Based on recent and near-term acquisitions, Alberta EnergyCompany Ltd., (AEC) has upped cash flow projections for itsmidstream business for 2000 from the original estimate of C$145million to over C$165 million. The company also expects itsmidstream’s forecasted cash flow for the year 2001 to be C$230million, double its performance in 1999.

AEC said its growing natural gas storage business is reachingrecord profitability, increasing 55% to C$30 million in the firstnine months of 2000 when compared to the same period for last year.AEC attributes the increase primarily to the “application ofproprietary systems for optimizing the utilization of its gasstorage assets.”

Currently, AEC operates two storage facilities in Alberta with acapacity of 95 Bcf, and the 14 Bcf Wild Goose facility inCalifornia. The company also is leasing 3 Bcf of storage space inKaty, TX. “We would like to continue to grow our storage business,”said AEC spokesman Greg Kist. “We think it is one of our corecompetencies and we will continue to look for opportunities.” Kistadded that the company is actively searching in North America forstorage acquisition prospects.

AEC in September purchased the 30% of AEC Pipelines Ltd., thatis publicly traded, and the company also entered into a partnershipagreement with Koch Pipelines Canada L.P. and Canadian NaturalResources Ltd., to own and expand the crude oil Cold Lake PipelineSystem.

AEC also bought out its partner TransCanada Pipelines’ interestin the crude oil Express Pipeline System. AEC issued 1.7 millioncommon shares to TransCanada on Nov. 6 to satisfy the C$100 millionpurchase price (see NGI, Oct. 8). AEC also expects to close its$100 million purchase of a 36% interest crude oil TransandinoPipeline System in Argentina later this month.

Alex Steis

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