Terry Halifax
Northern News Services

Inuvik (May 10/02) - While politicians jockey for the pipeline position, the producers and pipeline companies are getting their regulatory ducks in a row.

Any pipeline project on Canadian soil must first be approved by the National Energy Board (NEB).

The Mackenzie Valley group have filed intent with the board, but still have many regulatory hurdles to overcome, while the Calgary-based Foothills Pipe Lines Inc. has had that approval for their Alaska line in place for decades.

"The certificate to build the pipeline is in place and it is still valid," said NEB spokesperson Ross Hicks.

"The Alaskan Pipeline project was approved back in the 70s when they formed the Northern Pipeline Agency," he said. "However, because of economics, they never built it."

The certificate was used to build and later advance Phase One - the Alaskan Pre-Built pipeline - that has been in operation for 20 years.

The line ships 30 per cent of all Canadian gas exports from Caroline, Alta. to Chicago via the Northern Border System and to San Francisco via the Foothills PG&E system. Since its inception, the pre-build has shipped 11 trillion cubic feet of gas.

Hicks said while the original certification is still valid, Foothills may need to complete a new environmental study.

"In the 30 years that have gone by, technology has changed."

Foothills spokesperson Rocco Ciancio said the certificate may require some updating, but is otherwise good to go.

"Technology has changed a fair bit, so everything would be done to modern standards, but the approval is in place and that's the important thing," Ciancio said.

Key producers and Phillips hold the majority of interest in the area of North Slope gas.

Ciancio says the next big step is to get the Alaskan producers British Petroleum, ExxonMobil on side with the project, but said they will keep talks confidential until a decision was made.

"The key thing here, is reaching a commercial arrangement with the producers - you don't have a project until you have gas producers and sellers willing to use the service," he said

. "We put together the proposal and met with the producers a few times to discuss it, but that's basically as far as its gone."

There is talk in the industry that the producers may go it alone on the pipeline. Cianco says that may set the line back up to three years waiting for regulatory approval.

"That's certainly an option open to them, but we've always maintained that there's a timing advantage in going with the ANGTS system in that the regulatory approval is already in place," he said. "To start from scratch, you would be looking at anywhere from 18 to 36 months to get that approval."

Hejdi Carlsen, spokesperson for TransCanada Pipelines Ltd. says TransCanada holds an interest in both projects and they feel the market can handle both lines.

"We look at current demand projections for natural gas throughout North America and I believe that those demands definitely make two separate pipelines viable," Carlsen said.

"It's all very dependant on producers and regulators."

She says TransCanada is in the enviable position to deliver and accept northern gas from either or both pipelines.

"Our pipeline infrastructure is uniquely positioned to accept Northern gas and re-deliver it to a number of Canadian market regions and across the U.S., in probably the most cost-efficient manner," she said. "We definitely see ourselves as having an advantage in that sense."