Perspectives on North American Pipeline Infrastructure Opportunities

Transcription

1 Perspectives on North American Pipeline Infrastructure Opportunities IPLOCA September 2009 Don Wishart, EVP Operations & Major Projects TransCanada Corporation

2 Forward-Looking Information This presentation may contain certain information that is forward looking and is subject to important risks and uncertainties. The words "anticipate", "expect", "believe", "may", "should", "estimate", "project", "outlook", "forecast" or other similar words are used to identify such forward-looking information. Forward-looking statements in this document are intended to provide TransCanada shareholders and potential investors with information regarding TransCanada and its subsidiaries, including management s assessment of TransCanada s and its subsidiaries future financial and operations plans and outlook. Forward-looking statements in this document may include, among others, statements regarding the anticipated business prospects and financial performance of TransCanada and its subsidiaries, expectations or projections about the future, and strategies and goals for growth and expansion. All forward-looking statements reflect TransCanada s beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those predicted in these forward-looking statements. Factors that 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 operating performance of the Company s pipeline and energy assets, the availability and price of energy commodities, regulatory processes and decisions, changes in environmental and other laws and regulations, competitive factors in the pipeline and energy industry sectors, construction and completion of capital projects, labour, equipment and material costs, access to capital markets, interest and currency exchange rates, technological developments and the current economic conditions in North America. By its nature, 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 expectations expressed. Additional information on these and other factors is available in the reports filed by TransCanada with Canadian securities regulators and with the U.S. Securities and Exchange Commission (SEC). Readers are cautioned to not place undue reliance on this forward-looking information, which is given as of the date it is expressed in this presentation or otherwise, and to not use future-oriented information or financial outlooks for anything other than their intended purpose. 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.

3 Existing Pipelines Proposed Pipelines Gas Storage Facilities TransCanada Pipeline Assets 59,000 km (36,500 miles) of wholly-owned pipeline Foothills/BC GTN System Tuscarora Northern Border North Baja Alberta System Bison Keystone Canadian Mainline Great Lakes ANR TQM Portland Iroquois Interests in an additional 7,800 km (4,800 mi) of pipeline Unparalleled connections from traditional and emerging basins to growing markets Average daily volume of approximately 15 Bcf Provider of 370 Bcf of gas storage capacity 3,882 kms of pipeline currently under construction 3,463 kms of construction is associated with the 1,090,000 B/d Keystone Oil Pipeline 3 TransCanada Guadalajara September Tamazunchale 11, 2009

4 Industry Trends: Oil and Gas Conventional supplies of oil and gas are declining New shale gas basins play a significant and growing role in gas supply but also involve a fair amount of uncertainty around the recoverable capacity Low cost shale gas, coupled with lower demand, has pushed out LNG U.S. demand for Canadian oil is increasing and will be partially satisfied by the oil sands crude Construction costs have doubled and tripled then declined in the last five years, portraying the volatile nature of the industry Applied technologies are enabling solutions Environmental issues will be a significant influence

5 Pipeline Opportunities Natural Gas Pipeline Outlook

6 Canada, U.S., and Mexico Natural Gas Demand Bcf/d History Forecast Growth 0.7% pa Commercial Growth 0.4% pa Residential Growth 0.3% pa Industrial Growth 0.3% pa Electric Gen Growth 1.7% pa E.G. Industrial Residential Commercial Other

7 North American Gas Supply (Including Mexico Production) Bcf/d Demand Eastern Canada History Forecast WCSB U.S. Rockies Gulf of Mexico U.S. Other Mexico LNG North

8 Production From Key U.S. and B.C. Gas Shales Bcf/d History Forecast North East B.C. Marcellus Shale Haynesville Shale Fayetteville Shale Woodford/Caney Shale Barnett Shale

9 U.S. LNG Imports and Re-gas Capacity 20.0 Bcf/d History Forecast Re-gas Capacity Actual Imports

10 Alaska Pipeline Project Mackenzie Gas Pipeline Pipelines Proposed Pipelines Gas Storage Facilities Conventional Gas Basins Advancing Northern Gas Pipelines Alaska Pipeline 1,715 miles, NPS 48 2,500,000 tonnes of pipe AGIA License granted by state to TC Dec TransCanada/Exxon partnership in-place 2009 Open season planned for 2010 Competing BP/ConocoPhillips proposal does not conform with AGIA requirements Mackenzie Gas Pipeline 1,843 miles, NPS ,000 tonnes of pipe Largest construction proposal in Canadian history Environmental review by independent Joint Review Panel is ongoing Project proponents involved in discussions with Canadian federal government to financially restructure project Both projects face challenges due competition from low cost shale gas and regulatory hurdles 10 These challenges can be overcome in the mid to long-term timeframe

11 Mexico Pipeline Developments Tijuana Mexicali Nogales Naco CD Juarez Tamazunchale Pipeline 130 km, 36-inch diameter Initial capacity 170 MMcf/d Future expansion up to 430 MMcf/d Guaymas Chihuahua Guadalajara Pipeline 310 km, 30-inch diameter Initial capacity 500 MMcf/d Future expansion up to 900 MMcf/d Topolobampo Mazatlán Monterrey Reynosa Altamira Tamazunchale, 2006 in service Tamazunchale Pipeline Extension, 2012 in service San Luis de la Paz to Guadalajara San Lui de la Paz Mérida Cancun Manzanillo to Guadalajara, 2011 in service Guadalajara Toluca Tuxpan Valladolid Manzanillo Mexico City Lázaro Cárdenas Acapulco

12 Pipeline Opportunities Crude Oil Pipeline Outlook

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14 Alberta Oil Sands Established Reserves Mineable 32 B In Situ 143 B Source: Alberta Energy and Utilities Board

15 CAPP 2009 Canadian Crude Oil Forecast Source: CAPP June 2009 Canadian Crude Oil Production & Supply Forecast ( ) Oil sands growth drives Canadian crude production

16 Canadian and U.S. Crude Oil Pipeline Proposals Source: CAPP June 2009 Canadian Crude Oil Production & Supply Forecast ( ) TransCanada s proposed and existing pipeline projects

17 Pipelines Proposed Pipelines Gas Storage Facilities Keystone Oil Pipeline 2012 in-service Hardisty Keystone Gulf Coast Expansion 2010 in-service Steele City Keystone 2009 in-service Patoka Wood River Cushing Keystone System* 1,090,000 B/d capacity 910,000 B/d binding contractual commitments for an average term of 18 years Future expansion potential to 1,500,000 B/d capacity US$12.2 billion, TC 100% In service in-service Houston Port Arthur * Comprises Keystone and Keystone Gulf Coast Expansion. Keystone is currently in construction.

18 Other Pipeline Opportunities CO 2 Pipelines Water Pipelines Ethanol Pipelines Hydrogen Pipelines

19 Summary of Pipeline Mileage (2009+) Miles of Pipeline Construction (by diameter) 4-10 in in in. 30+ in. Total Gas Pipelines U.S ,427 7,526 9,303 Canada Crude Oil Pipelines U.S ,394 2,608 Canada 866 1,934 2,800 Product Pipelines U.S ,586 Canada Total 82 1,681 2,860 12,694 17,317 Source: Oil & Gas Journal, February 2009

20 Influencing Factors Regulatory process and permitting Material and contract commitments NIMBY: landowners, communities, Long-term contracts Societal rebalancing of: Risk/reward Individual rights versus the public good

21 Perspectives on North American Pipeline Infrastructure Opportunities IPLOCA September 2009 Don Wishart, EVP Operations & Major Projects TransCanada Corporation