Walking tall in Texas
Ramsay talks NWT potential at Houston conference
Walter Strong
Northern News Services
Published Monday, May 26, 2014
NORTHWEST TERRITORIES
The minister of Industry, Tourism and Investment was invited to Texas at the start of the month to participate in a global energy outlook panel discussion during the 2014 Offshore Technology Conference in Houston May 7.
David Ramsay: touts post-devolution territory at Houston conference. |
With more than 108,000 delegates from 120 countries in attendance - making it one of the largest petroleum trade shows in North America -David Ramsay said it was a good place highlight the territory's on and offshore oil and gas potential.
More importantly for Ramsay, it was a chance to call attention to the change in command that took place with territorial devolution.
"The (regulatory) process is the same, but we're now in charge. That's the message we wanted to get out to the industry," Ramsay said.
"The GNWT is now in charge of land, water and resource management in the NWT."
Before devolution, an environmental review before the territory's Mackenzie Valley Review Board would automatically include participation by the federal government.
Now, federal participation in time-sensitive environmental applications will not include the federal government unless the board invites them.
There are caveats to this change. Offshore oil and gas projects and the Norman Wells proven area remain under the regulatory jurisdiction of the federal government through the National Energy Board and Aboriginal Affairs and Northern Development Canada.
As well, Inuvialuit settlement areas remain outside territorial jurisdiction.
"We have gone from managing one percent of the land area to 80 per cent of the land area," Ramsay said.
"It's a big step forward for us. It's important that we continue to dialogue with industry on how we can get industry involved in those opportunities."
Getting NWT oil and gas resources to market continues to be a challenge and a barrier to investment, as described recently by Henry Sykes, president of MGM Energy. MGM Energy recently abandoned its oil and gas exploration in the NWT.
Sykes described the decision to exit the territory as tied to the remoteness of NWT oil and gas assets.
"There's no oil further away from markets in North America than in the NWT," Sykes said.
Husky Energy and ConocoPhillips continue to move forward with preliminary resource exploration in the territory's Sahtu Canol shale play, but even if those explorations prove the economic viability of the region, a significant challenge remains.
With only one pipeline in the territory - Enbridge's Norman Wells pipeline - there is no way to get enough oil or natural gas out of the territory to justify production, according to Sykes.
"As I understand it, there is some spare capacity in that pipeline," Sykes said. "But even if you could use all that spare capacity, it's not nearly enough to justify the amount of investment you have to put into the Canol (shale play) to start producing oil."
Ramsay said the GNWT continues to work behind the scenes to keep developments surrounding resource transportation alive.
While in Houston, Ramsay met with ExxonMobil, a partner in the proposed but indefinitely stalled Mackenzie Valley gas project.
Ramsay said he was told the company hasn't given up hope on the project.
Imperial Oil, the lead partner in the Mackenzie Valley gas project, has taken the required regulatory steps to keep the project alive.
But today natural gas is too cheap to justify the project.
Despite the low price of natural gas, Ramsay said the territory's gas resources may yet have economic potential as a "feeder stock" for B.C.'s burgeoning liquified natural gas industry, if the province is ever able to conclude its negotiations surrounding offshore exports, pipeline construction and liquid natural gas plant development.
Another proposal in very preliminary discussions surrounds moving resources northward towards Inuvik and over to Alaska's Prudhoe Bay where the Trans-Alaska pipeline could then move product to Valdez for export.
"We've had preliminary discussions with the State of Alaska and the Government of Alberta about how the NWT could, at some point, be a conduit to get oil to market through the NWT," Ramsay said.
"The Trans Alaska pipeline system is under-capacity, and the State of Alaska generates a lot of their revenue from the oil that passes through that system."
"They are very interested."
Taking resources northward could also help unlock offshore development in the Beaufort Delta, Ramsay added.
"The area had a good taste of jobs and opportunities back in the 70s and 80s," Ramsay said. "We'd like to see a return of prosperity to the territory and the region."
