Canada's largest oil and gas producer said that it has decided to "halt project execution activities" because of insufficient progress on key areas critical to the project, including the finalization of benefits and access agreements, and the setting-up of a timetable for the project and a clear regulatory process. The announcement is seen as a major setback for the development of the Mackenzie project, which is planned to bring new supplies of gas from the Canadian Arctic to southern markets in Canada and the United States. Imperial and a group of companies including its parent company ExxonMobil, Texas-based ConocoPhillips and Shell Canada Ltd, filed their long-awaited regulatory applications for the mega-project last autumn. However, there has been little progress since, especially over how much money the oil and gas producers will pay native groups for the right to use their land to build the pipeline. Imperial said the project partners will focus on regulatory issues and want to see substantial progress before the start of public regulatory hearings, expected as early as late summer, to allow the project to continue. This development appears aimed at putting pressure on the Canadian federal government and native groups to break the logjam over land-use agreements and economic and social benefits that has delayed the project's development. The oil company said the Mackenzie gas partners will stop activities such as geotechnical data gathering and the start of detailed engineering and preparatory work on contracting for construction. "Despite significant effort and expenditures by the proponents and other parties, the reality is that adequate progress is not being made in key areas," said Michael Yeager, senior vice-president of Imperial Oil. "Our efforts to resolve issues in these areas have not diminished. However, to achieve real progress, approaches need to change. We are refocusing our efforts to address these essential issues. We are not giving up on developing a project that can be a sound investment for the proponents and can contribute to sustained economic development for the people of Canada's north, including employment, business opportunities, and growth." Another partner in the pipeline proposal is the Aboriginal Pipeline Group with a one-third stake, representing numerous NWT aboriginal groups who support the pipeline. Chairman Fred Carmichael said that the native group remains committed to the project. "It continues to represent a significant opportunity for the people of the North to reduce their reliance on government. Without this project there will be no job creation, business opportunities, or income for aboriginal people, including that derived from the APG's ownership interest. The project's future depends on successful resolution of these issues, and all parties – governments, industry, and the people of the North – must work together to resolve these issues if the project is to proceed." One group that has opposed the pipeline plans is the Deh Cho First Nation. About 40% of the proposed pipeline route is currently within Deh Cho lands, which cover virtually the entire SW corner of the NWT, and the Deh Cho has been attempting to get Ottawa to settle its outstanding land claim before the pipeline is developed.