Vector's Canadian Portion Gets Nod From NEB
While just a smidgen of its project would be in Canada, Vector
still needed - and got yesterday - approval from Canada's National
Energy Board (NEB). "This is a significant milestone and supports
Vector's status as the most advanced project to meet increasing
demand for natural gas for markets east of Chicago," said Vector
Vice President Juri Otsason. Vector expects to receive final
certification from the Federal Energy Regulatory Commission (FERC)
in the second quarter, which will represent the final step in
The NEB found Vector to be "economically feasible" based on
available gas supply, markets and shipper commitments. "The Board
is also of the view that Vector will contribute to increased
security of supply and liquidity in Canadian markets.
"TransCanada argued that some of its shippers could be harmed
because of Vector. However, Vector does not expect a lengthy period
of excess pipeline capacity in eastern Canada. The Board finds no
evidence of the certainty or magnitude of potential harm and is not
persuaded that it would be significant."
The total Vector project will consist of about 343 miles of
pipeline. In Canada, Vector plans to construct and operate about 15
miles of pipe, extending from a point along the international
boundary in the St. Clair River near Sarnia, ON, to a point near
Dawn. The estimated capital cost of the Canadian portion of the
project is $35.4 million.
Vector plans to be in service by Oct. 1, 2000 and intends to
begin construction of some segments of the pipeline, including
critical river crossings, in 1999. Full delivery capacity of the
pipeline, which will transport gas from Chicago, IL, to Dawn, ON,
will be 1 Bcf/d.
The Vector project is a joint venture of Calgary-based Enbridge
Inc. and Detroit-based MCN Energy Group Inc. Vector is designed to
transport western Canadian and U.S. sourced gas from the rapidly
expanding Chicago hub, where it will interconnect with Northern
Border Pipeline's extension and the Alliance Pipeline, to growing
markets in eastern Canada and the midwestern and northeastern
regions of the United States. The Board's decision follows an
environmental screening of the facilities and a public hearing.
Vector took the lead among the pipelines intended to move gas
east from Chicago when it won preliminary approval on
non-environmental grounds from FERC back in October, putting it
ahead of competitors TriState Pipeline, Independence Pipeline and
the Tennessee Eastern Express projects.
In a draft order, the Commission said no evidence was produced
to demonstrate Vector was not required by the public convenience
and necessity. Vector is to bear the full risk of building the $447
million pipeline because it filed for an optional certificate (OC),
which allows an applicant to gain Commission authorization for a
project without demonstrating market demand for services.
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