2

• TransCanada

• Williams

• Sunstone Project

• Route Details

• Capital Costs

• Project Schedule

• Rates and Precedent Agreements

3

• 59,000 km (36,500 mi)of wholly owned pipeline

• Interests in an additional7,800 km (4,800 mi)of pipeline

• 15 Bcf/d

• 360 Bcf of natural gasstorage capacity

• 17 power plants

• 7,700 megawatts

• Proposed crude oilpipeline and two LNGterminals

4

I D A H O

W A S H I N G T O N

Victoria

Sumas

Portland

Seattle

Sandpoint

Redmond

Bend

Salem

Spokane

Pasco

Lewiston

Walla Walla

Yakima

Williams NorthwestPipeline

TransCanada GTNSystemPalomar Gas

Transmission Project

Mist

Madras

5

6

• Over 50 years in Wyoming

• Powder River Basin– One of the largest producers of coalbed

methane gas

• Gas Processing including Opal– Combined plant capacity 3.1 Bcf/d

• Northwest Pipeline

• More than 250 employees in Wyoming

• Generating Revenue for Wyoming– $16 million in ad valorem production and

personal property taxes– $16 million in severance, conservation and

franchise taxes– $28 million in royalties for federal and state

lands– $27 million for royalties for private lands

7

• Connected to Major Marketsthroughout the Northwest

• Off-system opportunities to serveother states

• Peak design capacity of 3.4 Bcf/d

• Seasonal storage capacity of 12.6Bcf and 608 Mdth of firmwithdrawal capability

• Current north-flow capacity fromRockies (655 MDth/d)

• Current south-flow capacity fromRockies (348 Mdth/d)

• 51% of gas transported on NWP isRockies gas

Wes

t Coa

st

RockiesBasins

San JuanBasin`

Western CanadaSedimentary Basin

CA

NV

ID

OR

WA

WY

UT

AZ

CO

JacksonPrairie

ClayBasin

Northwest Pipeline

MT

Cascade Natural Gas

Puget Sound Energy

Avista

Intermountain GasNorthwest Natural

Southwest Gas

Other Pipelines

Ker

n

GTN

Paiut

e

TuscaroraPG

&E

EPNG/TW

TransCanada

Tra

nsC

olor

ado

CIG

NM

Plymouth

West Coast

8

Continued focus on providing necessary infrastructure

ü Supply Area Interconnects - ~1.3 Bcf/d completed since 2004

ü Parachute Lateral – 450 MDth/d from Piceance to Greasewood Hubconstructed in 2007

- Colorado Hub Connection 445+ MDth/d – 2009

- Sundance Trails 150 MDth/d – 2010- Uinta – Opal Gathering Line 400-600 MDth/d – 2010

- Blue Bridge Pipeline Project 500 MDth/d – 2011- Sunstone Pipeline 1.2 Bcf/d – 2011

9

OPALOPALCHEYENNECHEYENNE

MEEKERMEEKERDenverDenver

MALINMALINPowderRiver

PowderRiver

BigHornBig

Horn

WindRiverWindRiver

GreaterGreenRiver

GreaterGreenRiver

UintaUinta

PiceancePiceanceParadoxParadox

SandWashSandWash

Denver/JulesbergDenver/

Julesberg

WCSBWCSB

WillistonWilliston

AnadarkoAnadarko

NITNIT

Northern BorderFoothills

(Sask.)

NG

TL

GTN

Foothills

(B.C.)

North

wes

t Pip

elin

e

TC Mainline

WAMSUTTERWAMSUTTER

STANFIELDSTANFIELD

SunstoneSunstone

10

• JV Partnership between Williams Gas Pipeline Company, LLCand TransCanada Pipeline USA, Ltd.

• Reaches the broadest market

– Pacific Northwest– California– Northern Nevada

• Relatively lower-risk

– Existing corridors, existing infrastructure, existingoperators

– Lower miles– Reasonable cost estimate

• Downward rate pressure on GTN

11

• 1.2 Bcf/d of Capacity

• 585 miles of 42-inch pipeline– 1,440 MAOP

• 55,800 hp of compression (site rated)– 43,800 hp electric compression at Opal

– 12,000 hp of gas compression at Mid-point

– Fuel rate of 0.83%

• Pipeline largely parallels existing NWP system and existingutility corridors– maximizes the use of recognized BLM utility corridors

– avoids a significant amount of agricultural and Native American land

– saves more than $150 MM by reducing the overall length byapproximately 33 miles

– Over 80% in existing utility corridors

12

(167.7)Reduction in Cost Estimate

2,512.4Previous 618-mile Route Estimate

2,344.7Total Project Costs152.4AFUDC and A&G

2,192.3Total Direct Costs

201.4Compression

30.0Line Pack and Commissioning

28.7Environmental

49.1Land

72.5Other Construction

980.8Pipeline Construction

68.2Other Materials

746.3Line Pipe15.3Engineering, Design & Project Management

13

• Cost estimates in 2011 “as spent dollars”– Impact to costs of escalating steel prices and contractor costs have been

factored into the estimate– Costs were escalated for the year the expenditures are anticipated to

occur

• Validation of costs– A high level estimate by a major third party engineering firm generally

validated Williams and TransCanada’s original estimate– A separate third party engineering firm is currently finalizing a more

detailed construction study

• Third-party environmental contractor instrumental in routeselection

• Based on November 2011 start date– Sunstone is also offering a June 2011 start date which increases cost

14

Recent Cost Comparison for 42-Inch-Mile

REX East Exh. K(2009 Service)

$68,020

REX EastEarnings Call(2009 Service)

$85,187

Ruby(2011 Service)

$65,564

Bronco(2011 Service)

$96,814

Sunstone(2011 Service)

$87,108

15

$0.803

$0.845

Equal to or greater than 10 years but less than 15 years

10 Year Negotiated Rate (Limited to 450 MDth/d)

$0.753Equal to or greater than 15 years but less than 20 years

$0.717Equal to or greater than 20 years but less than 25 years

$0.694Equal to or greater than 25 years but less than 30 years

$0.67830 years or greater

Rate (Dth/d)

$0.777

$0.828

$0.890

$0.716

$0.740

$0.700

Rate (Dth/d)

Nov. 2011Start Date

June. 2011Start Date

16

• Stanfield-to-Malin Option

– Utilize existing contracted and uncontracted capacity

• LTF capacity currently available equals 329 MDth/d atMalin and 405 MDth/d at Kingsgate

• Additional capacity up for renewal before November2011 equals 637 MDth/d at Malin and 740 MDth/d atKingsgate

– 324 MDth/d at Malin and 371 MDth/d Kingsgatedoes not have renewal rights

– Fuel rate 0.93% (monthly average of past 3 years)

17

0

500

1,000

1,500

2,000

2,500

Jan-

04

Jul-

04

Jan-

05

Jul-

05

Jan-

06

Jul-

06

Jan-

07

Jul-

07

Jan-

08

MD

th/d

Malin

Tuscarora

18

Sunstone1.2 Bcf/d

Ruby1.2 Bcf/d

PNW400 MMcf/d

California375 MMcf/d

Producers425 MMcf/d

California375 MMcf/d

Mktr/IPP200 MMcf/d

Producers625 MMcf/d

19

• Conduct Open Season – March 17 – May 30, 2008

• Perform Biological and Cultural Surveys – Summer/Fall 2008

• Sponsor Announces Planned Commencement Date – June 30, 2008

• Shipper Board Out – July 31, 2008

• NEPA Pre-Filing with FERC – August 1, 2008

• Sunstone Board Out – September 22, 2008

• Shipper Regulatory Approval Out – October 31, 2008

• Place Pipe and Materials Order – May 15, 2009

• FERC filing – May 31, 2009

• FERC Certificate – May 31, 2010

• Construction Start – July 2010

• In-Service Date – November 1, 2011

*Shippers have the option to bid for a June 2011 in-service date.

20

• Existing corridor

• Fewer miles

• Realistic cost

• Market diversity

• No stranded costs

Thank you