MacKenzie Valley gas pipeline cost estimates updated

By OGJ editors
HOUSTON, Mar. 13 -- Mackenzie Valley Pipeline sponsors have updated the cost estimates for the Mackenzie natural gas transportation project to $16.2 billion (Can.) and delayed the expected completion date by 3 years, operator Imperial Oil Ltd. said.

The changes were outlined in updated information Imperial filed with Canada's National Energy Board and Joint Review Panel, the Calgary-based firm said Mar. 12.

Project costs are now estimated at $7.8 billion for the Mackenzie Valley mainline and $3.5 billion for the gas gathering system. In addition, the estimated cost of anchor fields development is $4.9 billion.

The 1,200-km pipeline, previously pegged at $6.5 billion, would link Beaufort Sea fields to the Alberta border. Project timing is uncertain, but production start-up is expected no sooner than 2014, Imperial said. Previously, the anticipated construction completion was 2011 (OGJ Online, Feb. 23, 2007).

The Mackenzie gas project would include development of 6 tcf of gas in three onshore fields in the Mackenzie Delta and construction of a gas and natural gas liquids gathering system, gas pipeline, and related facilities.

The Mackenzie Valley gas pipeline would have 1.2 bcfd of throughput capacity, and would be expandable to accommodate gas from other fields.

The project is being proposed by Imperial, ConocoPhillips Canada, Shell Canada Ltd., ExxonMobil Canada, and the Aboriginal Pipeline Group (APG).

APG was formed in 2000 to enable ownership interest by the Aboriginal peoples of the Northwest Territories. TransCanada PipeLines Ltd. is helping to finance APG's ownership.

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