TransCanada’s Mainline in an Evolving Supply, Market and Infrastructure Environment

LDC Gas Forum – Montreal – November 13, 2009

Steve Pohlod, VP - Commercial East

2

Agenda

• Supply / Demand Outlook

• Mainline Evolution

• The History

• The Future

• Mainline Initiatives

3

Forward-Looking Information

•This presentation may contain certain information that is forward looking and is subject to important risks and uncertainties. The words "anticipate", "expect", "believe", "may", "should", "estimate", "project", "outlook", "forecast" or other similar words are used to identify such forward-looking information. Forward-looking statements in this document are intended to provide TransCanada shareholders and potential investors with information regarding TransCanada and its subsidiaries, including management’s assessment of TransCanada’s and its subsidiaries’ future financial and operations plans and outlook. Forward-looking statements in this document may include, among others, statements regarding the anticipated business prospects and financial performance of TransCanada and its subsidiaries, expectations or projections about the future, and strategies and goals for growth and expansion. All forward-looking statements reflect TransCanada’s beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those predicted in these forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include, among other things, the ability of TransCanada to successfully implement its strategic initiatives and whether such strategic initiatives will yield the expected benefits, the operating performance of the Company’s pipeline and energy assets, the availability and price of energy commodities, regulatory processes and decisions, changes in environmental and other laws and regulations, competitive factors in the pipeline and energy industry sectors, construction and completion of capital projects, labour, equipment and material costs, access to capital markets, interest and currency exchange rates, technological developments and the current economic conditions in North America. By its nature, forward-looking information is subject to various risks and uncertainties, which could cause TransCanada's actual results and experience to differ materially from the anticipated results or expectations expressed. Additional information on these and other factors is available in the reports filed by TransCanada with Canadian securities regulators and with the U.S. Securities and Exchange Commission (SEC). Readers are cautioned to not place undue reliance on this forward-looking information, which is given as of the date it is expressed in this presentation or otherwise, and to not use future-oriented information or financial outlooks for anything other than their intended purpose. TransCanada undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

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Gas Pipelines• 59,000 km wholly owned• 7,800 km partially owned• 250 Bcf of regulated natural gas

storage capacity• Average volume of 15 Bcf/d

Oil Pipelines• Keystone 1.1 million Bbl/d• Expandable to 1.5 million Bbl/d

Energy• 19 power plants, 10,900 MW• Diversified portfolio, primarily

low-cost, base-load generation• 120 Bcf of non-regulated natural

gas storage capacity

TransCanada Corporation (TSX/NYSE: TRP)

Pipelines

Pipelines (Proposed)

Pipelines (In Development)

Power Facilities

Gas Storage

LNG (Proposed)

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North American Supply/Demand Balance

0102030405060708090

100

1990 1995 2000 2005 2010 2015 2020

Gulf of Mexico + U.S. Other

WCSB

U.S. Rockies

Eastern Canada

Bcf/d

LNG

Mexico

Demand

History Forecast

U.S. Shale

BC Unconventional

6

Mainline Flows

Bcf/d

0

1

2

3

4

5

6

7

8

1990 1995 2000 2005 2010 2015 2020

History Nov-08 May-09 Sep-09

7

TransCanada’s Mainline Evolution

PNGTS Expansion – 1998

• $273 million

Emerson Extension to Viking – 1960

• $37 million

Upstream Expansion for TQM (North Bay Shortcut) – 1982

• $470 million

GH-5-89 – 1991 to 1992

• $2573 million

Expansions for the Niagara System – 1980 to 1982

• $364 million

Expansion For Canadian, U.S. Midwest and U.S. Northeast Markets – 1997/98

• $897 million

Mainline Built – 1956 to1958

• $375 million

Union Gas / GLGT (TB0) – 1967

8

B.C. Production Forecast

Source: TransCanada

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

2000 2005 2010 2015 2020

Bcf/d

Conventional

Montney

Horn River

Actual Forecast

1 Bcf/d from both Montney and Horn River by 2013

9

Alberta System

0

500

1000

1500

2000

2500

3000

Nov-0

9

Feb-

10

May

-10

Aug-1

0

Nov-1

0

Feb-

11

May

-11

Aug-1

1

Nov-1

1

Feb-

12

May

-12

Aug-1

2

Nov-1

2

Feb-

13

May

-13

Aug-1

3

Nov-1

3

Feb-

14

May

-14

Aug-1

4

Nov-1

4

MMcf/d

Montney - Requests

Horn River - RequestsMontney - Direct Alberta Receipt Contracts

Fort Nelson / McMahon - ContractsHorn River - Contracts

Groundbirch - Contracts

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Alberta System Update

North Central Corridor• 300 km of 42-inch pipe• 26 MW of compression• Approximately $925 million• In-service 2010

Groundbirch Pipeline Project• Commitments for 1.1 Bcf/d by 2014• 77 km, 36-inch pipe• Approximately $250 million• Expected in-service Q4 2010

Horn River Pipeline Project• Commitments for 378 MMcf/d in 2013• 155 km combination of NPS 30 and

existing pipe• Approximately $340 million• Expected in-service Q2 2012

AB Jurisdiction Application Approved

• Extend Alberta system across provincial borders

• Integrated service to AB and BC customers, and Northern gas producers

Pipelines

Pipelines (Proposed)

Pipelines (In Development)

Shale Gas Basins

McMahon

Horn River

Fort Nelson

11

Northern Gas: Mackenzie Delta & Alaska

0

1

2

3

4

5

6

7

8

2010 2015 2020 2025 2030

Bcf/d

Alaska

Mackenzie Delta

12

Mackenzie Gas Project• Joint Review Panel report – Dec

2009• NEB Reasons for Decision on

MGP application – Sept 2010 • Financial restructuring

discussions on-going

Alaska Pipeline Project• AGIA license issued Dec 2008

• June 2009 - TransCanada and ExxonMobil joint venture

• All AGIA commitments remain with TransCanada

• Next step is open season mid-2010

Northern Projects:Recent Developments

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Rockies Supply

23456789

101112

1995 2000 2005 2010 2015 2020

History Sept-09 TSO Update

Bcf/d

14

Supply / Throughput Initiatives:Rockies Gas – New Capacity Options

Opal

Malin

Wamsutter

Cheyenne

Dawn

Emerson

Chicago

Stanfield

Ruby (EP)1.2 Bcf/d

Harper

Bison (NBPL)0.5 Bcf/d

REX (JV)1.8 Bcf/d

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Rockies East Projects

Bison• 302 mile natural gas pipeline• 477 MMcf/d contracted• Initial capacity 400 MMcf/d to

500 MMcf/d• Proposed in-service date

November 2010• Future expansion up to 1.0 Bcf/d

and extension potential

Bison Extension Phase l

16

Lower 48 Shale Gas Production

0

2

4

6

8

10

12

14

16

2000 2005 2010 2015 2020

Bcf/d

Actual Forecast

Barnett

Woodford/Caney

Fayetteville

Haynesville

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Mid-Continent Shales – Barnett, Woodford/Caney, Bossier, Fayetteville & Haynesville

Woodford/CaneyShale

HaynesvilleShale

BossierShale

BarnettShale

FayettevilleShale

Dawn

18

Marcellus Shale Gas Production

0

1

2

3

2000 2005 2010 2015 2020

Bcf/d

Actual Forecast

19

Mid-Continent Shales – Marcellus

NS

VT

MA

NJ

KYIL

MO

IA

WI

ON

AR

TN

NC

VA

WV

DEMD

PA

NY

OHIN

MI

SC

GAALMS

CT

DC

KS

MB

ME

MN

NB

ND

NE

NH

OK

PE

QC

RI

SD

SK

TX

MarcellusShale

Extent ofDevonian

Shale

Dawn

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Long Haul Firm Contracts

Mainline Long Haul Contracts (at Nov.1)

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

GJ/Day

FST FT LTWFS

21

Short Haul Firm Contracts

Mainline Short Haul Contracts (at Nov.1)

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

GJ/Day

FT-NR FT STS FT-SN

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Discretionary Service Use Evolution

0

500

1000

1500

2000

2500

3000

3500

4000

4500

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

Average TJ/d Total Discretionary Volumes

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Mainline Eastern Zone Tolls

Actual Forecast

1.00

2.00

200020

01

2002

200320

04

2005

200620

07

2008

200920

10

2011

201220

13

2014

201520

16

2017

201820

19

2020

$Cdn/GJ (Nominal)

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Mainline Initiatives

• On-going Priorities

• Supply connection / Increasing Throughput

• Cost Reduction

• Change is Required

• Rate Design Review and Evolution

• Service Evolution

• Business Model Alternatives

Thank you.

Questions / Comments?