Richard Gleeson
Northern News Services

Yellowknife (Oct 13/00) - A Mackenzie Valley pipeline route would be better for gas producers and better for Canada, concluded a study released this month.

Prepared by the Canadian Energy Research Institute, the study concluded a Mackenzie Valley pipeline with a link to Alaska's Prudhoe Bay would cost $2.5 billion less to construct than an alternative being promoted by Alaska and the Yukon and produce $3 billion more in federal taxes and royalties over its lifetime.

The release of the report is the latest salvo in an on-going battle between the two territories and countries to get a pipeline built through their jurisdiction.

"Canada would best be served with a pipeline down the Mackenzie Valley," concluded the report. "Producers generate larger revenues, costs are minimized and the government generates greater taxes. Looking at the impacts per dollar spent, the Mackenzie Valley route shows clear advantages over the Alaska highway routes in Gross Domestic Product, employment and income."

The route being promoted by the Alaskan and Yukon governments would pipe gas from the north slope of Alaska through southern Yukon where it would hook into a pipeline going to the Beaufort Delta.

The Mackenzie Valley route runs up the Mackenzie Valley to the Arctic Ocean, with an optional under-sea link to Prudhoe Bay.

Last week Yukon premier Pat Duncan said there are enough northern reserves to warrant pipelines down both routes, but said the Alaska-Yukon line should be built first.

The report echoes the arguments NWT premier Stephen Kakfwi has been making in support of the Mackenzie Valley route.

Insiders say the numbers that will determine which route will prevail will be those comparing the profitability of the two options for the gas companies that own the reserves.

It is those companies that will largely be responsible for coming up with the billions it will take to transport Arctic coast reserves to southern markets.

The Canadian Energy Research Institute is a non-profit agency funded by government and industry. It was established 25 years ago.