TransCanada working on projects worth nearly $14 billion targeting Asia

TransCanada Corp is participating in projects worth nearly C$14 billion ($13.5 billion) that aim to fill Asia's fast-growing demand for Canadian oil and gas and is eyeing more, the pipeline operator's chief executive said on Wednesday. "We've got something approaching C$13 billion-C$14 billion of joint venture projects that we're now underway with," CEO Russ Girling said in an interview at the World Energy Congress in South Korea.
"I would have never predicted that 24-36 months ago." Asian national oil and gas companies have been drawn to the North American market as shale oil and gas output has changed the landscape of energy markets, with many taking stakes in developing fields to get priority access to the supplies. TransCanada is already planning to build pipelines to transport gas produced in northern Canada to two liquefied natural gas (LNG) terminals for export to Asia.
One of the LNG projects is operated by Royal Dutch Shell Plc, which is partnering Korea Gas Corp, Mitsubishi Corp and PetroChina Co Ltd. The other is led by Malaysia's state-owned Petronas. The North American company also has a joint venture with PetroChina to build a pipeline to transport crude from Canadian oil sands production. TransCanada may also complete in 2017-2018 its 1.1-million bpd cross-country pipeline, Girling said, and is preparing to file an application with the National Energy Board for the C$14 billion Energy East Pipeline project.
This is one of several pipeline projects in Canada aimed at transporting landlocked crude to local refineries and for exports to Asia. Another prospect is in Alaska where TransCanada and the three major North Slope oil producers - ConocoPhillips, BP and Exxon Mobil - have embarked on joint studies of a possible LNG project to supply Asian markets, estimated to cost up to $65 billion.
The producers have been re-injecting about 8 billion cubic feet per day of gas back into fields as the original plan to send it to other US states was derailed by the shale gas boom. "Producers are thinking about the timeframe of 2020-2025 to want to bring that gas to market," Girling said. "The key issue for producers to be able to commit that capital is what is the royalty scheme going to look like and what is the fiscal take of the Alaska government," he said. "If they can sort that out, it becomes a viable and real project for Alaska with meaningful supply for this region."