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North Baja Pipeline Tests Market for Expansion

TransCanada Corp. and Sempra Energy announced an open season to test market interest in expanding the North Baja Pipeline system, including the system's sister pipelines in Mexico, Gasoducto Bajanorte Pipeline (GB) and Transportadora de Gas Natural de Baja California (TGN), both owned by Sempra.

The companies expect there to be market interest in transporting additional supply of liquefied natural gas (LNG) on the pipeline from Sempra's 1 Bcf/d Energia Costa Azul LNG terminal and other proposed terminals in Baja California Norte. North Baja Pipeline already is planning to reverse gas flow on its system from Mexico into the southwestern United States in 2007 when the Energia Costa Azul LNG terminal comes online. At that time the pipeline is expected to be expanded to 1.5 Bcf/d from its current 500 MMcf/d capacity.

The proposed expansion contemplated by this open season would provide additional pipeline capacity for a potential expansion of the Energia Costa Azul terminal and any additional LNG terminals planned for the area, including Chevron's proposed 700 MMcf/d Terminal GNL Mar Adentro, which is scheduled to come online in 2009.

"North Baja is ideally situated to play a major role in transporting regasified LNG from an expanded terminal facility into various U.S. markets," said Jeff Rush, general manager of TransCanada's GTN and North Baja systems.

Ryan O'Neal, vice president of Sempra Pipelines & Storage, said the companies are expecting a "strong market response to this open season."

The open season expires at 5 p.m. PDT on June 8. The parties will have until Sept. 1, to enter into binding firm transportation precedent agreements.

The existing 220-mile North Baja pipeline system -- comprised of NBP and GB -- went into service in 2002. TGN went into service in 2000. The North Baja Pipeline begins at an interconnection with El Paso Natural Gas near Ehrenberg, AZ, and crosses into Southern California before entering the Mexican state of Northern Baja California. The line parallels the U.S.-Mexico border for 140 miles before reaching an interconnection with TGN near Tijuana.

For more information on the open season go to the North Baja Pipeline websites at www.northbajapipeline.com and www.gasoducto-bajanorte.com or contact Mike Burke at (503) 833 4509.

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