TransCanada hopes to ‘win the day’ in U.S. pipeline deal

Gary Park

Petroleum News Calgary correspondent

TransCanada is close to locking up another deal that could eventually see its natural gas pipeline network stretch across most of North America. As the Calgary-based pipeline company wheels and deals to take a lead role in both the planned North Slope and Mackenzie Delta projects it is on the verge of locking up another key delivery leg in the United States.

Chief Executive Officer Hal Kvisle said TransCanada hopes within two to three months to close a US$1.7 billion deal to acquire Gas Transmission Northwest, which carries 2.9 billion cubic feet per day from the British Columbia border to the California-Oregon border.

While there are a “number of steps and uncertainties along the way” including the possibility of another bidder surfacing, he is confident TransCanada “will win the day” and acquire GTN, a unit of PG&E Corp., which has just emerged from three years under bankruptcy protection.

Kvisle said TransCanada is also looking to acquire larger stakes in pipelines it co-owns, such as the Iroquois system in the U.S. Northeast, where it holds a 41 percent stake in a 1 billion cubic foot per day pipeline. As well, he said the search is on for new sites for a liquefied natural gas terminal on the U.S. eastern seaboard after its US$400 million joint venture with ConocoPhillips was scuttled by residents of a tiny Maine fishing village.

Kvisle said a replacement location would need to have “lower human impact” than the original plan.

He was not concerned about proposals for two LNG terminals in Atlantic Canada that could feed 1 billion to 2 billion cubic feet per day into the U.S. Northeast by 2007. Demand will be strong enough to accommodate those projects and more and it would only be if 15 billion to 20 billion cubic feet per day of LNG were to come on stream that TransCanada would hesitate, Kvisle said.