TransCanada PipeLines Ltd. and Nicor Inc. said they plan to dustoff their old Viking Voyageur proposal and re-submit it as asubstantially amended pipeline project, one that would be aboutone-seventh the length of the originally proposed project and wouldflow northward from the Chicago market hub to serve growing gasmarkets in northern Illinois and southern Wisconsin.

In a July 31st filing at FERC, the joint partners in Voyageurindicated that they were developing plans for a 140-150 mile, 1.05Bcf/d pipeline that would begin at the Joliet/Chicago Hub area,where it would interconnect with Northern Border Pipeline andAlliance Pipeline, and would extend northward, ending justsouthwest of Milwaukee, WI. They plan to submit a formalapplication to the Commission in either September or October, saidEd Werneke, vice president of supply ventures with Nicor, parent ofNicor Gas.

The radically altered Voyageur surfaced a little over a monthafter the announcement of a virtually identical proposal, theIllinois Wisconsin Express. Amending the previously filedcertificate presumably would give the Voyageur proposal a headstart on the Express which has yet to file at FERC.

Werneke said Voyageur’s plan “is to revise the application thatwe have at FERC currently – which would be that old Viking Voyageurconcept.” The original application called for construction of a773-mile, 1.4 Bcf/d pipeline that would interconnect withTransCanada at the Manitoba border and bring gas down throughMinnesota, Wisconsin and into the market hub in Chicago.

The project sponsors asked FERC last April to suspendconsideration of the project, which was in head-to-head competitionwith the proposed Alliance Pipeline, because they were unable toobtain enough shipper commitments to justify building the entireline, Werneke

Voyageur Revitalized continued from page 1

noted. The Commission gave the sponsors until late July “to seeif we could serve them [northern Illinois and southern Wisconsin]in some other way.” The sponsors in the end decided to pursue thesouthern portion of the project (from southern Wisconsin toJoliet), but opted to forego the northern section (from theManitoba-Minnesota border to southern Wisconsin), at least for now.They hope to build the southern section for about $260-$270million.

But it has not ruled out building the northern sectionaltogether. “Sometime in the future we would anticipate that thatmight be something we would do, but for the time being we don’tbelieve that there is adequate support for that to be completed allthe way up to the Canadian border,” Werneke said.

Looking to the future, “we have been very active in designing adifferent type of pipeline project, but we still want to serve thesame markets” that were planned in the original project – northernIllinois and southern Wisconsin, Werneke said. “Those are verystrong markets. They’re experiencing a lot of growth. They’reexperiencing a lot of interest in electric power generation. And,of course, in Wisconsin currently the utilities there are prettymuch captive to one pipeline,” ANR Pipeline. He believes VikingVoyageur, if approved and built, would provide targeted customerswith an alternative to ANR.

“We’ve been working very closely with the LDCs in both states.We’ve had strong support at a conceptual level right now fromthem,” he noted. Some of the LDCs include Nicor’s own utilitysubsidiary Nicor Gas in Illinois, and Wisconsin Gas, WisconsinElectric Power and Madison Gas and Electric. The sponsors told FERCthat they are “actively negotiating” with these LDCs, and intend tohold an open season during the middle of August. Werneke declinedto say whether any shippers have committed to the project yet. “I’mreally not at liberty to talk about the level of commitments wehave right now.”

The competing Illinois Wisconsin Express Project is sponsored bya coalition of El Paso Energy, Enron, Peoples Energy and NorthernBorder Pipeline. They have plans to build a $220-$280 millionpipeline that also would extend from Joliet, IL, north to justnorth of Milwaukee. The project would have an initial designcapacity of 650 MMcf/d. Moreover, ANR and Viking Gas Transmissionhave announced plans to expand their existing transportationsystems to capture the incremental growth in the region.

“I really don’t view it [the Express Project] as seriouscompetition personally. I think that our project is much betterdefined,” Werneke said. Given that Viking Voyageur already has aproposal on file at the Commission, “we believe that positions usto have a competitive edge.”

He thinks the new Viking Voyageur project will fare well atFERC. “I think FERC has demonstrated an interest in seeingcompetition among the interstate pipelines. And this wouldcertainly go a long way to providing competition in Wisconsin,which they don’t have much of right now.” He said the sponsors planto propose an in-service target date of November 2000 for theproject.

Susan Parker

©Copyright 1998 Intelligence Press, Inc. All rightsreserved. The preceding news report may not be republished orredistributed in whole or in part without prior written consent ofIntelligence Press, Inc.