Spanning over 131km, the Pioneer Pipeline runs from Drayton Valley in central Alberta to west of Edmonton. The pipeline purchase is underpinned by 15-year firm delivery contracts for 328 million cubic feet per day (mmcf/d) and an eight-year firm receipt contract for 47 mmcf/d.
“This acquisition presents a unique opportunity to connect Western Canadian Sedimentary Basin (WCSB) supply to Alberta power generation demand, which supports coal-to-gas conversion and lowers carbon emissions,” said Tracy Robinson, Executive Vice President at TC Energy and President of Canadian Natural Gas Pipelines.
NGTL System currently spans 25,000km in length and receives, gathers and transports gas produced in the Western Canadian Sedimentary Basin to customers in Alberta and into northeast British Columbia.
Expanding the system, TC Energy is also building the US$5-billion Coastal GasLink pipeline to bring feed-gas from the Montney shale basin in northeast BC to the proposed LNG Canada’s proposed liquefaction and export plant proposed at Kitimat on the Pacific Coast.
“Utilizing the existing Pioneer Pipeline maximizes the use of existing infrastructure and provides the most efficient solution to deliver gas to this growing demand,” added Robinson.
The proposed purchase is still subject to the execution of definitive sale agreements, which are expected to occur in Q2-2020. The deal also requires approval of the Canadian Energy Regulator.