Partners in the long-delayed Mackenzie gas pipeline in Canada’s Far North have chopped spending on the proposal and closed some offices as their efforts to wrest financial support from Ottawa drag on with no deal in sight, they said on Thursday.

Imperial Oil Ltd. and its partners in the $16.2-billion pipeline plan have closed offices in Norman Wells and Fort Simpson, Northwest Territories, and reduced the size of its office in Inuvik, N.W.T., spokesman Jon Harding said.

He did not disclose how much money was being pulled from the project.

For its part, ConocoPhillips Co. said suspension of work will prompt a non-cash impairment of $525-million (U.S.) after tax for the first quarter. Besides being a partner in the Mackenzie pipeline, it has a 75 per cent interest in the Parsons Lake gas field, one of three “anchor fields” for the development.

The viability of the proposal, which won regulatory approval last year, has become increasingly questionable due to rising costs and depressed natural gas prices as vast new shale gas supplies have been developed much closer to major markets.

Imperial’s chief executive officer, Bruce March, said last month that he did not believe the project’s time had passed, however.

The company, which is the Canadian affiliate of Exxon Mobil Corp., and the government resumed talks last year over a multibillion-dollar support package for Mackenzie.

It would provide funding for roads, airstrips and other infrastructure in the sparsely populated and largely undeveloped Northwest Territories.

The line would carry 1.2 billion cubic feet of gas a day to southern markets from the Mackenzie Delta on the coast of the Beaufort Sea. It was first envisioned in the 1970s.

North American natural gas prices have slumped in recent months to 10-year lows and have also forced proponents of a larger Alaska gas pipeline proposal to rethink a long-haul line to southern markets and consider liquefied natural gas exports to Asia instead.

The other Mackenzie partners are Royal Dutch Shell PLC, Exxon Mobil and the Aboriginal Pipeline Group. Last year Shell put its stake on the block but it has yet to announce a buyer.