Natural gas pipelines continue to be TransCanada’s largest business. The enormous shifts that have occurred in North America’s natural gas market in recent years have presented opportunities and challenges for our systems, but the transformational changes we’ve made to our asset base in response to changing supply and demand patterns will ensure our existing pipelines will prosper over the long haul. At the same time, we have also secured significant growth opportunities to connect the abundant natural gas supplies from the continent’s shale basins to new and existing markets at home and abroad.
In 2014, we placed $900 million of new facilities into service on our NGTL System and in Mexico – the two regions that make up the bulk of our short-term growth plan for natural gas pipelines.
The restructuring of the Canadian Mainline’s tolling framework has resulted in greater stability and competitiveness for the Mainline system through a settlement we reached with the three major local distribution companies in Ontario and Québec that the NEB approved in late 2014. The settlement will enhance access of northeastern U.S. natural gas production to markets served by TransCanada facilities and provides long-term stability for the Mainline system over the next 15 years. It also facilitates $500 million in new capital projects to add needed capacity in the Eastern Triangle region while ensuring we can recover our system-wide costs. We also moved forward with significant expansion to the southern arm of the Eastern Triangle, filing an NEB application for the $1.5-billion Eastern Mainline project that will add capacity in the Toronto-to-Ottawa corridor to ensure the markets in southern Ontario and Québec continue to have abundant supplies of natural gas into the future. The addition of 245 kilometres (km) of new pipe under the Eastern Mainline project will allow us to convert approximately 3,000 km of Mainline facilities that are not fully contracted to crude oil service for the Energy East Pipeline project. Doing so will help to reduce costs and increase stability for gas shippers, while continuing to ensure that eastern Canadians have the gas supply they need to heat their homes, schools and hospitals.
As one of the continent’s largest natural gas transporters, we will be an essential player in meeting the need for new and improved infrastructure, beginning with $20 billion in commercially secured projects already in development.
Similarly, the future of our ANR Pipeline in the United States was enhanced through long-term commitments to move almost two billion cubic feet per day of natural gas from the Marcellus and Utica regions to key market destinations for an average term of 23 years. This included support for a program to reverse the flow on ANR’s Southeast Main Line to enable more natural gas to move south to the Gulf Coast, where markets are experiencing a resurgence of demand for industrial use and planned liquefied natural gas (LNG) export terminals. This successful recontracting ensures the ANR Pipeline will be used to its full potential and provides a solid base to explore further expansions to transport growing gas supplies to key North American markets.
In 2014, we placed $900 million of new facilities into service on our NGTL System and in Mexico, the two regions that make up the bulk of our short-term growth plan for natural gas pipelines. The NGTL System saw $300 million in new assets begin operation, and another $4.8 billion of new investment is expected by the end of 2017. NGTL continues to be the primary gathering system for Alberta and northeastern British Columbia, moving growing production from the Duvernay, Montney and Horn River plays. In Mexico, the US$600-million extension of the Tamazunchale Pipeline over extremely rugged terrain demonstrated our expertise in engineering and project management. Looking forward, the Topolobampo and Mazatlan projects will double our Mexican assets to US$2.6 billion by 2016 and we are competing for more projects as the country shifts towards using more natural gas for electricity generation and industrial growth.
Further on the horizon, TransCanada is helping to bring British Columbia’s plans to develop a West Coast LNG export industry to life. We have been successful in reaching agreements with several First Nations in northern British Columbia and our teams will continue to build relationships and have meaningful discussions with those living along our pipeline routes to ensure they realize long-term benefits from the historic opportunity that LNG development represents for these communities. The Prince Rupert Gas Transmission and Coastal GasLink projects are underpinned by leading international energy companies that have yet to make final investment decisions on their respective LNG developments. Both projects are expected to be in service by the end of the decade.