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TransCanada chasing LNG deals Expects flat supply until Arctic and LNG projects are online Gary Park Petroleum News Calgary Correspondent
TransCanada is wasting no time pursuing its belief that Arctic gas and liquefied natural gas will be a key part of the North American equation.
“We see a pretty flat supply picture for the next five years until northern (North Slope and Mackenzie Delta) gas comes to market,” Chief Executive Officer Hal Kvisle told analysts July 25.
He said TransCanada is already on the trail of partnerships and opportunities to participate in the construction of LNG terminals in eastern Canada and the United States.
“We have a number of well-advanced, fairly detailed (LNG) concepts that we’re working on and some excellent relationships” with key players, Kvisle said.
He said Canada’s dominant gas pipeline company has spent the last two years working “quite diligently and fairly thoroughly with a competent group of people ... on a number of different LNG opportunities.”
However, he declined to identify any of the other parties “until we actually have deals in place.” North American gas shortage looming Kvisle has been one of the strongest proponents of LNG’s role in heading off a looming North American gas shortage that TransCanada officials have blamed partly on the failure of regulators to grasp the decline in pipeline volumes as production has sagged in the Western Canada Sedimentary Basin.
“TransCanada is in the gas and power business for the long term and we look forward to playing a significant role in bringing new sources of natural gas to the North American marketplace,” he said in the conference call.
To that end, he noted that TransCanada has “made significant progress on a number of fronts during the first half of 2003,” notably the agreement that sets it up for an ownership stake in the proposed Mackenzie Valley pipeline.
As well, TransCanada acquired from Duke Energy the 50 percent it did not already own in Foothills Pipe Lines, which has certificates to build the Canadian portion of an Alaska Highway pipeline.
“Full ownership of Foothills will enable TransCanada to play a more direct leading role in bringing the Canadian portion of this mammoth project on stream,” Kvisle said.
TransCanada said a recent regulatory rate settlement with gas producers caused a 1.5 percent drop in its second-quarter earnings to C$202 million (US$146 million) from the same period a year ago. Its revenues dropped C$34 million (US$24 million) to C$1.31 billion (US$943 million).
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