Emera set to invest C$350 mil in Canada-US gas pipeline

Emera set to invest C$350 mil in Canada-US gas pipeline

Washingon (Platts)--16May2006

Canada's Emera said Tuesday it will invest about C$350 million (US$315
million) for full ownership of a proposed pipeline that will deliver natural
gas from a planned LNG terminal near Saint John, New Brunswick, to markets in
Canada and the US Northeast.

The proposed 90-mile, 30-inch-diameter Brunswick Pipeline will run from
the Canaport LNG import terminal and through southwestern New Brunswick to
connect with the US portion of Maritimes & Northeast Pipeline at the US-Canada
border near Baileyville, Maine. Emera is expected to finance the investment
with a combination of equity and debt. The investment is forecast to provide a
11% to 14% return on equity, Emera said.

Halifax, Nova Scotia-based Emera, the parent of Nova Scotia Power and
Bangor Hydro-Electric Co, has also held a 12.9% stake in Maritimes & Northeast
since that pipeline's inception in 1999. Emera has negotiated with Duke
Energy, its Maritimes & Northeast partner, for an affiliate of Duke to
continue its lead role in the Brunswick Pipeline permitting process and
ultimately build and operate the line on Emera's behalf.

"We are pleased that Emera plans to invest in the Brunswick Pipeline
while we continue with development of our related US mainline expansion," said
Doug Bloom, president of Maritimes & Northeast. "This project is critical to
increasing natural gas availability in the markets served by Maritimes."

Brunswick will be capable of moving about 850,000 Mcf/d of regasified LNG
and can be expanded with added compression, Emera said. The project needs
National Energy Board approval and a formal filing will be made shortly, with
a public hearing expected later this year. Construction is slated to start in
2007 and be completed by late 2008. Canaport LNG is a partnership of Spain's
Repsol YPF and Irving Oil.

Emera has negotiated a 25-year send-or-pay toll agreement with Repsol to
move gas through Brunswick Pipeline.

"This agreement on natural gas transmission, along with agreements with
Maritimes, completes the full value chain arrangements and will enable our
project to be first to market with secure natural gas supplies," said Phil
Ribbeck, Repsol's director of North America LNG.

--Valarie Jackson, valarie_jackson@platts.com

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