The 131km natural gas runs between Drayton Valley area and Wabamun area west of Edmonton, Alberta, Canada
TransAlta and its partner Tidewater Midstream & Infrastructure have signed an agreement with ATCO Gas and Pipelines, a subsidiary of Canadian Utilities, to sell Pioneer Pipeline for C$255m ($192m).
Pioneer Pipeline is a 131km natural gas pipeline that runs from the Drayton Valley area to the Wabamun area west of Edmonton, Alberta, Canada. The throughput from the pipeline is about 130MMcf/d of natural gas.
The agreement replaces TransAlta’s agreement to sell the pipeline to NOVA Gas Transmission. However, most of the agreement terms remain substantially the same.
Canadian Utilities president and CEO Siegfried Kiefer said: “This transaction continues to illustrate ATCO’s commitment to understand and support our customers’ evolving needs and develop solutions that support the transition to a lower-emitting energy system.”
Pioneer Pipeline will be integrated into NGTL’s and ATCO’s Alberta natural gas transmission systems
After the transaction is closed, Pioneer Pipeline will be integrated into NGTL’s and ATCO’s Alberta natural gas transmission systems, supplying reliable natural gas to TransAlta’s power generation stations at Sundance and Keephills.
The gas supply agreement will help to facilitate in converting the coal-fired power plants to be powered by natural gas.
As part of the transaction, TransAlta has also entered into a long-term gas supply agreement with NGTL for a total of 400 TJ/day by 2023.
Subject to customary regulatory approvals, the deal is expected to be closed in the second quarter of next year.
TransAlta president and CEO Dawn Farrell said: “We are excited to work with both ATCO and NGTL to meet our gas supply requirements as we execute our strategy of providing 100% clean, reliable and affordable electricity to Albertans.”
In June this year, TransAlta announced that it will sell the pipeline to NOVA Gas Transmission, a subsidiary of TC Energy for C$255m ($192m).
Tidewater Midstream said that the proceeds from the transaction will be split equally between Tidewater and TansAlta.