GTN Collaboration Meeting Phoenix, AZ December 11 & 12, 2014
Long Term Marketing & Transactional System Update Joe Pollard Director, Long Term Marketing
USPL Org Chart Dean Ferguson Sr. VP, and General Manager Jay White Vice President, Marketing Laura Heckman Vice President, Business Development Steven Jaskolski Director, Commercial Services Michael Moses Director, System Operations Joseph Pollard Jeff Nielsen John Hampton Todd Johnson Martin Wilde 3
USPL Long Term Marketing Org Chart Joseph Pollard Director LT Marketing Bruce Hopper Randy Hunter Jay Story TC Offshore Martin Wilde Ken Garman Gary Skarb Amy Sowa Michael Wells 4
USPL Short Term Marketing Jeff Nielsen Director Storage Erik Anderson ST Marketing Lee Bennett Pricing & Analysis Garrett Word Colin Strom Lonnie Lozano Stuart McCausland Adam Lakhani Nathan Anderson Cesar Perez Dana Coats 5
USPL Business Development Laura Heckman Vice President BD Central John Hampton Director BD West Todd Johnson Director Business Ops Martin Wilde Director Mike Aaron Dan Andruccioli Andy Armstrong Madeline Bingamon Lynn Cannon Karen Tarpley Jim Schoene David White Bill Fonda Alan Behrens Richard Shepherd Paul Towne Jerry Breaux Vacant John Cordaway Hugh Morgan Peter Ten Eyck 6
Transactional System Update New Transactional System North Baja Pipeline was first pipeline to go live on October 1, 2014. GTN and Tuscarora are targeted for mid 2015. The new system: 1. Completely integrate workflow from contracting all the way through nomination, gas flow and then invoicing. 2. Significant level of customer oriented functionality by bringing online capacity release process, contracting, nominations, imbalance and OBA tracking and invoice generation. 7
Transactional System Update New Transactional System Customer training will take place prior to implementation. The tentative training plan will include, regional training meetings in conjunction with individual customer training, as needed. Commercial services personnel expect to be closely involved with users to provide enhanced customer service as the system is rolled out. 8
Transactional System Update Changes New Log in ID s for TCPLUS. New electronic communication agreements. Online Service Requests. IT no longer have Rec/Del points or MSQ. Capacity Release with Special Terms will no longer have to be submitted 2 days prior to posting. 9
Transactional System Update Nominations 10
GTN Collaboration Meeting Canadian Update December 12, 2014 Roland Guebert, Manager, Commercial West Markets Canadian and Eastern US Pipelines Confidential For Discussion Purposes Only
Discussion Points WCSB Update Western Canadian Supply Western Canadian Demand NGTL and Foothills Update Design Forecast / Annual Plan / Facilities Western Gate Design Capability and Firm Contracts Abandonment Surcharge 2015 Rates Confidential For Discussion Purposes Only 12
WCSB Gas Supply Potential Abundant Key WCSB Natural Gas Plays * Shale includes Horn River, Cordova, Liard & Duvernay Conventional includes tight gas Source: BMO Capital Markets Confidential For Discussion Purposes Only 13
Gas Well Completions (First Half 2014) 0-1000 m (9%) 1001-2000 m (4%) 2001-3000 m (3%) > 3000 m (84%) CBM (<1% of tot) Confidential For Discussion Purposes Only
Western Canadian Demand Bcf/d Confidential For Discussion Purposes Only 15
AB Oil Sands production a significant driver of natural gas demand History Forecast Sources: ERCB, CAPP, TransCanada Note: includes 175-230 Mb/d non-thermal bitumen production Confidential For Discussion Purposes Only 16
WCSB Supply/Demand & Export Flows Bcf/d History Forecast WCSB Supply Other WC Demand WC Oil Sands Demand LNG Exports WCSB Exports Confidential For Discussion Purposes Only 17
NGTL System Supply Summary Bcf/d 8 6 Peace RiverProject Area 5.4 5.9 6.3 6.8 7.5 8.5 Bcf/d 8 6 North & East Project Area 4 4 2 2 0.8 0.7 0.6 0.5 0.5 0.5 0 0 13/14 Gas Year 14/15 15/16 16/17 17/18 18/19 13/14 Gas Year 14/15 15/16 16/17 17/18 18/19 Bcf/d 8 Mainline Project Area 6 4 4.3 4.1 3.7 3.5 3.3 3.1 2 0 13/14 Gas Year 14/15 15/16 16/17 17/18 18/19 Confidential For Discussion Purposes Only 18
NGTL System Demand Summary Bcf/d 4 3 Peace River Bcf/d 4 3 North & East 3.0 3.3 3.5 3.7 3.9 4.1 2 2 1 0 0.1 0.1 0.1 0.1 0.1 0.1 1 0 13/14 14/15 15/16 16/17 17/18 18/19 13/14 14/15 15/16 16/17 17/18 18/19 Bcf/d 4 Mainline 3 2 1.5 1.5 1.6 1.6 1.7 1.7 1 0 13/14 14/15 15/16 16/17 17/18 18/19 Confidential For Discussion Purposes Only 19
NGTL System Design Forecast Summary NGTL supply continues to grow to approximately 12 Bcf/d by 2020 with a focus on liquids rich supply in shale/unconventional plays. Supply growth in Western AB and Northeastern BC, with continued decline in the Eastern part of the basin. Intra-Basin Deliveries grow to almost 6 Bcf/d by 2020, driven primarily by Oil Sands gas demand. LNG Export Capacity ramps up to 4.8 Bcf/d by 2022/23. Confidential For Discussion Purposes Only 20
NGTL System - Annual Plan Summarizes upcoming facility plans to meet the growing supply/demand requirements across the system Focus on presenting information about facilities expected to be applied for with the National Energy Board (NEB) in 2015 For smaller projects (Section 58 applications), Facility notifications are provided For larger projects (Section 52 applications), Information is provided facilities with subsequent updates to shippers closer to the Application date Also provides an opportunity to provide updates on already applied-for facilities Confidential For Discussion Purposes Only 21
Planned NGTL System Facility Additions ~4 Bcf/d incremental requests Receipt contracts in northwestern AB and northeast BC Delivery contracts primarily driven by Oil Sands development and gas-fired electric power generation ~$2.7 billion of planned facilities ~540 km Pipeline ~7 Compressors Multiple meter stations Planned 2015-2017 Facilities North Montney (NEB decision expected Q1, 2015) Confidential For Discussion Purposes Only 22
NGTL and Foothills Delivery Capacity Capability TJ/day Design Capacity Firm Requirements as of December 1, 2014 Winter 2014/2015 TJ/day Foothills BC (Zone 8) 3,212 2,067 NGTL Alberta /BC Border 2,242 2,242 NGTL Capability Is a function of local demand (increasing in the Calgary area) and local supply (decreasing close to ABC) However, it can be increased through debottlenecking, some looping and additional compression Facility builds require 1 to 3 years, consistent with many of the larger Projects downstream Confidential For Discussion Purposes Only 23
Abandonment Surcharge (LMCI: Land matters Consultation Initiative) Pipe Abandonment (LMCI) National Energy Board (NEB) initiative to address the future cost of abandoning oil & gas pipelines (started in May 2009) Starting in January 2015, all NEB regulated pipes must begin collecting sufficient funds to cover the future costs of abandoning their pipeline systems Funds collected will be held in an abandonment Trust fund until required for future abandonment applications NEB set out specific annual reporting requirements for all Trusts including periodic reviews (eg. 5 years) of key factors that could affect the annual collection amount NGTL & Foothills Applications filed Confidential For Discussion Purposes Only 24
Abandonment Surcharge Starting Jan 1, 2015, invoices for transportation services will include a separate abandonment surcharge NGTL Abandonment Surcharge A single energy surcharge for all services [eg. receipt and delivery] regardless of distance, path, contract term or other service attributes 1.08 cents/gj Foothills Abandonment Surcharge A single energy surcharge for all services regardless of zone, distance, path, contract term or other service attributes 0.36 cents/gj Confidential For Discussion Purposes Only 25
2015 Interim Rates - NGTL The applied for 2015 Interim Rates are based on the following parameters: Forecast 2015 revenue requirement of $1,718 million established pursuant to the terms of the current Revenue Requirement Settlement Forecast of contract demand quantities and throughput for 2015 Application of the existing rate design methodology approved by the Board in Order TG-04-2010. Interim rates were applied for October 31 to be effective January 1, 2015 Confidential For Discussion Purposes Only 26
2015 Foothills BC (Zone 8) Rates Revenue Requirement 2015 - $63.7 Million (2014 Rate Filing: $64.9 Million) After adjustments for (over)/under: 2015 - $57.7 Million (2014: $60.3 Million) Total Firm Contract 2015 1,822 TJ/d (2014: 1,819 TJ/d) Total Throughput 2015 1,910 TJ/d (2014: 1,920 TJ/d) Results in an FT Rate of 2015 8.2 /GJ (2014: 8.6 /GJ) Confidential For Discussion Purposes Only 27
Summary NGTL and Foothills 2015 Tolls/Rates Rate $/GJ (CDN) 2014 2015 NGTL FT-R ($/mcf/d CDN 3 yr) NGTL FT-D1 0.189 0.197 ($/GJ/d CDN 1 yr) ABC Border Empress /McNeill Border 0.170 0.176 0.165 0.185 NGTL FT-D2 NGTL FT-D3 0.138 0.165 0.150 0.180 Foothills BC 0.086 0.082 Approximate conversion based on FX rate of $0.8723 NGTL rate would be $0.152 US/Dth/d. Foothills would be $0.079 US/Dth/d As filed October 31, 2014 Confidential For Discussion Purposes Only 28
Contact Information Bruce Newberry Customer Account Manager Commercial West Markets 403.920.5579 bruce_newberry@transcanada.com Cam Stacey Customer Account Manager Commercial West Markets 587.933.4781 cam_stacey@transcanada.com Roland Guebert Manager Commercial Markets Commercial West Markets 403.920.5386 roland_guebert@transcanada.com Confidential For Discussion Purposes Only 29
Markets and Outlook Jeff Nielsen Director, Short Term Marketing
Agenda North American Supply Demand Overview Western United States Fundamentals Gas Transmission Northwest Short Term Firm Marketing 31
North American Supply 2014 TransCanada Outlook Bcfd 140 120 100 80 60 40 20 History Forecast WCSB Northeast U.S. Rockies/San Juan Permian Mid-Continent Gulf Coast Gulf of Mexico Mexico 0 Other 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029 Source: 2014 TransCanada Outlook (Preliminary) Near term supply growth dominated by Appalachia and associated gas production 32
North American Demand 2014 TransCanada Outlook Bcfd 140 120 History Forecast LNG Exports 100 80 Electric Generation 60 40 Industrial 20 0 Residential & Commercial 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029 Source: 2014 TransCanada Outlook LNG exports will heavily influence transport flow dynamics 33
Appalachian Supply Growth New Infrastructure is Being Built 25 20 15 10 5 Bcfd Supply Growth (vs 2013 Base Year) High Side PIRA Fall 2014 Low Side TSO Spring 2014 DTI ETC Rover TCO 18 Brownfield Projects Average ~ 0.4 Bcfd Transco Transco Atlantic Sunrise Constitution CGT-TCO TCO-WB Xpress DTI-Atlantic Coast * Transco-Appalachian Connector * TETCO-Adair Southwest TGP-Broad Run Expansion TGP-SW LA Supply TETCO-Access South Algonquin-Atlantic Bridge CGT/TCO-Rayne Xpress * Transco-Atlantic Sunrise Williams-Constitution * ETC-ET Rover * 0 2014 2015 2016 2017 2018 2019 2020 * Greenfield projects denoted by asterisk ** Only probable projects included in stack above 18 Brownfield Projects 34
Project Focus Shifting to Southwest Appalachia Region Exports Midwest 4.5 5.8 Ontario Utica, Southwest Marcellus 0.3 21 Probable Projects, 7 Other Proposed 0.5 9 Probable Projects, 4 Other Proposed 1.0 2.2 1.0 U.S. Northeast 1.8 2.3 Northeast Marcellus 5.0 Gulf Coast Utica Shale 1.5 4.3 2.6 Marcellus Shale U.S. Southeast Probable, Bcfd Other Proposed, Bcfd 35
How Significant is LNG Export? Projected LNG exports from Gulf Coast 7 Bcfd, likely to grow as more projects are approved West Coast 2013 Demand ~8 Bcfd 8 Bcfd 7 6 5 4 3 2 1 0 Lake Charles Cameron Freeport Sabine Pass Sabine Pass Freeport Lake Charles Cameron Projected Gulf Coast LNG Export Facilities Source: TransCanada Spring 2014 Outlook LNG Imports and Exports are treated as Supply and Demand respectively 36
Short Term Marketing Positive Fundamentals AECO supply dynamics improved economics to West on GTN GTN competes economically to supply the west Strong California storage demand Negative Fundamentals Upstream capacity constraints on NGTL Redwood Path pressure reduction (15% to 20%) 37
Western Canadian Sedimentary Basin 2014 TransCanada Outlook Bcfd 20 18 16 14 12 10 8 6 4 2 0 History Forecast Source: 2014 TransCanada Outlook (Preliminary) 38
WCSB: Demand Stack (Contracts) 12.00 BcF/D 10.00 8.00 6.00 4.00 7.87 7.96.45.45 1.35 1.35.89.89.20.20 1.72 1.81 8.55 8.69 8.59.45.45.44 1.35 1.38 1.38.89.89.89.21.20.18 2.39 2.45 2.48 8.83 8.82 8.83 8.83 8.96 9.13.23.43.43.43.43.43 1.38 1.38 1.38 1.38 1.38 1.38.89.89.89.89.89.89.18.21.18.18.18.18 2.55 2.48 2.52 2.52 2.52 2.52 9.84 9.67 9.74.23.23.23 1.38 1.38 1.38.89.89.89.18.18.18 3.17 3.10 3.16 9.06.23 1.38.89.18 2.52 8.48 8.44 8.41 8.41 8.41 8.41 8.51.23.23.23.23.23.23.23 1.38 1.38 1.38 1.38 1.38 1.38 1.38.89.89.89.89.89.89.89.18.18.18.18.18.18.18 2.35 2.41 2.38 2.38 2.38 2.38 2.40 7.89.22 6.74 1.38.22.12.89.89.08.08 1.87 2.01 2.00 1.66 1.66 1.66 1.81 1.81 2.00 2.00 2.01 2.01 2.06 2.28 2.36 2.27 2.27 2.25 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.84 1.82 1.60 1.60 1.60 1.52 1.43 1.43 1.43 1.43 1.43 1.50 1.63 1.63 1.63 1.63 1.63 1.52 1.43 1.43 1.43 1.43 1.43 1.50 1.61 1.61 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 GTN - Kingsgate Northern Border - POM TransCanada - Empress Great Lakes - Emerson Northwest - Sumas Alliance - B.E.P Vicking - Emerson 12.00 BcF/D 10.00 8.00 6.00 4.00 2.00 9.16 8.50.43.45 1.75 1.73.89.89.18.20 2.50 1.97 1.66 1.96 9.86.23 1.75.89.18 2.90 2.29 8.81.23 7.28 1.75.22.74.89.18.89.08 2.38 1.93 1.93 1.81 6.55 5.84.22 5.48.49.20.89.46.15.13.45 4.15.89 4.00 3.94.89 3.76 3.81 1.79 1.06.45.45.45 1.04.45.41.89.89.89 1.52 1.48.09 1.36.09.01.89.89.91.88.87.05.80.79 1.60 1.45 1.63 1.45 1.61 1.51 1.68 1.52 1.71 1.55 1.71 1.55 1.71 W 13/14 S 14 W 14/15 S 15 W 15/16 S 16 W 16/17 S 17 W 17/18 S 18 W 18/19 S 19 W 19/20 GTN - Kingsgate Northern Border - POM TransCanada - Empress Great Lakes - Emerson Northwest - Sumas Alliance - B.E.P Vicking - Emerson TOTAL 39
Market Supply WESTERN CANADIAN SEDIMENTARY BASIN ROCKY MOUNTAIN 15,000 12,000 14,500 11,500 MMcf/D 14,000 13,500 13,000 MMcf/D 11,000 10,500 10,000 9,500 12,500 13,712 13,002 13,781 14,083 13,627 13,047 13,600 13,908 13,350 9,000 9,917 9,916 10,179 10,145 10,169 10,091 10,035 9,880 9,956 12,000 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 8,500 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC RANGE 2014 5- YR AVERAGE 2013 RANGE 2014 5- YR AVERAGE 2013 PERMIAN SAN JUAN 5,000 3,700 4,800 4,600 3,500 4,400 3,300 4,200 MMcf/D 4,000 3,800 3,600 MMcf/D 3,100 2,900 3,400 2,700 3,200 4,335 4,374 4,578 4,663 4,706 4,827 4,890 4,902 4,773 2,698 2,705 2,723 2,724 2,620 2,650 2,649 2,723 2,729 3,000 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2,500 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC RANGE 2014 5- YR AVERAGE 2013 RANGE 2014 5- YR AVERAGE 2013 40
AECO Netbacks Variable W 14/15 S 15 AECO CHICAGO-ALLIANCE DAWN-TCPL MINNESOTA-GLGT DAWN-GLGT CHICAGO-GLGT CHICAGO-VIKING MALIN CHICAGO-N.BORDER SUMAS N. BORDER VENTURA WADDINGTON-IROQUOIS BOSTON-PNGTS $3.03 $2.33 $2.37 $2.47 $2.59 $2.59 $2.73 $2.90 $3.05 $3.14 $3.24 $6.25 $6.86 AECO BOSTON-PNGTS WADDINGTON-IROQUOIS CHICAGO-ALLIANCE DAWN-TCPL MINNESOTA-GLGT CHICAGO-GLGT CHICAGO-VIKING DAWN-GLGT SUMAS MALIN CHICAGO-N.BORDER N. BORDER VENTURA $0.03 $1.14 $2.83 $1.92 $1.97 $2.19 $2.28 $2.31 $2.35 $2.56 $2.62 $2.68 $2.75 W 15/16 S 16 AECO DAWN-TCPL CHICAGO-ALLIANCE MINNESOTA-GLGT DAWN-GLGT CHICAGO-GLGT CHICAGO-VIKING MALIN CHICAGO-N.BORDER N. BORDER VENTURA SUMAS WADDINGTON-IROQUOIS BOSTON-PNGTS $3.20 $2.40 $2.44 $2.53 $2.61 $2.69 $2.83 $3.08 $3.15 $3.31 $3.34 $5.50 $6.98 AECO BOSTON-PNGTS WADDINGTON-IROQUOIS CHICAGO-ALLIANCE DAWN-TCPL MINNESOTA-GLGT CHICAGO-GLGT DAWN-GLGT CHICAGO-VIKING SUMAS CHICAGO-N.BORDER MALIN N. BORDER VENTURA $0.13 $1.54 $2.05 $2.05 $2.36 $2.41 $2.44 $2.44 $3.00 $2.81 $2.81 $2.90 $2.92 41
AECO Netbacks Full Cost W 14/15 S 15 AECO CHICAGO-ALLIANCE DAWN-TCPL MINNESOTA-GLGT DAWN-GLGT CHICAGO-GLGT CHICAGO-VIKING MALIN CHICAGO-N.BORDER SUMAS N. BORDER VENTURA WADDINGTON-IROQUOIS BOSTON-PNGTS $3.03 $2.33 $2.37 $2.47 $2.59 $2.59 $2.73 $2.90 $3.05 $3.14 $3.24 $6.25 $6.86 AECO BOSTON-PNGTS WADDINGTON-IROQUOIS CHICAGO-ALLIANCE DAWN-TCPL MINNESOTA-GLGT CHICAGO-GLGT CHICAGO-VIKING DAWN-GLGT SUMAS MALIN CHICAGO-N.BORDER N. BORDER VENTURA $0.03 $1.14 $2.83 $1.92 $1.97 $2.19 $2.28 $2.31 $2.35 $2.56 $2.62 $2.68 $2.75 W 15/16 S 16 AECO DAWN-TCPL CHICAGO-ALLIANCE MINNESOTA-GLGT DAWN-GLGT CHICAGO-GLGT CHICAGO-VIKING MALIN CHICAGO-N.BORDER N. BORDER VENTURA SUMAS WADDINGTON-IROQUOIS BOSTON-PNGTS $3.20 $2.40 $2.44 $2.53 $2.61 $2.69 $2.83 $3.08 $3.15 $3.31 $3.34 $5.50 $6.98 AECO BOSTON-PNGTS WADDINGTON-IROQUOIS CHICAGO-ALLIANCE DAWN-TCPL MINNESOTA-GLGT CHICAGO-GLGT DAWN-GLGT CHICAGO-VIKING SUMAS CHICAGO-N.BORDER MALIN N. BORDER VENTURA $0.13 $1.54 $2.05 $2.05 $2.36 $2.41 $2.44 $2.44 $3.00 $2.81 $2.81 $2.90 $2.92 42
California Net forwards Variable W 14/15 S 15 GTN-STAN OPAL-STAN NORTHWEST P.L.-STAN GTN-MALIN PG&E SOUTH-CG SUMAS-MALIN RUBY-MALIN SOUTHERN TRAILS-ESSEX(S) TRANSWESTERN-TOPOCK(P) TRANSWESTERN-TOPOCK(S) KERN RIVER-DAGGET EL PASO-TOPOCK (P) EL PASO-TOPOCK (S) $3.51 $4.02 $4.09 $3.72 $4.04 $4.34 $4.72 $3.93 $3.97 $3.98 $4.06 $4.07 $4.10 GTN-STAN NORTHWEST P.L.-STAN OPAL-STAN GTN-MALIN SUMAS-MALIN PG&E SOUTH-CG RUBY-MALIN SOUTHERN TRAILS-ESSEX(S) KERN RIVER-DAGGET TRANSWESTERN-TOPOCK(P) TRANSWESTERN-TOPOCK(S) EL PASO-TOPOCK (P) EL PASO-TOPOCK (S) $3.30 $3.47 $3.68 $3.50 $3.71 $3.88 $3.71 $3.72 $3.72 $3.75 $3.86 $3.87 $4.38 W 15/16 S 16 GTN-STAN OPAL-STAN NORTHWEST P.L.-STAN GTN-MALIN PG&E SOUTH-CG SUMAS-MALIN RUBY-MALIN SOUTHERN TRAILS-ESSEX(S) TRANSWESTERN-TOPOCK(P) TRANSWESTERN-TOPOCK(S) KERN RIVER-DAGGET EL PASO-TOPOCK (P) EL PASO-TOPOCK (S) $3.68 $4.19 $4.31 $3.89 $4.28 $4.56 $4.88 $4.11 $4.16 $4.17 $4.23 $4.27 $4.29 GTN-STAN NORTHWEST P.L.-STAN OPAL-STAN GTN-MALIN SUMAS-MALIN PG&E SOUTH-CG RUBY-MALIN KERN RIVER-DAGGET SOUTHERN TRAILS-ESSEX(S) TRANSWESTERN-TOPOCK(P) TRANSWESTERN-TOPOCK(S) EL PASO-TOPOCK (S) EL PASO-TOPOCK (P) $3.47 $3.73 $3.89 $3.67 $3.96 $4.18 $4.59 $3.93 $3.95 $3.99 $3.99 $4.11 $4.12 43
California Net forwards Full Cost W 14/15 S 15 GTN-STAN OPAL-STAN NORTHWEST P.L.-STAN GTN-MALIN PG&E SOUTH-CG SUMAS-MALIN RUBY-MALIN SOUTHERN TRAILS-ESSEX(S) TRANSWESTERN-TOPOCK(P) TRANSWESTERN-TOPOCK(S) KERN RIVER-DAGGET EL PASO-TOPOCK (P) EL PASO-TOPOCK (S) $3.51 $4.02 $4.09 $3.72 $4.04 $4.34 $4.72 $3.93 $3.97 $3.98 $4.06 $4.07 $4.10 GTN-STAN NORTHWEST P.L.-STAN OPAL-STAN GTN-MALIN SUMAS-MALIN PG&E SOUTH-CG RUBY-MALIN SOUTHERN TRAILS-ESSEX(S) KERN RIVER-DAGGET TRANSWESTERN-TOPOCK(P) TRANSWESTERN-TOPOCK(S) EL PASO-TOPOCK (P) EL PASO-TOPOCK (S) $3.30 $3.47 $3.68 $3.50 $3.71 $3.88 $3.71 $3.72 $3.72 $3.75 $3.86 $3.87 $4.38 W 15/16 S 16 GTN-STAN OPAL-STAN NORTHWEST P.L.-STAN GTN-MALIN PG&E SOUTH-CG SUMAS-MALIN RUBY-MALIN SOUTHERN TRAILS-ESSEX(S) TRANSWESTERN-TOPOCK(P) TRANSWESTERN-TOPOCK(S) KERN RIVER-DAGGET EL PASO-TOPOCK (P) EL PASO-TOPOCK (S) $3.68 $4.19 $4.31 $3.89 $4.28 $4.56 $4.88 $4.11 $4.16 $4.17 $4.23 $4.27 $4.29 GTN-STAN NORTHWEST P.L.-STAN OPAL-STAN GTN-MALIN SUMAS-MALIN PG&E SOUTH-CG RUBY-MALIN KERN RIVER-DAGGET SOUTHERN TRAILS-ESSEX(S) TRANSWESTERN-TOPOCK(P) TRANSWESTERN-TOPOCK(S) EL PASO-TOPOCK (S) EL PASO-TOPOCK (P) $3.47 $3.73 $3.89 $3.67 $3.96 $4.18 $4.59 $3.93 $3.95 $3.99 $3.99 $4.11 $4.12 44
California Storage NORTH CALIFORNIA STORAGE SOUTHERN CALIFORNIA STORAGE 250,000 160,000 200,000 140,000 120,000 150,000 100,000 MMcF 100,000 50,000 137,093 97,469 71,504 79,153 105,793 132,433 151,266 159,818 165,933 176,181 187,726 185,646 MMcF 80,000 60,000 40,000 20,000 72,471 36,933 20,225 30,590 49,244 67,100 81,678 92,792 103,331 113,328 116,840 113,563 0 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 0 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC MIN RANGE 2014 5-YR AVERAGE 2013 RANGE 2014 5-YR AVERAGE 2013 TOTAL CALIFORNIA - STORAGE 380,000 330,000 280,000 MMcF 230,000 180,000 130,000 80,000 30,000 209,564 134,402 91,730 109,744 155,036 199,533 232,944 252,610 269,264 289,509 304,566 299,209 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC RANGE 2014 5-YR AVERAGE 2013 45
Gas Transmission Northwest Incremental Volume & Average Rate 600 $.20 $.18 500 $.16 400 $.14 300 $.12 $.10 $.08 200 $.06 100 $.04 $.02 238 200 227 200 206 200 245 181 315 295 181 315 295 181 315 476 175 315 524 175 315 464 175 315 362 175 315 225 245 295 287 23 23 26 15 15 DtH/D SOLD AVERAGE RATE PER DtH JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2013-SALES 2014-SALES 2015-SALES 2013-RATE 2014-RATE 2015-RATE 46
Update on Regulatory Filings and Issues John Roscher Director, Rates and Tariff
Tariff Change Filing Docket No. RP14-1196 Revisions allow GTN to offer available firm capacity through an open season bidding process or on a first-come, first-served basis Added timelines under which GTN will honor requests for posted, available capacity Term of Service Request Proximity to Start Date <= 92 Days Within 5 days > 92 Days < 1 Year Within 30 days 1 Year or > Within 6 months* * For capacity requests of one year or greater, GTN may honor such request or subject the requested quantity to an open season bidding process within five business days of receiving such request 48
Tariff Change Filing Docket No. RP14-1196 Revised provisions regarding the installation of facilities to remove outdated language and to add a new contribution in aid of construction ( CIAC ) provision ROFR provisions now require that GTN provide notice to an original capacity holder, no earlier than 13 months and no later than 12 months prior to termination of a service agreement, that an election regarding its right of first refusal is required at the 12-month mark Prior to GTN commencing a ROFR open season bidding process, GTN and shipper may mutually agree to extend the contract term of an existing service agreement (and avoid the ROFR process) Language was added that allows GTN to seek discount-type adjustments for negotiated rate agreements 49
Next GTN Rate Case Per the Docket No. RP11-2377 Settlement: Moratorium from 1/1/12 to 12/31/15. Must file a rate case such that rates will be effective January 1, 2016 (equates to a filing by June 30, 2015). 50
Next GTN Rate Case Projected Timeline Pre-Filing settlement discussions expect to kick off in Jan 15 Rate case filing June 30, 2015 Base period: April 1, 2014 March 31, 2015 Test period: April 1, 2015 December 31, 2015 Track III Schedule Staff Top Sheets October 2015 Intervenor/Staff Testimony December 2015/January 2016 Hearing May 2016 Initial Decision October 2016 51
Next GTN Rate Case Unique Rate Case Drivers Drop down remaining 30% of GTN to MLP 4 remaining years of bankruptcy credit (2016 2019) PG&E 279,968 Dth/d contract set to expire 10/31/16 (18-month unilateral evergreen notice at April 30, 2015) Outcome of PG&E rate proceeding (higher rates; equalized rates?) 52
PG&E Rate Proceeding Under the traditional Gas Accord rate design, non-core rates on the Redwood Path have a cost advantage over the southern Baja Path of approximately $0.20 per Dth in 2015, increasing sharply to $0.40 per Dth in 2017. Tentative Rate Case Schedule: January 1, 2015 new rate go into effect January March 2015 hearings Proposed Decision - Fall of 2015 Commission action 30 days thereafter 53
On The Horizon Potential changes to parking and lending service 54
Questions? 55
BD In The Northwest David White
GTN Growth Projects Carty Lateral new lateral to serve PGE generation facility in 2016 Trail West cross Cascades link to serve growing markets in the I- 5 corridor after 2019 Power demand growth Industrial developments System support/reliability Interconnect with Pacific Connector Gas Pipeline 57 TransCanada 57
Carty Lateral 26 mile 20 lateral to PGE 440 MW Carty Generating Station September 2015 In-Service 175,000 Dth/d (30 yrs.) Lateral Capacity 75,000 Dth/d (20 yrs.) Mainline Capacity 58
I D A H O Trail West Pipeline Victoria Sumas Northwest Pipeline Sandpoint 106 mile, 30 inch pipeline Seattle W A S H I N G T O N Spokane Supply receipt from GTN mainline near Madras Yakima Pasco Walla Walla Lewiston Delivery points into NW Natural and Northwest Pipeline at Molalla Portland Salem Molalla Redmond Bend T West Compression-based expandability up to approximately 750,000 Dth/d In-Service: Nov. 2019 59
The Integrated Project Concept Sumas Kingsgate Transportation Segments Molalla 4 3 T West 1 2 Madras Stanfield 1 NWP Gorge Capacity 2 GTN Capacity 3 Trail West Capacity 4 NWP Expansion Capacity: I-5 Corridor Malin Ruby Opal REX 60
Trail West Pipeline Schedule 61
Interconnect with Pacific Connector 234 mile pipeline to Jordan Cove LNG Export Terminal ~1.0 Bcf/d GTN and Ruby Interconnects 2018 In-Service 62
Tuscarora Expansion 2014 Open Season 2016 Opportunity 15,000 Dth/d 2018 Opportunity 60,000 Dth/d 2020 Opportunity 90,000 Dth/d 2023 Opportunity 160,000 Dth/d 63