... TransCanada Montney Mainline Receives NEB Recommendation - North American Energy Pipelines

TransCanada Montney Mainline Receives NEB Recommendation

transcanada-logoThe TransCanada Corp. North Montney Mainline Project received the National Energy Board‘s recommendation that the Canadian government approve the proposed $1.7 billion project.

“The project is a critical component in the infrastructure chain between prolific and growing Canadian gas supply and existing and new markets, and the NEB recommendation is a significant milestone for the growth of our NOVA Gas Transmission Ltd. (NGTL) System,” said Russ Girling, TransCanada‘s president and CEO. “This Project and the NGTL System are important parts of TransCanada’s $46 billion capital growth plan, which includes more than $14 billion in proposed natural gas pipeline projects to support the emerging liquefied natural gas (LNG) industry on the west coast of British Columbia.”

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The proposed North Montney Mainline Project will provide substantial new capacity on the NGTL System to meet the transportation requirements associated with rapidly increasing development of natural gas resources in the Montney supply basin in northeastern B.C.

The project will connect Montney and other Western Canadian Sedimentary Basin supply to both existing and new natural gas markets, notably emerging markets for LNG, and will generate long-term economic opportunities for B.C. and its northern communities.

The NEB also approved the applied-for rolled-in tolling design for the project costs during a transition period, subject to certain conditions which TransCanada is reviewing. Following the transition period, TransCanada will have the option of applying to the board for a revised tolling methodology, or will have the option of implementing stand-alone tolling on the project. TransCanada will engage its shippers to determine an appropriate approach that best meets market requirements.

The project will consist of two large diameter, 42-in. pipeline sections, Aitken Creek and Kahta, totaling approximately 301 km (187 miles) in length, and associated metering facilities, valve sites and compression facilities.

The project will also include an interconnection with TransCanada’s proposed Prince Rupert Gas Transmission Project to provide natural gas supply to the proposed Pacific NorthWest (PNW) LNG liquefaction and export facility near Prince Rupert, B.C. Subject to certain conditions, NGTL expects to have the Aitken Creek Section in service in 2016, and the Kahta Section in service in 2017.

The initial capacity of the North Montney Mainline will allow the shipment of approximately 2.4 billion cubic feet/day (bcf/d) of natural gas. Progress Energy Canada Ltd., a subsidiary of the Malaysian integrated energy company, PETRONAS, has contracted for 2.0 bcf/d of firm receipt service and 2.1 bcf/d of firm delivery service.

Other producers have signed contracts for 78 million cubic feet/day, and NGTL is also continuing discussions with other parties that have expressed interest in obtaining transportation services that would utilize the North Montney Mainline facilities.

TransCanada will comply with all regulatory requirements and is evaluating the various conditions the NEB proposed in the report. Under one of the conditions, TransCanada can begin construction on the North Montney Mainline Project only after a positive final investment decision (FID) has been made on the proposed PNW LNG Project, and TransCanada is proceeding with construction of the Prince Rupert Gas Transmission Pipeline.

In response to other conditions, TransCanada will continue to engage and work with affected Aboriginal groups on further opportunities to address and mitigate routing and other potential project impacts.

A link to the full NEB report can be found by clicking here.

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