TransCanada Advances Keystone Oil Pipeline Project
TransCanada Corporation (TSX: TRP) (NYSE: TRP) (TransCanada) today announced that it continues to make significant progress on the Keystone Pipeline project. Based on strong industry support, TransCanada has entered into contracts or conditionally awarded approximately US$3.0 billion for major materials and pipeline construction contractors and is continuing to secure land access agreements in preparation for the start of construction in the spring of 2008. Based on the increased size and scope of the project and the executed material and service construction contracts, the capital cost of Keystone is expected to be approximately US$5.2 billion.
TransCanada intends to file an application with the National Energy Board (NEB) in November for additional pumping facilities required to expand Keystone from a nominal capacity of approximately 435,000 barrels per day to 590,000 barrels per day. Plans to expand Keystone were originally announced earlier this year following the successful completion of an open season during which an additional 155,000 barrels per day of firm contracts from Hardisty, Alberta to Cushing, Oklahoma were secured. In total, Keystone has secured firm long term contracts for a total of 495,000 barrels per day with an average duration of 18 years.
Producers and refiners continue to express an interest in contracting for additional volumes. In response, Keystone intends to hold a binding open season before the end of the year for the remaining capacity.
“The support from committed shippers and ongoing expressions of interest for additional capacity clearly confirms the value of Keystone as a competitive way to link growing oilsands supply to U.S. energy markets,” says Hal Kvisle, TransCanada president and chief executive officer. “We remain committed to ensuring that timely new oil pipeline capacity is available to meet industry needs.”
The 3,456-kilometre (2,148-mile) Keystone Pipeline will transport crude oil from Hardisty, Alberta to U.S. Midwest markets at Wood River and Patoka, Illinois and to Cushing, Oklahoma. The Canadian portion of the project involves the conversion of approximately 864 kilometres (537 miles) of existing Canadian Mainline pipeline facilities from natural gas to crude oil transmission service and construction of approximately 373 kilometres (232 miles) of pipeline, pump stations and terminal facilities at Hardisty, Alberta. The U.S. portion of the project includes construction of approximately 2,219 kilometres (1,379 miles) of pipeline and pump stations. It is expected that on start-up in late 2009 Keystone will be capable of delivering 435,000 barrels per day to Wood River and Patoka, Illinois. It will be expanded to 590,000 barrels per day and extended to Cushing, Oklahoma in late 2010.
Keystone has received NEB approval for two major regulatory applications this year to construct and operate the Canadian portion of the project. Applications for U.S. regulatory approvals at federal and state levels are proceeding.
To view a map of the pipeline route and obtain other information about the Keystone Pipeline, please visit the project web page at www.transcanada.com/keystone.
With more than 50 years experience, TransCanada is a leader in the responsible development and reliable operation of North American energy infrastructure including natural gas pipelines, power generation, gas storage facilities, and projects related to oil pipelines and LNG facilities. TransCanada’s network of wholly owned pipelines extends more than 59,000 kilometres (36,500 miles), tapping into virtually all major gas supply basins in North America. TransCanada is one of the continent’s largest providers of gas storage and related services with approximately 360 billion cubic feet of storage capacity. A growing independent power producer, TransCanada owns, or has interests in, approximately 7,700 megawatts of power generation in Canada and the United States. TransCanada’s common shares trade on the Toronto and New York stock exchanges under the symbol TRP.
(Note: All financial figures are in Canadian dollars unless noted otherwise.)
This news release may contain certain information that is forward-looking and is subject to important risks and uncertainties. The words “anticipate”, “expect”, “may”, “should”, “estimate”, “project”, “outlook”, “forecast” or other similar words are used to identify such forward looking information. All forward-looking statements are based on TransCanada’s beliefs and assumptions based on information available at the time such statements were made. The results or events predicted in this information may differ from actual results or events. Factors which could cause actual results or events to differ materially from current expectations include, among other things, the ability of TransCanada to successfully implement its strategic initiatives and whether such strategic initiatives will yield the expected benefits, the availability and price of energy commodities, regulatory decisions, changes in environmental and other laws and regulations, competitive factors in the pipeline and energy industry sectors, construction and completion of capital projects, access to capital markets, interest and currency exchange rates, technological developments and the current economic conditions in North America. By its nature, such forward-looking information is subject to various risks and uncertainties which could cause TransCanada’s actual results and experience to differ materially from the anticipated results or other expectations expressed. For additional information on these and other factors, see the reports filed by TransCanada with Canadian securities regulators and with the U.S. Securities and Exchange Commission. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date it is expressed in this news release or otherwise, and TransCanada undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
Contacts: TransCanada Media Inquiries Shela Shapiro/Cecily Dobson (403) 920-7859 or (800) 608-7859 Investor & Analyst Inquiries David Moneta/Myles Dougan (403) 920-7911 Website: www.transcanada.com