FAQ

Frequently Asked Questions

Answers to some common questions about the APG.

WHAT IS THE MACKENZIE VALLEY PIPELINE?

The MVP is a 30 inch diameter buried Natural Gas pipeline that will run from Inuvik 1220 kilometers to just over the NWT/Alberta border.
APG has negotiated the right to own up to 1/3 of the MVP.
The MVP is one component of the Mackenzie Gas Project. The other components (owned by our Partners) are:

The 3 anchor fields (Taglu, Niglintgak, Parsons Lake)
The Gas Gathering system
The Inuvik Area Facility (IAF)
The 10 inch liquids line from the IAF tying in to the existing line at Norman Wells.

WHAT IS NATURAL GAS?

Natural gas is 99% methane. It is gaseous, similar to air.
It is not a liquid, so if by chance there was a leak, it wouldn’t spread on the ground or pollute the water. It would rise into the atmosphere because natural gas is lighter than air.

WHAT IS THE CAPACITY OF THE PIPELINE?

NEB application was for up to 1.2 BCFD, but may be expanded later to 1.8 BCFD by adding additional compressor stations to the pipeline.

THE GOVERNMENTS DID NOT AGREE WITH ALL OF THE JRP’S RECOMMENDATIONS. WHAT’S YOUR TAKE ON THIS?

We’re glad that part of the Regulatory Process is finished.
In general the JRP’s recommendations were well-meaning, and the Government has accepted, or accepted in principle, 87 of the 115 recommendations directed to them. However 28 were rejected mostly because they were clearly outside the JRP’s mandate.
The panel members clearly did not understand their responsibilities; they cannot tell Governments or future Regulatory Boards what to do. They were naïve to believe the Government would accept all their recommendations.
The significant delay created by the JRP went totally against the best interests of those (northerners) they were supposed to represent by withholding jobs and contract work the north severely needs.
The JRP stated that the adverse impacts of the Project could be significant and its contribution towards sustainability could be negative if the Government did not accept all their recommendations. However the NEB in their reasons for decision stated “if it were the case that the lack of full implementation of the Joint Review Panel Report means that we should accept that some adverse environmental effects are likely, we find these effects to be justified in the circumstances.” (emphasis added).

APG HAS BEEN VISITING COMMUNITES IN THE SAHTU, GWICH’IN AND INUVIALUIT REGIONS - WHAT HAVE YOU BEEN HEARING?

The common theme is frustration over why this Project is taking so long to begin construction.
There is no work going on in the Oil & Gas industry so people have no jobs, and contractors are losing their businesses because of no work.
People don’t understand why the JRP seem to have done everything they can to delay this Project, when they were supposed to be acting in the best interests of their northern stakeholders.
The degree of frustration is HUGE.
The north needs this pipeline NOW

THE GOVERNMENT CLOSED DOWN THEIR PIPELINE OFFICES. WHAT DOES THIS MEAN?

The Northern Gas Project Secretariat (NGPS) was set up to assist in the environmental assessment and regulatory review of the proposed Mackenzie Gas Project, and the Mackenzie Gas Project Office (MGPO), was responsible for leading the development of the government’s response to the Joint Review Panel report. Both offices completed their jobs, and have now been closed.
This doesn’t signal a lack of support from the Government.
The Project has now achieved an important milestone as the NEB issued their Reasons for Decision. APG will continue to work with its partners in the Mackenzie Gas Project to make this Project a reality.

WHAT DO YOU SEE HAPPENING IN THE NEXT YEAR?

We expect the NEB to present their decision to Cabinet before the end of January, or shortly thereafter. Once that happens the Project will re-engage with the GOC to finalize a Fiscal Framework that would ensure the Project proceeds to the next step, which is the Decision to Re-start (re-staffing, field programs, work on Project Permit Applications).

WHY DO YOU THINK THIS PROJECT IS IMPORTANT?

This Project is the future of the Mackenzie Valley.
$500M Social Economic Impact Fund
$1B in set-aside work for Aboriginal corridor contractors
Business & employment opportunities

Over 7000 jobs in NWT during construction, and over 100,000 across Canada
Approx 150 permanent full-time positions with the main pipeline and anchor fields

GDP benefits of over $100B to Canada
Tax revenue of over $10B to Federal, Provincial and Territorial governments
Over 30,000 person-years of employment in NWT, and over 200,000 across Canada
Attaches a new Canadian gas supply basin to the North American Pipeline grid
Supports and strengthens Canada’s priority for Arctic Sovereignty
Enhances infrastructure throughout the region
Catalyst for Canadian Arctic offshore exploration

WHAT ARE SOME ENVIRONMENTAL BENEFITS OF NATURAL GAS?

Natural gas from Canada’s Mackenzie Delta is part of our environmental solution.
The land and everything that comes from the land is important to Aboriginal people.

Natural gas comes from the land. It is a 100% natural product.

Natural gas is good for the land - and good for our people.

Good for the land because natural gas is the cleanest burning of the fossil fuels, with (50%) less CO2 emissions that coal and (33%) less CO2 emissions than oil.
Good for the people because it will help pave the way to a better future for Aboriginal youth. Dividends from our ownership share in the Mackenzie Valley Pipeline can be used for improved education, training, and employment opportunities and greater self sufficiency for Aboriginal people.

Supports Canada’s course in reduction of greenhouse gas emissions
Displaces coal & oil in the power generation market

The largest growth sector for natural gas over the next 10 – 15 years will be power generation

Ziff Energy predicts natural gas will account for 26% of all North American generation in 2020

The transportation sector is virtually untapped

Fleets (trucks, buses) represent a huge potential market. Compared to traditional vehicles natural gas vehicles emits:

90-97% less carbon monoxide
35-60% less nitrogen oxide
virtually no particulate emissions

Natural gas is the ideal transition fuel as we move towards renewable energy alternatives

Both northern pipelines, together with shale gas, will ensure an abundant supply.

HOW MUCH has APG invested in the Project to date?

As of December 2010 APG had invested over $145 Million in the pre-development phase of the Project, in the form of a loan from TransCanada Corporation.
The pre-development phase is the period leading up to the actual construction of the pipeline. This includes preliminary and final engineering, geotechnical work, and, of course, the regulatory process.
The $145MM figure is APG’s 1/3 portion of the costs associated with the Mackenzie Valley Pipeline. If, for some reason, the Project does not proceed, then TransCanada will bare all the risk of the loan, so APG will not end up owing any of the loan.

ISN’T all this gas going to the oilsands (tar sands, tar pits)?

The Mackenzie Valley Pipeline will connect to the Nova Gas Pipeline System (NGPS) in Alberta, whereupon the Mackenzie natural gas will join other sources of southern natural gas within the NGPS system.
There is no dedicated pipeline to transport Mackenzie natural gas to any specific site.
There is no contractual agreement to deliver Mackenzie gas to the oil sands.
A good analogy is water (molecules) flowing north in the Mackenzie River; once the Mackenzie reaches Point Separation, the water either flows into the west, middle, or east channels, and then splits off into other channels. There is really no determining factor where the water will flow – same as natural gas from the Mackenzie pipeline flowing into the NGPS system.

WHERE will APG get the gas in order to fill up its share of the pipeline?

APG is not responsible for attracting shippers to the pipeline. That is the responsibility of the Project Operator, Imperial Oil.
A number of companies have expressed interest in shipping natural gas in the MVP. These companies have reserves both in the Beaufort Delta region, and along the Mackenzie Valley.
MGM Energy has committed to ship 200,000 cubic feet per day, which leaves only 170,000 cubic feet per day to fill up the pipeline.

HOW much will APG’s shareholders receive from the revenue in the pipeline?

A conservative estimate based on a full pipeline transporting 1.2 billion cubic feet per day will generate approximately $20 million to APG shareholders per year.

WHO are the shareholders of APG?

Currently shareholders are the Inuvialuit Regional Corporation, the Gwich’in Tribal Council, and the Sahtu Pipeline Trust.
The Dehcho region remains the only corridor group not part of APG; however APG continues to hold 2 seats at the Board table for Dehcho representatives should they decide to join.

WHEN will there be any dividends from APG?

Once the pipeline is constructed and natural gas is flowing south, the dividends will begin flowing north to APG shareholders.