UPDATE 4-TransCanada to build $6.6 bln gas lines for Petronas
* New lines will serve LNG plant planned by Petronas unit * Project is second Pacific LNG project for TransCanada * TransCanada shares rise 2.4 pct * TransCanada CEO says confident of Keystone XL approvals (Adds detail.) CALGARY, Alberta, Jan 9 (Reuters) - TransCanada Corp will build pipelines worth as much as C$6.5 billion ($6.58 billion) to supply a Pacific Coast liquefied natural gas facility planned by the new Canadian unit of Malaysia's state-owned Petronas as the pipeline company looks to boost its exposure to a booming LNG sector. TransCanada, which is also behind the planned Keystone XL oil pipeline to the United States from Alberta, said on Wednesday it plans to build a C$5 billion line, the Prince Rupert Gas Transmission Project, to carry 2 billion cubic feet of gas per day from the massive Montney shale gas field in northeastern British Columbia. The destination is an LNG export facility being planned by Petronas's Progress Energy Canada unit at Port Edward, near Prince Rupert, British Columbia. TransCanada said it will spend a further C$1 billion to C$1.5 billion to connect the proposed 750-kilometer (465-mile) Prince Rupert Project line to its NOVA regional pipeline network. That will link the new line with gas from other areas of the Montney field as well as gas from Alberta producers. Beset by low prices at home and a sated U.S. market, Canadian gas producers are rushing ahead with projects to liquefy their gas so they can tap high-paying Asian consumers. Plans are in the works for at least a half-dozen LNG facilities on Canada's Pacific Coast. The LNG developments and natural gas pipelines mostly have been well received, especially in comparison with Enbridge Inc's proposed Northern Gateway oil pipeline to the Pacific. That plan faces bitter opposition from aboriginal groups along the line's route through northern British Columbia, who are worried about spills and tanker accidents. TransCanada expects to get continued support from British Columbia communities. "Recently we have built about C$1 billion of infrastructure in northeast B.C.," Russ Girling, TransCanada's chief executive, said in an interview. "Our process of community engagement and consultation has worked well for us and I believe those communities trust us." The company's shares rose 2.4 percent, or C$1.13, to C$48.39 on the Toronto Stock Exchange on Wednesday. The Prince Rupert project is the second planned by TransCanada, the country's largest pipeline operator, to serve the nascent LNG industry on Canada's northern Pacific Coast. It agreed in June to build a C$4 billion line to carry 1.7 bcf of gas per day from northeastern British Columbia to a LNG facility at the port of Kitimat being planned by Royal Dutch Shell Plc and partners Korea Gas Corp, Mitsubishi Corp and PetroChina Co Ltd. Northeastern British Columbia contains some of the world's largest unconventional natural gas reserves. The Montney and Horn River shale gas deposits alone contain trillions of cubic feet of gas. Progress Energy Canada, formed after Petronas bought Canada's Progress Energy Resources Corp for C$5.2 billion in December, plans to spend up to C$11 billion to build the Prince Edward LNG plant. Progress and TransCanada expect to finalize definitive agreements on building the pipelines early this year, TransCanada said. The Prince Rupert line is expected to be in service by the end of 2018, subject to regulatory approvals. Meanwhile, Girling said he is confident that the Keystone XL pipeline, a controversial pipeline to link Canada's booming oil sands with refineries and ports on Texas' Gulf Coast, will get the final regulatory approvals it needs in the United States. He said he "fully expects" the governor of Nebraska to approve it, and that he is "very optimistic" that the U.S. State Department will do the same. The oil pipeline received a boost last week when Nebraska regulators said its proposed new route would avoid many of the ecologically-sensitive areas that led the U.S. government to block it last year. ($1=$0.99 Canadian) (Reporting by Scott Haggett, Maneesha Tiwari in Bangalore and Nicole Mordant in Vancouver,; Editing by Peter Galloway and Sofina Mirza-Reid)
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