Regulatory delay hits pipeline
Paul Bickford
Northern News Services
Published Monday, May 26, 2008
YELLOWKNIFE - The Mackenzie Gas Project is facing another regulatory delay.
A report by the Joint Review Panel (JRP) expected in mid-2008 has now been once again delayed to sometime next year.
"We cannot see this as a positive development for the project," said Pius Rolheiser, a spokesperson for Imperial Oil in Calgary.
Rolheiser said it will delay the ultimate decision on whether the pipeline will proceed.
Imperial and the other project proponents were advised of the delay in mid-May by the Northern Gas Project Secretariat, which acts as spokespersons for the JRP.
Rolheiser said the expectation for a report in mid-2008 was based on a timeline presented at the last hearing on the project by the National Energy Board (NEB) in September 2007.
The 2004 agreement to set up the seven-member JRP envisioned it would take 10 months to complete public hearings and a report.
Rolheiser said the JRP report is a necessary part of the NEB review process.
The NEB is examining the technical and commercial aspects of the project, while the JRP is looking at environmental and socioeconomic issues.
The JRP report will feed into the NEB process.
"At this point, we don't have a clear understanding of the reasons for the delay," Rolheiser said, although he said the proponents recognize the JRP has a big task.
Imperial Oil is willing to work with the JRP to expedite the process, he added. "We have indicated our willingness to work with them in any way we can."
Rolheiser said any kind of delay raises concerns about cost escalation for the project.
"Unless you're buying an iPod, things get more expensive as time goes on," he said.
Brian Chambers, the executive director of the Northern Gas Project Secretariat, said JRP members have an "immense" amount of work and take very seriously their obligation to examine carefully and thoroughly the issues raised by parties to the review.
"The issues are complex," he said. "They are numerous."
Chambers said the JRP was not actually in place until 2005 and hearings did not start until early 2006 as more information was requested from project proponents.
The JPR faced court action from northern Alberta's Dene Tha First Nation, which wanted to be consulted on the project.
Chambers said the public hearings phase also took longer that anticipated. It began in February 2006 and concluded in November 2007.
The JRP visited 26 communities, most in the NWT but also Edmonton, Whitehorse and High Level, Alta.
It sat for 115 days of hearings, which produced 11,000 pages of transcripts.
In all, the panel received more than 5,000 verbal and written submissions totalling tens of thousands of pages.
Chambers said no date in 2009 has been set for the release of the JRP's report.
"I do know they are very actively engaged and are meeting regularly to work on the report," he said.
Premier Floyd Roland has expressed disappointment at the delay.
"While I appreciate this review is a large undertaking, constant delays have a negative impact on the project, and on the entire investment climate in the Northwest Territories," Roland said in a statement.
The premier said there is no indication when in 2009 the report will be prepared.
"The time is right for this project to move ahead," he said. "Continued delays in the process are not helpful."
Roland urged the JRP to be as speedy as possible with its report so the process can move to the next stage and the National Energy Board can do its work.
Currently, the project proponents are estimating that the earliest natural gas can start flowing through a Mackenzie Valley pipeline is 2014.
If the NEB issues a final approval, the proponents have to look at any attached conditions and then make a decision on investing, Rolheiser said.
The JRP delay has not changed Imperial Oil's commitment to the project, he added.
Rolheiser said the proponents are still working on benefit and access agreements with aboriginal communities along the pipeline route and a fiscal arrangement with the federal government.
Agreements have been signed with the Gwich'in and the southern Sahtu, while there are agreements-in-principle with the Inuvialuit and the northern Sahtu.
As for the Dehcho, Rolheiser said discussions are at a more preliminary stage, although progress is being made.
"We don't have an agreement-in-principle yet, but we're much, much closer than we have been," he said.
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