The long-planned and frequently delayed Mackenzie Gas Project, a C$16 billion ($21.21 billion) pipeline that would carry 1.2 Bcf/d from the gas-rich Mackenzie Delta in Canada's Northwest Territories to pipelines in northern Alberta, was given a life extension Thursday.
In an announcement, Canada's National Energy Board said it would extend the sunset clauses for the project developers until December 31, 2022.
The project developers, led by Imperial Oil, last summer had asked for an extension of a December 2015 deadline for a project investment decision.
In a letter to the developers, the NEB said the project "is still in the public interest" and that the original conditions attached to the project will require that it be designed, constructed and operated in a way that is safe and protects the environment.
The project is a joint venture of Imperial, Shell, ConocoPhillips, ExxonMobil and the Aboriginal Pipeline Group. The proposed 1,842-km (1,144-mile) pipeline is designed to carry 1.2 Bcf/d from the gas-rich Mackenzie Delta near the Beaufort Sea south through the Northwest Territories to link with pipelines in northern Alberta.
Proponents of the project still face many challenges, not the least of which is building a major gas pipeline to bring gas into markets already awash with the output of shale plays.
Imperial asked the NEB to extend the sunset clauses on August 20, 2015. On November 9, NEB extended the sunset clauses to September 30, 2016 so it could consider the application.
Also in November, the board and Government of the Northwest Territories Regulator of Oil and Gas Operations coordinated their respective reviews and invited the public to submit their comments on the requested extensions.
The board received comments from 14 groups and individuals, mostly in support of the application. Four of the parties opposed the extension.
The extension to the sunset clause for the Mackenzie Valley Pipeline will not come into effect until it is approved by the Canadian federal government.
A representative of Imperial Oil did not immediately return a call for comment.
