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Prentice: Mackenzie gas line must come first Canada’s industry minister will tell Palin ‘extremely important’ Mac line built before Alaska; Ottawa will play no equity role Gary Park For Petroleum News
If the Mackenzie Gas Project is to proceed it must get built before the Alaska Gas Project — a point Canada’s Industry Minister Jim Prentice intends to drive home at an upcoming meeting with Alaska Gov. Sarah Palin.
“It is extremely important that the Mackenzie project go first,” he told the Canadian Energy Pipeline Association. “Both projects are good projects and one doesn’t necessarily preclude the other.”
“The North American economy, frankly, would have challenges in terms of the pipeline industry, the steel industry, in their capacity to build these two projects at the same time,” said Prentice, the lead cabinet minister in the pipeline sector.
He said the MGP is extremely important to Canada, but “it is a private sector project” that the Canadian government has no intention of joining as an equity partner.
Prentice said the MGP “needs to be driven by the private sector and the government of Canada has never distinguished itself as the owner of pipelines … that should be left to the private sector.”
Otherwise, the government supports the MGP, although, because of its role in opening up a new oil and gas basin, it must be subject to a thorough environmental review before it can access 15 percent of Canada’s remaining natural gas that would otherwise be stranded, he said.
Canadians doing work in advance of gas regulatory process “We recognize that a timely, efficient and effective application review and authorization process (under the National Energy Board) must be in place upon completion of the environmental assessment process,” he said.
To that end, Prentice said the government has been working in advance of the regulatory process to ensure it knows what permits will be needed and what information will be needed from the proponent to be able to move forward.
“We are working with northern boards and agencies to ensure that, should the project proceed, we too will be ready to move ahead,” he said.
But Prentice made no mention of the status of talks with the MGP partners on the fiscal terms for a pipeline.
Although the Joint Review Panel which is handling the socioeconomic aspects of the MGP has disclosed that its report to the NEB will not be delivered this year, threatening a possible one-year delay in bringing gas onstream, Prentice said the government hopes a number of recent changes will reduce the frustrations and delays in handling future regulatory applications.
New office established He said C$150 million will be made available over the next five years to establish a Major Projects Management Office, designed to streamline the regulatory system for major natural resource projects and protect the environment, while increasing the competitiveness of Canada’s resource sector.
He said the Major Projects Management Office is intended to “overcome delays and a lack of coordination in Canada’s regulatory system and to provide a single point of entry into the federal regulatory system for proponents of major resource projects.”
In addition, the government has established the Northern Regulatory Improvement Initiative to improve a regulatory decision-making system that is shared by federal, territorial and aboriginal governments.
Dissatisfaction the driver Prentice said the dissatisfaction associated with the MGP experience “has driven some of the changes that have been made.”
He said the unique regulatory aspects of the MGP are unique and untested for a trans-regional project of the MGP’s scope and complexity.
He said the government has already invested C$250 million in environmental assessment and regulatory systems across the North and is committed to meeting the regulatory challenges.
Prentice also said he is committed to ensuring strict environmental standards are followed in northern and Arctic regions should either or both the Mackenzie and Alaska pipelines go ahead.
“We all need to cooperate and pull our own weight in creating a modern, environmentally clean oil and gas industry,” he said. In addition to ensuring the economic environment is in place to help industries thrive and compete in a globalized world, “we also have a responsibility for stewardship of the common good, especially in protecting the environment.”
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