
Feds offer lower royalties for Mackenzie Valley pipeline CBC \|\| November 20, 2005 Ottawa has removed some of the last hurdles facing the proposed $7-billion Mackenzie Valley pipeline, telling project backers it will consider taking on some of the risk if it gets a greater share of the rewards. Imperial Oil leads four companies in Mackenzie Valley project. In a letter to the head of Imperial Oil, Deputy Prime Minister Anne McLellan says Ottawa isn't prepared to subsidize construction of the pipeline, but could look at royalties and the possibility of investing in the project. Ottawa would "consider assuming a greater share of the project downside risks provided it is able to increase its share in the potential financial rewards," she said. Article Posted at www.KnowledgeDrivenRevolution.com Work on the 1,200-kilometre pipeline was halted at the end of April, with the oil companies involved saying there hadn't been enough progress in resolving several key issues, including land access. FROM Apr. 28, 2005: Oil companies stop work on Mackenzie Valley pipeline A senior vice-president with Imperial Oil said part of the problem was First Nations groups looking for the pipeline to provide them with enough money to address all their social problems, including a housing shortage, which he said isn't realistic. Under the federal government's proposal, the consortium would pay lower royalties to Ottawa until the pipeline was paid for. "We are willing to consider the request for fiscal enhancements but anything that we do has to be commercially viable and cannot be a subsidy," McLellan said. Ottawa is also considering a federal loan guarantee for the Aboriginal Pipeline Group's portion of project expenses. The guarantee would increase the APG's earnings in the project by reducing the costs of borrowing money. Pipeline supporters welcomed McLellan's letter. "It would be fair to say that these assurances would lead us to believe that our concerns on fiscal terms have been largely addressed," Imperial Oil spokesman Pius Rohleiser said. Imperial Oil says it will let the National Energy Board know next Wednesday whether it's ready to proceed with public hearings. It still needs to reach a deal with aboriginal groups over access to their land. About KDR \| \| Home \| \| Weekly Features Archive	Weekly Weekly Features Archive
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Feds offer lower royalties for Mackenzie Valley pipeline

CBC || November 20, 2005

Ottawa has removed some of the last hurdles facing the proposed $7-billion Mackenzie Valley pipeline, telling project backers it will consider taking on some of the risk if it gets a greater share of the rewards.

Imperial Oil leads four companies in Mackenzie Valley project.

In a letter to the head of Imperial Oil, Deputy Prime Minister Anne McLellan says Ottawa isn't prepared to subsidize construction of the pipeline, but could look at royalties and the possibility of investing in the project.

Ottawa would "consider assuming a greater share of the project downside risks provided it is able to increase its share in the potential financial rewards," she said.

Article Posted at www.KnowledgeDrivenRevolution.com

Work on the 1,200-kilometre pipeline was halted at the end of April, with the oil companies involved saying there hadn't been enough progress in resolving several key issues, including land access.

FROM Apr. 28, 2005: Oil companies stop work on Mackenzie Valley pipeline

A senior vice-president with Imperial Oil said part of the problem was First Nations groups looking for the pipeline to provide them with enough money to address all their social problems, including a housing shortage, which he said isn't realistic.

Under the federal government's proposal, the consortium would pay lower royalties to Ottawa until the pipeline was paid for.

"We are willing to consider the request for fiscal enhancements but anything that we do has to be commercially viable and cannot be a subsidy," McLellan said.

Ottawa is also considering a federal loan guarantee for the Aboriginal Pipeline Group's portion of project expenses.

The guarantee would increase the APG's earnings in the project by reducing the costs of borrowing money.

Pipeline supporters welcomed McLellan's letter.

"It would be fair to say that these assurances would lead us to believe that our concerns on fiscal terms have been largely addressed," Imperial Oil spokesman Pius Rohleiser said.

Imperial Oil says it will let the National Energy Board know next Wednesday whether it's ready to proceed with public hearings. It still needs to reach a deal with aboriginal groups over access to their land.

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