US FERC grants initial approval to North Baja gas line expansion

Washington (Platts)--9Oct2006

North Baja Pipeline has received preliminary approval from the US Federal
Energy Regulatory Commission to expand its system in California and Arizona to
accept more regasified liquefied natural gas from Mexico.

FERC made a preliminary determination on all non-environmental issues
related to the 126-mile project, which would be built in three phases and
brought online between 2007 and 2010.

FERC late last month issued a supportive draft environmental impact
statement, putting the project well on its way to final approval as long as
the commission issues a favorable final environmental review. FERC's September
6 decision on non-environmental issues granted the North Baja expansion
preliminary approval and approved its request for rolled-in rate treatment.

North Baja, an indirect subsidiary of TransCanada PipeLines Ltd.,
proposes to build 46 miles of laterals and loop its existing 80-mile system
with 42- and 48-inch-diameter pipelines. It also proposes modifications that
would allow for bidirectional gas flow, build an interconnection with Southern
California Gas and make changes to its US-Mexico border facility.

North Baja is the US segment of the international North Baja/Gasoducto
Bajanorte pipeline project, which would move gas from LNG terminals proposed
for Baja California, Mexico, and supply electricity generators in the region.

The North Baja segment extends from an interconnection with an El Paso
Natural Gas in Ehrenberg, Arizona, through southeast California to the border.

--Joel Kirkland, joel_kirkland@platts.com

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