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Vol. 13, No. 48 Week of November 30, 2008
Providing coverage of Alaska and northern Canada's oil and gas industry

AK-WA Connection 2008: TransCanada leaps out of starting gate

Canadian pipeline operator draws on expertise in Anchorage, Puget Sound for preliminary work on Alaska gas pipeline project

Rose Ragsdale

For the Alaska-Washington Connection

Now that the State of Alaska has awarded a license to TransCanada Corp. for building a pipeline to market North Slope natural gas, the Calgary, Alberta-based company is pursuing plans it outlined to Alaska officials in securing the green light for the project,

Work is already under way even though the legislation that authorizes TransCanada to take the lead in developing the gas line does not take effect until after Thanksgiving, 91 days after Alaska Gov. Sarah Palin signed the bill into law Aug. 27.

After the license has been signed by Alaska’s commissioners of Natural Resources and Revenue, TransCanada will be reimbursed under terms of the gas line legislation for a portion of its expenses on the project. Capital cost of the pipeline is expected to exceed $26 billion (in 2007 dollars).

TransCanada is now focused on moving ahead with project development, including engineering, environmental reviews, regulatory reviews in Canada and the U.S., aboriginal relations and commercial work, according to a company spokeswoman.

The pipeline operator hopes to conclude an initial open season to ascertain interest in pipeline among potential gas shippers by July 2010.

If the open season attracts enough shipping commitments from gas producers or future producers, TransCanada will apply for approval of the Federal Energy Regulatory Commission to use pre-filing procedures by April 2011; and to apply for FERC certificates of public convenience and necessity (CPCN) to authorize the construction and operation of the Alaska Section of the pipeline and gas treatment plant by October 2012. In addition to the FERC CPCN approval, other major regulatory approvals are required for the project.

“We would expect the FERC to issue certificates of public convenience and necessity authorizing the construction and operation of the Alaska Section in June 2014,” said Cecily Dobson, a TransCanada spokeswoman. “Construction of the project would begin after regulatory approvals are received in (the fourth quarter of) 2014. We would expect the pipeline to be in service by September 2018.”

No time to waste

Though the gas pipeline’s projected startup is at least a decade away, TransCanada is wasting no time getting started. The company has let contracts for aerial photography to Aerometric Inc., which has offices in Anchorage and Seattle, engineering planning to Colt Engineering, which has offices in Calgary and Anchorage, and environmental planning to ENSR, which has three offices in the Puget Sound area and one in Anchorage.

TransCanada also plans to hire a number of contractors to assist with technical, regulatory and commercial work in preparation for the planned open season in 2010, Dobson said.

In addition, Port of Anchorage officials report that TransCanada contractors have visited the port recently to review its expanding capabilities.

As for Alaska, Washington State and northwestern Canada business communities interested in encouraging development of the Alaska gas pipeline project, Dobson said they “can continue to support the project publicly and politically, as well as assist TransCanada in specific contractor roles as required.”



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