Petronas' Progress Inks Pipeline Deal With TransCanada

TransCanada Corporation, through its wholly-owned subsidiary, NOVA Gas Transmission Ltd. (NGTL), has signed agreements with Progress Energy for approximately two billion cubic feet per day (Bcf/d) of firm gas transportation services to underpin the development of a major pipeline extension of the NGTL System.

Progress Energy was acquired by Malaysia’s Petronas last year for almost $5 billion.

In July, Petronas submitted an export application with Canada’s National Energy Board to export LNG from northern British Columbia. Pacific NorthWest LNG, which is 90% owned by the Malaysian firm has applied for a license to export up to 19.68 million tonnes of LNG per year for 25 years beginning in 2019.

Apart from providing substantial new capacity on the NGTL System in response to the rapidly increasing development of natural gas resources in northeastern British Columbia, the project will also include an interconnection with TransCanada's proposed Prince Rupert Gas Transmission (PRGT) project to provide natural gas supply to the proposed Pacific NorthWest LNG.

Under the commercial arrangements with Progress, receipt volumes will ramp up between 2016 and 2019 to an aggregate volume of approximately 2.0 Bcf/d and delivery volumes to the PRGT project will be approximately 2.1 Bcf/d beginning in 2019.