Mr. Speaker, as Minister of Energy, Mines and Petroleum Resources, I would like to take this opportunity to bring Members of the Legislative Assembly up to date on our efforts to encourage oil and gas development in the Mackenzie Valley.
On October 31, 1995, the Department of Energy, Mines and Petroleum Resources, on behalf of the Government of the Northwest Territories, filed a complaint with the National Energy Board concerning the tariffs charged to ship oil on the interprovincial pipeline system from Norman Wells to Zama, Alberta. The department requested a hearing to review the tariff levels, with a view to having the board order a reduction from the current tariff of $6 per barrel.
During November, December and January, the parties to the complaint exchanged letters outlining their positions. This exchange was followed in early February by a request from Interprovincial Pipeline Ltd. for a delay in any proceedings so that they might conclude negotiations with Imperial Oil.
The results of these negotiations were released on March 8th. The changes, if ratified, will result in a decrease in the Norman Wells pipeline tariff of between 20 and 25 per cent. This will reduce the shipping cost of a barrel of oil from $6 to $4.50.
We are generally pleased with the progress made to date on this issue.
As a next step, we have asked IPL to convene a settlement conference which will include all the parties to the complaint, in order to obtain clarification of the proposed changes and to provide a forum for seeking general agreement to the changes. We have offered to suspend our request for a formal hearing should a settlement conference be convened before the end of April. Should such a conference not occur, we will then aggressively pursue a hearing before the National Energy Board.
Mr. Speaker, a reduction in pipeline transportation costs will increase the value of our oil and gas resources. This should in turn lead to increased exploration and development activity and create new jobs, business opportunities and other economic benefits. The subsurface lands held by the Sahtu claimants should also attract greater industry interest as a result of these lower tariffs.
Mr. Speaker, we must finalize a package, therefore, which will provide for northern control over northern resources and thereby ensure that resource revenues which are created in the North remain in the North with the people. Thank you.
--- Applause