Update on Expression of Interest Project – Government Funding Announcement

Recently, the Government of Ontario announced the projects that are eligible for funding assistance under its Natural Gas Expansion Program. We are pleased that our Hamilton Airport Regional Expansion Project (Economic Development) has been approved for funding assistance.

Enbridge Gas can now proceed with the steps required to expand access to natural gas access for this project, which may include Leave to Construct or other regulatory approvals from the Ontario Energy Board (OEB). Program funding is conditional upon the project receiving OEB approvals and construction of the new natural gas infrastructure cannot begin until this approval is received.

Once Enbridge Gas receives the required regulatory approval, we will be able to provide more detail on construction timelines, the processes to connect homes and businesses to natural gas, and what residents and businesses can do to prepare. We will keep you apprised as the regulatory approvals and project scope are finalized.

Enbridge Gas has been meeting Ontario’s energy needs for more than 170 years and we look forward to unlocking the potential Economic benefits this project will bring to the region. Through the bid forms submitted during the Expression of Interest process, bidders indicated that these economic benefits are expected to include significant private capital investment along with the potential creation of thousands of new direct and indirect jobs.

We look forward to working together and collaborating on next steps.

Update on Expression of Interest Program – as of May 16, 2020

The Expression of Interest process closed on May 13, 2020 and Enbridge thanks those that submitted bid forms. On May 15, 2020, the Ontario Energy Board announced an extension to the deadline for Enbridge Gas to submit its applications to the Ontario government’s Natural Gas Expansion Program. The previous deadline was June 3, 2020 and it is now August 4, 2020. Enbridge Gas now anticipates allocating capacity on a preliminary and conditional basis to successful bidders no later than August 5 2020 (was June 5, 2020).

To serve a growing demand for natural gas in the region in an around the Hamilton International Airport, Enbridge Gas Inc. (“Enbridge”) is pleased to announce this Expression of Interest to expand the existing natural gas system to serve this area (see map below).

This Hamilton Airport Regional Expansion Project (the "Project”) could provide up to 10,000 m3/hour of additional natural gas capacity to serve new and existing business customers in this developing area, depending upon location. The potential Project is targeting incremental large volume commercial and industrial growth planned to develop over the next five-to-ten years and could be in-service as early as fall 2022.

Enbridge recognizes that with the COVID-19 pandemic, many businesses are currently facing significant challenges however in an attempt to leverage Ontario's Natural Gas Expansion Support Program the process must move forward at this time.

The development of this Project is contingent upon sufficient market support, approval of the Project by the Ontario Energy Board (“OEB”) and government funding support. If sufficient demand is demonstrated, Enbridge, with the support of the City of Hamilton, will apply for funding from the Ontario government' Natural Gas Expansion Support Program, with the goal of making the Project economically viable for customers in the area. Assuming the Project is successful in obtaining adequate funding and sufficient customer interest is expressed, the estimated Hourly Allocation Factor for incremental capacity for customers would be in the range of $250 - $350 per m3/hour. By targeting this range, Enbridge is trying to ensure the Project is economic for customers. This allocation will address the facilities needed to serve the area shown on the attached map (page 3). This allocation does not include costs that are required to serve each specific customer such as new facilities built at the customer's site. The customer allocation and any customer specific service costs will be subject to an economic review based on OEB approved guidelines.

Enbridge will consider the size and location of all requests for new capacity in designing the optimal facilities. If sufficient customer interest or required government funding is not forthcoming, the Project is unlikely to proceed as proposed.

Capacity would be available for the following services, depending on market support:

  1. New firm distribution service
  2. Conversion of existing interruptible distribution service to firm service

This Expression of Interest process closes, and completed Expressions of Interest Bid Forms are due, no later than 12:00 p.m. EDT on May 13, 2020.

Service Description and Details

  1. As this Project requires a significant capital investment by Enbridge, the term of the customer’s natural gas distribution contracts will be no less than five years and not to exceed 20 years; and/or may include upfront payments for capacity and/or negotiated rates above currently posted. The facilities, rates and services included in this Expression of Interest will be subject to OEB approval, securing adequate government funding, and sufficient interest being received to justify a Project.
  2. Submitting an Expression of Interest form:
    If you wish to participate in this Expression of Interest in the Hamilton Airport Regional Expansion Project, please complete, sign and return the attached non-binding Expression of Interest Bid Form via email to Economic.Development@enbridge.com. Completed forms must be returned by email on or before 12 p.m. EDT on May 13, 2020

Map of proposed project service area

The map below outlines an area centered around the Hamilton International Airport and the Red Hill South Business Park that is under consideration for a potential project to expand natural gas capacity. All potential large volume commercial or industrial customers considering developments within this area over the next five-to-ten years are encouraged to participate in this Non-Binding Expression of Interest. Customer economics improve with economies of scale and proximity to any potential new facilities.

Hamilton Airport Regional Expansion Project Map

Expression of Interest Process and Bid Form

This process is designed to gauge interest in the Project and to assist Enbridge with determining the optimal facility requirements to meet market needs and prepare an application to the Natural Gas Expansion Support Program. Enbridge will acknowledge receipt of all Bid Forms by email on or before end of day on May 13, 2020. Enbridge in its sole discretion reserves the right to reject any and all proposals received. The returned Bid Forms will be time-stamped by the date on the email.

Any suggested contractual Condition(s) Precedent that the customer proposes should be clearly articulated and attached to the Bid Form and will be considered during the capacity allocation process.

Enbridge anticipates allocating capacity on a preliminary and conditional basis to successful bidders no later than June 5, 2020. Subject to a government funding approval (expected in 4Q 2020), successful bidders will then be asked to commit to the capacity by executing a Letter of Indemnity or an Enbridge Gas Distribution Contract or Letter of Agreement to more formally support the need for the project. Any updates to the EOI process or timelines will be posted online here.

Expression of Interest Bid Form

If you have any questions about the Hamilton Airport Regional Expansion Project, please contact your account manager or one of the following:

Blair Auton
Sr. Analyst New Business Projects
(289) 649-2066
Enzo Greco
Advisor Construction Project Management
(289) 649-2061
Wayne Passmore
Economic Development
(519) 436-5356