March 19, 2010

Regulatory delays hinder start of Mackenzie Gas Project

CALGARY

Natural gas could start flowing from the Mackenzie Gas Project in 2018 at the earliest, four years later than past estimates, according to an updated schedule Imperial Oil Ltd. filed to federal regulators this week.

In the previous timeline filed in 2007, the project’s backers had expected startup in 2014.

“This revised startup timing reflects regulatory delays, lack of a fiscal agreement, project restaffing requirements and seasonal constraints,” Imperial, the lead partner in the Mackenzie project, said in a letter to the National Energy Board.

“Timely actions by all parties, including the proponents, governments and regulators, will be essential to achieve this schedule.”

The long-delayed Mackenzie Gas Project would connect natural gas fields near the coast of the Beaufort Sea in the Northwest Territories to southern markets via a pipeline more than 1,200 kilometres long.

Imperial’s U.S. parent ExxonMobil Corp., ConocoPhillips, Royal Dutch Shell and the Aboriginal Pipeline Group are the other owners of the project.

Gas shipper TransCanada Corp. is also involved because the Arctic gas would be fed into its vast Alberta pipeline network.

A federally-appointed Joint Review Panel issued a report into the socio-economic and cultural impacts of the pipeline on Dec. 30, 2009, concluding the project should go ahead if each of its 176 recommendations are upheld.

The NEB is getting ready to begin its review of the project, which will take the JRP report into consideration. The NEB said last week that many of the panel’s recommendations should be trimmed.

The NEB is set to make its decision in September.

Canadian Press

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