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Alliance $3 Billion Pipeline in Full Construction Mode

Alliance $3 Billion Pipeline in Full Construction Mode

Just in case there were any doubters still out there, Alliance Pipeline says it now has nine of 10 mainline construction crews in the field installing the $3 billion pipeline system. The crews started construction on two spreads in North Dakota, one in Minnesota, two in Iowa, one in Illinois and two in Saskatchewan. A Third crew is starting in Saskatchewan this week.

"The Alliance Pipeline system -- which includes the Aux Sable natural gas liquids extraction and fractionation facility -- will provide increased access to North American markets for western Canadian natural gas resources," said Alliance CEO Dennis Cornelson.

Over the next 400 days Alliance plans to install more than 2,300 miles of steel pipe weighing over 1.2 million tons. The system will be powered by 14 mainline compressor stations totaling more than 550,000 horsepower. The related $365 million Aux Sable Liquid Products extraction and fractionation facilities will be in Channahon, IL. The system is to be in service Oct. 1, 2000.

Seven of the 14 mainline compressor station sites have started construction; all but one of the remainder will be under construction by the end of June.

Alliance is designed to initially offer 1.325 Bcf/d of firm delivery service from the gas producing areas of northeastern British Columbia and northwestern Alberta to markets in the midwestern United States and eastern Canada. It consists of three significant, integrated components:

Investors in Alliance and Aux Sable Liquid Products LP include affiliates of Duke Energy, 9.8%; Enbridge Inc., 21.4%; Fort Chicago Energy Partners LP, 26.0%; The Coastal Corp., 14.4%; The Williams Companies, 4.8%; and Westcoast Energy Inc., 23.6%.

The Alberta-to-Chicago toll on Alliance will be a 93 cent/Mcf demand charge and an energy toll of 81 cents/MMBtu, assuming 1,070 But gas and including fuel and a 16% authorized overrun service (AOS).

Joe Fisher, Houston

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