Calgary-based AltaGas Income Trust and Devon Canada Corp. have shelved plans to develop the Noel natural gas pipeline and Pouce Coupe sour gas facility expansion project because of a market slowdown. The projects were announced earlier this year.
According to AltaGas, the projects “were subject to certain economic conditions precedent and are being deferred for economic reasons.” It noted that natural gas inventories “are at record highs and cooling demand has been low while prices remain below their year-ago level.”
AltaGas in April said it would build a pipeline from the Noel region of British Columbia to an expanded Pouce Coupe gas processing facility in northwestern Alberta for C$90 million. The planned pipeline, which was expected to be in service by mid-2008, was to transport 90 MMcf/d from Noel to the sour gas facility.
“The Noel region is an underdeveloped area with substantial reserves potential,” AltaGas CEO David Cornhill said. “We believe that the Noel pipeline construction project and Pouce Coupe facility expansion project continue to be attractive projects for transporting and processing natural gas from the Noel region.”
AltaGas said it intends to continue to develop the Noel pipeline construction project and Pouce plant, but it did not indicate when the projects will move forward.
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