August 06, 2007 23:59 ET

TransCanada and NW Natural Form Palomar Gas Transmission Joint Venture

PORTLAND, OREGON--(CCNMatthews - Aug. 6, 2007) - Palomar Gas Transmission LLC (Palomar), a newly formed joint venture of TransCanada Corporation (TransCanada) (NYSE:TRP) (TSE:TRP) and Northwest Natural Gas Company (NW Natural) (NYSE:NWN), announced today a proposal to build a natural gas pipeline that would serve growing markets in Oregon, the Pacific Northwest, and the western U.S. If approved, the new transmission line is scheduled to begin service in late 2011.

Palomar was formed by TransCanada and NW Natural to design, construct, and own the Palomar pipeline. TransCanada and NW Natural are equal owners of the joint venture. TransCanada's Gas Transmission Northwest System (GTN), headquartered in Portland, will operate the proposed pipeline. The partners are seeking a federal certificate to build and operate a pipeline extending approximately 220 miles from northwestern Oregon to north-central Oregon.

The Palomar pipeline will connect TransCanada's existing GTN System in central Oregon with NW Natural's distribution system near Molalla, Oregon, approximately 30 miles southeast of Portland. NW Natural's utility operations has agreed to contract for about 100 million cubic feet per day of capacity on the 36-inch-diameter pipeline.

"NW Natural currently depends on a single interstate pipeline for its supply, approximately two-thirds of which comes through the Columbia Gorge," said Gregg Kantor, president and chief operating officer of NW Natural. "The Palomar pipeline would significantly diversify our delivery options and enhance reliability for NW Natural's customers." NW Natural serves about 641,000 residential, business, and industrial customers in Oregon and southwest Washington.

NorthernStar LLC, developer of the proposed Bradwood Landing liquefied natural gas (LNG) terminal, may elect to take capacity on Palomar should the Bradwood Landing terminal and the Palomar pipeline be constructed.

"This project is being designed so that, if an LNG terminal is constructed on the Columbia River, the Palomar pipeline can be extended to serve it," Kantor said.

The total cost of the project is estimated to be between $600-700 million in current dollars if both proposed sections are built.

Palomar will request preliminary environmental approval for the project from the Federal Energy Regulatory Commission (FERC), the pipeline's principal regulator. Even before that filing is made, Palomar will begin the public engagement process in which parties, including landowners, will have the opportunity to ask questions, register comments, and provide input into the overall pipeline certificate process.

TransCanada is a leader in the responsible development and reliable operation of North American energy infrastructure. TransCanada's network of more than 36,500 miles of pipeline taps into virtually all major gas supply basins in North America. TransCanada is one of the continent's largest providers of gas storage and related services with approximately 360 billion cubic feet of storage capacity. A growing independent power producer, TransCanada owns, or has interests in, approximately 7,700 megawatts of power generation in Canada and the United States. TransCanada's Gas Transmission Northwest system, headquartered in Portland, has been operating in Oregon since 1963.

NW Natural, also headquartered in Portland, is the largest independent natural gas utility in the Pacific Northwest, serving approximately 641,000 home, business, and industrial customers in Oregon and southwest Washington.

(All dollar figures are in U.S. dollars.)


This news release may contain certain information that is forward- looking and is subject to important risks and uncertainties. The words "anticipate," "expect," "may," "should," "estimate," "project, "outlook," "forecast" or other similar words are used to identify such forward-looking information. All forward-looking statements are based on TransCanada's beliefs and assumptions based on information available at the time such statements were made. The results or events predicted in this information may differ from actual results or events. Factors which could cause actual results or events to differ materially from current expectations include, among other things, the ability of TransCanada to successfully implement its strategic initiatives and whether such strategic initiatives will yield the expected benefits, the availability and price of energy commodities, regulatory decisions, changes in environmental and other laws and regulations, competitive factors in the pipeline and energy industry sectors, construction and completion of capital projects, access to capital markets, interest and currency exchange rates, technological developments and the current economic conditions in North America. By its nature, such forward-looking information is subject to various risks and uncertainties which could cause TransCanada's actual results and experience to differ materially from the anticipated results or other expectations expressed. For additional information on these and other factors, see the reports filed by TransCanada with Canadian securities regulators and with the U.S. Securities and Exchange Commission. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date it is expressed in this news release or otherwise, and TransCanada undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

The results or events predicted in this information may differ from actual results or events. Factors which could cause actual results or events to differ materially from current expectations include, among other things, the ability of Palomar Gas Transmission to obtain the needed permits, gather landowner approvals, complete any needed financing , and the typical construction risks inherent in pipeline projects for materials and labor availability.

This release and other information made by NW Natural from time to time may contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and other statements that are other than statements of historical facts. NW Natural's expectations, beliefs and projections are expressed in good faith and are believed to have a reasonable basis. However, each such forward-looking statement involves uncertainties and is qualified in its entirety by reference to the factors described in Part I, Item 1A, "Risk Factors," and "Forward-Looking Statements" following Part II, Item 7A, in NW Natural's 2006 Annual Report on Form 10-K, and in "Forward-Looking Statements" following Part I, Item 2, of NW Natural's Quarterly Report on Form 10-Q for the quarter ended March 31, 2007, that could cause the actual results of NW Natural to differ materially from those projected in such forward-looking statements.

All subsequent forward-looking statements, whether written or oral and whether made by or on behalf of TransCanada or NW Natural, also are expressly qualified by these cautionary statements. Any forward-looking statement speaks only as of the date on which such statement is made, and the companies undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time and it is not possible for the companies to predict all such factors, nor can they assess the impact of each such factor or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.

Contact Information

  • Media Inquiries:
    Steve Sechrist
    NW Natural
    (503) 220-2594


    David Dodson
    (503) 833-4731


    Shela Shapiro
    (800) 608-7859


    Investor Inquiries:
    Bob Hess
    NW Natural
    (503) 220-2388


    Myles Dougan
    (800) 361-6522, ext. 7911