VANCOUVER - TransCanada Corp. (TSX:TRP) said Tuesday it has been chosen by Shell Canada Ltd. to build, own and operate a $4-billion natural gas pipeline across northern British Columbia.

The Calgary-based company said the pipeline will transport natural gas from the Montney region in northeastern B.C. to a liquefied natural gas export facility near Kitimat, B.C.

The Coastal GasLink pipeline is expected to run about 700 kilometres with an estimated initial capacity of 1.7 billion cubic feet per day. An estimated 2,000 to 2,500 jobs will be created to construct the line over two to three years.

"We look forward to having open and meaningful discussions with aboriginal communities and key stakeholder groups, including local residents, elected officials and the government of British Columbia," said Russ Girling, TransCanada's president and chief executive officer.

"Coastal GasLink will add value to British Columbians, particularly aboriginals and communities along the conceptual route, by creating real jobs, making direct investments in communities during construction and providing economic value for years to come."

The Kitimat natural gas export facility is jointly owned by Royal Dutch Shell, alongside other partners, including Korea Gas Corp., Mitsubishi Corp. and PetroChina Company Ltd.

Kitimat is also the endpoint for the $5.5-billion Northern Gateway pipeline project which proposes to transport from Alberta's oilsands to the B.C. coast through a 1,100-kilometre pipeline.

Northern Gateway, which is backed by Enbridge (TSX:ENB), has been criticized by environmental groups, First Nations and B.C.'s Opposition New Democrats.

TransCanada has been at the centre of a controversy over a US$7.6-billion proposal to expand its Keystone XL system and extend it to refineries on the U.S. Gulf Coast.

Critics have argued the Keystone project would increase U.S. dependence on "dirty'' oilsands while supporters have focused on its positive impacts for the struggling U.S. economy.

TransCanada broke the proposed project into two parts after the U.S. government denied a permit for the project in January, and plans to refile a new application for the northern portion of the line that runs form the Canada-U.S. border to Steele City, Neb.

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  • 10. Oil And Gas Accounts For 4.8 Per Cent Of GDP

    The oil and gas industries accounted for around $65 billion of economic activity in Canada annually in recent years, or slightly less than 5 per cent of GDP. Source: <a href="" target="_hplink">Canada Energy Research Institute</a>

  • 9. Oil Exports Have Grown Tenfold Since 1980

    Canada exported some 12,000 cubic metres of oil per day in 1980. By 2010, that number had grown to 112,000 cubic metres daily. Source: <a href="" target="_hplink">Canadian Association of Petroleum Producers</a>

  • 8. Refining Didn't Grow At All As Exports Boomed

    Canada refined 300,000 cubic metres daily in 1980; in 2010, that number was slightly down, to 291,000, even though exports of oil had grown tenfold in that time. Source: <a href="" target="_hplink">Canadian Association of Petroleum Producers</a>

  • 7. 97 Per Cent Of Oil Exports Go To The U.S.

    Despite talk by the federal government that it wants to open Asian markets to Canadian oil, the vast majority of exports still go to the United States -- 97 per cent as of 2009. Source: <a href="" target="_hplink">Natural Resources Canada</a>

  • 6. Canada Has World's 2nd-Largest Proven Oil Reserves

    Canada's proven reserves of 175 billion barrels of oil -- the vast majority of it trapped in the oil sands -- is the second-largest oil stash in the world, after Saudi Arabia's 267 billion. Source: <a href="" target="_hplink">Oil & Gas Journal</a>

  • 5. Two-Thirds Of Oil Sands Bitumen Goes To U.S.

    One-third of Canada's oil sands bitumen stays in the country, and is refined into gasoline, heating oil and diesel. Source: <a href="" target="_hplink">Natural Resources Canada</a>

  • 4. Alberta Is Two-Thirds Of The Industry

    Despite its reputation as the undisputed centre of Canada's oil industry, Alberta accounts for only two-thirds of energy production. British Columbia and Saskatchewan are the second and third-largest producers. Source: <a href="" target="_hplink">Natural Resources Canada</a>

  • 3. Alberta Will Reap $1.2 Trillion From Oil Sands

    Alberta' government <a href="" target="_hplink">will reap $1.2 trillion in royalties from the oil sands over the next 35 years</a>, according to the Canadian Energy Research Institute.

  • 2. Canadian Oil Consumption Has Stayed Flat

    Thanks to improvements in energy efficiency, and a weakening of the country's manufacturing base, oil consumption in Canada has had virtually no net change in 30 years. Consumption went from 287,000 cubic metres daily in 1980 to 260,000 cubic metres daily in 2010. Source: Source: <a href="" target="_hplink">Canadian Association of Petroleum Producers</a>

  • 1. 250,000 Jobs.. Plus Many More?

    The National Energy Board says oil and gas employs 257,000 people in Canada, not including gas station employees. And the Canadian Association of Petroleum Producers says the oil sands alone <a href="" target="_hplink">will grow from 75,000 jobs to 905,000 jobs by 2035</a> -- assuming, of course, the price of oil holds up.