MEDIA / Oil Producers Endorse IPL Energy Terrace Pipeline Tolling
Agreement, National Energy Board Concludes Facility
Hearing in Record Time
TSE, ME SYMBOL: IPL
NASDAQ SYMBOL: IPPIF
APRIL 16, 1998
CALGARY, ALBERTA--(April 16, 1998)IPL Energy Inc. today announced
that its wholly-owned subsidiary, Interprovincial Pipe Line Inc.
of Edmonton, and affiliated Lakehead Pipe Line Partners, L.P., of
Duluth, Minn. have reached a tolling agreement with the Canadian
Association of Petroleum Producers for the proposed Terrace crude
oil pipeline expansion project.
The Terrace expansion project is a phased program that ultimately
will provide an additional 520,000 barrels per day of heavy crude
oil capacity for Western Canadian producers seeking greater access
to Midwest U.S. markets. The estimated investment for the project
is Cdn. $840 million for the Canadian portion of the expansion,
and U.S. $380 million for the United States portion.
The agreement provides for a fixed toll increase of Cdn. $0.05 per
barrel, or approximately 3.5 percent, for transportation from
Edmonton, Alta., to Chicago, Ill.
Details of the agreement were filed with Canada's National Energy
Board as part of Interprovincial Pipe Line's application for the
first phase of the Terrace expansion. The NEB hearing on the
facility application concluded today after two days of
deliberation. This is the shortest hearing time for a crude oil
project of this magnitude and reflects significant industry
support for the project. In addition to NEB approval, the tolling
settlement is also subject to approval by the Federal Energy
Regulatory Commission in the United States.
Pending NEB approval, the first phase of the Terrace project will
provide an initial 95,000 barrels per day increase in capacity as
early as January of next year, rising to 170,000 barrels per day
by the end of 1999, at an investment of Cdn. $610 million in
Canada and U.S. $138 million in the United States. Subsequent
phases in the program will provide the balance of 350,000 barrels
per day of added capacity.
Brian F. MacNeill, President and Chief Executive Officer of IPL
Energy, said that the tolling agreement accompanying the Terrace
program builds upon the company's pioneering agreement with
shippers in 1995, the first liquids pipeline incentive tolling
arrangement on the continent, as well as the "risk sharing"
agreement developed with shippers for the SEP II expansion program
in 1996.
" For a small increase in overall tolls, the Terrace tolling
agreement provides shippers with toll stability and certainty. At
the same time, the fixed toll increase provides IPL Energy with a
favourable base return with the opportunity to enhance that return
as throughput increases through construction of the additional
phases," Mr. MacNeill said.
IPL Energy Inc. is a leader in energy delivery and services,
operating the world's longest crude oil and liquids pipeline
through the combined Interprovincial Pipe Line Inc. and Lakehead
Pipe Line Partners, L.P., system and Canada's largest natural gas
distribution company through The Consumers' Gas Company Ltd.
which serves 1.4 million residential, commercial and industrial
customers in south central and eastern Ontario, Quebec and Upper
New York State. IPL Energy's common shares trade on the Toronto
and Montreal stock exchanges in Canada under the symbol "IPL". In
the United States the shares trade on The NASDAQ National Market
under "IPPIF". |
