The Mackenzie Gas Project moved a step closer to fruition, at least from a regulatory standpoint, as Canada’s National Energy Board (NEB) issued a certificate of public convenience and necessity for the Cdn$16.2 billion (US$16.1 billion) project.

This latest approval from the NEB follows a decade-long battle between regulatory officials in Canada and the project’s five partners, Imperial Oil, Mackenzie Valley Aboriginal Pipeline LP, ConocoPhillips, ExxonMobil and Shell Canada.

While the project, which is still awaiting further regulatory approval, has finally gotten NEB approval, the partners previously said that the earliest they could make a final decision on whether to proceed with the project would be late 2013.

Last April, the partners pushed back the project’s potential start-up date by five years with the earliest estimate being in 2018 due to regulatory delays, no financing agreement in place, weather constraints and re-staffing requirements.

The project includes a 760-mile, 1.2 billion cubic feet per day (Bcf/d) natural gas pipeline that would have the capability to expand capacity to 1.8 Bcf/d, as well as a gathering system and a gas processing plant.

Much of the cost estimates and market analysis tied to the development of the project were conducted in 2007.

Although there have been questions regarding the feasibility of the project, given the large amounts of unconventional resources discovered and put into development in the last few years, Pius Rolheiser, a spokesman for Imperial Oil, said the project will be needed to replenish declining conventional resources.

“There’s a significant focus on current conditions in the market. Well, Mackenzie is a project that could come on stream no earlier than very late this decade and would operate for a period of 20-plus years after that,” he told the Toronto Star. – Frank Nieto