TransCanada Announces Third Quarter Results

Third Quarter 2004 Highlights:

(All financial figures are in Canadian dollars unless noted otherwise)

- Net income for third quarter 2004 of $245 million or $0.51 per share, including $52 million or $0.11 per share from discontinued operations. Net income for the nine months ended September 30, 2004 of $847 million or $1.75 per share, including $52 million from discontinued operations.

- Funds generated from operations for third quarter 2004 of $394 million. Funds generated from operations for the nine months ended September 30, 2004 of $1,207 million.

- Dividend of $0.29 per common share declared by the board.

- Alberta Energy and Utilities Board disallowed approximately $24 million of operating costs in its decision in third quarter on Phase I of the Alberta System 2004 General Rate Application.

- During the third quarter, TransCanada entered into an agreement to acquire hydroelectric assets in New England with a total generating capacity of 567 megawatts (MW) for US$505 million. The sale will be subject to a bankruptcy court-supervised auction process and bankruptcy court approval.

- The company also announced a joint proposal with Petro-Canada to develop a $660 million liquefied natural gas (LNG) facility in Gros Cacouna, Quebec.

- In October, Cartier Wind Energy Inc., which is 50 per cent owned by TransCanada, was awarded six projects by Hydro-Quebec Distribution to build 739.5 MW of wind energy facilities for an estimated $1.2 billion. These plants are expected to be placed into service between 2006 and 2012 and are subject to negotiation of power purchase agreements.

TransCanada Corporation announced net income for the third quarter 2004 of $245 million or $0.51 per share, compared to $248 million or $0.51 per share for the third quarter 2003. Net income from continuing operations (net earnings) was $193 million or $0.40 per share, compared to $198 million or $0.41 per share for third quarter 2003.

For the first nine months of 2004, TransCanada's net income was $847 million or $1.75 per share, compared with the $658 million or $1.36 per share for the same period in 2003. The increase was mainly the result of an after-tax gain of $15 million or $0.03 per share from the sale of the ManChief and Curtis Palmer power plants to TransCanada Power, L.P. and recognition of other gains of $172 million or $0.36 per share. The $172 million in gains was the result of the removal of TransCanada's obligation to fund the redemption of TransCanada Power, L.P. units in 2017, as well as a reduction in ownership interest in TransCanada Power, L.P. in the second quarter 2004.

"The anticipated closing of the Gas Transmission Northwest acquisition and other growth initiatives on a number of fronts -- including the potential purchase of hydroelectric power assets from USGen New England, Inc. and the announced investments in wind power and LNG facilities -- will strengthen our near-term financial performance and position us for long-term growth," said Hal Kvisle, TransCanada's chief executive officer.

"The company's strong balance sheet and the growing North American demand for energy provide the foundation for growth in our areas of expertise to deliver long-term, solid returns for investors."


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