Pipeline Profiles: Trans Quebéc & Maritimes

Pipeline system and key points

Section updated June 2020

The Trans Québec & Maritimes pipeline (TQM) transports natural gas in the province of Québec. The pipeline commenced operations in 1982. At the end of 2016, regulated assets include 572 km of pipeline and various auxiliary infrastructures. Gaz Métro Holding Inc., a wholly-owned subsidiary of Gaz Métro Limited Partnership and TransCanada PipeLines Limited are the general partners of TQM.

TQM extends from an interconnect with the TransCanada's Canadian Mainline near Saint Lazare, Québec, to a point near Québec City in the municipality of Lévis on the south shore of the St. Lawrence River. TQM also extends from Terrebonne, north of Monteal, tro a point on the Canada-U.S. border near East Hereford, Québec. The TQM pipeline has 31 delivery points and two compressor stations.

Key points on TQM include:

  • East Hereford – export interconnect with the Portland Natural Gas Transmission System at the Canada-U.S. border near East Hereford, Québec. TQM delivers natural gas customers in the U.S. states of Vermont, New Hampshire, Maine and Massachusetts.
  • Saint Lazare – interconnect with TransCanada’s Canadian Mainline near Saint Lazare, Québec. TransCanada’s Canadian Mainline delivers natural gas produced in the Western Canadian Sedimentary Basin and the Appalachian Basin.
Trans Québec & Maritimes pipeline system map

Source: CER

Text version of this map

This map provides an overview of the Trans Québec & Maritimes pipeline.

CER documents related to the construction, operation and maintenance of the TQM pipeline can be found here: TQM pipeline regulatory documents [Folder 90703].

You can see the TQM pipeline and all CER-regulated pipelines on the CER’s Interactive Pipeline Map. The map shows more detailed location information, the products carried by each pipeline, the operating status and more. You can also view a map on TQM Pipeline’s website.

Throughput and capacity

Section updated quarterly (early March, mid-May, mid-August and mid-November)

Note: The physical capacity of a pipeline is based on many factors such as the direction of flow, ambient temperature, pipeline compression, and maintenance work or other pressure restrictions. The operational capacity at each key point may also reflect contracts for transportation service, and supply and demand across the system. The actual physical capacity of the pipeline may, at times, be higher than the assumed operational capacity stated here.

Open data can be freely used and shared by anyone for any purpose. The data for these graphs are available.

Tolls

Section updated June 2020

A toll is the price charged by a pipeline company for transportation and other services. Tolls allow pipeline companies to safely operate and maintain pipelines. Tolls also provide funds for companies to recover capital (the money used to build the pipeline), pay debts, and provide a return to investors. The interactive graph below shows the TQM T-1 firm transportation toll for the system per month since 2006.

Open data can be freely used and shared by anyone for any purpose. The data for these graphs are available.

TQM tolls are calculated in accordance with a toll settlement for 2017 to 2021 and are cost-based. The CER approved TQM’s tolling methodology in February 2017 (Order TG-001-2017) [Folder 3179270]. The Canadian Mainline has a firm contract for all the capacity on TQM and demand charges are paid by TransCanada PipeLines, regardless of flows.

Official CER documents related to the traffic, tolls and tariffs for TQM can be found here: TQM toll documents [Folder 92841].

A list of shippers on the TQM pipeline is available in an annual filing TQM submits to the CER, Application for TQM 2019 Final Tolls (Contract Quantities, PDF page 15 of 26) [Folder 3760584].

Abandonment funding

Section updated June 2020

The CER requires all pipelines to set aside funds to safely cease operation of a pipeline at the end of its useful life. In 2016, TQM estimated it would cost $116 million to do this. These funds will be collected over 25 years and are being set aside in a trust.

Table 1: Trans Quebec & Maritimes Pipeline Inc.’s abandonment trust fund balance
  2015 2016 2017 2018 2019
Trust fund balance ($) 5 257 000 10 158 000 15 585 000 21 338 000 28 609 000

Official CER documents related to abandonment funding can be found here, sorted by year and by company: abandonment funding documents [Folder 3300366].

Pipeline financial information

Section updated June 2020

Pipeline companies report important financial information to the CER quarterly or annually. A solid financial position enables companies to maintain their pipeline systems, attract capital to build new infrastructure, and meet the market’s evolving needs. The data in this table comes from TQM’s Quarterly Surveillance Reports [Folder 155540].

Table 2: TQM financial data
TQM financial data 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Revenues (million $) 82 82 82 79 81 84 81 85 90 97
Fixed costs (million $) 70 69 69 64 60 59 56 57 56 55
Average rate base (million $) 413 394 373 362 353 343 340 334 329 341
Return on equity (%) 6.4 6.47 6.76 5.66 6.12 5.91 6.40 5.32 5.59 6.06

TQM’s 2017-2021 Settlement Agreement and previous settlement agreements since 2010 set a fixed return on rate base and did not specify a capital structure or rate of return on equity. For illustrative purposes, TQM reports its rate of return on rate base based on the After Tax Weighted Average Cost of Capital (ATWACC) methodology as approved by the CER’s most recent cost of capital decision for TQM, RH-1-2008 [Document 551438]. Because the ATWACC includes after-tax return on debt as well as return on equity on the full rate base, it is typically lower than return on equity reported on only the equity component of rate base. In recent years it has averaged about 6%. TQM’s revenue has been stable, and its costs and rate base have been declining.

Corporate financial information

Section updated June 2020

TQM is owned by Trans Québec & Maritimes Pipeline Inc. which is owned 50% by TransCanada PipeLines Limited and 50% by Gaz Métro Holding Inc., a wholly-owned subsidiary of Gas Métro Limited Partnership, the natural gas distribution company in Québec. Its credit rating is highly influenced by Trans Canada PipeLines’ credit rating, as nearly all of TQM’s earnings are from a long-term contract with TransCanada PipeLines Limited. TQM’s credit ratings remain investment grade.

Credit ratings provide an idea of the financial strength of a company, including its ability to attract capital to build new infrastructure and meet financial obligations. The credit ratings below are expert opinions of how likely the debt issuer is to live up to its obligations.

Table 3: Trans Quebec & Maritimes Pipeline Inc. credit ratings
  2013 2014 2015 2016 2017 2018 2019 2020
DBRS credit rating A (low) A (low) A (low) A (low) A (low) A (low) A (low) A (low)
S&P credit rating A- A- A- A- A- A- A-

Financial regulatory audits

Section updated June 2020

The CER audits pipeline companies to confirm compliance with the Canadian Energy Regulator Act, regulations, CER orders and CER decisions. Financial regulatory audits focus on toll and tariff matters such as detecting cross-subsidies. TQM’s last audit was completed in April 2011. Official CER documents related to TQM’s financial regulatory audits can be found here [Folder 646387].

Condition compliance

Section updated June 2020

Every pipeline company in Canada must meet federal, provincial or territorial, and local requirements. This includes Acts, Regulations, rules, bylaws, and zoning restrictions. Pipelines are also bound by technical, safety, and environmental standards along with company rules, protocols and management systems. In addition to these requirements, the CER may add conditions to regulatory instruments that each company must meet. Condition compliance is monitored by the CER and enforcement action is taken when required. For a detailed list of conditions that TQM must meet, and their status, please see the condition compliance table and search for “Trans Québec and Maritimes Pipeline Inc.”

Safety performance

Section updated June 2020

The CER holds the companies it regulates accountable to protect the safety of Canadians and the environment. As part of this accountability, companies must report to the CER events such as incidents and unauthorized third-party activities that happen without the pipeline company’s written consent. For a summary of pipeline incidents and unauthorized activities on the TQM pipeline since 2008, visit the Safety performance dashboard and select “Trans Québec and Maritimes Pipeline Inc.”

Emergency management

Section updated June 2020

The CER checks to make sure companies are keeping pipelines safe by doing inspections, in-depth safety audits, and other activities. Yet, even with these precautions, an emergency could still happen. Sound emergency management practices improve public safety and environmental protection outcomes, and provide for more effective emergency response.

The CER holds its regulated companies responsible for anticipating, preventing, mitigating, and managing incidents of any size or duration. Each company must have an emergency management program that includes detailed emergency procedures manuals to guide its response in an emergency situation. We oversee the emergency management program of a regulated company’s projects as long as they operate.

The CER requires companies to publish information on their emergency management program and their emergency procedures manuals on their websites so Canadians can access emergency management information. To view Trans Québec & Maritimes’ Emergency Response Plans, view TransCanada’s Central Region and Eastern Region plans at its Emergency Preparedness website.

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