrid securities, portfolio management, including drop-downs to TC PipeLines, LP, and common equity through our dividend reinvestment plan and, if appropriate, establishment of an at-the-market or ATM equity issuance program. In July, we reinstated the issuance of common shares from treasury at a 2% discount under our dividend reinvestment plan, commencing with the third quarter dividends paid on October 31st, which resulted in approximately CAD 175 million or 39% of these dividends being reinvested in TransCanada common shares. The DRIP aligns well with our expected spending profile over the next few years and should provide meaningful subordinated capital to maintain our financial strength through a capital program of this magnitude in a compressed timeframe.
With the dividend reinvestment plan and, if appropriate, the establishment of an ATM program, we do not foresee a need for additional discrete equity to finance our current CAD 25 billion suite of near-term growth projects. I'll now turn the call back over to Russ.
Thanks, Don. As you can see on this chart, we have a long history of prudently raising the dividend supported by earnings and cash flow generation. Over the past 16 years, it has increased from CAD 0.80 to the current dividend of CAD 2.26 per share. This equates to an average annual dividend growth rate of 7%. At the same time, we have maintained an industry-leading earnings and cash flow coverage payout ratios. Based on our confidence in our growth plans, we expect to increase the dividend at an annual rate that is at the upper end of our previous guidance range of 8%-10% through 2020. In summary, we believe the actions announced today will contribute to both short- and long-term shareholder value. Monetization of our U.S. Northeast Power business increases the stability and predictability of our EBITDA.
Maintaining our full interest in growing Mexican natural gas pipelines and instead accessing capital markets is expected to be accretive to earnings per share. The acquisition of Columbia Pipeline Partners, LP increases our ownership in Columbia's principal assets to 100% and further simplifies our corporate structure. Together, these actions are expected to add to our growth portfolio, be accretive to comparable earnings per share in 2017 and thereafter, strengthen the company's financial position, and support annual dividend growth at the upper end of our previous guidance of 8%-10% through 2020. To conclude, I'd leave you with the following key messages. Today, we are a leading North American energy infrastructure company with a strong track record of delivering long-term shareholder value, including a 15% average annual return since 2000.
Our visible CAD 25 billion growth portfolio of commercially secured low-risk projects is expected to generate significant growth in earnings and cash flow. This is expected to support, as I said, an annual dividend growth rate at the upper end of our previous guidance range of 8%-10% through 2020. We are well-positioned to prudently fund our industry-leading capital program. That concludes my remarks. I'll turn the call back to David.
Thank you very much for participating today. We very much appreciate your interest in TransCanada. We look forward to talking to you again soon. Thanks again. Have a great afternoon.
Thank you. The conference has now ended. Please disconnect your lines at this time. We thank you for your participation.