TransCanada to Become Sole Owner of the Keystone Pipeline System

CALGARY, ALBERTA, Jun 16 (MARKET WIRE) --
TransCanada Corporation (TSX: TRP)(NYSE: TRP) (TransCanada) today
announced that it has reached an agreement to become the sole owner of
the Keystone Pipeline System (Keystone) through the acquisition of
ConocoPhillips' remaining interest in the project for approximately
US$550 million plus the assumption of approximately US$200 million of
short-term debt. The purchase price reflects ConocoPhillips' capital
contributions to date and includes an allowance for funds used during
construction. TransCanada will also assume responsibility for
ConocoPhillips' share of the capital investment required to complete the
project resulting in an incremental commitment of approximately US$1.7
billion through the end of 2012. The transaction is expected to close in
third quarter 2009, subject to the receipt of certain regulatory
approvals.

"This acquisition represents a unique opportunity for TransCanada to
become the exclusive owner of an important oil transmission system that
will play a vital role in transporting a growing supply of Canadian crude
oil to the largest refining markets in the United States for decades to
come," said Hal Kvisle, TransCanada president and chief executive
officer. "We believe the significant commercial support Keystone has
received to date highlights the value it will create for our customers
and our shareholders."

When completed, Keystone will be one of the largest oil delivery systems
in North America with the capacity to deliver 1.1 million barrels per
day. Keystone has secured long-term commitments for 910,000 barrels per
day for an average term of approximately 18 years which represents
approximately 83 per cent of the commercial design of the system. As a
result of Keystone's access to premium markets, competitive and stable
tolls, faster transit times, and improved batch quality, it is
anticipated that Keystone will also move incremental volumes for
customers on a short-term basis or under additional long-term contracts.
In the future, Keystone could be economically expanded from 1.1 million
barrels per day to 1.5 million barrels per day in response to additional
market demand.

The first phase of Keystone is currently under construction. It will
extend 3,456 kilometres (2,148 miles) from Hardisty, Alberta to U.S.
Midwest markets. It will have an initial nominal capacity of 435,000
barrels per day and serve markets in Wood River and Patoka, Illinois.
Commissioning of this segment is expected to commence in late 2009 with
commercial operations to follow in early 2010. The line will subsequently
be expanded to a nominal capacity of 590,000 barrels per day and extended
to Cushing, Oklahoma. Commissioning of the Cushing segment is expected to
commence in late 2010.

Keystone is also currently seeking the necessary regulatory approvals in
Canada and the U.S. to construct and operate an expansion and extension
of the pipeline system that will provide additional capacity of 500,000
barrels per day from Western Canada to the U.S. Gulf Coast in 2012. The
Keystone expansion will extend 2,720 kilometres (1,690 miles) from
Hardisty, Alberta to a delivery point near existing terminals in Port
Arthur, Texas. Construction of the expansion facilities is anticipated to
commence in 2010 following the receipt of the necessary regulatory
approvals.

The total capital cost of Keystone is expected to be approximately US$12
billion. Approximately US$2.7 billion has been spent to date with the
remaining US$9.3 billion to be invested between now and the end of 2012.
Capital costs related to the construction of Keystone are subject to a
capital cost risk-and-reward sharing mechanism with its customers.

With more than 50 years' experience, TransCanada is a leader in the
responsible development and reliable operation of North American energy
infrastructure including natural gas pipelines, power generation, gas
storage facilities, and projects related to oil pipelines and LNG
facilities. TransCanada's network of wholly owned pipelines extends more
than 59,000 kilometres (36,500 miles), tapping into virtually all major
gas supply basins in North America. TransCanada is one of the continent's
largest providers of gas storage and related services with approximately
370 billion cubic feet of storage capacity. A growing independent power
producer, TransCanada owns, or has interests in, over 10,900 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.

Note: All financial figures are in Canadian dollars unless noted
otherwise.

Forward-Looking Information

This news release may contain certain information that is forward looking
and is subject to important risks and uncertainties. The words
"anticipate", "expect", "believe", "may", "should", "estimate",
"project", "outlook", "forecast" or other similar words are used to
identify such forward-looking information. Forward-looking statements in
this document are intended to provide TransCanada security holders and
potential investors with information regarding TransCanada and its
subsidiaries, including management's assessment of TransCanada's and its
subsidiaries' future financial and operations plans and outlook.
Forward-looking statements in this document may include, among others,
statements regarding the anticipated business prospects and financial
performance of TransCanada and its subsidiaries, expectations or
projections about the future, and strategies and goals for growth and
expansion. All forward-looking statements reflect TransCanada's beliefs
and assumptions based on information available at the time the statements
were made. Actual results or events may differ from those predicted in
these forward-looking statements. Factors that could cause actual results
or events to differ materially from current expectations include, among
others, the ability of TransCanada to successfully implement its
strategic initiatives and whether such strategic initiatives will yield
the expected benefits, the operating performance of TransCanada's
pipeline and energy assets, the availability and price of energy
commodities, regulatory processes and decisions, changes in environmental
and other laws and regulations, competitive factors in the pipeline and
energy sectors, construction and completion of capital projects, labour,
equipment and material costs, access to capital markets, interest and
currency exchange rates, technological developments and the current
economic conditions in North America. By its nature, forward-looking
information is subject to various risks and uncertainties, which could
cause TransCanada's actual results and experience to differ materially
from the anticipated results or expectations expressed. Additional
information on these and other factors is available in the reports filed
by TransCanada with Canadian securities regulators and with the U.S.
Securities and Exchange Commission (SEC). Readers are cautioned to not
place undue reliance on this forward-looking information, which is given
as of the date it is expressed in this news release or otherwise, and to
not use future-oriented information or financial outlooks for anything
other than their intended purpose. TransCanada undertakes no obligation
to update publicly or revise any forward-looking information, whether as
a result of new information, future events or otherwise, except as
required by law.

Contacts:
Media Inquiries:
TransCanada
Cecily Dobson/Terry Cunha
(403) 920-7859 or (800) 608-7859

Investor & Analyst Inquiries:
TransCanada
David Moneta/Myles Dougan/Terry Hook
(403) 920-7911 or (800) 361-6522

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