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Mackenzie Gas Project (MGP) and induced oil and gas exploration and development activities in the NWT

Lead Department(s): Indian and Northern Affairs Canada
Start Date: (Budget 2004, Budget 2005) 2004–05
End Date: 2008–09

Total Federal Funding Allocation: $225,000,000

Description

Increased demand and rising prices for energy-efficient natural gas across North America have led Imperial Oil Resources, Conoco-Phillips Canada, Shell Canada Limited, ExxonMobil Canada (commonly known as the Producers) and the Aboriginal Pipeline Group (APG) to develop natural gas resources in the Mackenzie Delta and transport them via a 1200 kilometre pipeline through the NWT to southern markets. The proposed Mackenzie Gas Project (MGP) is a $7 billion project. Initially, 830 million cubic feet per day of northern Canadian natural gas would be available to transport at start up which is targeted for 2011. Although the pipeline itself will bring economic benefits to Canada, of equal importance is that the transportation infrastructure will spur continued exploration and development of the 82 trillion cubic feet of remaining recoverable natural gas resources located in the NWT, northern Yukon and Beaufort Sea that could be tapped by a Mackenzie Valley pipeline. It would open up a new energy producing region that would be a major contributor to North American energy supply.

In recognition of the significant contribution of oil and gas exploration and development activities to creating economic benefits, contributing to strong and healthy Aboriginal and northern communities and opening up a new frontier energy supply region, the Government of Canada is contributing capacity funds for federal and regional agencies to implement environmental and regulatory responsibilities, to strengthen the government's scientific expertise, to support northerners' participation in the environmental assessment (EA) and regulatory process and their ability to take advantage of economic opportunities.

Shared Outcome(s)

Coordinated federal response to the MGP's project definition and construction stages and to induced oil and gas activities
Effective implementation of environmental assessment/regulatory processes
Research relevant to the environmental assessment and regulatory review of the MGP and induced oil and gas activities
Supporting northerners' participation in economic opportunities

Governance Structure(s)

Senior Officials Committee
Federal Hearings Committee
Interdepartmental Working Groups
Crown Consultation Unit

Federal Partners	Total Allocation ($ thousands)	Planned Spending for 2007–08 ($ thousands)	Expected Results for 2007–08
Canadian Environmental Assessment Agency	$2,946	$0
Department of Fisheries and Oceans	$35,013	$6,700	Provision of scientific advice on longstanding responsibilities such as the status of fish stocks, while having enough flexibility to respond to newer issues such as the threat of invasive species, increasing oil and gas exploration and development activity, and species at risk. An adaptive organization that is better aligned with the department's requirements for scientific knowledge and Government of Canada priorities.
Indian and Northern Affairs Canada	$90,303	$20,700 + $2,157 reprofiled from 2006–07.	Coordinated federal government's response to the MGP that avoids duplication and overlap with other federal departments and agencies, as well as northern boards. Follow-up on the EA of the MGP and related regulatory obligations. Implement resource management responsibilities. Support community capacity to participate in the EA/regulatory process and to take advantage of economic opportunities.
Environment Canada	$41,855	$8,838	The Department will focus on its responsibilities pursuant to the EA of the MGP under its legislation and key national policies on such matters as climate change, pollution prevention, wildlife conservation, species-at-risk, emergency preparedness, and others as appropriate. Follow-up on the MGP EA process and initiate related regulatory obligations.
Parks Canada	$648	$162	Follow-up on the MGP EA process to ensure the ecological and commemorative integrity of the national parks, historic sites and rivers located in the NWT.
National Energy Board	$8,072	$1,700	Exercise regulatory mandate in assessing the MGP pipeline. The Board is working with a number of regulatory agencies to ensure that environmental assessment and related regulatory issues are dealt with in a coordinated and timely manner.
Natural Resources Canada	$28,982	$4,900 + $346 reprofiled from 2006–07	Validate industry assessments (science) to ensure that appropriate mitigation measures have been taken to minimize environmental impacts, protect the public interest and assess the cumulative effects of individual projects on the broader northern landscape and people.
Transport Canada	$17,006	$4,000	Responsible for the regulatory oversight of the transportation system.
Total	$224,825	$47,000 + $2,503 reprofiled

1. For purposes of this initiative, provided below is a list of common themes that apply to all eight departments involved in the MGP. (return to source paragraph). They are the following:

Environmental Assessment Process: Activities required in response to environmental assessment processes
Regulatory and Legal Obligations: Northern Boards, departmental permitting, issuance of authorization etc., and other approvals, legal surveying
Environment and Resource Management: Responsibilities dealing with water, lands, conservation
Coordination, Management and Communication: Resources to coordinate the activities of the various oil and gas pipeline actors, and to manage the overall federal responsibilities
Consultation: Departmental and Crown Consultation Unit consultations
Science: Research projects supporting EA and regulatory review of the MGP and oil and gas development
Legal Services: Support for negotiations, litigation and agreements

Contact Information

Randall Meades
Executive Director
Federal Project Coordination Secretariat
(613) 944-9318