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Alliance Pipeline Holding Open Season for New Services

June 15, 2009
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After nine years as an express route to Chicago, Alliance Pipeline has set out to take advantage of growing natural gas supplies in northern British Columbia by diversifying. Until July 15, the transporter is holding an open season auction of proposed new services for BC producers.

The offering includes up to 500 MMcf/d in new gathering receipt capacity, plus a Canadian delivery service to points other than Chicago along Alliance's path. The principal target is to create an alternative route from northern BC into the NOVA shipping and trading hub in Alberta.

Alliance's action is running in parallel with two pipeline projects -- called Groundbirch and Horn River -- mounted by NOVA's owner, TransCanada Corp., to extend the Alberta grid into the Dawson Creek and Fort Nelson regions of BC (see NGI, March 2).

Both areas are hotbeds of unconventional gas development, currently in early stages but driven by large-scale growth programs including industry heavyweights such as EnCana Corp., BP Energy Canada and Shell Canada. In the Dawson Creek region the prime target is a formation known as Montney, which is a geological mixture of tight and shale layers. Around Fort Nelson the target is the Horn River shale layer, a formation described as at least as rich as the Barnett and much larger.

Alliance's open season is primarily aimed at adding service in the Dawson Creek area. The express pipeline's inlet is nearby at Fort St. John and includes branches collecting gas from points in the region. Alliance's supply outlook, echoing forecasts by other industry participants, anticipates that BC gas production will nearly double to approach 6 Bcf/d within 10 years.

Alliance's invitation to participate in its open season says it has been approached by gas producers, marketers and consumers in BC, Alberta and Saskatchewan. There is potential to add services along the mainline route across Alberta and Saskatchewan, depending on the level of interest expressed by the industry.

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