Intelligence brief: TransCanada expands US portfolio; Carolinas replace coal with $1b. combined-cycle plants

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TransCanada is expanding its North America pipeline presence (Image credit: Alberta Utilities Commission)

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TransCanada expands into US with Columbia acquisition

TransCanada’s proposed $13 billion acquisition of Columbia Pipeline Group will bring the total length of the company’s natural gas pipeline system to about 91,000 km (57,000 miles).

The deal, which is subject to the approval of Columbia shareholders and regulators, will see TransCanada pay $25.50 per common share for Columbia and assume about $2.8 billion of debt.

Columbia operates about 24,000 km of pipelines in the US. Its assets include: Columbia Gas Transmission, which transports an average of 3 billion cubic feet per day through an 18,000 km pipeline network and 92 compressor stations in 10 states around the Marcellus and Utica shale regions; and Columbia Gulf Transmission, a pipeline system of about 5,400 km located primarily in Louisiana, Mississippi, Tennessee and Kentucky.

Russ Girling, TransCanada’s president and chief executive, said the acquisition complemented the company’s existing pipeline system and positioned it to transport natural gas to liquefied natural gas terminals for export.

TransCanada’s existing portfolio includes 56,600 km of wholly owned natural gas pipelines and 10,700 km of partially owned pipelines in Canada, the US and Mexico. In 2007 it purchased the 15,109 km ANR pipeline, which delivers natural gas from Texas, Oklahoma and Louisiana to the US Midwest.

Carolinas to replace coal with $1b. combined-cycle plants

The North Carolina Utilities Commission has approved Duke Energy Progress’ plan to construct two 280-megawatt combined-cycle natural gas-fueled power plants to replace its existing 376 MW coal plant, which will be retired by 2020.

Construction of the combined-cycle plants will cost about $1 billion. It is scheduled to begin in 2016 and be in service by late 2019.

According to Duke, the new plants will reduce sulfur dioxide by about 99%, nitrogen oxide by 45%, water discharged by 60%, and mercury emissions to negligible levels. Carbon-dioxide emissions will be reduced by about 60%, on a per-megawatt-hour basis, “due to the efficiency of the new gas units and the fact that natural gas burns more cleanly than coal”, it said.

In addition to the environmental benefits, Duke said the combined-cycle plants were about 35% less expensive to operate than the existing coal units. These savings will be passed on “dollar-for-dollar” to customers in North Carolina and South Carolina, it said.

Duke will file an application for a minimum of 15 MW of new solar generation over the next seven years after the Asheville coal plants have been decommissioned and coal-ash excavation is completed, it said.