TransCanada seeks to start building B.C. gas pipeline without approval
The pipeline would help feed a proposed liquefied natural gas export terminal on B.C.'s north coast, but is waiting on approval for the LNG project.
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CALGARY — TransCanada Corp. (TSX:TRP) is seeking regulatory approval to start construction of a pipeline that would help feed a proposed liquefied natural gas export terminal on B.C.'s north coast even though a final decision hasn't been made whether to build the terminal.
The Calgary-based company has conditional federal and provincial approvals for the North Montney Mainline, but they are subject to a positive financial investment decision for the proposed Pacific Northwest LNG project on Lelu Island near Prince Rupert, B.C.
TransCanada has asked the National Energy Board to allow it to move forward with construction of about 206 kilometres of pipeline and related facilities of the proposed 306-kilometre North Montney Mainline project ahead of that decision.
Construction would cost about $1.4 billion and connect the NMML project with TransCanada's existing pipeline network about 35 kilometres southwest of Fort St. John, B.C., allowing the company to ship the gas to markets across Canada and much of the U.S.
Company spokesman Shawn Howard said growing Montney basin production from Progress Energy and others means there is demand for the pipeline, which could carry 1.5 billion cubic feet of natural gas per day, even without a final go-ahead on the LNG terminal.
"Simply put, Progress and the other NMML shippers have a need to connect their North Montney gas supply to market," said Howard in an email.
The LNG terminal is primarily backed by Malaysia's national oil and gas company, Petronas, which has yet to make a final investment decision for the Pacific Northwest LNG project.
TransCanada says that it's seeking regulatory approvals that would allow it to begin construction on the pipeline in the first half of 2018 and bring it into service over a two-year period beginning in April 2019.