After half a century as the mainstay of natural gas transportation across Canada, TransCanada PipeLines Ltd. is charting a new course — out to sea, where it aims to launch an armada to serve offshore production projects.

TransCanada stepped forward during the fourth bi-annual International Pipeline Conference and trade fair in Calgary with a plan, based on a technical breakthrough in pipe manufacturing, for shipping gas by freighters and barges. The move injected competition into an emerging niche for gas shipping: delivering production from discoveries that are either too remote for subsea pipelines or not big enough to justify laying permanent lines.

TransCanada unveiled its plan without fanfare, to international industry representatives with a trade-fair booth manned by experts and in a technical paper by pipeline staffers Gary Stephen and Alan Glover, and Tom Zimmerman of C-FER Technologies, a materials-testing arm of the Alberta Research Council. The proposal — trade-marked GTMs, short for gas transport modules — is a variation on a theme that has attracted considerable and growing expert study and business interest in Canada’s budding East Coast oil and gas industry since 1998.

The idea is to apply the techniques of container shipping to natural gas transportation, by in effect creating a portable floating pipeline that sails aboard economical freighters rather than costlier, more hazardous ocean tankers. The original entry — trademarked Coselles, short for coiled carousels of pipe — started out as the brainchild of a Calgary engineering partnership, Cran & Stenning Technology Inc. Its plan, with the technical aspects protected by an array of patents, won encouraging reviews from a technical study group that included a ‘Who’s Who’ of East Coast energy developers and the Newfoundland Ocean Industries Association, then a further examination by the engineering house of Fluor Daniel.

A home-grown Newfoundland entry in exploration and production, Canadian Imperial Venture Corp. of St. John’s, has formed a joint venture to market the plan with a subsidiary of the Calgary firm,Wild Rose Holdings Ltd. The marketing partnership predicted freighters carrying Coselles packed with compressed natural gas (CNG) could deliver production from the Grand Banks to Boston for US$1.40/Mcf or to the Nova Scotia starting point of Maritimes & Northeast Pipeline at Goldboro for US$0.90.

TransCanada bills its version of the concept as safer, as well as potentially lower in costs. It relies on an invention — patented by U.S.manufacturer NCF Industries, with TransCanada licensed to market it worldwide — that has been trade-marked CRLP, short for composite reinforced line pipe. The product started out as a technique of making lightweight, high-pressure air tanks for firefighters and emergency escape equipment for sailors on U.S. nuclear-powered submarines.

CRLP is made by wrapping a thick layer of glass fibres impregnated with resin tightly around an inner layer of metal pipe. The result is a container about one-third lighter yet 1.3-1.8 times stronger than conventional steel. The composite-reinforced pipe has also been found to be more durable and resist fractures better than plain metal.

TransCanada’s ocean delivery plan calls for lengths of the composite pipe to be sealed at both ends, filled with gas compressed to 3,600 pounds per square inch and stacked aboard freighters in loads of up to 1 Bcf per ship. The CNG system is projected to provide economic deliveries equivalent to a medium-sized pipeline with a capacity of 100-500 MMcf/d over a range of up to 700 nautical miles (800 land miles or 1,300 kilometres).

The Canadian pipeline also points to inland uses for smaller variations on the system, such as loading the containers on river barges, railway cars and trucks. The composite pipe has undergone tests for about 14 years in the U.S. In Canada, TransCanada has been working on the technology since 1996, and has installed test sections of the new pipe in eastern Canada and northern Alberta over the past four years.

The Calgary-based pipeline expects to obtain official certification and approvals for the new shipping system this year from the American Bureau of Shipping and the American Society of Mechanical Engineers. The rival proposals for introducing a new method of shipping gas by sea are far from speculative ventures into engineering novelties offshore of Canada’s East Coast.

While development off Nova Scotia uses conventional pipeline systems, Newfoundland authorities and business leaders are encouraging the industry to add gas to the oil developments on the Grand Banks. Reserves available to the next Grand Banks production project — White Rose, sponsored by Husky Energy and Petro-Canada, and currently advancing through the regulatory process — include 2.7 Tcf of gas by the latest count of the Canada-Newfoundland Offshore Petroleum Board.

Barring a transportation breakthrough, the gas will be left behind. Although Husky, Fluor and Duke Energy sketched out a pipeline concept for Grand Banks gas last year, they concluded it would be a $3.5 billion giant requiring 7-10 Tcf of proven reserves to support. A Husky survey concluded that the current, limited state of knowledge about the Grand Banks points to reserves of up to 26 Tcf. About four-fifths remains in the elusive realm of “undiscovered potential.”

But 4.8 Tcf — enough to interest developers of low-cost shipping as an alternative to pipelines — have been found in the most explored area, the Jeanne d’Arc Basin about 180 miles offshore of St. John’s and the site of the Hibernia, Terra-Nova and White Rose oil projects. The area lies within the sailing range rated as economic by TransCanada and the rival Canadian Imperial group for their new compressed gas container shipping systems.

©Copyright 2002 Intelligence Press Inc. Allrights reserved. The preceding news report may not be republishedor redistributed, in whole or in part, in any form, without priorwritten consent of Intelligence Press, Inc.