By Nia Williams

(Reuters) – Imperial Oil’s application to extend the life of its remote Norman Wells oil and gas facility in Canada’s Northwest Territories has been put on hold pending an environmental assessment report, the Canada Energy Regulator said on Tuesday.

The Norman Wells site produces around 6,500 barrels of oil equivalent per day (boepd) and is spread across nine natural and artificial islands in the Mackenzie River – Canada’s longest river – and the town of Norman Wells on the riverbank.

Imperial, majority-owned by Exxon Mobil Corp, applied last year to extend its Norman Wells operating permit, which is due to expire on Dec. 31 2024, by another 10 years.

However, the regional Indigenous government, the Sahtu Secretariat Incorporated (SSI), decided in September that the application required an environmental assessment, because Imperial also proposed replacing pipelines between its wells and processing facility.

The environmental assessment will be conducted by the Mackenzie Valley Environmental Impact Review Board, and the regulator said it will extend Imperial’s permit in the interim.

“This will allow the Norman Wells facility to continue operating while the Review Board’s environmental assessment process unfolds,” the CER said in a statement on social media.

An Imperial spokeswoman said the Calgary-based company was reviewing the latest update and assessing its next steps.

The SSI outlined concerns about the impact of climate change on the Norman Wells operations and the Enbridge pipeline that transports the oil to Alberta in a September letter to the CER.

SSI Chair Charles McNeely said melting permafrost in the far northern region raised questions about the stability of the oil and gas infrastructure, while the Mackenzie River is experiencing unprecedented riverbed scouring, threatening the numerous pipelines within the Norman Wells operation.

“Today, in an area of increasing environmental sensitivity, does it make sense to accept any degree of risk from an aging oilfield that in 2021 provided less than 1% of Canada’s daily Conventional Light Crude production?” McNeely wrote.

(Reporting by Nia Williams in British Columbia and Ismail Shakil in Ottawa; Editing by Bill Berkrot)