ANGTS - A North American Energy Solution

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Alaska Natural Gas Transportation System A North
American Energy Solution
November 30, 2001 Marty Heeg Vice President,
Business Development
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Agenda

• Overview of Foothills Pipe Lines
• A short history of the certificated Alaska
  Natural Gas Transportation System
• ANGTS assets and readiness
• Benefits to Alaska and Canada
• Pipeline options
• Our view of northern development and supply/demand

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Who is Foothills?

• Sponsor of Alaska Natural Gas Transportation
  System
• Privately held corporation owned by TransCanada
  PipeLines and Westcoast Energy
• Owner and operator of the Phase I portions of the
  ANGTS in Canada
• Phase I currently delivers 3.3 Bcfd of natural
  gas to United States
• Active in developing northern pipeline projects
  since 1970s

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Acronyms

• AHPP -- Alaska Highway Pipeline Project
• ANGTS -- Alaska Natural Gas Transportation
  System
• ANGTA -- Alaska Natural Gas Transportation
  Act
• NPA -- Northern Pipeline Act
• ANNGTC -- Alaska Northwest Natural Gas
  Transportation Company

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A Short History of ANGTS

• 1976 - ANGTA passed to expedite the pipeline
  to take Alaska gas to southern markets
• 1977 - After extensive review of three
  alternatives, ANGTS is selected as the best
  project
• 1978 - NPA established in Canada as ANGTA
  counterpart
• 1980 - FERC/NEB approves building of Phase I of
  ANGTS
• 1981 - Phase I in service --Phase I portion
  of ANGTS has delivered 11 Tcf of Canadian
  gas to U.S. markets

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ANGTS Flexible Framework

• The ANGTA/NPA framework
• Provides for expediting the delivery of Alaskan
  gas to the Lower 48
• Is tested and accepted framework
• Allows for updates
• Allows Project to be modified to the required
  capacity and pressure and the use of updated
  technology

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ANGTS Status

• ANNGTC/Foothills was selected by the United
  States and Canada to construct and operate the
  ANGTS
• Significant assets have been secured
• FERC and NEB Certificates
• U.S. Corps 404 Permits
• Significant development work completed
• 94 of right-of-way acquired, reserved or under
  application

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ANGTS Land Tenure
Prudhoe Bay

• ALASKA
• Federal Grant
• 434 miles have been acquired.
• State Application
• 200 miles under active application.
• Other Lands
• 110 miles to be acquired.

ALASKA
Fairbanks
Inuvik
NUNAVUT

• YUKON
• Grant of easement for the entire ROW in Yukon.
• Recognized in the Umbrella Final Agreement.

Beaver Creek
YUKON
Whitehorse
B.C.
NWT
Fort Nelson
ALBERTA

• NORTH B.C.
• Foothills holds Map Reserves within this segment

Boundary Lake
Gordondale
SASKATCHEWAN
Caroline
Kingsgate
Monchy
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ANGTS is Ready Today
Foothills and its shareholders have invested
time, money and considerable effort to keep the
Alaska Natural Gas Transportation System in an
advanced state of readiness.

• Extensive field testing and technology work
• Computerized Soils Database
• Technical and Environmental Plans filed with
  FERC/NEB
• Tariffs filed with FERC and NEB

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ANGTS is the Best Alternative

• Has been extensively reviewed
• Follows existing infrastructure
• Will minimize adverse environmental effects
• Easily accessible for maintenance and operations
• Lowest capital cost option
• Quickest to market

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Alaska Natural Gas Transportation SystemLowest
Cost, Quickest to Market for ANS Gas
Alaska
Nunavut
Northwest Territories
Yukon
Alberta
B.C.
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Alaskan Benefits

• Increase in Gross State 55 billion Product
• Increase in Employment 26,000 person years
• Increase in State and Local 12 billion
  Government revenues
• Based on 3 MMbtu gas price over 25 years

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Canadian Benefits

• Increase in Gross Domestic 19 billion Product
• Increase in Employment 11,000 person years
• Increase in Government 5.2 billion revenues
• Based on 3 MMbtu gas price over 25 years

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ANGTS Advantages

• Earliest Timing
• Three-year head start on a green field project
• Land Tenure
• Extensive right-of-way acquired, reserved or
  under application
• Flexible Framework
• Treaty between the U.S. and Canada
• Best Route
• Follows existing transportation corridors
• Benefits
• Extensive benefits to Alaska and Canada

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Progress Report and Next Steps

• MOU with withdrawn partners from ANNGTC
• Formal proposal to the North Slope Producers
• Producer decision on the project expected in
  the 1st Quarter of 2002

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Our Perspectives on Northern Gas Development

• Strong gas demand is here to stay

• Two separate pipelines will be built from Alaskan
  North Slope and Mackenzie Delta

• Optimization of South of 60 takeaway capacities
  required

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Northern Gas Pipeline DevelopmentSouth of 60
Takeaway Capacities
o
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