August 1 0 , 2020 Northern Border Pipeline Com pany 700 Louisiana - - PDF document

Northern Border Pipeline Com pany 700 Louisiana Street, Suite 700 Houston, TX 77002-2700 John A. Roscher Director, Rates & Tariffs tel 832.320.5675 em ail John_Roscher@tcenergy.com w eb www.northernborder.com

August 10, 2020

• Ms. Kimberly D. Bose, Secretary

Federal Energy Regulatory Commission 888 First Street, N.E. Washington, D.C. 20426 Re: Northern Border Pipeline Company Presentation from August 6, 2020 Technical Conference Docket No. RP20-859-000 Dear Ms. Bose, Attached please find Northern Border Pipeline Company’s presentation from the technical conference held on August 6, 2020, in the above-captioned docket. Respectfully submitted, NORTHERN BORDER PIPELINE COMPANY By: TransCanada Northern Border Inc., Its Operator John A. Roscher Director, Rates & Tariffs Enclosures

Northern Border Pipeline Company

FERC Technical Conference | RP20-859-000

August 6, 2020

Protect ourselves against a fall when working at heights

Before you scale a ladder this fall, review these safety tips:

• Inspect all ladders for damage before use
• Be sure the ladder is stable before ascending
• Consider using a spotter/footer
• Keep your body near the center line of the ladder
• Maintain three points of contact with the ladder

How fast do you want to hit?

• 4 foot fall = 18 km/h (11 mph)
• 8 foot fall = 25 km/h (15 mph)
• 12 foot fall = 30 km/h (19 mph)
• 20 foot fall = 40 km/h (25 mph)

• Review the need for the Proposal
• Recognition of Increasing Btu Levels
• Impacts of High Btu Gas
• Discuss Proposal
• Safe Harbor
• Option To Post An Upper Btu Limit
• No Hard Cap Btu Limit
• Pairing Option
• Scenarios

Agenda

• Need for the proposal is as great today as when it was filed
• Increasing system Btu levels
• Decreasing receipts from the WCSB
• Increasing receipts from the Bakken Supply Basin
• Higher Btu gas from the Bakken Supply Basin
• Impacts of Increasing System Btu Levels
• Effects and safety concerns on commercial end users, local distribution companies, electric

generators, and Northern Border’s facilities

• Northern Border’s tariff currently does not have a stated upper Btu limit or other provisions

that would allow Northern Border to manage these issues

Need for the Proposal

• Northern Border has experienced increasing blended Btu levels (from 1080 to ~1120 range)

at Glen Ullin as a result of Bakken receipts overtaking WCSB receipts.

• Increased higher Btu Bakken receipts have resulted in blended system Btu levels in excess of

1100 on a more frequent basis.

• If Bakken production continues to displace Canadian supply, as projected, the result will be a

permanent system Btu level in excess of 1100.

Increasing System Btu Levels

Illustrative Btu Level Sensitivity

Bakken Receipts (Bcf/d)

1.3 1.6 2.0 2.4 Bakken Btu 1,075 1,055 1,060 1,068 1,075 1,100 1,069 1,077 1,088 1,100 1,140 1,091 1,103 1,122 1,140 1,160 1,102 1,117 1,138 1,160

Assumes: PoM BTU of 1,030 & NBPL capacity of 2.4 Bcf/d

1. 1.7 1. 1.1 0. 0.4 0. 0.7 1. 1.3 2 1,064 064 1,091 091 1,122 122 200 400 600 800 1,000 1,200 0.5 1 1.5 2 2.5 3 20 2016 16 20 2019 19 Futu ture P Possibility ty

Northern Border Composition

WC WCSB Bakke kken Bt Btu

Bakken Growth

Increasing Btu Levels

Bakken Region Interconnects – Increasing Capacity

• Continues

to be necessary and is becoming more urgent as flow dynamics and Btu levels change.

• At trough of COVID-19 and Economic

disruptions system Btu levels were approximately 1082.

• As Bakken flows have returned, Btu levels

have reached 1095.

• This

includes receipts

• f

~100,000 MMBtu per day from Bison pipeline at 980 Btu.

• Kurtz Flow Contracts End January

2021

Need for the gas quality revisions hasn’t changed since the May 1, 2020 Filing

• Pipelines downstream of Northern Border have rejected gas shipped on Northern Border’s system

due to gas quality concerns.

• In June 2018, Northern Border advised interconnecting parties of scheduled maintenance of a gas

processing plant upstream of Northern Border and, as a result, Northern Border was seeing higher Btu values on the pipeline.

• Higher Btu content gas was received at the Joliet point which delivers to Vector Pipeline L.P.
• Joliet point deliveries were curtailed from 268,000 Dth/d to an average of 76,000 Dth/d for a 31

day period during June/July 2018.

• Midwestern Gas Transmission Company made several postings from June 23, 2018 – June 27, 2018

regarding restrictions due to high Btu content at the Channahon point where it receives gas from Northern Border.

• Channahon point deliveries were curtailed from 339,240 Dth/d to 90,000 Dth/d.
• In March 2020, Vector Pipeline was unable to blend its gas stream to meet its tariff requirement of an

upper limit of 1100 Btu/cf due to increased nomination containing high Btu content. Vector requested that Northern Border curtail flows by 50 percent for a portion of the Gas Day from March 28, 2020 – March 30, 2020.

Recognition of Need to Address Increasing Btu levels

Recognition of Need to Address Increasing Btu levels

Pip Pipeli line Tariff B Btu L u Limits

Northern Natural Gas 950 – No upper limit ANR Pipeline Company 967 – 1200 Natural Gas Pipeline Company of America LLC (Amarillo Line) 950 – 1065 Midwestern Gas Transmission Company 967 – 1100 Vector Pipeline L.P. 962 – 1100 Guardian Pipeline, L.L.C. 950 – 1100 Horizon Pipeline Company, L.L.C. 950 – Ability to post upper limit Northern Border Pipeline Company 967 – No upper limit

• Ethane Content – The ability to maintain a blended stream of 1100 Btu helps Northern Border stay within its equipment

manufacturers’ specifications for Ethane content.

• Interconnecting Pipeline Limits – Multiple delivery points have an 1100 hard cap upper Btu limit.

• North Dakota Pipeline Authority has recognized Btu management is becoming increasingly more

important for Bakken gas

• May 22, 2018 – Williston Basin Petroleum Conference
• September 26, 2018 – N.D. Petroleum Council Annual Meeting
• WBI Energy Transmission’s 2020 Tioga to Emerson Project open season
• “[A] lower gross heating value may be required for the Project to ensure that natural gas

deliveries can meet the gas quality specifications of the downstream interconnecting pipelines. WBI Energy requests that shippers provide the estimated heating value of the gas they desire to deliver to the Project….”

• Ten intervenors filed comments in support of the Northern Border Filing
• Supporters representing the owners and operators of distribution facilities and end-use

equipment expressed concern that higher Btu gas transported on the Northern Border pipeline system and delivered to them causes operational and safety concerns.

• The utility operating companies and local distribution companies that intervened provide

energy sourced through Northern Border whether electricity or gas, to millions of retail and industrial consumers in at least twelve states.

Recognition of Need to Address Increasing Btu levels

• Impacts and Safety Concerns on Commercial End Users, Local Distribution Companies, and Electric

Generators

• Power generation facilities are designed for a specific gas composition, and higher BTU gas can lead to

premature turbine hot section failures and reduced service life.

• Facilities with open burners, such as glass plants, do not tolerate higher BTU changes well due to tight

tolerance of process temperatures and burner design.

• Higher content of heavy hydrocarbons increases production of NOX, leading to failed emissions tests.
• Reciprocating engines, such as generators, are susceptible to detonation when energy content rises, which

reduces component life within the engine.

• Carbon monoxide production from the incomplete combustion of the gas
• Damage to appliances due to burner design for lower BTU gas
• Impacts and Safety Concerns on Northern Border’s Assets
• Higher Btu levels on Northern Border are closely-correlated with higher ethane levels
• Higher levels of ethane reduce turbine hot section life, unit reliability, and time between overhauls.
• Operates 13 Siemens RB211 or Avon compressors with an upper ethane limit of 12-13%.
• 13 of 16 Bakken receipts points have ethane levels above manufactures recommendations ranging

from 13.9 – 24.5%

• Gas Quality Policy Statement does not require that a pipeline operate its pipeline imprudently until it fails.
• Instead, it states, “Gas quality, as discussed in this policy statement, is concerned with the impact of

non-methane hydrocarbons on the safe and efficient operation of pipelines, distribution facilities and end-user equipment.

Impacts of High Btu Gas

• Northern Border has proposed two mechanisms with regard to the gross heating value gas specification of its FERC

Gas Tariff Section 6.5.1(i). 1. Safe Harbor Implementation of a Btu safe harbor in which the delivery of gas with a Btu of 1100 Btu per cf or less but not less than 967 Btu per cf may not be refused by Northern Border because of the Btu value of the gas. 2. Option To Post An Upper Btu Limit Ability for Northern Border to post an upper Btu limit to assure that gas will (1) not adversely impact Northern Border’s operations or (2) be accepted for delivery into interconnects with interstate and intrastate pipelines, plants, end-users or directly connected local distribution companies.

• Northern Border has also proposed an optional pairing service to assist parties in blending their gas to lower the

net heating value.

• The pairing mechanism, requested by many parties, provides for the pairing of gas between receipt point
• perators for the purpose of blending the receipts of gas from each point to a level that satisfies any

applicable posted upper Btu limit.

• Clarification that a party which operates multiple receipt points is permitted to pair gas amongst its own

points rather than be required to pair with a third party.

• The proposal will allow Northern Border, on a not unduly discriminatory basis, to receive gas above 1100 Btu when

it is consistent with safe and reliable operations.

• Northern Border’s proposal does not contain a hard cap upper Btu limit that would unnecessarily restrict

gas supply.

Northern Border’s Proposed Tariff Modifications

• Clarification that “tendering parties” intended to refer to “receipt point operators” in tariff provisions for pairing

eligibility.

• Allows point operators to submit pairing proposals to Northern Border for evaluation and acceptance.
• Northern Border will evaluate the proposal as expeditiously as possible and, on a not unduly discriminatory basis, will

determine whether the proposal is operationally feasible and will provide notice to the point operators of the acceptance or denial of the pairing proposal.

• Receipt points including Glen Ullin and points upstream can be used for pairing. A point does not need to be at or

below 1100 Btu to be used for pairing.

• No capital improvements are required at the receipt points to make them accessible for pairing.
• Northern Border has developed a pairing proposal document that will help facilitate the exchange of information

needed for pairing.

• Northern Border has started posting current SCADA flow with BTU values for each point of receipt on its internet

web site that will allow point operators to determine if they are within the safe harbor or are in compliance with any applicable upper Btu limit.

• Northern Border will not collect any fees associated with the evaluation and implementation of a pairing proposal

to satisfy any applicable Btu limitations and will implement the pairing provision in a non-discriminatory manner.

Proposed Tariff Modifications - Pairing

Receipt Point Data and Pairing Proposals

• Northern Border modified its Informational Postings to allow all

interested parties access to the Btu level at each receipt point http://www.northernborder.com/Default.aspx

• Approved Pairing Proposals will be added to the Information Postings

and removed if an approved Pairing Proposal is rejected. The basis for rejecting an approved Pairing Proposal will be posted.

• An additional discussion was held July 30, 2020 with interested

parties to discuss the system application utilized for the pairing process.

1. If the blended gas at Glen Ullin is less than 1100 Btu

• No action required

2. If the blended gas at Glen Ullin is more than 1100 Btu

• Gas Quality and Gas Control calculates which gas needs to be restricted to lower Btu to 1100
• Will post an Upper Btu Limit to ensure the blended stream meets acceptable Btu level
• Prior notice of such limitation will be provided to the extent reasonably practicable and updated as

appropriate

• Posting will include the anticipated duration of the limitation
• Contact customer(s) who are over the limit
• Restrict gas at a point, segment, or location, beginning at locations with the highest Btu gas down,

until the blended gas stream at Glen Ullin reaches the acceptable Btu level Glen Ullin is utilized as the mainline blending point because 19 of the 23 receipt points on Northern Border’s system are located at or upstream of Glen Ullin.

• No substantial or consistent volumes are received after Glen Ullin that would allow for sufficient blending

Implementation Scenarios

Scen enario:

The blended gas stream on Northern Border’s mainline at Glen Ullin is 1098 Btu. No posting is necessary to establish an Upper Btu Limit due to the blended gas stream being less than the target value of 1100 Btu. No receipt flows affected.

Scenario 1 – No Upper Btu Limit Posting

Component RECEIPT A RECEIPT B RECEIPT C RECEIPT D RECEIPT E Btu 1035 1160 1180 1065 1200 Flow Rate (Mcf/d) 1,000,000 500,000 200,000 300,000 250,000 Total Volume (Mcf/d) 2,250,000 Heating Value (Btu) 1098 Target Value (Btu) 1100

Scen enario:

The blended gas stream on Northern Border’s mainline at Glen Ullin is 1098.84 Btu. No posting is necessary to establish an Upper Btu Limit due to the blended gas stream being less than the target value of 1100 Btu. No receipt flows affected.

Scenario 1A – No Upper Btu Limit Posting

Component Alexander Charbonneau Glen Ullin Receipt Hay Butte Killdeer Little Missouri Manning Southeast Little Missouri Port of Morgan Btu 1164.56 1190.95 1134.15 1238.88 1134.86 1177.96 1113.36 1154.15 1027.53 Btu Fraction 43.11 55.48 12.47 1.51 37.86 29.87 18.15 65.61 328.58 Flow Rate (Mcf/D) 86,269 108,553 25,612 2,844 77,745 59,089 37,998 132,477 745,195 Component Saskana North Roosevelt Rawson Roosevelt Spring Creek Squaw Creek Stateline Watford Hebron Btu 963.51 1176.44 1148.92 1152.92 1150.16 1176.66 1022.39 992.98 986.42 Btu Fraction 2.82 24.15 83.47 10.59 285.07 0.00 54.02 22.70 23.37 Flow Rate (Mcf/D) 6,820 47,829 169,299 21,410 577,572 123,123 53,279 55,220

Scenario:

• The blended gas on Northern Border’s mainline is 1108 Btu at Glen Ullin, which is above the targeted Btu level of

1100 Btu.

• Northern Border follows the procedures to post an Upper Btu Limit of 1195 on Receipt points upstream of Glen

Ullin.

• Gas at Receipt Point B and E are curtailed on an equal percentage basis or refused until:

1) Gas satisfies Upper Btu Limit. 2) A pairing proposal is proposed by Receipt B or Receipt E tendering party and approved by Northern Border. 3) Aggregate deliveries lower the blended Btu at Glen Ullin to 1100 and Northern Border removes the Upper Btu Limit at receipt points upstream of Glen Ullin.

Scenario 2 – Upper Btu Limit Posting – Multiple Receipts

Component RECEIPT A RECEIPT B RECEIPT C RECEIPT D RECEIPT E Btu 1035 1200 1180 1075 1200 Flow Rate (Mcf/D) 1,000,000 500,000 200,000 300,000 250,000 Total Volume (Mcf/d) 2,250,000 Heating Value (Btu) 1108 Target Heating Value (Btu) 1100

Scen enario:

• Gas Day January 11, 2020, the blended gas on Northern Border’s mainline was 1107.71 Btu at Glen Ullin, which is above the

targeted Btu level of 1100 Btu.

• Northern Border follows the procedures to post an Upper Btu Limit of 1166 at Receipt points upstream of Glen Ullin.
• Gas at Charbonneau, Hay Bute, North Roosevelt and Squaw Creek are refused or curtailed until:

1) Gas satisfies Upper Btu Limit. 2) A pairing proposal is proposed by Receipt points and approved by Northern Border. 3) Aggregate deliveries lower the blended Btu at Glen Ullin to 1100 and Northern Border removes the Upper Btu Limit at Receipt points upstream of Glen Ullin.

Scenario 2A – Upper Btu Limit Posting – Multiple Receipts

Component Alexander Charbonneau Glen Ullin Receipt Hay Butte Killdeer Little Missouri Manning Southeast Little Missouri Port of Morgan Btu 1165.12 1191.51 1112.36 1236.61 1137.22 1163.49 1137.28 1162.13 1019.19 Btu Fraction 49.14 60.87 16.26 0.11 44.84 37.56 12.38 59.27 255.59 Flow Rate (Mcf/D) 93,806 113,644 32,509 202 87,697 71,807 24,215 113,436 557,819 Btu Fraction 54.20 0.00 17.93 0.00 49.46 41.43 13.66 65.37 281.93 Flow Rate to Reach 1100 Btu 93,806 32,509 87,697 71,807 24,215 113,436 557,819 Component Saskana North Roosevelt Roosevelt Rawson Spring Creek Squaw Creek Stateline Watford Hebron Btu 962.92 1166.25 1145.43 1153.91 1158.70 1175.11 1033.88 990.52 975.43 Btu Fraction 2.32 20.03 11.61 93.08 294.71 39.95 62.41 13.79 33.80 Flow Rate (Mcf/D) 5,351 38,195 22,545 179,436 565,760 75,629 134,279 30,963 77,073 Btu Fraction 2.56 0.00 12.81 102.68 325.09 11.55 68.85 15.21 37.28 Flow Rate to Reach 1100 Btu 5,351 22,461 22,545 179,436 565,760 134,279 30,963 77,073

Scenario:

• Blended gas on Northern Border’s mainline is 1108 Btu at Glen Ullin, which is above the targeted Btu level of

1100 Btu.

• Northern Border follows the procedures to post an Upper Btu Limit of 1160 on Receipt points upstream of Glen

Ullin.

• Receipts A and C have a pairing agreement in place, their combined Btu is 1058.
• Receipts B and D have a pairing agreement in place, their combined Btu is 1096.
• Receipt E will be curtailed until the blended BTU downstream from Glen Ullin is 1100.

Scenario 3 – Upper Btu Limit Posting – with Pairing

Component RECEIPT A RECEIPT B RECEIPT C RECEIPT D RECEIPT E Btu 967 1207 1262 1048 1200 Flow Rate (Mcf/D) 6,000 61,000 2,700 142,000 20,000 Total Volume (Mcf/d) 231,700 Heating Value (Btu) 1108 Target Heating Value (Btu) 1100

Scen enario:

• Gas Day January 11, 2020, the blended gas on Northern Border’s mainline was 1107.71 Btu at Glen Ullin, which is above the

targeted Btu level of 1100 Btu.

• Northern Border follows the procedures to post an Upper Btu Limit of 1163 on Receipt points upstream of Glen Ullin.
• Pairing agreements between Charbonneau and Stateline receipt points were accepted and have a blended 1106.13 Btu.

Charbonneau and Stateline flow will not be restricted.

• Gas at the Alexander, Hay Butte, Little Missouri, North Roosevelt and Squaw Creek are refused or curtailed.

Scenario 3A – Upper Btu Limit Posting – with Pairing

Component Alexander Charbonneau Glen Ullin Receipt Hay Butte Killdeer Little Missouri Manning Southeast Little Missouri Port of Morgan Btu 1165.12 1191.51 1112.36 1236.61 1137.22 1163.49 1137.28 1162.13 1019.19 Btu Fraction 49.14 60.87 16.26 0.11 44.84 37.56 12.38 59.27 255.59 Flow Rate (Mcf/D) 93,806 113,644 32,509 202 87,697 71,807 24,215 113,436 557,819 Btu Fraction 0.00 68.65 18.33 0.00 50.56 16.32 13.96 66.84 288.24 Flow Rate to Reach 1100 Btu 113,644 32,509 87,697 27,666 24,215 113,436 557,819 Component Saskana North Roosevelt Roosevelt Rawson Spring Creek Squaw Creek Stateline Watford Hebron Btu 962.92 1166.25 1145.43 1153.91 1158.70 1175.11 1033.88 990.52 975.43 Btu Fraction 2.32 20.03 11.61 93.08 294.71 39.95 62.41 13.79 33.80 Flow Rate (Mcf/D) 5,351 38,195 22,545 179,436 565,760 75,629 134,279 30,963 77,073 Btu Fraction 2.61 0.00 13.09 104.98 332.36 0.00 70.39 15.55 38.12 Flow Rate to Reach 1100 Btu 5,351 22,545 179,436 565,760 134,279 30,963 77,073

• Northern Border participated in at least 20 meetings with individual stakeholders regarding the gas

quality proposal. The pairing concept and tariff language revisions were incorporated in the May 1, 2020 filing at the request of stakeholders.

• Northern Border has worked to develop a pairing proposal document that will help facilitate the

exchange of information and has offered its Technical Staff to discuss the pairing system to allow shippers to more fully understand its operation.

• Additional Pairing meeting held July 30,2020.
• As requested, Northern Border started posting the Btu values for all receipt points and will post

accepted Pairing Proposals.

• Modifications to Proposed Tariff Language
• A party which operates multiple points of delivery is permitted to pair gas amongst its own

points rather than be required to pair with a third party

• Express clarification that pairing proposals will be administered in a transparent and non-

discriminatory manner.

• Subsequent to the May 1, 2020 filing Northern Border has continued to engage in discussions and has

agreed to address certain concerns raised by parties.

Stakeholder Outreach and Engagement

Questions