TransCanada Corporation (TSE:TRP) secures long-term deals with gas producers

Pipeline company TransCanada Corporation (TSE:TRP, Mkt cap 53.03B, Div/yield 0.62/4.09, EPS 0.28, Shares 866.91M) has successfully concluded a long-term, fixed-price open season to transport natural gas on the Canadian Mainline to Eastern Canada.

The Calgary-based company said on Monday that gas producers in the Western Canada Sedimentary Basin (WCSB) have agreed binding, long-term contracts for the transport 1.5 GJ/d of natural gas from the Empress receipt point in Alberta to the Dawn hub in Southern Ontario, at a single toll of $0.77/GJ.

TransCanada  long-term deal gas producers

TransCanada Corporation (TSE:TRP) secures long-term deals with gas producers

​The contracts have a term of 10 years, with early termination rights that can be exercised following the initial five years of service (upon payment of an increased toll for the final two years of the contract).

Russ Girling, president and CEO of TransCanada, said in a statement: "Today, WCSB producers are facing a much more challenging landscape than they have in the past. This new offering helps our customers compete more effectively by utilizing existing capacity on the Canadian Mainline, and demonstrates the importance and value of this system to deliver their products to markets in Eastern Canada and the Northeast U.S."

Girling added: "This long-term agreement provides significant benefits for our customers, shareholders, communities and governments that depend on the economic benefits that are generated by natural gas exploration, production and transportation. In addition to utilizing existing capacity and pipelines already in operation, the incremental revenue generated from this offering will make the Canadian Mainline more competitive."

Madison.com reported that TransCanada did not give up after its last open season to get gas producers in Western Canada to sign up for capacity on the pipeline failed. "That persistence has now paid off," the website said, with the simplified rate and early termination option proving to be a winning combination.

Most of the incremental revenue from these new contracts will flow to TransCanada's bottom line, Madison.com explained.

The Canadian Mainline currently transports about 20% of the natural gas produced in the WCSB to serve Canadian markets and interconnects with the United States.

TransCanada Corporation (TSE:TRP) is a Canadian energy infrastructure company with head offices in Calgary, Alberta. The Company operates through three segments: Natural Gas Pipelines, Liquids Pipelines and Energy. Natural Gas Pipelines and Liquids Pipelines consist of its respective natural gas and liquids pipelines in Canada, the United States and Mexico, as well as its regulated natural gas storage operations in the United States. Its natural gas pipeline network transports natural gas to local distribution companies, power generation facilities and other businesses across Canada, the United States and Mexico. Its existing liquids pipeline infrastructure connects Alberta and the United States crude oil supplies to the United States refining markets in Illinois, Oklahoma and Texas, as well as connecting the United States crude oil supplies from the Cushing, Oklahoma hub to refining markets in the United States Gulf Coast. Energy includes its power operations and the non-regulated natural gas storage business in Canada. More from Reuters »

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Oil Pipelines – Canadian Government approves two major pipeline projects

Oil Pipelines Canadian Government approved

Oil Pipelines – the Canadian Government has approved two major crude oil pipeline projects and rejected a third.

The Canadian Government has approved two major crude oil pipeline projects and rejected a third.
Minister of Natural Resources, Jim Carr, and Minister of Transport, Marc Garneau, announced on Tuesday that Kinder Morgan’s C$6.8bn Trans Mountain Expansion Project had been given the green light, subject to 157 conditions.

The Government has also approved Enbridge‘s Line 3 Replacement Project, subject to 37 conditions. Enbridge is planning to replace 1,067 km of existing pipeline from Hardisty, Alberta, to Gretna, Manitoba, to enhance the safety of the line and restore its original capacity of 760,000 barrels a day.

But another Enbridge project, the long-stalled Northern Gateway pipeline, will not proceed because it would result in crude oil tankers transiting through the sensitive ecosystem of the Douglas Channel, part of the Great Bear Rainforest, the Government said.

Enbridge welcomed the approval of the Line 3 replacement program, the largest project in its history at approximately C$7.5bn.

“We have strong support for the project from our communities along the route, including Indigenous communities,” the company said in a statement.

Commenting on the rejected Northern Gateway pipeline, the company expressed disappointment with the decision and said it was an important project to ensure Canada gets its resources to international markets.

“Northern Gateway also represented an unprecedented partnership with Indigenous people,” Enbridge continued. “The 31 Indigenous communities who had a one-third ownership in Northern Gateway stood to realize C$2bn in benefits to their communities and would have played an important stewardship role in the project.”

The Government also announced a moratorium on crude oil tankers along British Columbia’s northern coast.

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TransCanada Keystone pipeline halted following spillage

North American energy company TransCanada Corporation (TSE:TRP, Mkt cap 34.60B, P/E – , Div/yield 0.56/4.57, EPS -1.75, Shares 702.34M) has cut the power at its Keystone pipeline following an oil spill in South Dakota, a spokesman for the firm has confirmed.

TransCanada Keystone

TransCanada – Keystone pipeline halted following spillage

TransCanada’s Mark Cooper revealed that the spill was spotted by a local landowner around noon local time on Saturday who swiftly made the matter known to the company.

Following the call, the pipeline was brought to a halt in a matter of minutes, according to Cooper.

“As soon as we got that report in we immediately began efforts to shut down the pipeline and crews were immediately dispatched to the site,” he said.

Cooper then proceeded to play down the extent of the spillage, stating that it covered a “small surface area” and no significant impact to the environment was observed.

The company will continue to investigate the source of the spill, which was found about six kilometres from TransCanada’s Freeman pump station, which sits roughly 60 km southwest of Sioux Falls, S.D.

Cooper confirmed that it has also informed landowners and local agencies in the area as well as regulatory agencies including the National Response Center and the Pipeline and Hazardous Materials Safety Administration.

The Keystone pipeline, which carries about 500,000 barrels of oil a day, begins its journey at Hardisty, Alta., east through to Manitoba before it turns south to markets in the American Midwest and U.S. Gulf Coast.

This latest incident will have done little to help TransCanada’s cause to push through its proposed 4,600-kilometre Energy East Pipeline that would ship Alberta crude to New Brunswick.

TransCanada Corporation is a Canadian energy infrastructure company with head offices in Calgary, Alberta. The Company operates through three segments: Natural Gas Pipelines, Liquids Pipelines and Energy. Natural Gas Pipelines and Liquids Pipelines consist of its respective natural gas and liquids pipelines in Canada, the United States and Mexico, as well as its regulated natural gas storage operations in the United States. Its natural gas pipeline network transports natural gas to local distribution companies, power generation facilities and other businesses across Canada, the United States and Mexico. Its existing liquids pipeline infrastructure connects Alberta and the United States crude oil supplies to the United States refining markets in Illinois, Oklahoma and Texas, as well as connecting the United States crude oil supplies from the Cushing, Oklahoma hub to refining markets in the United States Gulf Coast. Energy includes its power operations and the non-regulated natural gas storage business in Canada. More from Reuters »

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TransCanada signs up ABB to build ‘e-houses’ for its Energy East Pipeline

TransCanada Corporation (TSE:TRP, Mkt cap 33.76B, P/E 20.38, Div/yield 0.52/4.33, EPS 2.36, Shares 709.00M) and ABB announced today that they have shaken hands on a deal that will see ABB deliver a number of multi-million dollar electrical houses along the Energy East Pipeline.

TransCanada ABB Energy East Pipeline

TransCanada signs up ABB to build ‘e-houses’ for its Energy East Pipeline

TransCanada said the agreement will benefit the Québec economy, with it expected to create 120 jobs in the province and a further 90 spin-off jobs outside of the greater Montreal area.

“This agreement demonstrates our ongoing commitment to hire local suppliers to safely build this piece of national energy infrastructure and support job creation in Québec,” said John Soini, president, Energy East Pipeline Project.

The ‘e-houses’, which are required to power pump stations to ensure safe and GHG-efficient operations, are slated to be manufactured at a new production facility in the greater Montreal region.

ABB Canada, a division of ABB Group, will be tasked with making at least 22 e-houses, with each one custom-designed to TransCanada’s requirements – which includes a compact design to minimize the impact on the local environment.

“We are already very active in Québec, spending $100 million in contracts with more than 250 suppliers over the last three years alone,” added Soini. “This includes $25 million in service contracts in preparation of the project. We look forward to continuing to work closely with Québec suppliers as we develop the project and will work to develop further opportunities.”

In a statement, TransCanada highlighted how the Energy East project will create over 3,000 jobs each year in Québec during the nine years of planning and construction for the pipeline, along with $972 million in tax revenue for the province. When the pipeline goes into service, total tax revenues for Québec will amount to $1.2 billion for the first 20 years of its operation, it claims.

TransCanada Corporation is a Canadian energy infrastructure company with head offices in Calgary, Alberta. The Company operates through three segments: Natural Gas Pipelines, Liquids Pipelines and Energy. Natural Gas Pipelines and Liquids Pipelines consist of its respective natural gas and liquids pipelines in Canada, the United States and Mexico, as well as its regulated natural gas storage operations in the United States. Its natural gas pipeline network transports natural gas to local distribution companies, power generation facilities and other businesses across Canada, the United States and Mexico. Its existing liquids pipeline infrastructure connects Alberta and the United States crude oil supplies to the United States refining markets in Illinois, Oklahoma and Texas, as well as connecting the United States crude oil supplies from the Cushing, Oklahoma hub to refining markets in the United States Gulf Coast. Energy includes its power operations and the non-regulated natural gas storage business in Canada. More from Reuters »

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TransCanada not prepared to write off Keystone XL

TransCanada Corporation (TSE:TRP, Mkt cap 29.59B, P/E 17.72, Div/yield 0.52/4.98, EPS 2.36, Shares 708.95M) is nothing if not determined with its Keystone XL pipeline. On hearing that U.S. President Barack Obama had formally rejected the energy project on Friday (6 Nov.), the firm declared it was “absolutely committed” to seeing it through, the Financial Post reports.

“Today, misplaced symbolism was chosen over merit and science – rhetoric won out over reason,” TransCanada’s president and CEO Russ Girling told the media shortly after Obama’s White House news conference to announce his decision on the long-delayed pipeline.

transcanada president russ girling

“Today, misplaced symbolism was chosen over merit and science – rhetoric won out over reason,” TransCanada’s president and CEO Russ Girling

Girling suggested that the fight to get the project off the ground didn’t end with the president’s rejection, with talk of a new application for a border-crossing pipeline being submitted. This, too, would require presidential approval.

The Keystone XL project has now been active for seven years, suffering setback after setback and consuming $2.8 billion of the company’s capital.

TransCanada had hoped a request to suspend the latest review would bide itself some time to apply for state-level approvals for its route through Nebraska.

However, documents released by the State Department on Friday revealed that the U.S. Secretary of State John Kerry had signed the recommendation to reject Keystone XL the next day, Tuesday.

Then on Wednesday, Kerry formally denied TransCanada’s suspension request, after he had recommended Obama reject the pipeline.

Obama rejected Keystone XL on the grounds that “shipping dirtier crude oil into this country would not increase America’s energy security.”

Commenting on the impact of the $2.8 billion that’s already been spent on the project, FirstEnergy Capital Corp. analyst Steven Paget said in a research note that TransCanada could write it off, which would have a one-time effect on its earnings.

TransCanada Corporation is a Canadian energy infrastructure company with head offices in Calgary, Alberta. The Company operates through three segments: Natural Gas Pipelines, Liquids Pipelines and Energy. Natural Gas Pipelines and Liquids Pipelines consist of its respective natural gas and liquids pipelines in Canada, the United States and Mexico, as well as its regulated natural gas storage operations in the United States. Its natural gas pipeline network transports natural gas to local distribution companies, power generation facilities and other businesses across Canada, the United States and Mexico. Its existing liquids pipeline infrastructure connects Alberta and the United States crude oil supplies to the United States refining markets in Illinois, Oklahoma and Texas, as well as connecting the United States crude oil supplies from the Cushing, Oklahoma hub to refining markets in the United States Gulf Coast. Energy includes its power operations and the non-regulated natural gas storage business in Canada. More from Reuters »

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TransCanada calls $654m Ironwood Power Plant acquisition a “unique opportunity”

TransCanada Corporation (TSE:TRP, Mkt cap 32.02B, P/E 18.54, Div/yield 0.52/4.61, EPS 2.44, Shares 709.00M) believes it has acquired a “unique opportunity” in agreeing to buy a gas-burning power plant in Pennsylvania for US$654 million from Talen Energy Corp.

TransCanada Ironwood Power Plant acquisition

TransCanada calls $654m Ironwood Power Plant acquisition a “unique opportunity”

Calgary-based TransCanada says the 778-megawatt Ironwood power plant in Lebanon, Penn., is a “natural extension” of its northeast power business, where the company now has over 4,500 megawatts of generating capacity.

Russ Girling, TransCanada’s president and chief executive officer, said the acquisition strengthens its portfolio of assets in the region.

“This relatively new and highly efficient gas-fired power plant provides us with a solid platform from which to continue to grow our already substantial wholesale, commercial and industrial customer base in this market area,” he said in a statement.

TransCanada, better known for its pipeline business, explained the Ironwood power plant delivers energy into the PJM power market, North America’s largest and most liquid energy region which includes a three-year forward capacity market.

The firm added that its proximity to the Marcellus shale gas play makes it well positioned to access competitively priced natural gas in a market that is currently transitioning away from coal-fired power generation to gas.

The Ironwood acquisition will immediately add to earnings and cash flow and generate about US$90 to $110 million in earnings a year before interest, taxes, depreciation and amortization, TransCanada said.

“The Ironwood power plant will be very complementary to our U.S. northeast operations, which now total over 4,500 MW, and is consistent with our disciplined approach to growth in this important region where we have been operating on the power side since 1998,” added William Taylor, TransCanada’s executive vice-president and president, Energy.

It will fund the acquisition with a combination of cash on hand and available credit. That deal is expected to be wrapped up in the first quarter of 2016.

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TransCanada to make further staff reductions

TransCanada Corporation (TSE:TRP, Mkt cap 30.22B, P/E 17.50, Div/yield 0.52/4.88, EPS 2.44, Shares 709.00M) has told its staff to expect layoffs as the pipeline builder looks to offset low oil prices and fulfil its growth plan, the Calgary Herald reports.

TransCanada staff reductions

TransCanada to make further staff reductions

Employees were informed last week that “organizational changes” are to take place over the coming months, wrote company spokesman James Millar in an email, noting that the firm has already carried out a reduction of some senior leadership positions.

“This transformational change will allow us to reach the full potential set out in our ambitious growth plan, which includes $46 billion of commercially secured projects underway for completion by the end of the decade,” he explained.

Millar highlighted how the Calgary-based company had commenced restructuring in June as a means to remain competitive and deliver shareholder value as it strives to grow and build new projects.

He added that falling oil prices have had a “profound impact” on its customers, making it essential to drive down costs.

“We are now introducing significant changes that will make us a more nimble organization that will ensure each one of our three business units – natural gas pipelines, liquids pipelines and energy – are able to make the decisions necessary to maintain competitiveness and maximize shareholder value,” he wrote.

Millar said he doesn’t know exactly how many jobs will be cut but that the firm anticipates “about a 20% reduction in senior leadership positions.”

From there, another analysis of the business will take place and more employees will be affected.

He said the company, which currently has more than 6,000 staff in North America, is looking to complete the restructuring process by the end of November.

TransCanada Corporation is a Calgary based energy infrastructure company. TransCanada operates through 3 segments: Natural Gas Pipelines, Liquids Pipelines and Energy. Natural Gas Pipelines and Liquids Pipelines consist of natural gas and liquids pipelines in Canada, the United States and Mexico, plus regulated natural gas storage operations in the United States. The companies natural gas pipeline network transports natural gas to local distribution companies, power generation facilities and other businesses across Canada, the United States and Mexico. TransCanada’s existing liquids pipeline infrastructure connects Alberta and the United States crude oil supplies to the United States refining markets in Illinois, Oklahoma and Texas. The company’s network also connects United States crude oil supplies from the Cushing, Oklahoma hub to refining markets in the United States Gulf Coast. Transcanada’s energy business covers power operations and non-regulated natural gas storage business in Canada.

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TransCanada Embarks On Efficiency Drive By Culling 185 Jobs

TransCanada says cuts are designed to move forward its $46-billion capital growth plan.

TransCanada Corporation (TSE:TRP, Mkt cap 38.29B, P/E 22.34, Div/yield 0.52/3.85, EPS 2.42, Shares 708.94M) has illustrated its cost-cutting efforts by laying off 185 people from its major projects departments, the Calgary Herald reports.

TransCanada cuts move forward $46-billion capital growth plan

TransCanada says cuts are designed to move forward its $46-billion capital growth plan.

Downsizing of the workforce has become common practice among producers and oilfield services companies, with low oil and gas prices necessitating an efficiency drive.

However, the move marks the first large-scale layoff by a midstream company in Calgary – where the pipeline builder is based – this year.

TransCanada spokesman Mark Cooper confirmed the news in his response to an email inquiry by the Herald, adding that of the 185 workers laid off, approximately 100 were full-time employees.

“[The job cuts are] designed to ensure we move forward with our $46-billion capital growth plan in a way that meets the needs of our customers, while allowing TransCanada to remain competitive and deliver incremental value for our shareholders,” Cooper explained.

Analysts, meanwhile, believe the downsizing to be, in part, the result of a lull in its line of projects, pointing to its King’s North Connection gas pipeline project in southern Ontario, which was only green-lit by the National Energy Board last week and will not enter service until 2017.

TransCanada also continues to run into delays in its proposed $12-billion Energy East oil pipeline, forcing the firm to push back the pipeline’s start a further 12 months to 2020.

If it does eventually come into service, however, it will represent North America’s largest crude pipeline, spanning 4,600 kilometres from Alberta’s oilsands to New Brunswick, with the capacity to carry 1.1 million barrels of crude a day to foreign markets.

Cooper, however, says that the layoff cannot be attributed to any one project in particular. Instead, it is the result of a “significant restructuring” of its entire major projects department in the name of efficiency and effectiveness.

TransCanada is a Canadian energy infrastructure company. The Company operates 3 divisions: Natural Gas Pipelines, Liquids Pipelines and Energy.

Natural Gas Pipelines and Liquids Pipelines consist of natural gas and liquids pipelines in Canada, the United States and Mexico, plus regulated natural gas storage operations in the US.

TransCanada’s natural gas pipeline network ships natural gas to local distribution companies, power generation facilities and other businesses across Canada, the United States and Mexico.

The companies liquids pipeline infrastructure connects crude oil sources in Alberta and the United States to the US refining markets in Illinois, Oklahoma and Texas, as well as connecting the US crude oil supplies from the Cushing, Oklahoma hub to refining markets in the US Gulf Coast.

The Energy division holds TransCanada’s power operations and the non-regulated natural gas storage business in Canada.

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