Empire Pipeline Empire Connector Project

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1 Empire Pipeline Empire Connector Project Diverse Incremental Gas Supply for the Northeast Markets Kevin D. Cotter Director Empire Pipeline

2 Our Prime Location GAS SUPPLY SOURCES UNION GAS DAWN HUB: Canadian, Gulf, &Mid-Continent FUTURE: Alaska, Rocky Mountain CANADA & Gulf LNG TCPL INTERCONNECTS At Niagara & Chippawa Lake Erie OH PA Lake Ontario TRANSCANADA Chippawa Niagara NFGSC System Storages are located throughout Western NY and PA. Appalachian Production enters NFGSC s system at numerous points. Empire Pipeline Independence Ellisburg Leidy Hub GAS SUPPLY SOURCES Gulf & Appalachian Prod n FUTURE: Cove Point & Gulf LNG ELLISBURG LEIDY HUB INTERCONNECTS Transco, TETCO, TGP, TCO & DTI GAS SUPPLY A-5 Line Corning Tuscarora Storage Empire Connector Project 250 MDth/Day Cost: Approx. $177 Million Millennium Pipeline 500 MDth/Day MILLENNIUM NY PA NFGSC Tuscarora Extension Project Will Interconnect with both Millennium and Empire Pipelines 130 MDth/Day Cost: Approx. $39 Million National Fuel Gas Company NFGSC System Storages NFGSC System Pipelines Empire State Pipeline Interconnects

3 The Empire Connector Project Empire Pipeline Capacity 250 MMCF/day In-service November 2008 Supply Dawn, Ontario TransCanada Pipeline Chippawa TGP Corning 78 miles of 24 pipe 20,620 Hp Compression Receipts from TCPL, TGP, storage and local production Deliveries to Millennium, TGP, upstate New York LDCs and storage Storage Millennium Wagoner, New York Ramapo, New York TCO Market Algonquin Gas Transmission

4 Empire Connector Project Progress to Date Pipeline Construction Clearing, Grading, Trenching: 98% Complete Pipe Stringing, Bending Welding: 95% Complete Restoration: 60% Complete All HDDs and most crossings complete NYS Thruway bore starting now Hydrostatic testing of Southern Section underway Final Tie-ins ins continue

5 Empire Connector Project Progress to Date Metering & Regulation Stations Victor Station work continues Station substantial completion by early October Tie-in in with existing Empire pipeline mid-october Corning M&R Station at Millennium s compressor site Fabrication and construction underway Final tie-ins ins expected by late October

6 Empire Connector Project Progress to Date Oakfield Compressor Station Greenfield construction site 20,620 HP of new compression Station main gas piping complete Foundations and building structures mostly done Solar turbocompressor units set in place Electrical systems and wiring installation continues on tight critical path Tie-ins with existing Empire line are complete Testing and commissioning expected late October

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11 Empire Connector Customers/Market Producers and Marketers contracting for delivery to markets served by the Millennium pipeline LDCs that are contracting for Millennium capacity Producers and Marketers contracting seasonally for filling storage or pursuing basis driven opportunities LDCs and Marketers with existing Empire capacity to expand deliverability of gas supplies from REX, Cove Point LNG and/or storages

12 Empire Connector Project Diversity of Markets Pipeline Markets: National Fuel Gas Supply Corporation Dominion El Paso (TGP) Millennium LDC Markets: National Fuel Gas Distribution National Grid (NiMo) Energy East (RG&E, NYSEG) Other LDCs via Millenium

13 Diversity for the Northeast Existing Sources of Supply Gulf Coast Mid- Continent WCSB Chippawa 8 BCF Seneca Lake & Honeoye Storages Dawn Local Production New Sources of Supply 800 BCF 78 BCF Appalachian Storage Corning Market Alaska Gulf LNG Dawn & Michigan Storages Rocky Mountain

14 Empire Connector Attributes Storage Opportunities Access to storage options with NFG Supply Significant storage service at Dawn and other similar Michigan area locations Potential storage access at Seneca and Honeoye Planned NFG Supply expansion can provide access to Tuscarora storage New storage opportunities (East Branch, Galbraith)

15 Empire Connector Pricing Cost competitive alternative to traditional long-line delivery Expected to have very low fuel charges Remaining Connector capacity is available at competitive rates with negotiated terms Basis Opportunities can exist

16 Empire Connector Rates Max rate Anchor Representative Rates 1-33 year term >3 year term Year Round Reservation $ $7.60 $10.65 Equivalent Unit Rate $ $0.25 fixed rate of $0.35 or maximum rate Winter Period Reservation $ $ $14.00 Equivalent Unit Rate $ $ fixed rate of $0.46 or maximum rate Summer Period Reservation $ * * Equivalent Unit rate $ * * Fuel (estimated) 0.6% 0.6% 0.6% * See your marketing representative