Dave Sullivan
Northern News Services

Hay River (Oct 29/01) - Paramount Resources of Calgary appears close to signing an economic benefits agreement with five aboriginal communities for oil and gas in the Cameron Hills.

Three of the five communities met Friday to look at what Fort Providence Chief Sam Gargan calls a final agreement.

Prior to now there were concerns with the environmental impact of Paramount's plans, according to Karen Thomas, chief of West Point. The tiny village near Hay River is one of the five aboriginal communities.

In Kakisa, another of the five communities, leaders often criticized and closely monitored the environmental impact review process, says Chief Lloyd Chicot.

"One of the biggest concerns was lack of respect for the land, traditional lands. We weren't kept informed," Chicot said.

"For me, there needs to be a lot more negotiation. We want to be clear what's happening," he said before Friday's meeting on the Hay River reserve.

The communities won't reveal details of the Paramount deal, but company spokesperson Shirley Maaskant says it does not include royalty payments other than to the federal government.

South Slave Metis and the Hay River Reserve are the other parties to the deal.

The leaders say it was relatively easy for Paramount to set up in the federally-owned Cameron Hills, because leases were issued and exploration wells drilled in the 1960s, well before land claims were established. The problem is, Chicot said, is Paramount now wants to open up a lot more of the hills for exploration.

In addition to wanting to bring 12 exploration wells into production, Paramount wants to drill nine new ones this winter and carry out seismic work, Maaskant said.

Wells in the hills will cost about $5.5 million each by the time they start producing, she said.

On the Alberta side of Cameron Hills, the company has approvals it needs to link dozens more wells there to a pipeline. One being built this winter will pipe oil and gas south to a Paramount treatment plant at Bishto Lake, in Ala.

A Paramount deal with Ford Liard to ship that community's gas will go through the same network. The Fort Liard and Cameron Hills projects were both delayed because of concerns about flaring.

Extracting gas from Cameron Hills could be tied to a future proposal by pipeline company Enbridge to supply the town of Hay River with natural gas.

If Enbridge is thinking of getting its gas from Cameron Hills, the company has not contacted Paramount, Maaskant said.

Paramount has not yet selected a builder for the pipeline network it wants that will link together the Cameron Hills wells.