PIPELINES / Vector Pipeline Announces FERC Filing
TSE, ME SYMBOL: IPL
NASDAQ SYMBOL: IPPIF
DECEMBER 16, 1997
CALGARY, ALBERTA--(December 16, 1997) - The Vector Pipeline
project, initiated by IPL Inc., has filed an application with the
Federal Energy Regulatory Commission in Washington D.C. to
construct, lease and operate the 328-mile U.S. portion of its
proposed 343-mile natural gas pipeline. When completed, Vector
will be a key transportation link between the existing natural gas
hubs at Chicago and Dawn, Ontario.
"The filing of this application puts the Vector Pipeline project
on schedule to be in-service by November 1, 1999," said Vector
President Brian Vaasjo. "Vector will lower the rising sea of gas
in Chicago and move it to the market hub at Dawn to serve growing
markets in Eastern Canada and the U.S. Eastern Seaboard."
Included in the FERC application is a description of the project
including changes made to the original proposal. Among the
changes, Vector is now proposing to increase the diameter of the
pipe from 36 inch to 42 inch for 269 miles of new pipeline to be
constructed in the U.S. Vector will also change its design
pressure from 1,440 psig to 1,000 psig. This design change would
see Vector operate at a lower pressure to match the seasonal
variations in pressure of supply sources in the Chicago area as
well as to better integrate Vector with pipelines and storage
facilities along the pipeline route. Vector is also proposing to
lease 59 miles of existing 36-inch diameter pipeline under a
long-term lease with Michigan Consolidated Gas Company. Vector
intends to construct two 30,000 HP compressor stations and five
meter/regulating stations to accommodate the planned capacity.
The cost of refinements to the design and escalating costs of
material and labour have been offset by a reduction in rate of
return on equity in order to maintain the $0.23 U.S./Dth toll from
Chicago to Dawn.
The Vector Pipeline project will have a design capacity of one
billion cubic feet of natural gas per day. Vector will provide
seamless natural gas transportation service from the rapidly
expanding Chicago hub to points in Michigan and on to Dawn. From
there, the gas can be further transported by other existing and
proposed transmission systems for redelivery in both Canada and
the United States.
"The Vector system represents the next logical step in the
evolution of competition in the continental natural gas market,"
said Mr. Vaasjo. "Vector is a hub-to-hub, transportation-only
pipeline charging competitive, market-driven rates."
Mr. Vaasjo added that from an environmental point-of-view, the
Vector project scores high marks because, among other reasons, it
leases existing pipeline facilities and the new construction
follows existing rights-of-way for 94 percent of its length.
Vector is also pleased to acknowledge today that MCN Energy Group,
Inc. has increased its interest in Vector Pipeline from 17 1/2
percent to 20 percent.
Vector has completed an open season and received firm service
requests in excess of 1 billion cubic feet per day. The pipeline
will originate at a point of interconnection with the terminus of
the approved Northern Border Pipeline extension and the proposed
Alliance Pipeline and Viking Voyageur pipeline projects.
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SYSTEM DESCRIPTION
Capital Cost ($U.S.) United States Segment $447 million
Canada Segment $24 million
Total $471 million
Length of Pipeline 269 miles of new pipeline through
Illinois, Indiana and Michigan.
59 miles of leased pipeline between
Milford and Belle River, Michigan.
15 miles from Canada/US border to
Dawn, Ontario
343 miles total
Capacity 1 MMDth/d (approx. 1 Bcf/d)
of initial firm capacity
Compression Two 30,000 HP compressor stations
In-Service November 1, 1999
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