On Wednesday, Aug. 28, the National Energy Board (NEB) became the Canada Energy Regulator (CER). For further information please visit our Implementing the Canadian Energy Regulator Act information page

Pipeline Profiles: Foothills

Pipeline system and key points

Section updated June 2019

The Foothills pipeline system transports natural gas produced in the Western Canadian Sedimentary Basin and to markets in Alberta, British Columbia and Saskatchewan, as well as the United States. The pipeline commenced operations in 1981. At the end of 2016, NEB-regulated assets included 1 241 km of pipeline and various auxiliary infrastructures.

The Foothills pipeline receives natural gas from an interconnect with the NOVA Gas Transmission Ltd. system near Caroline, Alberta and other interconnection points further south.

Key points on the Foothills system include:

  • Monchy – export interconnect with the Northern Border Pipeline at the Canada U.S. border near Monchy, Saskatchewan. Northern Border supplies markets in the mid-continent U.S. and Chicago.
  • Kingsgate – export interconnect with the Gas Transmission Northwest Pipeline (GTN) at the Canada-U.S. border near Kingsgate, British Columbia. GTN supplies markets in the Pacific Northwest, California and Nevada.

Official NEB documents related to the construction, operation and maintenance of the Foothills pipeline can be found here: Foothills regulatory documents [Folder 90702].

You can see the Foothills Pipeline and all NEB-regulated pipelines on the Board’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 maps on TC Energy’s website.

Foothills pipeline system map

Source: NEB

Text version of this map

This map provides an overview of the Foothills Pipeline.

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 2019

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 tolls for key paths on the pipeline since 2006.

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

Foothills operated under a negotiated settlement from 2003-2017. Tolls on Foothills are zone-based and are set according to a full cost of service model. Foothills Zones 6 and 7 are located in Alberta. Zone 8 is located in British Columbia and Zone 9 in Saskatchewan. Zones 7 and 8 are also referred to as the Western Leg segment of the Foothills system; while Zones 6 and 9 are referred to as the Eastern Leg segment.

Official NEB documents related to the traffic, tolls and tariffs for the Foothills pipeline can be found here: Foothills regulatory documents (tolls and tariffs) [Folder 92840].

A list of shippers on the Foothills pipeline is available in an annual filing Foothills submits to the NEB, the Statement of Rates and Charges effective January 1, 2019, (Schedule F, PDF page 19 of 24) [Folder 3642528].

Abandonment funding

Section updated June 2019

The Board requires all pipelines to set aside funds to safely cease operation of a pipeline at the end of its useful life. In 2016, Foothills estimated it would cost $245 million to do this. These funds will be collected over 30 years and are being set aside in a trust.

Table 1: Foothills’ abandonment trust fund balance
  2015 2016 2017 2018
Trust fund balance ($) 9 363 000 18 123 000 25 700 000 35 136 000

Official NEB 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 2019

Foothills operates under a cost of service tolling methodology as negotiated with shippers. Under this methodology the return on equity has remained stable in recent years, while revenue has decreased. Pipeline companies report important financial information to the Board 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 Foothills’ Quarterly Surveillance Reports [Folder 155864].

Table 2: Foothills Pipeline financial data
Foothills Pipeline financial data 2010 2011 2012 2013 2014 2015 2016 2017 2018
Revenues (million $) 204.1 192.2 194.2 193.4 181.8 178.9 173.4 180.7 178.4
Net income (million $) 25.4 23.5 21.7 20.9 19.4 17.7 16.0 18.3 16.7
Average rate base (million $) 654.6 605.1 559.3 518.4 480.6 437.7 398.4 369.1 336.9
Deemed equity ratio (%) 40 40 40 40 40 40 40 40 40
Return on equity (%) 9.7 9.7 9.7 10.1 10.1 10.1 10.1 10.1 10.1

Corporate financial information

Section updated June 2019

Foothills Pipe Lines Ltd. owns the Foothills pipeline system. Foothills Pipe Lines Ltd. is a wholly-owned subsidiary of TransCanada PipeLines Limited (TCPL). All financial ratios have remained stable and TCPL’s credit ratings remain investment grade.

Credit ratings and financial ratios 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. The financial ratios provided below were calculated by DBRS.

Table 3: TransCanada PipeLines Limited financial ratios and credit ratings
  2013 2014 2015 2016 2017 2018
EBIT interest coverage (times) 2.40 2.68 2.75 2.55 2.56 2.60
Cash flow/total debt and equivalents (%) 15.5 15.9 13.6 10.8 12.8 12.7
DBRS credit rating A (low) A (low) A (low) A (low) A (low) A (low)
S&P credit rating A- A- A- ABBB+- BBB+ BBB+
Moody’s credit rating A3 A3 A3 A3 A3 A3

Financial regulatory audits

Section updated March 2018

The Board audits pipeline companies to confirm compliance with the National Energy Board Act, regulations, Board orders and Board decisions. Financial regulatory audits focus on toll and tariff matters such as detecting cross-subsidies. Foothills’ last audit was completed in August 2009. Official NEB documents related to Foothills’ financial regulatory audits can be found here: [Folder 568135].

Condition Compliance

Section updated September 2018

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 Board may add conditions to regulatory instruments that each company must meet. Condition compliance is monitored by the Board and enforcement action is taken when required. For a detailed list of conditions that Foothills must meet, and their status, please see the condition compliance table and search for “Foothills Pipe Lines Ltd.”

Safety Performance

Section updated June 2019

The Board 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 NEB 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 Foothills pipeline since 2008, visit the Safety performance dashboard and select “Foothills Pipe Lines Ltd.”

Emergency Management

Section updated June 2019

The NEB 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 NEB 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 Board 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 Foothills’ Emergency Response Plans, see TransCanada’s Rocky Mountain Region and Wild Rose Region plans at its Emergency Preparedness website.

 

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