TransCanada targets September 2018 pipeline startup, 2010 open season

TransCanada is aiming for July 2010 to hold an open season for the Alaska Gas Pipeline, giving itself until then to achieve alignment with potential shippers, chief executive officer Hal Kvisle said Sept. 30.

He told an International Pipeline Conference that while work proceeds on the Alaska project, frustrations and costs keep building over the Mackenzie Gas Project.

Kvisle said engineering, environmental reviews; negotiations on aboriginal relations and commercial work are all proceeding in Alaska.

If the open season generates sufficient firm shipping contracts, TransCanada would seek regulatory approvals and start construction, targeting an in-service date of September 2018.

Kvisle said his company is “working towards holding an open season and working towards a very comprehensive regulatory filing.”

Regardless of how much gas comes out of North America’s shale plays, he anticipates sufficient unused capacity to move the gas to market by the time the Alaska gas line comes on-stream.

He also continued to voice hope that commercial discussions with Alaska’s three big producers will get under way in time.

But Kvisle said his view of the Mackenzie project was influenced by the plodding progress on the regulatory front.

By the end of 2008 – likely at least six months from final regulatory approvals – the co-venturers will have spent C$800 million on a project he described as “from the biggest or most complicated project” the industry has dealt with.

“The Mackenzie is a very significant example of regulatory challenges,” even though the National Energy Board has expeditiously handled exhaustive regulatory applications.

But “countless” other regulatory aspects related to a northern pipeline has left the industry partners “very frustrated with the degree to which we’ve been bogged down,” Kvisle said.

He said TransCanada is well positioned to take advantage of growing shale gas production in the United States and Canada, which he said has “emerged as a very significant potential contributor” compared with seven or eight years ago when it was not even on TransCanada’s radar.

– Gary Park