(EnergyAsia, January 11 2013, Friday) — TransCanada Corp has been selected to design, build, own and operate a C$5 billion pipeline to deliver natural gas to a proposed export terminal along the British Columbia coast in western Canada. (US$1=C$0.99).
The contract was awarded by Calgary-based Progress Energy, a fully owned subsidiary of Malaysia’s state energy firm Petronas, which is building the terminal at Prince Rupert’s Port Edward to export liquefied natural gas (LNG) to Asia.
Due to start up in 2018, the Prince Rupert Gas Transmission project will have an initial capacity to deliver two billion cubic feet a day from the prolific Montney region in British Columbia province, said TransCanada. The pipeline, which could be expanded to handle 3.6 billion cubic feet/day, will be connected to TransCanada’s existing network of gas pipelines including Canada’s main 14,101-km Mainline link supplying western Canadian gas to Quebec.
It will transport natural gas primarily from the North Montney gas-producing region near Fort St. John city to Petronas’s Pacific Northwest LNG export facility in Port Edward.
The company said it will immediately start Aboriginal and stakeholder consultation and preparation of the relevant regulatory filings under jurisdiction of British Columbia province.
“The proposed Prince Rupert Gas Transmission project will allow British Columbians, and all Canadians, to continue to benefit from the responsible development of the growing supply of valuable natural gas resources in western Canada”, said Russ Girling, TransCanada’s President and CEO.
Petronas, which completed its C$5.9-billion purchase of Progress Energy in December, is looking to invest as much as C$11 billion to develop an LNG export business in western Canada.
Last June, TransCanada was selected by a Shell-led consortium to build the C$4 billion Coastal GasLink pipeline to deliver natural gas to a proposed LNG terminal at Kitimat, also located along the British Columbia coast.
Both pipeline projects await Canadian government and regulatory approvals.
TransCanada is also planning to extend its existing NOVA Gas Transmission Ltd (NGTL) system in northeastern British Columbia to connect it to the Prince Rupert project and to additional North Montney gas supply from Progress and other parties.
“This new infrastructure will allow the Pacific Northwest LNG export facility to access both the abundant North Montney supplies as well as other Western Canada Sedimentary Basin (WCSB) gas supply through the NOVA Inventory Transfer (NIT) trading hub and the extensive existing NGTL pipeline network,” the company said.
“Initial capital cost estimates associated with extensions of the NGTL System are approximately C$1 to C1.5 billion, with an in-service date targeted for the end of 2015.”
TransCanada owns and operates approximately 24,000 km of natural gas pipelines in Western Canada including the Foothills Pipeline System in southeast B.C. and 360 km in service or pending approvals in northeast B.C.
If approved, the Prince Rupert and TransCoastal pipeline projects would add a total of more than 1,400 km to the company’s Western Canadian natural gas transmission systems.