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Alliance Gauging Interest in Potential Expansion

Alliance Pipeline launched a test Monday of market demand for a potential 30% increase of delivery capacity along its 3,848-kilometer (2,291-mile) delivery route for liquids-rich natural gas to Chicago from northern British Columbia and Alberta.

The Calgary energy transportation firm circulated a request for nonbinding expressions of interest in adding up to 500 MMcf/d to its current capacity of 1.6 Bcf/d.

The increase could be done by low-cost additions of compressors instead of expensive installations of new pipe, Alliance said. No price tag was forecast for the plan, which remains in an early stage of assessment.

The 18-year-old Alliance system is fully booked. Production of liquids-rich gas that the line specializes in carrying is forecast to grow steadily from northeastern BC and northwestern Alberta shale deposits led by the Montney formation. The Canadian pipeline also picks up eastbound U.S. gas traffic from Williston Basin production fields in North Dakota.

Alliance Vice President Dan Sutherland said, “With existing firm capacity on the system fully subscribed and interruptible capacity at a premium, customer demand is certainly the driver for exploring a potential capacity expansion.”

A binding open season could be held as early as the fall if the market test talks generate strong interest, Alliance said. A tentative target of 2020 has been set for completing the potential expansion project.

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