CER provides reasons for NGTL’s denial related to business

CALGARY, Alberta, March 22, 2022 (GLOBE NEWSWIRE) — The Board of the Canada Energy Regulator has denied NOVA Gas Transmission Ltd.’s application. the North Montney Mainline in northeast British Columbia to the proposed Willow Valley Interconnection delivery point. The Board concluded that the tolling method would result in tolls that were neither just nor reasonable. The Board approved NGTL’s request to designate the Willow Valley Intertie Delivery Point as a Group 1 Delivery Point, citing the overall benefits of designation.

On January 19, 2022, the Board issued its decision with reasons to follow as NGTL requested an expedited decision.

In May 2021, NGTL applied to CER for a new service for PETRONAS Canada Ltd. This service would link the North Montney Mainline and Coastal GasLink (CGL) pipeline to the Willow Valley Interconnection delivery point. From there, the natural gas would be transported on the CGL pipeline to LNG Canada’s export terminal in Kitimat, British Columbia.

The service tolls were designed to cover incremental costs only and transferred the risk of cost overruns to other shippers on the NGTL System. The design of the toll did not respect the principle of cost causality. Under this principle, users of a pipeline system are responsible for the costs associated with transporting their product through the pipeline.

The Board also decided that there was insufficient information at that time to determine whether the tolling methodology previously approved for NGTL’s existing system would still be appropriate once gas deliveries begin in Willow Valley interconnection. This decision does not impact the current pricing methodology for existing services on the North Montney Mainline.

Fast facts

  • The CGL pipeline is under construction by TC Energy and is regulated by the British Columbia Oil and Gas Commission.
  • The Commission heard from 22 intervenors/participants at the hearing.
  • The CER is responsible for regulating tolls, tariffs and traffic for pipelines that cross a provincial or international border.
  • the Canadian Energy Regulator Act says fees must be just and reasonable and not unfairly discriminatory – which generally means that all shippers must be treated fairly.
  • A toll is the price charged by a pipeline company for transportation and other services. Tolls help pipeline companies cover the cost of operating and maintaining pipelines safely.

Related links

The Canada Energy Regulator (CER) ensures that energy flows safely across the country. We review energy development projects and share energy information, while applying some of the strictest safety and environmental standards in the world. Find out how the CER is working for you visit us online Where connect on social networks.

Contact

Mireille Ferland
Communications Officer
Canada Energy Regulator
E-mail: [email protected]
Telephone: 403-390-8931
Telephone (toll-free): 1-800-899-1265

About Keith Tatum

Check Also

Solving the labor shortage in the construction industry requires change

Addressing scarcity and attracting and retaining People Y, Z and beyond will require breaking with …