June 15, 2001 --- Vol. 7, No. 69June 2001

No bottlenecks in Alberta

A senior official with TransCanada PipeLines says Arctic natural gas will face no pipeline bottlenecks in Alberta, whether one or two lines cross the province.

Bob Reid, executive director of the company's Mackenzie Valley initiative, said TCPL's pipeline network within the province can accommodate gas from both the North Slope and the Northwest Territories.

Now that the Alliance pipeline from northern British Columbia to Chicago is operating is averaging 1.5 billion cubic feet per day and the Northern Border pipeline from Western Canada to Chicago is delivering about 2.35 billion cubic feet per day, TCPL's massive Alberta system is running at less than capacity, Reid told a Canadian International Petroleum Conference.

He said there is also spare capacity on the liquids-rich Alliance line for producers who want to send natural gas liquids to chemical plants in the Chicago area.

In addition, he said, declining production from Western Canadian wells and the need for about 1 billion cubic feet per day of gas to power an influx of oil sands and heavy oil projects in northern Alberta means the TCPL grid can carry as much gas as flows south with only minor expansions.

"We are well positioned to take gas into our system from both the Mackenzie Valley and the Alaska Highway lines," he said. "All we have to do is re-jig the system to accommodate incremental volumes in a very efficient manner."

Reid said that using existing pipelines bound for the United States would cut capital costs for producers who face combined price tags of at least C$10 billion if the two pipelines proceed, shipping an anticipated 3.3 billion cubic feet per day of Arctic gas within a decade.

Reid said TCPL believes markets will dictate that both lines are built, although he said the "over-the-top" proposal, while technically possible, is unlikely given the risks associated with the environment.

TCPL is a joint partner with Westcoast Energy in Foothills Pipe Lines, the leading contender to operate an Alaska Highway pipeline. Both companies along with Calgary-based Enbridge are also front-runners to participate in a Mackenzie Valley line.

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