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Imperial ready for Mac attack
Gary Park Petroleum News Calgary correspondent
A mounting “sense of urgency” as Alaska moves ahead with plans to develop its North Slope gas resources should see the first regulatory application filed for a Mackenzie Valley pipeline this summer, Imperial Oil Chief Executive Officer Tim Hearn said April 21.
“Eventually, Alaska gas will come and we need to make sure we’re first,” he told reporters in Toronto.
“Our challenge is to file (applications) by mid-year and we’ll look at all kinds of ways to make recommendations to streamline the process, to make sure there’s not waste in it,” Hearn said.
“We shouldn’t let this (project) slide around and lose it because of our own inability to stay focused.”
The sense of urgency among partners in the Mackenzie Gas Project, headed by Imperial, has quickened with word April 20 that Calgary-based TransCanada will file an application for a trans-Alaska pipeline to the Canadian border.
Hart Searle, a spokesman for the Mackenzie partnership, told Petroleum News that what happens in Alaska is “something we have had in front of us for quite a while. We want to ensure that this tremendous opportunity (for producers, aboriginals, the North and Canadians) doesn’t become a missed opportunity and we fall behind.” Alaska a threat From a project standpoint, he said the Mackenzie partners must stay abreast of developments in Alaska, because any commitment to develop Alaska gas could pose a threat to the commercial viability of the Mackenzie project, as well as have an impact on the North American gas market and the availability of materials, supplies and contractors.
Searle said there is no specific date for regulatory filings, but he noted that regulators have indicated the pieces for the environmental assessment and other regulatory aspects could be in place by early July.
He said it’s important for the Mackenzie partners to “ensure our work is in alignment with and consistent with” the regulatory terms of reference and that they not act in any presumptuous manner.
Two months ago, Hearn said foot dragging by Canadian government officials involved in the environmental impact process could delay construction of the Mackenzie pipeline by six months.
He said at the time he was concerned that the slow pace could result in fierce competition for labor and materials, given that Canadian pipeline companies Enbridge and Terasen are moving ahead with plans to build multi-billion-dollar pipelines from the Alberta oil sands. Renewed focus from officials Hearn said April 21 that those worries have been eased as officials have demonstrated a “renewed focus” on the project.
“I think we’re doing better today, but ask me tomorrow and see how I feel,” he said.
On other issues, Hearn said Imperial, although “most concerned” about a projected C$2.1 billion cost overrun and one-year delay in an expansion of the Syncrude Canada oil sands complex, is still committed to successfully completing the project.
With a 25 percent stake in Syncrude, Imperial is making “experienced personnel” available to “strengthen the project management team” and get the job completed by mid-2006.
Imperial also announced that it hopes to enter the regulatory phase next year with its Kearl Lake oil sands project in conjunction with sister company ExxonMobil Canada.
That development, which could cost C$5 billion to C$8 billion over the long-term, is targeted for a 100,000 barrel per day start up.
Hearn said drill tests at the Kearl leases have been “encouraging.”
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