1 CORPORATE PROFILE a leading North American energy infrastructure company December 2012
2 Building and operating safe and reliable energy infrastructure it is what we do and we do it well. Millions of people across North America rely on the energy we deliver every day to heat and light their homes, cook their food and fuel their vehicles. We have done this successfully and responsibly for more than six decades. Our $49 billion of blue chip assets are essential to North Americans and we are well positioned to continue to meet the continent s growing energy needs for decades to come. Our Vision Our strategic vision remains clear: to become the leading energy infrastructure company in North America. In pursuing this goal, we strive to deliver strong financial performance on our large portfolio of attractive, low-risk projects and continue to create and cultivate a high-quality portfolio of future growth opportunities. TransCanada s financial performance continues to build on our solid track record of delivering strong and sustainable earnings and cash flow. Over the past 10 years, TransCanada has made significant investments in high-quality energy infrastructure assets, investments that have allowed the company to move forward in achieving its vision. We are in the midst of an unprecedented C$50-billion growth program that has seen $10 billion in new pipeline and power projects placed into service since These new operating assets are critical to North American infrastructure and have become an important part of our growing asset base. Our People TransCanada s success is a reflection of our exceptional team of over 4,600 employees across North America who bring skill, experience, energy and knowledge to the work they do every day. TransCanada s people are the heart of our competitive advantage. Our path forward lies in committed and motivated people who demonstrate our values of integrity, collaboration, responsibility and innovation. As TransCanada continues to progress our capital program, we are excited about the significant opportunities available in the years ahead. Our approach is to select only the very best opportunities and move those initiatives forward. Over the long term, we plan to continue to cultivate a portfolio that will position TransCanada to capitalize on North America s increased demand for cleaner and more efficient energy. In addition, we continue to focus on enhancing the value of existing assets by maximizing revenue and minimizing costs. This means increasing throughput on our pipelines, maximizing the availability and output of our power plants and minimizing the cost of our operations. These are simple concepts we put into practice every day. TransCanada plays a vital role in connecting energy supplies to key North American markets. We operate one of the largest natural gas transmission networks in North America 68,500 kilometres (km) (42,500 miles) tapping into virtually every major gas supply basin in North America. TransCanada is one of the continent s largest providers of natural gas storage and related services with approximately 380 billion cubic feet (Bcf) of storage capacity. Through our energy business, we own or have interests in approximately 11,800 megawatts (MW) of power generation in Canada and the United States. The 3,467-km (2,154-mile) Keystone oil pipeline along with the proposed Keystone XL, Gulf Coast and Houston Lateral projects meet the needs for long-term North American energy security. Our success is related directly to the way in which we uphold our responsibilities to our shareholders, our stakeholders, and the wider community in which we operate. Ours is a business based on solid principles and sound governance, supported by dedicated employees, and respected by our industry peers. TransCanada has always been, and will remain, a company that can be relied on. Western Canada Calgary Eastern Canada Northern Canada U.S. West Coast U.S. Mid West U.S. Northeast U.S. Southeast/Gulf Coast Houston Mexico 492 People 2,127 People 263 People 2 People 83 People 576 People 408 People 154 People 519 People 20 People
3 OUR PRIORITIES Safety and Integrity TransCanada has an industry-leading safety record. Our public safety and pipeline integrity programs are designed to ensure public safety and to meet or exceed industry best practices and regulatory requirements. The health and safety of the public, our employees and our contractors is paramount. At TransCanada, we seek to anticipate and minimize hazards of every description in the field and in the office. From design and construction to operation and maintenance, safety is an integral part of everything we do. Community Partnerships Giving back to communities has been part of our culture for over 60 years. At TransCanada, we believe in making a positive difference where we live and work. TransCanada demonstrates our commitment to being a good neighbour, a dependable and trusted community partner and an employer of choice. Whether it s partnering with community groups or employee engagement and giving, we are leading the way to build vibrant communities. Our commitment to building strong communities aligns with our corporate values of integrity, collaboration, responsibility and innovation. In 2011, we distributed more than $9.6 million in financial and in-kind donations in communities across North America. Our community investment program focuses on three key areas: wellness, safety and the environment. Protecting the Environment At TransCanada, we recognize the importance of environmental stewardship as we strive to meet the energy needs of North Americans. As owner of major natural gas and oil transmission systems in North America and as a generator of significant electrical capacity, TransCanada strives to minimize our environmental footprint while meeting the energy demands of the continent in a responsible and sustainable manner. In short, our responsibility toward the natural world is comprehensive and accounts for the potential impacts that our operations might have on the environment. Ours is a broad, preventative vision of environmental sustainability. We have been recognized for these efforts. For the tenth year in a row, TransCanada was named to the Dow Jones Sustainability Index, a global index that tracks the performance of the leading sustainability-driven companies. We are also listed among Canada s 50 best corporate citizens by Corporate Knights magazine. Stakeholder Engagement TransCanada recognizes that many people and groups may be affected by our business activities, and that we must deliver value to our shareholders in a socially and environmentally responsible manner. We strive to engage stakeholders early and often. This means listening, providing accurate information and responding to stakeholder interests in a prompt and consistent manner. TransCanada uses two-way communication and recognizes that diverse thoughts, opinions and experiences contribute to better decisions and outcomes. Customer Satisfaction TransCanada is an essential and dependable supplier of natural gas, oil and electricity services to producers and refiners in Canada and the U.S., and to energy consumers in market regions in Canada, the U.S. and Mexico. The operating experience and innovative spirit of TransCanada s people are key sources of value for customers. Our pipeline networks are among the largest, most complex, and safest transmission systems in the world. Through extensive construction and operating programs, we follow the best practices in the North American pipeline industry. We have extensive knowledge of North American energy markets, underscored by an in-depth understanding of our core markets. Our significant experience in changing environments enables us to seize new opportunities and deliver value to our customers. We seek feedback from our customers through regular surveys and work to understand what drives their expectations. Our ability to selectively identify and apply advanced technology ensures reliable services at the lowest cost.
4 Wholly Owned Natural Gas Pipeline Partially Owned Natural Gas Pipeline Natural Gas Pipeline Under Construction 12 Natural Gas Pipeline In Development Natural Gas Pipeline Proposed Oil Pipeline Oil Pipeline Under Construction Oil Pipeline In Development Oil Pipeline Proposed Power Facility Gas Storage
5 Our Portfolio of Assets Natural Gas Pipelines 1. Alaska Pipeline Project: proposed natural gas pipeline 2. Alberta System: 24,373 km (15,145 miles) 3. ANR: 16,656 km (10,350 miles) plus approximately 250 Bcf of underground natural gas storage 4. Bison: 487 km (303 miles). TransCanada operates and effectively owns 83.3 per cent of the system 5. Canadian Mainline: 14,101 km (8,672 miles) 6. Coastal GasLink Pipeline Project: conceptual route for proposed pipeline 7. Foothills: 1,241 km (771 miles) 8. Great Lakes: 3,404 km (2,115 miles). TransCanada operates Great Lakes and effectively owns 69 per cent of the system 9. GTN: 2,178 km (1,353 miles). TransCanada operates and effectively owns 83.3 per cent of the system 10. Guadalajara: 310 km (193 miles) 11. Iroquois: 666 km (414 miles). TransCanada owns 44.5 per cent 12. Mazatlan Pipeline Project: proposed natural gas pipeline 13. North Baja: 138 km (86 miles). TransCanada operates North Baja and effectively owns 33.3 per cent of the system 14. Northern Border: 2,265 km (1,407 miles). TransCanada operates Northern Border and effectively owns 16.7 per cent of the system 15. Portland: 474 km (295 miles). TransCanada owns 61.7 per cent 16. Tamazunchale Extension: under construction 17. Tamazunchale: 130 km (81 miles) 18. Topolobampo Pipeline Project: proposed natural gas pipeline 19. TQM: 572 km (355 miles). TransCanada owns 50 per cent 20. Tuscarora: 491 km (305 miles). TransCanada operates Tuscarora and effectively owns 33.3 per cent of the system Oil Pipelines 21. Grand Rapids Pipeline Project: proposed oil pipeline 22. Gulf Coast Project: 780 km (485 miles) pipeline under construction 23. Houston Lateral Project: 80 km (48 miles) pipeline in development 24. Keystone Pipeline: 3,467 km (2,154 miles) pipeline in operation 25. Keystone XL: 1,897 km (1,179 miles) pipeline in development 26. Northern Courier Pipeline Project: proposed oil pipeline Energy 27. Bear Creek: 80 MW natural gas-fired cogeneration plant 28. Bécancour: 550 MW natural gas-fired cogeneration power plant 29. Bruce Power: Two stations generating approximately 6,300 MW of generating capacity, Bruce Power is located in Ontario. TransCanada owns 48.8 per cent of Bruce A, which has four 750 MW generating units, and 31.6 per cent of Bruce B which also has four generating units with a combined capacity of 3,200 MW 30. Canadian Solar: 86 MW, nine solar projects. TransCanada will purchase each project after they begin commercial operation and meet certain milestones 31. Cancarb: 27 MW facility fuelled by waste heat 32. Carseland: 80 MW natural gas-fired cogeneration plant 33. Cartier Wind: 590 MW Cartier wind farm project 62 per cent owned by TransCanada. 34. Coolidge: A 575 MW natural gas-fired generating station 35. CrossAlta: An underground natural gas storage facility with a working capacity of 68 Bcf. TransCanada owns 60 per cent of CrossAlta and operates the facility 36. Edson: An underground natural gas storage facility with a working capacity of approximately 50 Bcf 37. Grandview: 90 MW natural gas-fired cogeneration power plant 38. Halton Hills: 683 MW natural gas-fired power plant 39. Kibby Wind: 132 MW wind farm 40. Mackay River: 165 MW natural gas-fired cogeneration plant 41. Napanee: proposed 900 MW natural gas-fired power generating station 42. Ocean State Power: 560 MW natural gas-fired, combined-cycle facility 43. Portlands Energy: 550 MW, combined-cycle natural gas generation power plant, 50 per cent owned by TransCanada 44. Ravenswood: 2,480 MW gas- and oil-fired facility 45. Redwater: 40 MW natural gas-fired cogeneration plant 46. Sheerness: Two 390 MW coal-fired thermal power generating units. TransCanada has the rights to 756 MW of generating capacity from the PPA which expires in Sundance A: Power purchase arrangement (PPA) which expires in TransCanada has the rights to 100 per cent of the generating capacity of the 560 MW facility 48. Sundance B: TransCanada has the rights to 50 per cent of the generating capacity of the 706 MW facility under a PPA which expires in TC Hydro: Total generating capacity of 583 MW, comprises 13 hydroelectric facilities on the Deerfield and Connecticut Rivers
6 our business areas Pipelines TransCanada s credentials and track record in the construction and operation of large-diameter pipe in extreme climates and virtually all types of terrain are unequalled in North America. We are the leading operator of large gas turbine compressor stations and expert in remote facility control. Our employees are highly skilled in designing, building and operating complex infrastructure and take pride in delivering major projects on time and on budget. TransCanada has proven capabilities in the prudent use of new and leading-edge technologies to achieve excellence in pipeline construction and operations. Natural Gas Transmission We operate one of North America s largest natural gas pipeline networks 68,500 km (42,500 miles), transporting the majority of Western Canada s natural gas production to continental markets. We are the third-largest gas storage provider on the continent. TransCanada is also entering the emerging liquefied natural gas (LNG) market. We were selected by Shell Canada Limited and its joint venture partners in the LNG Canada project to develop an approximately 650-km pipeline to transport gas across northern British Columbia to LNG Canada s proposed export terminal near Kitimat, B.C. Operating one of the most sophisticated natural gas pipeline systems in the world, we provide storage, transportation and various capacity-related services to a variety of customers across Canada and to markets in the U.S. We re focused on optimizing our pipeline network by connecting new supply, providing better access to markets and introducing competitive and innovative approaches to meeting customers needs safely and reliably. Oil Transmission TransCanada has identified the opportunity to provide industry with incremental pipeline capacity for oil transmission to link a growing and reliable supply of Canadian and American crude oil with the rising demand for North American energy a logical fit with our existing business competencies and an efficient way to maximize the use and value of our current pipeline assets. The Keystone pipeline system is an innovative and cost-competitive solution that will play an important role in providing growing production of Canadian and American crude oil to the largest refining markets in the United States, significantly improving North American energy security. In 2010, TransCanada commenced commercial operation of the Keystone pipeline bringing crude oil from Canada to market hubs in the U.S. Midwest. The completion of the Cushing extension in 2011 extended the pipeline south from Steele City, Nebraska to Cushing, Oklahoma and increased its capacity to 591,000 barrels per day (bbl/d). The proposed 1,897-km (1,179-mile) Keystone XL expansion will begin at Hardisty, Alberta and extend southeast to Steele City, Nebraska, increasing the capacity of the Keystone system to 1.4 million bbl/d. Keystone XL includes Bakken Marketlink, which will transport up to 100,000 bbl/d of U.S. crude oil from the Williston Basin of North Dakota and Montana. The Gulf Coast Project is a 780-km (485-mile) pipeline from Cushing, Oklahoma extending south to Nederland, Texas with an eventual capacity of 830,000 bbl/d. The Houston Lateral Project is an 80-km (48-mile) pipeline proposed to facilitate deliveries into the Houston refining market.
7 Energy TransCanada s Energy division concentrates on power generation and marketing and unregulated natural gas storage. With our industry-leading experience in energy infrastructure development, operations and marketing, combined with excellent project management skills, financial strength and acumen, we are well positioned to be the partner and developer of choice. Power Generation A significant portion of TransCanada s energy portfolio is power generation. TransCanada is an established and growing player in the North American energy market with ownership or interests in approximately 11,800 MW of electricity. In the U.S., our portfolio includes natural gas-fired combined cycle and simple cycle plants, as well as hydro facilities. Across Canada, we have developed and operate a fuel-efficient and environmentally conscious fleet of cogeneration, wind and solar power generation facilities. We also hold an interest in Bruce Power, a nuclear power plant in Ontario and the largest independent power generator in North America. Power Marketing Our marketing operations are backed by solid assets and the strength of TransCanada. From our offices in Calgary, Alberta; Toronto, Ontario; and Westborough, Massachusetts, TransCanada conducts wholesale and retail electricity marketing in Canada and the U.S. Northeast. Financial Highlights (TSX, NYSE: TRP Year Ending December 31, 2011) (All financial figures are unaudited and in Canadian dollars unless noted otherwise) Total assets: $48.9 billion Net income: $1.5 billion (2.18 per share) Funds generated from operations: $3.7 billion Power by Fuel Source Natural Gas 34% Nuclear 21% Natural Gas/Oil 21% Coal 14% Hydro 5% Wind 4% Solar 1% Quick Facts about TransCanada Pipeline Assets Natural Gas Pipelines 57,000 km (35,500 miles) of wholly owned natural gas pipeline Interests in an additional 11,500 km (7,000 miles) of natural gas pipeline Average volume of approximately 14 billion cubic feet (Bcf) per day 250 Bcf of regulated natural gas storage capacity Oil Pipelines Keystone Oil Pipeline: 3,467 km (2,154 miles), 591,000 bbl/d Keystone XL: 1,897-km (1,179-mile) pipeline in development Gulf Coast Project: 780-km (485-mile) pipeline under construction Houston Lateral Project: 80-km (48-mile) pipeline in development Energy Assets 21 power facilities Approximately 11,800 MW owned, controlled or in development 130 Bcf of unregulated natural gas storage capacity Dividends declared per common share: $1.68 FORWARD LOOKING INFORMATION This publication contains certain information that is forward-looking and is subject to important risks and uncertainties (such statements are usually accompanied by words such as anticipate, expect, would or other similar words). Forward-looking statements in this document are intended to provide TransCanada security holders and potential investors with information regarding TransCanada and its subsidiaries, including management s assessment of TransCanada s and its subsidiaries future financial and operation plans and outlook. All forward-looking statements reflect TransCanada s beliefs and assumptions based on information available at the time the statements were made. Readers are cautioned not to place undue reliance on this forward-looking information. TransCanada undertakes no obligation to update or revise any forward-looking information except as required by law. For additional information on the assumptions made, and the risks and uncertainties which could cause actual results to differ from the anticipated results, refer to TransCanada s Management s Discussion and Analysis filed February 15, 2012 under TransCanada s profile on SEDAR at and other reports filed by TransCanada with Canadian securities regulators and with the U.S. Securities and Exchange Commission.
8 Today s TransCanada TransCanada is a leader in the responsible development and reliable operation of North American energy infrastructure. Our 68,500-kilometre (42,500-mile) pipeline network transports most of western Canada s natural gas production to key continental markets. We are developing one of North America s largest oil delivery systems. As an independent power producer, we own or have interests in approximately 11,800 megawatts of power generation in Canada and the United States. We are also one of North America s largest providers of natural gas storage capacity. TransCanada s Mission To provide reliable supplies of energy across the continent safely and responsibly. We are proud that millions of North Americans can depend on us for the energy they need. TransCanada s 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 have or can develop significant competitive advantage. TransCanada s Values Integrity I Responsibility I Collaboration I Innovation Visit us at Follow us on
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