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Construction Completed on Alliance Pipeline

Construction Completed on Alliance Pipeline

The C$4.6 billion Alliance natural gas and liquids pipeline, designed to transport 1.325 Bcf/d from northeast British Columbia to Chicago, has completed its construction phase and now is commissioning the mainline, laterals, compressors and supervisory equipment.

The final weld was completed on Aug. 12 near Regina, SK, and Alliance now is injecting linepack into its 1,857-mile mainline system that will stretch from northeastern BC to near Chicago, carrying both natural gas and liquids.

In Canada, Alliance completed its 758-mile 36-inch mainline; a 211-mile 42-inch mainline; and 405 miles of 4-24 inch laterals. About 29 miles of laterals still remain to be built in Canada. In the United States, Alliance has constructed the entire 888-mile, 36-inch mainline portion. All told, it has built 2.26 thousand miles of mainline and lateral pipe, which it told FERC is targeted to begin flowing natural gas on Oct. 2.

All of the 14 mainline compressor stations --- seven in Canada and seven in the U.S. --- have been built, but only nine have been commissioned. When it began construction in May 1999, Alliance already had commitments from 37 shippers for 15-year contracts worth a total of $8.2 billion (See NGI, March 8, 1999).

The large volumes of gas Alliance will haul from western Canada into the U.S. Midwest is expected to have a major impact on existing pipelines, markets and prices. TransCanada PipeLines already has filed for new tolls to compensate for customers which have failed to renew firm contracts on its line and instead are routing their gas through Alliance.

New gas that makes its way into the Chicago area could be sent on to southern Ontario through the Chicago-to-Dawn Vector Pipeline, scheduled to open in late October with initial capacity of 720 Bcf/d. (See NGI, July 3) The Foothills/Northern Border route from western Canada into the Midwest also is expected to see some slack.

In Chicago, Alliance will interconnect with four interstate pipeline systems --- ANR Pipeline, Midwestern Gas Transmission, Natural Gas Pipeline Company of America and Vector --- and two gas distributors, Peoples Gas Light & Coke and Nicor.

Alliance spokesman Jay Godfrey said last month that "when October comes we won't be in the position that we'll have to start filling the pipe. It essentially already is going to be full." Connections to 37 gas plants are already complete, he said.

Investors in Alliance Pipeline Limited Partnerships include affiliates of Coastal (14.4%), Enbridge (21.4%), Fort Chicago Energy Partners LP (26%), Williams (14.6%) and Westcoast Energy (23.6%).

Carolyn Davis, Houston; Susan Parker, Washington

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