Conference of Western Attorneys General Regulatory Predictability Sean McMaster

1
Conference of Western Attorneys
GeneralRegulatory PredictabilitySean McMaster
TransCanada CorporationFebruary 16, 2012
2
Forward Looking Information
This presentation may contain certain information
that is forward-looking and is subject to
important risks and uncertainties. The words
"anticipate", "expect", "believe", "may",
"should", "estimate", "project", "outlook",
"forecast" or other similar words are used to
identify such forward-looking information.
Forward-looking statements in this presentation
are intended to provide TransCanada security
holders and potential investors with information
regarding TransCanada and its subsidiaries,
including managements assessment of
TransCanadas and its subsidiaries future
financial and operational plans and outlook.
Forward-looking statements in this presentation
may include, among others, statements regarding
the anticipated business prospects, and financial
performance of TransCanada and its subsidiaries,
expectations or projections about the future,
strategies and goals for growth and expansion,
expected and future cash flows, costs, schedules
(including anticipated construction and
completion dates), operating and financial
results, and expected impact of future
commitments and contingent liabilities. All
forward-looking statements reflect TransCanada's
beliefs and assumptions based on information
available at the time the statements were made.
Actual results or events may differ from those
predicted in these forward-looking statements.
Factors that could cause actual results or events
to differ materially from current expectations
include, among others, the ability of TransCanada
to successfully implement its strategic
initiatives and whether such strategic
initiatives will yield the expected benefits, the
operating performance of the TransCanadas
pipeline and energy assets, the availability and
price of energy commodities, capacity payments,
regulatory processes and decisions, changes in
environmental and other laws and regulations,
competitive factors in the pipeline and energy
sectors, construction and completion of capital
projects, labour, equipment and material costs,
access to capital markets, interest and currency
exchange rates, technological developments and
economic conditions in North America. By its
nature, forward-looking information is subject to
various risks and uncertainties, which could
cause TransCanada's actual results and experience
to differ materially from the anticipated results
or expectations expressed. Additional information
on these and other factors is available in the
reports filed by TransCanada with Canadian
securities regulators and with the U.S.
Securities and Exchange Commission (SEC). Readers
are cautioned not to place undue reliance on this
forward-looking information, which is given as of
the date it is expressed in this presentation or
otherwise, and not to use future- oriented
information or financial outlooks for anything
other than their intended purpose. TransCanada
undertakes no obligation to update publicly or
revise any forward-looking information, whether
as a result of new information, future events or
otherwise, except as required by law.
3
Leading North American Energy Infrastructure
Company

• Competitively positioned in pipeline and energy
  infrastructure
• Approximately 50 billion of premium pipeline and
  energy assets
• Employs over 4,200 people in nearly 50
  professions, trades and fields, located in 7
  provinces and 32 states

3
4
Corporate Statistics

• TransCanada Corporation (TRP) listed TSX and
  NYSE(Financial figures are unaudited and in
  Canadian dollars, at December 31, 2011)
• Total assets                              
    49.0 billion
• Net income (attributable to common
• shares)                        1.5 billion or
  2.18 per share
• Comparable Earnings 1.6 billion or 2.23 per
  share
• Funds generated from operations 3.7 billion
• Dividends declared per common share 1.76

4
5
Our Vision and Values

• Our Vision
• TransCanada will be the leading energy
  infrastructure company in North America
• With a strong focus on pipelines and power
  generation opportunities
• Located in regions where we enjoy or can develop
  significant competitive advantage.

Our Values Integrity Collaboration Responsibility
Innovation
5
6
TransCanada Corporation (TSX/NYSE TRP)

• Natural Gas Pipelines
• 57,000 km (35,500 mi) wholly owned
• 11,500 km (7,000 mi) partially owned
• 250 Bcf of regulated natural gas storage capacity
• Average volume of 14 Bcf/d
• Oil Pipelines
• Keystone 1.4 million Bbl/d ultimate capacity
• Energy
• 19 power plants, 10,800 MW
• Diversified portfolio, including wind, hydro,
  nuclear, coal and natural gas
• 130 Bcf of non-regulated natural gas storage
  capacity
• Phases 1 and 2 in operation, Phases 3 and 4 in
  development

6
7
Natural Gas Pipelines

• 57,000 km (35,500 mi) of wholly owned natural gas
  pipeline
• Interests in an additional 11,500 km (7,000 mi)
  of natural gas pipeline
• 250 Bcf of regulated natural gas storage capacity
• Unparalleled connections from traditional and
  emerging basins to growing markets
• Average daily volume of approximately 14 Bcf

7
8
Oil Pipelines

• Keystone Pipeline - 2,154-miles, transporting
  crude oil from Alberta to markets at Wood River
  in Illinois and at Cushing Oklahoma
• Proposed Keystone XL Pipeline Project a
  proposed 1,661-mile pipeline from Alberta to
  serve markets at Cushing, Oklahoma and Port
  Arthur, Texas
• 1.4 million Bbl/day ultimate capacity
• Bakken and Cushing Marketlink Projects would
  provide opportunity to transport U.S. crude
  production
• Proposed Houston lateral would expand capacity to
  the US Gulf Coast refining center

8
9
Keystone Oil Pipeline - Linking Growing Crude
Oil Supply to Large U.S. Markets
millions of barrels per day
Source 2009 EIA Actuals
9
10
Keystone Oil Pipeline - Linking Growing Crude
Oil Supply to Large U.S. Markets
millions of barrels per day
Source 2009 EIA Actuals
10
11
Keystone Oil Pipeline - Linking Growing Crude
Oil Supply to Large U.S. Markets
millions of barrels per day
Source 2009 EIA Actuals
11
12
Keystone Oil Pipeline - Linking Growing Crude
Oil Supply to Large U.S. Markets
millions of barrels per day
Source 2009 EIA Actuals
12
13
Benefits of Keystone Project

• The United States will derive significant
  benefits from the Keystone projects
• Energy Security
• National Security
• Economic Stimulus
• Job Creation
• Tax revenue
• Promotes domestic crude oil production and
  improved netback pricing to domestic producers
  vis a vis rail/truck transport

13
14
Keystone XL Major Permitting Processes

• State Permitting
• South Dakota Energy Conversion and Transmission
  Facilities Act permit
• Public informational meetings and formal
  evidentiary hearing
• Considers impacts of proposed route but not
  alternative routes not a siting process per se
• 12-month mandatory timeline from application to
  Order
• Application filed March 12, 1009
• Order issued March 12, 2010
• Keystone filed Motion for limited reconsideration
  April 14, 2010
• Amended Order issued June 29, 2010
• Highly predictable and reliable process!

14
15
Keystone XL Major Permitting Processes

• State Permitting, continued
• Montana Major Facilities Siting Act (MFSA)
• Detailed application to Montana Department of
  Environmental Quality
• MDEQ used DOS NEPA process to satisfy Montana
  Environmental Quality Act obligation, as
  permitted by statute
• Application filed December 18, 2008
• Multiple rounds of information requests
• Application deemed complete April 2010
• Final EIS issued August 26, 2011
• In December 2011, Governor Schweitzer announced
  MFSA certificate would be issued shortly
• MDEQ working on final details of MFSA Certificate

15
16
Keystone XL Major Permitting Processes

• State Permitting, continued
• Nebraska No siting statute prior to November
  2011
• Public concern over route across Sandhills region
  led Governor Heineman to call a Special Session
  of the Legislature in November 2011
  (notwithstanding Final EIS approval of Sandhills
  route)
• Legislature enacted Major Oil Pipeline Siting Act
• Requires formal process before State Public
  Service Commission regulations yet to be
  promulgated
• Legislation authorized Nebraska Department of
  Environmental Quality to work with Dept. of State
  and Keystone to develop alternate route to avoid
  Sandhills region
• State Dept. denial of Presidential Permit
  temporarily suspended DEQ process, pending new
  legislative direction in 2012 session.

16
17
Keystone XL Major Permitting Processes

• Federal
• Presidential Permit from US Department of State
  under Executive Order 13337 authorizing border
  crossing
• State Dept. conducts environmental review under
  NEPA
• State Dept. conducts National Interest review
  considering wide array of factors
• Numerous federal agencies participate in NEPA and
  NID reviews. Montana Department of Environmental
  Quality also served as cooperating agency in NEPA
  review
• US Army Corps of Engineers wetland and
  waterbody permitting under Clean Water Act
• Bureau of Land Management Grant of Right-of-Way
  and Temporary Use Permit for 42 miles of federal
  lands crossed
• US Fish Wildlife Service Consultation with
  Dept. of State under Endangered Species Act re
  impacts to Threatened and Endangered Species
• State Dept. and State Historic Preservation
  Offices reviewed impacts to cultural resources
  under National Historic Preservation Act.

17
18
Keystone XL Major Permitting Processes

• Delays in the Federal Approval Process
• Keystone planned its permitting schedule based on
  the State Department processing of two similar
  Presidential Permit applications that were
  processed between 2006 and 2009.
• Keystone I -- 23 months from application to
  permit
• Alberta Clipper -- 27 months from application to
  permit
• Instead, the DOS process took 40 months, from
  September 2008 to January 2012 to get to a
  decision. The decision only occurred in January
  2012 because of a Legislative deadline
• A number of factors impacted the DOS review
  timeline
• EPA criticism of the Draft and Supplemental Draft
  EIS
• BP Gulf of Mexico Spill
• San Bruno explosion
• ExxonMobil Yellowstone spill
• Issues around scope and process were generally
  resolved in favor of broader scope and more
  process

18
19
Keystone XL Major Permitting Processes

• January 18, 2012 - Decision to Deny Presidential
  Permit
• 60 day deadline imposed by Congress in Payroll
  Tax Relief Extension bill is insufficient time
  for State Dept. to obtain and assess additional
  information it needed
• DOS needed additional information about potential
  route alternatives in Nebraska to avoid Sandhills
• In light of the Nebraska reroute there is
  incomplete information about potential
  environmental, socioeconomic, environmental
  justice, and cultural resources impacts
• The project as presented and analyzed at this
  time would not serve the National Interest
• The determination does not preclude any
  subsequent permit application or applications for
  similar projects

19
20
Thank you.