Nov 1 TransCanada Corp said on
Thursday its Mexican subsidiary has been awarded a contract to
build, own and operate the El Encino-to-Topolobampo Pipeline by
CFE, Mexico's federal power company.
The Canadian pipeline operator expects to invest about $1
billion in the project, which is supported by a 25-year natural
gas transportation service contract with the Comision Federal de
The pipeline will be about 530 km (329 miles) long and have
contracted capacity of 670 million cubic feet per day. It is
anticipated the project will be in service in the third quarter
of 2016, the company said.
TransCanada said the pipeline is being driven by Mexico's
plan to expand its electrical grid and generating capacity, much
of which will be derived from natural gas-fired power plants.
The company, Canada's largest pipeline company, operates the
Keystone pipeline that has the capacity to transport a quarter
of Canada's crude oil exports to the United States.
It is also at the centre of the contentious Keystone XL
project, between Alberta and southern Nebraska. That project
still awaits U.S. federal approval after President Barack Obama
rejected the initial application early this year.
The Topolobampo pipeline will begin in El Encino, in the
state of Chihuahua, and terminate in Topolobampo, in the state
of Sinaloa, interconnecting with other pipelines set to be built
as a result of separate bid processes, the company said.
"This project is a response to a CFE invitation to bid. As
Mexico makes the transition from fuel oil to cleaner-burning
natural gas, there will be additional opportunities for
TransCanada," said Russ Girling, TransCanada's chief executive
in a statement.
TransCanada said it has already built and is operating the
Guadalajara and Tamazunchale pipelines and it will soon break
ground on a Tamazunchale pipeline extension.