Yellowknife (Aug 02/06) - The Mackenzie Valley pipeline's contribution to greenhouse gas emissions was the subject of exchanges between environmental advocates and Imperial Oil at National Energy Board hearings, Monday.

Sierra Club lawyer Paul Falvo attempted to link the proponents' interests in Alberta's tar sands to their desire to exploit natural gas reserves in the Mackenzie Delta.

"Does your investment in the oil sands make this project more economically viable?" asked Falvo. Imperial rejected the claim.

Falvo also said pipeline proponents - Imperial, Shell, ConocoPhillips and Exxon - should "not escape the liability of environmental costs" associated with extracting oil from the tar sands. Imperial has a 25 per cent share in the gigantic Syncrude property near Fort McMurray Alta., Shell has a 60 per cent interest in the Athabasca oil sands project, while ConocoPhillips also has a share of Syncrude.

Since the pipeline's conception, the Sierra Club has maintained that gas from the Delta will be consumed by tar sands oil extraction and in turn, the burning of that crude will increase greenhouse gas emissions.

However, Imperial - lead proponent of the $7.5 billion project - says the Nova Gas Transmission Ltd. system in Alberta, where the Mackenzie pipeline would be connected, is too complex to determine the product's final destination.

"It's not possible to track where every molecule of gas ends up," said Imperial's Heather Marreck.

As well, Marreck said future North American natural gas demand would remain "regardless of what happens at the tar sands."

Also debated was whether or not Imperial had asked the federal government to subsidize the project, something the resource company also rejected.

From Falvo's point of view "royalty adjustments" and "federal investments" offered by the Paul Martin Liberal government to sweeten the deal for Imperial amounted to subsidies.