TransCanada spends $2 billion to expand Nova gas line to US, benefits Alberta producers

New gas supply and increased export demand drives major expansions

TransCanada Corporation announced it will move forward with a new $2 billion expansion program on its NOVA Gas Transmission Ltd. (NGTL) System, based on new contracted customer demand for approximately 3 billion cubic feet per day (Bcf/d) of incremental firm receipt and delivery services.

“Between now and 2021, TransCanada is investing approximately $2 billion in new pipeline infrastructure to connect Western Canadian natural gas production to key markets within the basin and across North America,” said Karl Johannson, TransCanada’s President, Canada and Mexico natural gas pipelines and energy.

This expansion program results from growing producer demand to connect low-cost Montney, Duvernay and Deep Basin production to the NGTL System and move it to premium intra-basin and export markets.

 

“This expansion adds to the current $5.1 billion near-term capital program for the NGTL System, further enhancing our ability to meet the needs of our customers for safe, reliable and competitive gas transmission infrastructure,” said Johannson.

Numerous shippers have recently signed over 2.6 Bcf/d in total new firm supply contracts at multiple existing and proposed new receipt locations across the System.

TransCanada also successfully concluded a recent expansion open season for incremental service at the Alberta/British Columbia export delivery point, which connects Canadian supply through downstream TransCanada pipelines to Pacific Northwest, California and Nevada markets.

The open season was over-subscribed, and all 381 MMcf/d (408 TJ/d) of available expansion service was awarded under long term contracts.

“The NGTL System remains a key component of TransCanada’s high-quality portfolio of energy infrastructure assets that continue to produce solid results across various market conditions,” said Johannson.

The expansion program will be comprised of numerous projects that will in aggregate, include 273 kilometres (171 miles) of NPS 16 to NPS 48 pipeline, 150 MW of compression at five compressor stations, new meter stations and other associated facilities.

“Our strategy is to maintain and optimize NGTL’s competitive position and to focus on growing our established network to connect growing volumes of Western Canadian Sedimentary Basin natural gas to key market areas,” said Johannson.

Applications for the various projects will be filed with the National Energy Board starting in the fourth quarter of 2017.

Subject to regulatory approvals, construction is expected to start in early 2019, with initial projects expected to be in service in Q4 2019 and final projects in service by Q2 2021.

As part of its commitment to consulting early and often, TransCanada will engage landowners, communities and Indigenous groups near the project areas in Alberta and British Columbia.

TransCanada will focus on partnering with local contractors and businesses, providing opportunities for community and Indigenous participation through community investment, scholarships and programs such as the Aboriginal Construction Participation Program.