Inuvik (June 27/03) - Now that the financing has been arranged, the proposed Mackenzie natural gas pipeline faces the regulatory hurdles of 16 separate environmental agencies.

The estimated $5 billion, 1,500 kilometre pipeline travels through Inuvialuit, Gwich'in, Sahtu and Deh Cho lands - all with land and water boards that have to approve the project.

At a press conference to announce the deal at last week's petroleum show in Inuvik, K.C. Williams, CEO of Imperial Oil Resources said they expect the pipeline will have the capacity to carry 1.2 billion cubic feet (bcf) of gas per day, expandable to 1.9 bcf per day depending on how much demand there is from producers.

"The actual size will be a function of the long-term shipping commitments," Williams said. "Whatever the initial size, it will be expandable and accessible to others."

The project information package will be submitted this week for review by the Mackenzie Valley Environmental Review Board, the National Energy Board and numerous agencies which will issue terms of reference for the pipeline application.

The process is expected to take about eight months, but Williams hopes "it can be a lot shorter."

Hal Kvisle, CEO for TransCanada said his company is excited to be part of the historic project and wished all parties well in getting through the regulatory phase.

"We look forward to the day when we are actually able to see pipe being laid in the ground," Kvisle said.

In exchange for financing the Aboriginal Pipeline Group (APG) the $80 million for their share of the project definition phase, TransCanada will receive five per cent of the two-thirds share from the producer group.

Subsequent APG funding for construction will come from the producers Imperial, ExxonMobil, ConocoPhillips and Shell unless other financing is arranged prior to construction.

Fred Carmichael, Chair of the APG, presented each of the CEOs with a muskox kiviuuk sweater and was unabashed about his emotion in signing the deal.

"I am a very happy person today," Carmichael said to the crowd, which broke out in applause.

In tandem with regulatory review, aboriginal groups have begun to negotiate access and benefits agreements. Carmichael asked for all groups to negotiate for a fair deal, but to keep a good business sense.

"Keep it in mind, that you want the best deal for your children and your grandchildren," he said. "In order to reach that goal, you must be able to give and take; and believe me, we learned to give and take in the past three years."

Carmichael pointed in the crowd to the APG negotiators, Carl Chala and Patrick Schmidt who worked long hours to get the deal completed in time for the oil and gas show.

"These two young gentlemen deserve a round of applause," Carmichael said. "It's a wonder they're not divorced."