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Cornelson Discounts Supply Problems for Alliance
Alliance CEO Dennis Cornelson reiterated yesterday he’s not theslightest bit concerned about upstream gas supply problems puttinga damper on Alliance throughput once the the pipeline isconstructed. “Thinking about that very issue over the years, Ithink that it’s clear that with the higher gas prices that arebeing realized and the relatively low prices for oil at this timethat there will be real focus on natural gas exploration anddevelopment over the next several years.
“Our evidence to the National Energy Board was even withcontinued levels of drilling activitiy at recent levels there stillwill be enough gas to fill all these pieplines in that time frame.So we don’t really see any reason why all the pipelines aren’tgoing to be relatively fully utilized. Having said that, I thinkit’s relatively positive for western Canadian producers to havesome surplus pipeline capacity, and to the extent there is some,it’s more likely that it’s going to be on other peoples’ pipelinesthan on ours,” he told analysts during a conference call.
“Our pipeline will be full because the demand charges have beenpaid and that means the shippers will be shipping the gas on ourline,” he added.
Alliance is nearly fully subscribed with 1.3 Bcf/d of its 1.325Bcf/d of proposed capacity under contract. FERC approved the U.S.portion of the project last week. The NEB is expected to make itsdecision next month, Cornelson said.
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