Alliance pipeline seeks to replace existing transportation contracts

According to industry specialists, the Alliance pipeline, jointly owned by affiliates of Enbridge Inc. and Veresen Inc., could potentially face being repurposed out of Western Canada if shippers do not replace existing transportation contracts.

The 3719 km natural gas pipeline delivers gas rich in petroleum liquids, such as butane, ethane and propane, from the Western Canadian Sedimentary Basin and the Williston Basin to the Chicago region. The system has been in service since 2000 and transports, on average, around 45.3 million ft³/d of natural gas. Owners of the pipeline are currently in negotiations with shipping companies to replace existing transportation contracts, which are due to expire in December 2015.

Ed Kallio, Director of Gas Services at Ziff Energy Group, told local press at an industry forum in Calgary: “The Alliance system could be the next one to be repurposed out of Western Canada.

However, owners of the pipeline have stated that such a move is not being contemplated and that the system is an important source for the transportation of gas from Western Canada. Furthermore, a long-term supply deal with Encana Corporation and a subsidiary of PetroChina Co. Ltd. has recently been agreed, involving the transportation of up to 195 million ft³/d of gas from the companies’ Duvernay shale fields in Alberta.

Edited from various sources by Rosalie Starling

Read the article online at: https://www.worldpipelines.com/business-news/07032014/alliance_pipeline_seeks_to_replace_existing_transportation_contracts_132/