2008 annual report celebrating yesterday delivering today building for tomorrow celebrating yesterday It was a true engineering often under extremely adverse 4HElNALWELDONTHEPIPELINETOOK conditions, to build what would be PLACEIN+APUSKASING /NTARIOON wonder of its time. Nearly the world’s longest pipeline. /CTOBER 3,700 kilometres of steel )N 4RANS#ANADAS#ANADIAN To commemorate the event, pipe – pushed through -AINLINECELEBRATEDYEARSOF Canada Post and TransCanada some of the toughest history – recognizing a milestone unveiled a special edition Canadian anniversary of the final weld on postage stamp, depicting a single, terrain in Canada. the first pipeline system designed anonymous welder representing 5PTO WORKERSPERSEVERED to deliver Alberta natural gas to THOUSANDSOFLABOURERSWHOWORKED through a multitude of obstacles, MARKETSIN/NTARIOAND1UEBEC to complete the historic pipeline. Construction of the Mainline’s WESTERNLEGBEGANON*UNE Canadian Mainline AT"URSTALL 3ASKATCHEWAN.ATURAL Construction Facts GASREACHEDTHECITIESOF7INNIPEG -ANITOBAAND2EGINA 3ASKATCHEWAN s MILLIONORIGINALCOST on the Canadian Prairies in 3EPTEMBER7ORKERSPUSHED !LITTLEKNOWNFACTnASILVERDOLLAR s TONSOFPIPECARRIED on, challenged by the terrain and was welded to the pipe in that BY RAILWAYCARS THEREMOTENESSOFTHELAND MOVING location. That silver dollar is now on s LAKESANDRIVERSCROSSED ABOUTONEKILOMETREADAYACROSS display at TransCanada’s head office s 0ERMISSIONNEEDED /NTARIOAND lNALLYINTO1UEBEC in Calgary, Alberta. FROMMORETHAN landowners. s 3WAMP LIKEMUSKEG swallowed vehicles up to their door handles. s )MPENETRABLEROCKTHAT TOOKUPTO STICKSOF DYNAMITEPERKILOMETRETO dislodge. s 7ORKERSFACEDBONE numbing winters and MOSQUITO INFESTEDSUMMERS s 2AIN MUD SNOWANDICE were the yearly challenges faced by crews. 19 19 18 17 15 1 8 9 Calgary 10 23 5 Portland 2 Kapuskasing 7 Montreal 16 24 6 11 20 21 Toronto 13 Boston 4 12 14 New York 3 3 22 Natural Gas Pipeline Proposed Pipeline Oil Pipeline Power Facility Houston Gas Storage Pipelines TransCanada operates one of the largest natural gas pipeline systems in North America. With 50 years of experience, we are experts in the business of operating, maintaining and building large-diameter, long-haul pipelines. The strength of our pipeline business is rooted in these examples of critical infrastructure: Delivering 20% of the natural gas consumed in North America 1 Alberta System This 23,705 kilometre (14,730 mile) pipeline moves approximately 11 Bcf/d, making it one of the largest in North America. It gathers natural gas for use in Alberta and delivers it to provincial border points for export to North American markets. In 2008, the Alberta System gathered 66 per cent of the natural gas produced in Western Canada. 2 Canadian Mainline This 14,101 kilometre (8,762 mile) pipeline extends east from the Alberta border to Quebec and connects with other natural gas pipelines in Canada and the United States. Across the Canadian prairies, the system consists of five parallel lines capable of transporting approximately 7.0 Bcf/d. 3 ANR Pipeline System 4 ANR Storage This 17,000 kilometre (10,563 mile) pipeline has a peak day capacity of 6.8 Bcf/d. It delivers natural gas from producing fields in Texas, Oklahoma, Louisiana and the Gulf of Mexico to markets in Wisconsin, Michigan, Illinois, Ohio and Indiana. ANR also owns and operates 250 Bcf of regulated natural gas storage capacity in Michigan. 5 GTN 6 Northern Border 7 Great Lakes These three natural gas pipelines include a total of 7,828 kilometres (4,864 miles) of pipe and deliver natural gas from Western Canada to premium markets across North America. Energy TransCanada has built a successful power business by acquiring low-cost, baseload generation, and developing new large-scale facilities backed by long-term power purchase arrangements. Today we own or have interests in 19 power plants in Canada and the United States. We also have a significant non-regulated natural gas storage business in Alberta where we own or have the rights to 120 Bcf of capacity. Some examples of our Energy assets include: Capacity to power 11 million homes 8 9 Sundance 10 Sheerness Through these power purchase arrangements in Alberta and a number of other wholly-owned plants, we market 20 per cent of the province’s power. 11 Bruce Power Canada’s first private nuclear generating station, this facility currently produces 4,700 MW of power or more than 20 per cent of Ontario’s electricity. 12 Ravenswood Generating Station Located in Queens, New York, the 2,480 MW power plant is capable of supplying 20 per cent of New York City’s power needs. 13 TC Hydro 13 hydroelectric facilities on the Connecticut and Deerfield rivers in New Hampshire, Vermont and Massachusetts produce 583 MW of power. delivering today TransCanada is a leading North American energy infrastructure company. With approximately $40 billion in assets, today we are a leader in the responsible development and reliable operation of North American energy infrastructure including natural gas and oil pipelines, power generation and natural gas storage facilities. Our 59,000 kilometre (36,661 mile) wholly-owned natural gas $40 billion in assets pipeline network taps into virtually every major natural gas supply basin on the continent and provides our customers with unparalleled access to premium markets. Each day we deliver 20 per cent of the natural gas consumed in North America. Looking forward, our vast pipeline network is well positioned to connect new sources of supply such as shale gas, coalbed methane and offshore liquefied natural gas as well as supply from the north. We are also one of the continent’s largest providers of natural gas storage and related services with approximately 370 billion cubic feet of capacity – enough to meet the needs of nearly four million 4,000 talented employees homes each year. As one of Canada’s largest independent power producers, TransCanada owns, controls or is developing more than 10,900 megawatts of power generation in Canada and the United States – enough capacity to power 11 million homes. Our diversified power portfolio includes natural gas, nuclear, coal, hydro and wind generation primarily located in Alberta, Ontario, Quebec and the northeastern United States. Recently, we made a significant entry into the oil pipeline business through the Keystone Pipeline System. When completed it will be one of North America’s largest oil delivery systems with the capacity to move 1.1 million barrels per day from Western Canada to markets in the U.S. Midwest and Gulf Coast. Going forward, we will continue to create value for our shareholders and our customers by building and operating the energy infrastructure that North America needs. Today, we are in the midst of an $18 billion capital program that will see a number of attractive, low-risk projects completed over the next four years. They include expansions of our existing pipeline infrastructure, new pipeline infrastructure, new natural gas storage facilities and new power plants – critical infrastructure in the markets we serve. As we build for tomorrow, TransCanada is committed Creating value for to being a reliable and safe operator, with a focus on our shareholders and providing low-cost, competitive services to our customers. customers With growth comes greater responsibility. Responsibility to our investors, to our customers, to our employees, to the contractors who work diligently with us, to the regulators across the continent who scrutinize our proposals, to the thousands of residents in communities located near our pipelines and power plants, and to the environment. We have always worked hard to ensure environmental sustainability wherever we operate. Our success is a reflection of our exceptional team of 4,000 committed and motivated employees who bring skill, experience, energy and knowledge to the work they do. They are our competitive advantage. building for tomorrow $18 billion capital program underway Pipelines Northern Border System in North Dakota, tapping into a growing supply of U.S. Rockies 14 Keystone Pipeline System This US$12 billion natural gas for Midwest markets in the United pipeline will stretch 6,176 kilometres States. The US$500 - US$600 million initiative (3,837 miles) from Hardisty, Alberta to refining is expected to begin shipping natural gas in centres in the U.S. Midwest and Gulf Coast. late 2010. When completed, Keystone will be one of the largest oil delivery systems in North America with 17 Groundbirch 18 Horn River Pipeline the capacity to move 1.1 million barrels of oil a Projects Groundbirch and Horn River are both day to an American market looking for a growing designed to transport natural gas to market and reliable supply. In 2008, TransCanada agreed from shale gas deposits in northeastern British to increase its ownership interest up to 79.99 per Columbia. TransCanada held a successful open cent of Keystone. committed to moving the project through an season late in 2008 for the Groundbirch line, open season in 2010 and the subsequent Keystone will deliver with commitments reaching 1.1 Bcf/d by 2014. regulatory process. If successful, the project The 77 kilometre (48 mile) project should be could be sanctioned in 2014, with natural gas 1.1 million barrels of oil operational in late 2010. The company anticipated to start flowing in 2018. In Canada, per day to U.S. markets continues to work with potential shippers on TransCanada and the other co-venture the Horn River line. It is expected to start companies involved in the Mackenzie Gas shipping gas in early 2011. Pipeline project continue to pursue approval of 15 Alberta System North Central Corridor the proposed 1,200 kilometre (746 mile) pipeline Expansion Stretching 300 kilometres (186 miles) 19 Northern Pipeline Projects Billed as the project, focusing on obtaining regulatory across northern Alberta, the $925 million North largest construction project in U.S. history, the approval and the Canadian government’s support Central Corridor expansion will optimize natural US$26 billion (2007 dollars) Alaska Pipeline of an acceptable fiscal framework.