Question-and-Answer Session
Operator
(Operator Instructions). Scott Hanold with RBC Capital Markets. Please proceed with your question.
Scott Hanold - RBC Capital Markets
When looking at the capital requirement for the pipelines here in 2009, it's obviously pretty substantial. I think you mentioned an option using a third party to help finance that project if things became much tighter.
Can you kind of draw a little bit of color around what that would mean? That obviously wouldn't be an MLP, but what kind of party would that be and what does that do to continuing to have control of that asset?
Phil Rykhoek
I think we would always maintain control of that asset. That's the key. But there are a number of potential options that we've discussed, but we're not really at liberty to discuss any details. Clearly there is a lot of interest in being able to sequester carbon dioxide.
We're quite confident that if we should so wish that we would have a lot of options available to us. In particular, we're watching carbon legislation very closely. It looks like a good bet that there is going to be some, and that's only going to make this line more valuable.
Gareth Roberts
Scott, I think we'll try to do something along the lines of our first preference like the financing lease we did with Genesis with which obviously we have complete control. We get 100% of the capacity and so forth, because that's obviously key.
Scott Hanold - RBC Capital Markets
Okay. Got it. When looking at your work on the capital budget and your current hedge position and where to cut, where not to cut, can you talk about just your general tertiary projects across the board?
I guess your cash returns are sort of breakeven I think in that $30 to $40 per barrel range. But can you talk about sort of economic breakeven levels for the various projects? When you decide on making cuts, which ones are priority, the ones that are more of a near-term impact to production or do you sort of look at the long-term economic rate of return of the projects?
Gareth Roberts
Well, I think our breakeven costs are more like about $30. We're looking for about a 30% rate of return when we make these investments. We have a lot of opportunities that deliver those rates of return. What Bob was trying to say was that we basically selected projects that not only give us that rate of return, but also give us the reserve growth as well.
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