FortisBC Energy Inc

Kingsvale - Oliver Pipeline Reinforcement Project

(“KORP”)

Presentation to RDOS

March 15, 2012

Terasen Gas Inc. Name Change

to

FortisBC Energy Inc.

• On March 01, 2011, Terasen Gas Inc changed its name to Fortis BC Energy Inc

• FortisBC will now be the corporate name used by both the Fortis electrical and gas utility operations

KOR Project Rationale

Scope of Project

• 161 km of 24” diameter pipeline “loop” from Kingsvale to Oliver generally following the existing 12” FortisBC pipeline

• 1 km extension of the Southern Crossing Pipeline in the Yahk area

• New compression at Kingsvale, Trail and Yahk

The KOR Project will remove constraints on the existing pipeline system and thereby increase the capability of moving additional volumes of natural gas both east and west to the benefit of all FortisBC customers

Western North America Transmission

Systems

FortisBC

Spectra Energy

161 km 24” Kingsvale to Oliver Segment

KORP - Route

First Nations potentially impacted

• The KOR Project area lies in the claimed territories of the

Nlaka’pamux, Ktunaxa and Okanagan Nations.

• In total there may be twenty eight First Nations and five

First Nations’ organizations associated with the Project

area.

• The project crosses the Ashnola and Blind Creek

reserves of the Lower Similkameen Indian Band

Typical pipeline construction in progress

Typical Compressor Station

Typical pipeline Right of Way

The following FN have been identified • Nicola Tribal Association:

• Coldwater Indian Band • Cook’s Ferry Indian Band • Nicomen Indian Band • Nooaitch Indian Band • Shackan Indian Band • Siska First Nation • Upper Nicola Band (also member of Okanagan Nation Alliance, as below)

• Okanagan Nation Alliance: • Westbank First Nation • Lower Similkameen Indian Band (pipeline crosses reserves) • Upper Similkameen Indian Band • Osoyoos Indian Band • Penticton Indian Band • Okanagan Indian Band • Upper Nicola Band (Also member of Nicola Tribal Association, as above)

• Nlaka’pamux Nation Tribal Council • Ashcroft Indian Band • Boothroyd Indian Band • Boston Bar First Nation • Oregon Jack Creek Indian Band • Lytton First Nation • Spuzzum First Nation • Kanaka Bar First Nation • Skuppah First Nation

• Ktunaxa Nation Council Society: • Tobacco Plains Indian Band • ?Akisq’nuk First Nation • Lower Kootenay Band (Yaqan Nukiy) • St. Mary’s Band

• Unaffiliated • o Splatsin First Nation (Spallumcheen) • o Lower Nicola Indian Band • o Shuswap Indian Band

Local Governments

The KOR Project is located in/near the following areas of

the province:

• Nicola Regional District

• Regional District Okanagan Similkameen

• Boundary Regional District

• Central Kootenay Regional District

• Village of Keremeos

• Town of Princeton

• Town of Oliver

• City of Merritt

• East Kootenay Regional District

Status to date • Preliminary field studies commenced in 2010 to

determine whether a technically and environmentally suitable route existed primarily located alongside its existing 12” pipeline (known as looping).

• Studies continue in 2011 and 2012 including

• studying commercial feasibility

• overview assessments of potential environmental issues and locating a preferred route

• initiating engagement with local governments and potentially affected First Nations.

• Initiating the BC Environmental Assessment Act (BCEAO) and Canadian Environmental Assessment Act (CEAA)

• Drafting Application Information Requirements (dAIR) for BCEAO/CEAA Harmonized review

• first BCEAO/CEAA Working Group meeting held on Feb. 15 in Princeton to begin review of the dAIR

KORP – earliest Schedule Task Name Q1 Q2 Q3 Q4 Q2 Q3 Q3 Q1 Q2 Q3 Q1 Q2 Q3

1. First Nations, Government, and

Stakeholder Engagement

2. Planning and Environmental

Field Studies; submit Project

Description, prepare final

Application Information

Requirements; prepare

EAC Application

3. Submit Regulatory

Applications

4. Environmental Assessment

Process

5. Regulatory Approval

6. Detailed Engineering and

Permitting

7. Clearing and Right-of-Way

Preparation

8. Pipeline Construction

9. Compressor Station

Construction

10. System Start-Up

11. Restoration

at end of construction

2016

Q4

20132010 2012

Q3 Q4Q1 Q1 Q4Q4Q1

Q1 Q4 Q2Q2

2011

Task Milestone

2014 2015

Q2 Q3 Q4

KORP – earliest Key Dates

• Receive AIR from BCEAO and CEAA

• Commence environmental field studies to respond to AIR

• Complete research and file the Environmental Application

• Receive Environmental Assessment Certificate

• Request BCUC CPCN and confirm financial decision to construct

• Commence clearing

• Construct

• In-service

• Q2 2012

• Q2 2012

• Q1 2013

• Q4 2013

• Q4 2013

• Q4 2014

• Q2-Q4 2015

• Q4 2015

KORP–Regulatory Authorizations

Environmental

• FortisBC must receive an Environmental Assessment Certificate (EAC) from the BCEAO and approval under the CEAA

Public Interest and Financial

• FortisBC cannot proceed with construction without also receiving a Certificate of Public Convenience and Necessity (CPCN) from the BC Utilities Commission

Technical

• The BC Oil and Gas Commission (OGC) will provide final construction permits

KOR Project Next Steps

• The BCEAO will soon issue a Section 11 Order that will set out the scope of the project and the requirements for the Environmental Review

• BCEAO and CEAA have commenced contacting affected First Nations and local governments to determine their interest in participating in the Review

• Review of draft AIR to confirm study requirements commenced on February 15

• Field work to complete the environmental assessment to study the potential impacts of the project and propose mitigation could commence summer 2012