Interesting opinion piece in the Financial Post about the Mackenzie Delta natural gas issue. Basically, the proposed pipeline would feed more natural gas in to the all-consuming maw of Ft. McMurray to feed the tar sands. What scraps were left would go to American consumers.
Unfortunately, costs of building the pipeline -- never cheap -- have gone up dramatically. So the proposal in the FT is that instead of building a thousand-kilometer long pipeline, the Mackenzie gas be chilled and exported in a northern LNG terminal, similar to the Russian plan for the Shtokman field.
I like the idea -- the environmental impact is lower, the costs should be similar, if perhaps a bit higher, and instead of locking our gas sales in to a small number of customers in the south, we'd also theoretically be able to export to Japan and China -- maybe India and Europe in the future, depending on the economics. Europe and China are both intensely interested in diversifying their energy supplies, and Canada is about as reliable as you can get on these matters.
The distance to Japan or China shouldn't be a big problem -- it's about the same distance from Qatar to the US, a LNG trade that is already being pursued. In fact, the maritime routes from Qatar to any of the major gas consumers are quite long, so it would seem that if Qatar can be a major LNG exporter, than the Mackenzie Valley should have some opportunity.
Of course, Canada will always be kind of a midget when it comes to the LNG market -- Qatar, Iran, and Russia alone control the large majority of natural gas reserves.