CACOUNA, QC, Sept. 1 /CNW/ - TransCanada Corporation and Petro-Canada, two of Canada's largest energy companies, have signed a memorandum of understanding (MOU) to develop a liquefied natural gas (LNG) facility, named Cacouna Energy, in Gros Cacouna, Quebec, about 15 kilometres northeast of Rivière-du-Loup. The proposed facility would be capable of receiving, storing, and regasifying imported LNG with an average annual send-out capacity of approximately 500 million cubic feet a day of natural gas.

"This development is an extension of TransCanada's commitment to help meet the energy needs of consumers in North America, providing a safe, clean, reliable source of energy for the future," said Hal Kvisle, TransCanada's chief executive officer. "We are pleased to partner with Petro-Canada to pursue the development of an LNG facility in Quebec."

"Petro-Canada already has a large and growing business presence in Quebec, with a major expansion underway at our Montreal refinery," said Petro-Canada president and chief executive officer, Ron Brenneman. "We look forward to increasing our investment in Quebec with the development of the Cacouna Energy LNG facility in partnership with TransCanada. Having North American LNG capacity will strengthen Petro-Canada's ability to continue to be a major, long-term supplier and marketer of natural gas in North America."

In the proposed project, TransCanada and Petro-Canada will equally share the costs to construct an LNG receiving, storage and re-gasification facility on Gros Cacouna Island, adjacent to the existing harbour. TransCanada will operate the facility, while Petro-Canada will supply the LNG. The estimated cost of construction is $660 million. In addition to direct employment of 500-1000 people during the construction phase and 30-50 long-term positions to operate the facility, the development will contribute additional indirect employment as well as tax and business benefits to the region.

Before construction of the facility can commence, the proposed Cacouna Energy LNG facility must receive regulatory approval to proceed from federal, provincial and municipal governments. The regulatory approval process is expected to take approximately two years and will provide a number of opportunities for the public and other stakeholders to participate in the approval process. Provided the necessary approvals are received, it is expected the facility will be in service towards the end of the decade.

TransCanada's natural gas transportation expertise combined with Petro-Canada's sales and marketing experience and international upstream supply business enable Cacouna Energy to offer a uniquely Canadian solution to the anticipated shortfall in future North American natural gas supplies.

For more information about Cacouna Energy, go to www.energiecacouna.ca.

Petro-Canada is one of Canada's largest oil and gas companies, operating in both the upstream and downstream sectors of the industry in Canada and internationally. Petro-Canada's upstream production is approximately 450,000 barrels of oil equivalent per day of which about 28 per cent is natural gas production from Canada, the United States and Trinidad that is marketed in North America. The company's common shares trade on the Toronto Stock Exchange (TSX) under the symbol PCA and on the New York Stock Exchange under the symbol PCZ.

TransCanada is a leading North American energy company focused on natural gas transmission and power services with employees who are expert in these businesses. With a network of approximately 39,000 kilometres (24,200 miles) of pipeline, TransCanada transports the majority of Western Canada's natural gas production to the fastest growing markets in Canada and the United States. TransCanada owns, controls or is constructing nearly 4,700 megawatts of power - an equal amount of power can meet the needs of about 4.7 million average households. TransCanada's common shares trade under the symbol TRP on the Toronto and New York stock exchanges.

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For further information: Media Inquiries: TransCanada: Hejdi Feick or Anita Perry, (403) 920-7859; Petro-Canada: Andrew Pelletier, (514) 650-4111; Mona Rossiter, (403) 296-3648

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