TransCanada PipeLines has shelved plans to build a 90-mileextension of its mainline system into the southern portion of theNorthwest Territories to tap a major new production area near FortLiard that is estimated to hold 5 Tcf of potential reserves. Thepipeline company said there is not enough producer interest at thistime so the project has been put on indefinite hold. However, themuch larger Mackenzie Delta pipeline project, which would extendabout 1,800 miles to the northwest, is still on the front burner.

Following discussions with the government of the NorthwestTerritories last year, TransCanada agreed to look into theeconomics of building a pipeline to the Mackenzie delta and topursue a direct connection between the rapidly developing reservesin the southern part of the territories and its mainline. Theagreement came shortly after the Canadian arm of SanFrancisco-based Chevron Corp. calculated it found reserves of400-600 Bcf with a single new discovery well. The company said itstests show the 10,000-feet deep well will deliver 70-100 MMcf/dwhen it is put on production. Another well tested by ParamountResources and Berkley Petroleum came in at 45 MMcf/d with anestimated 250 Bcf of marketable gas. Other companies planned todrill additional wells with production potential of more than 100MMcf/d by this summer. The Fort Laid reserves currently includemore than 1 Tcf of proven and another 3 to 5 Tcf of potential.

TransCanada’s temporary departure from this budding developmentarea clears the way for Westcoast Energy to expand its existingsystem into the Liard area. The pipeline already has 100 MMcf/d ofcapacity. Expansions are planned to add 300 to 400 MMcf/d in thenext two years. Westcoast connects to TransCanada’ provincialAlberta system and will connect to Alliance Pipeline.

Westcoast signed an agreement last year with the Acho Dene Koe,the local Indian community that owns much of the land in the Liardarea, to develop new gathering, processing and transportationinfrastructure. The plan involves an extension of Westcoast’sexisting Pointed Mountain pipeline and could include an extensionof Alberta Energy Co.’s Maxhamish line.

Rocco Canonica

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