TransCanada set to make move into North American LNG

Gary Park, Petroleum News Calgary correspondent

TransCanada PipeLines is set to make an aggressive move into the North American liquefied natural gas sector, convinced that continental gas demand will climb by 26 percent over the next decade.

Hal Kvisle, chief executive officer of the Calgary-based pipeline, forecast LNG imports alone will rise to 7.7 billion cubic feet per day by 2012 from 600 million cubic feet per day in 2002, while total North American gas demand will surge to 86 billion cubic feet per day from 68 billion currently.

Speaking at TransCanada’s annual meeting April 25, he said the firm believes large-volume LNG imports will be an inevitable part of the supply equation and is now exploring “multiple” potential investments.

“The part we are interested in is a facility based in North America that receives the liquid and re-gasifies it and then pipelines it into the existing pipeline grid,” he said.

Kvisle estimated that LNG receiving terminals would range in cost from US$300 million to US$1 billion. He said TransCanada would likely be seeking partners for any venture.

He said the greatest growth in LNG demand will likely occur between 2007 and 2012 when new supplies start arriving on the U.S. East Coast from Trinidad and Venezuela, but before any Arctic gas can come on stream.

Also interested in shipping

Using gas transportation modules, “stranded” gas that is currently reinjected could be taken from floating production, storage and offloading systems and delivered to markets. Results of the studies are expected later this year.