Mackenzie may be approved but will it be too late?
NATHAN VANDERKLIPPE
CALGARY— From Thursday's Globe and Mail
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In the spring of 2006, Shawn Denstedt, a Calgary lawyer, got a new desk and placed on it two stacks of paper. They contained the prewritten final arguments for Royal Dutch Shell PLC and ConocoPhillips urging regulators to approve the Mackenzie Valley natural gas pipeline.
The National Energy Board today will finally decide whether the $16.2-billion project should be approved. If it is built, the Mackenzie line will be the single largest private investment in Canadian history, and the long-awaited decision caps an arduous process that has spanned years of deliberation over its merits.
That wait, Mr. Denstedt discovered when he finally needed those documents years later, has now been etched into permanently into his office furniture.
“When I picked up the papers, there were two dark spots on my desk where they sat,” he said. “It took long enough that the rest of the desk had gotten bleached out in the sun.”
But any joy that the process is finally concluding has been dampened by the growing questions over whether the project will ever be built. In the time it has taken to make a decision, the economics of the project have dramatically shifted. Natural gas prices, which reached to $14 (U.S.) per 1,000 cubic feet in 2006 – and again in 2008 – have now sunk to around $4, as huge new North American shale gas finds have created a supply glut. With so much gas now available, many wonder whether an expensive new project should be built to tap a distant pool that, compared with some of the new plays, contains only modest reserves.
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