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Alberta Distributor Joins Battle Over NOVA Tolls

Alberta Distributor Joins Battle Over NOVA Tolls

An epic battle with multiple fronts is shaping up in Canada over an appeal by the Northwest Territories government for the National Energy Board to take jurisdiction over the Nova pipeline grid away from Alberta.

While an extension was granted to a deadline for responses, the biggest natural gas distribution house in western Canada wasted no time in stepping forward into a fray set off by a Nova toll settlement. Atco Gas says that, like the territories, it too is unhappy with the pact reached earlier this year among Nova and gas producers, shippers and marketers that were allowed to participate in the negotiations. As operator of almost all of Alberta's web of distribution pipelines and about 800,000 gas users including major industrial establishments, Atco reports it already objected to the toll deal before the Alberta Energy and Utilities Board.

Atco takes no immediate position on the territorial appeal, which demands a sweeping political change to end 45 years of jealously-guarded Alberta control over the 17,000-kilometer Nova grid. But Atco says the new system of distance-based tolls spells an "unfair" distribution of transportation costs, with gas users inside Alberta paying too much compared to shippers using the Nova grid to make out-of-province sales via long-distance pipelines.

Under the old regime of standardized postage-stamp rates, Nova charged C27.7 cents (US18.5 cents) per Mcf regardless of how far gas traveled. In the new system, charges will range this year from C19.9 cents to 35.9 cents (US13.3-24 cents) for shipments bound for out-of-province destinations via Nova connections with long-distance pipelines.

Rates also vary with the diameter of pipe that shippers require, and 5% discounts are offered for signatures on long transportation service contracts of five years. After calling on the AEUB to hold full-scale public hearings on the Nova settlement, Atco says it wants to be involved every step of the way in any forthcoming procedures triggered before the NEB by the territorial demand to turn control over transportation of gas across Alberta.

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