TransCanada Makes Advances on C$24 Billion Near-Term Capital Plan

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Researched by Industrial Info Resources (Sugar Land, Texas)--TransCanada Corporation (NYSE:TRP) (Calgary, Alberta) is carrying out a string of grassroot and expansion projects on pipelines in the U.S., Canada and Mexico as it continues spending for its C$24 billion ($19.3 billion) near-term capital program. For the second quarter of 2017, the company's net income increased to C$881 million ($708.9 million) from C$365 million ($293.4 million) from the same period of 2016. Industrial Info is tracking $32.3 billion in active projects involving TransCanada.

In the company's conference call, Chief Financial Officer Don Marchand said, "Today we are advancing a $24 billion near-term capital program and have five distinct platforms for future growth in Canadian, U.S. and Mexico natural gas pipelines, liquids pipelines and energy." To date, the company has spent approximately C$9 billion ($7.2 billion) on the program.

Chief Executive Officer Russ Girling discussed some of the company's projects, some of which it inherited from its purchase of Columbia Pipeline Partners in July 2016. Girling said Columbia was more or less fully integrated into TransCanada in April. "On the growth side, we continue to advance Columbia's US$7.2 billion of near-term capital by advancing construction of the US$1.5 billion Leach Xpress project and the US$400 million Rayne Xpress project. Both are expected to be in service this November."

The Leach Xpress project involves construction of approximately 160 miles of natural gas pipeline in Ohio, Pennsylvania and West Virginia. The pipeline will be able to transport up to 1.5 billion cubic feet per day (Bcf/d) of natural gas. Construction on the project began earlier this year. Price Gregory International (Houston, Texas) is acting as general contractor. For more information, see Industrial Info's project reports on the Ohio, Pennsylvania and West Virginia sections of the pipeline.

The Rayne Xpress project involves enhancing an existing natural gas pipeline with new compressor stations to add 1 Bcf/d of capacity to flow to the Gulf Coast. For more information, see Industrial Info's project reports on grassroot compressor stations near Means and Grayson in Kentucky.

"Moving to Mexico, we continue to advance the Tula, Villa del Reyes and Sur de Texas projects that will see us invest a total of US$2.5 billion in these projects, with approximately US$1.1 billion having been spent to date," said Girling. The company's Sur de Texas project is a subsea natural gas pipeline that will carry 2.6 Bcf/d of natural gas from the U.S. border in Texas through the Gulf of Mexico to Tuxpan, Mexico. The project began construction earlier this year and is expected to be completed in late 2018. For more information, see Industrial Info's project report.

The company's controversial Keystone XL pipeline, which will carry heavy crude from Alberta to Cushing, Oklahoma, and on to the Gulf Coast still has a few regulatory hurdles to overcome, although the project achieved a major milestone earlier this year when President Donald Trump issued a permit allowing the pipeline's construction. "We continue to advance the Keystone XL project during the second quarter following the receipt of the presidential permit this past March. Earlier this year, we filed an application with the Nebraska Public Service Commission seeking approval for the pipeline route through the state of Nebraska. A hearing on that application is scheduled in August, and a final decision expected by the end of November 2017." For more information, see Industrial Info's project report on the Nebraska section of Keystone XL. TransCanada launched an open season for remaining capacity on the Keystone system last week.

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