TransCanada Bringing More W Canada Gas East to Compete with M-U

TransCanada, one of Canada’s leading midstream/pipeline companies, cooked up a deal in 2016 to pipe natural gas from Canada’s West Coast to the East Coast in order to fend off cheap supplies of Marcellus/Utica gas that will flow into Canada from the NEXUS and Rover pipelines (see TransCanada Pipe Drops Price 42% to Compete with Marcellus/Utica). TransCanada dropped their pipeline price to lure drillers by (theoretically) making it less expensive to get gas from Western Canada, some 2,400 miles away, than from the Marcellus, just 400 miles away. Following a couple of open seasons and stiff regulatory hurdles, the plan was adopted and went into service last November (see TransCanada Pipe Begins Lowball Shipping to Compete with Marc/Utica). In February, TransCanada announced a $1.9 billion plan to expand its Western Canadian pipeline system in a bid to gather up and send even more Western Canadian gas to the East Coast–to compete with our gas (see TransCanada Spending $1.9B to Bring More Canadian Gas to Northeast). The expansion plan calls for an additional 1 billion cubic feet per day of gas to flow through the Nova Gas Transmission Line (NGTL) in Western Canada, which in turn connects to TransCanada’s Canadian Mainline that hauls gas to our region. The new news is that TransCanada has done it yet again. They’ve cut agreements with shippers for another 280 million cubic feet per day of natgas on the NGTL system…

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