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TransCanada and ConocoPhillips Pipe Line Company announce Keystone MOU
CALGARY, Alberta – November 3, 2005 – (TSX: TRP) (NYSE: TRP) (NYSE: COP) TransCanada Corporation (TransCanada), ConocoPhillips Company, and ConocoPhillips Pipe Line Company (CPPL) (a wholly owned subsidiary of ConocoPhillips Company), today announced they have entered into a Memorandum of Understanding which commits ConocoPhillips Company to ship crude oil on the proposed Keystone oil pipeline (Keystone), and gives CPPL the right to acquire up to a fifty per cent ownership interest in the pipeline, subject to certain conditions being met. Finalization of this transaction and the terms of the business arrangement are expected to occur after completion of the binding Open Season process, which will begin November 4, 2005.
“We are pleased that ConocoPhillips is joining us on the Keystone project to connect a reliable Canadian oil supply to high-demand energy markets in the U.S. Midwest through a unique, cost-effective pipeline proposal. Our proposed association with ConocoPhillips Pipe Line Company offers shippers the strengths of our two companies with proven expertise in building and operating energy infrastructure," said Hal Kvisle, TransCanada's chief executive officer.
“The Keystone pipeline is an excellent opportunity to further integrate our upstream assets in Canada with our Wood River refinery in Illinois,” said Jim Nokes, Executive Vice President, Refining, Marketing, Supply and Transportation for ConocoPhillips. “The pipeline will also play a critical role in supplying North American crude oil to refineries in the U.S. mid-continent region. We are looking forward to working with TransCanada on a project of such importance to both Canada and the United States.”
Valued at approximately US$2.1 billion, the Keystone pipeline is intended to transport approximately 435,000 barrels per day of crude oil from Hardisty, Alberta, to Patoka, Illinois through a 1,840-mile (2,950-kilometre) pipeline system. In addition to approximately 1,100 miles (1,700 kilometres) of new pipeline in the United States, the Canadian portion of the proposed project includes the construction of approximately 220 miles (355 kilometres) of new pipeline and the conversion of approximately 540 miles (870 kilometres) of existing TransCanada pipeline facilities from natural gas to crude oil transmission. Depending on shipper interest and support, there is potential for extensions at each end of the pipeline. The Keystone pipeline, upon receipt of the necessary shipper support and appropriate regulatory approvals in Canada and the United States, is expected to be in service in 2009.
Consultation with the public, potentially impacted landowners and other interested stakeholders was initiated immediately after the proposed project was announced in February of 2005 and will continue as the project develops. In November and December, TransCanada will host a series of public open houses in the United States and Canada to provide stakeholders along the proposed pipeline route with information about the project and gather community input.
TransCanada’s network of approximately 25,600 miles (41,000 kilometres) of pipeline transports the majority of Western Canada’s natural gas production to key Canadian and U.S. markets. A growing independent power producer, TransCanada owns, or has interests in, approximately 6,000 megawatts of power generation in Canada and the United States. TransCanada’s common shares trade on the Toronto and New York stock exchanges under the symbol TRP. For more information, go to www.transcanada.com.
ConocoPhillips Pipe Line Company operates more than 12,000 miles of pipelines and more than 80 storage terminals in the United States. CPPL transports both raw and finished petroleum products, including crude oil, propane and refined products such as gasoline, diesel and jet fuel. CPPL is a wholly owned subsidiary of ConocoPhillips, an integrated energy company with interests around the world. For more information, go to www.conocophillips.com.
FORWARD LOOKING INFORMATION
Certain information in this news release is forward-looking and is subject to important risks and uncertainties. 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, competitive factors in the pipeline and power industry sectors, and the current economic conditions in North America. For additional information on these and other factors, see the reports filed by TransCanada with Canadian securities regulators and with the United States Securities and Exchange Commission. TransCanada disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
CAUTIONARY STATEMENT FOR THE PURPOSES OF THE “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. You can identify our forward-looking statements by words such as “anticipates,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” and similar expressions. Forward-looking statements relating to ConocoPhillips’ operations are based on management’s expectations, estimates and projections about ConocoPhillips and the petroleum industry in general on the date these presentations were given. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Further, certain forward-looking statements are based upon assumptions as to future events that may not prove to be accurate. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements.
Factors that could cause actual results or events to differ materially include, but are not limited to, crude oil and natural gas prices; refining and marketing margins; potential failure to achieve, and potential delays in achieving expected reserves or production levels from existing and future oil and gas development projects due to operating hazards, drilling risks, and the inherent uncertainties in interpreting engineering data relating to underground accumulations of oil and gas; unsuccessful exploratory drilling activities; lack of exploration success; potential disruption or unexpected technical difficulties in developing new products and manufacturing processes; potential failure of new products to achieve acceptance in the market; unexpected cost increases or technical difficulties in constructing or modifying company manufacturing or refining facilities; unexpected difficulties in manufacturing, transporting or refining synthetic crude oil; international monetary conditions and exchange controls; potential liability for remedial actions under existing or future environmental regulations; potential liability resulting from pending or future litigation; general domestic and international economic and political conditions, as well as changes in tax and other laws applicable to ConocoPhillips’ business. Other factors that could cause actual results to differ materially from those described in the forward-looking statements include other economic, business, competitive and/or regulatory factors affecting ConocoPhillips’ business generally as set forth in ConocoPhillips’ filings with the Securities and Exchange Commission (SEC). ConocoPhillips is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
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For further information, please contact:
ConocoPhillips Pipe Line Company
Kurt Kadatz / Jennifer Varey
(403) 920-7859 or Toll Free (800) 608-7859
Investor & Analyst Inquiries:
(403) 920-7911 or Toll Free (800) 361-6522