The Mackenzie Gas Project co-sponsors, led by Imperial Oil Resources, said Thursday that the main regulatory applications will be submitted to the boards, panels and agencies responsible for assessing and regulating energy developments in the Northwest Territories this week. However, Imperial noted in a statement that a final “decision to construct the project has not been made.”

Besides Imperial, other co-sponsors participating in the regulatory process are ConocoPhillips Canada, Shell Canada, ExxonMobil Canada and the Aboriginal Pipeline Group (APG). The APG was formed in 2000 to represent the ownership interest of the Aboriginal peoples of the Northwest Territories in the proposed Mackenzie pipeline.

In a statement, Imperial said “the final decision to proceed with construction can only be made after obtaining the necessary regulatory approvals — and assessing any conditions attached to those approvals — and will be dependent on a number of other matters, such as finalization of benefits and access agreements, assessment of natural gas markets, updated project costs and firm fiscal terms. The resolution of these matters is essential to development of a firm project schedule and will be critical to a final construction decision.”

The gas project would include the development of an estimated 6 Tcf in the three largest onshore fields discovered in the Mackenzie Delta and construction of associated pipelines and facilities. Project co-sponsors estimate the initial cost of the three anchor field developments, gas and natural-gas liquids gathering system pipelines and related facilities, and the Mackenzie Valley natural-gas pipeline would be approximately C$7 billion for a system with initial design capacity of 1.2 Bcf/d, expandable to accommodate gas from other fields in the future.

Among the applications to be submitted will be development plan applications for the Taglu, Parsons Lake and Niglintgak gas fields; an application for construction of the gas and natural gas liquids gathering system pipelines and related facilities; and an application for a Certificate of Public Convenience and Necessity for a Mackenzie Valley natural gas pipeline. These applications are supported by an Environmental Impact Statement (EIS), which assesses the potential socio-economic and environmental impacts of all components of the proposed development.

“Although a number of critical activities are in progress, the filing this week of the main regulatory applications demonstrates our commitment to the project and our desire to initiate the regulatory review process,” said Imperial CEO J. Michael Yeager. He called the project a “significant opportunity for Canada,” and said the “capital intensive project” offered a “variety of construction challenges…all of which influence whether the project can ultimately proceed. Of near term importance is the successful completion of benefits and access agreements. These are essential to ensuring a viable project.”

During the coordinated environmental and regulatory review process, which is expected to include a series of public hearings, interested parties may participate directly in the regulatory assessment of the proposed project.

The applications filed this week will be followed in early 2005 by applications for permits to develop the project’s infrastructure, such as construction camps, access roads, pipeline rights-of-way, storage areas and granular quarries. These applications will be filed with the relevant federal and territorial regulatory boards and will also be available for public review, Imperial said.

Additional information on the project is available at www.mackenziegasproject.com.

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