The National Energy Board (NEB) has recommended the federal government approve a variance to the previously issued North Montney Mainline Project certificate, which would allow construction to start on the proposed $1.4 billion natural gas project in northeast British Columbia.
The project is being advanced by TransCanada Corporation’s wholly-owned subsidiary, NOVA Gas Transmission Ltd. (NGTL), as an expansion of the existing NGTL System. It is backed by 20-year commercial contracts with 11 shippers to transport approximately 1.5 billion cubic feet (1.6 million gigajoules) of natural gas per day.
“We are pleased with the NEB’s decision on the North Montney Mainline Project. These facilities are critical to the timely and economic development of the tremendous natural gas resource in the North Montney play,” said Russ Girling, TransCanada’s president and CEO. “Since 2011, the project has undergone thorough consultation, engagement and rigorous regulatory assessment. Through this process we have demonstrated the importance of this critical piece of energy infrastructure to natural gas producers and downstream markets throughout Canada and the United States.”
The project was originally approved in 2015, subject to conditions making construction contingent on a positive final investment decision on the then-proposed Pacific Northwest LNG liquefaction project. In March 2017, NGTL sought approval to remove those conditions and had restructured the commercial project arrangements and the associated facilities to accommodate a delay or, as occurred in July 2017, a cancellation of the Pacific Northwest LNG project.
The project consists of approximately 206 km (128 miles) of 42-in. pipeline, compression and associated metering facilities. It will boost the economy by supporting thousands of high-quality construction jobs and deliver an estimated $100 million in construction contracts for Indigenous businesses and workers. Subject to timely federal approval, construction is expected to start by the third quarter of 2018, with an anticipated in-service date of mid-2019.
The NEB also provided guidance on the tolling principles to be applied to the project. NGTL will work with its shippers to address these requirements.
This project represents a significant component of NGTL’s $7.2 billion multi-year infrastructure expansion program that will increase transportation capacity for Western Canada producers and provide downstream markets increased access to clean-burning natural gas.