Terry Halifax
Northern News Services

Inuvik (June 21/02) - There is some clear dissension within the ranks of the Aboriginal Pipeline Group (APG).

About four months ago, Inuvik Native Band Chief James Firth voiced his displeasure with the APG and feels an alternate route would provide more benefits to the Gwich'in people.

Last week, Firth re-affirmed those concerns with the release of a letter voicing support for an "Over the Top," pipeline to APG chair Nellie Cournoyea.

Firth called the APG one-third ownership plan "unacceptable," and are reviewing the proposal by Northern Route Gas Pipeline Corporation (NRGCP).

Fred Carmichael, president of the Gwich'in Tribal Council, also sits on the board of the APG. Carmichael said he and Firth are seeking the same thing -- the best deal for the Gwich'in people.

Carmichael said the Gwich'in board of directors gave him a mandate to review both pipeline plans.

The development corporation decided they did not have the expertise to conduct a review of the pipeline plans, so they contracted a Calgary firm to conduct a study. Carmichael says the ArcticGas-NRGCP people have been reluctant to share their project information.

"They really don't have a business plan that people can look at," Carmichael said. "It's quite difficult to get hard information."

Bruce Hall, managing director for Calgary-based ArctiGas Resources Corp. said they've had no request for information from the GDC and have "no problem" in showing their business plan.

"I find that very surprising, because (Fred Carmichael) doesn't participate in any discussions or meeting that we've been at," Hall said. "We've never had a request from Fred Carmichael for any information."

The group hired by the Gwich'in to review the projects says they've not had a chance to see both proposals yet.

Gerry Kalyniuk, vice- president of Canadian Petroleum Engineers said they have gathered much information and although they have yet to meet with ArcticGas, Kalyniuk doesn't foresee any problems.

"I don't want to characterize anything, we just haven't had a chance to get together with them yet," he said. "We hope to meet with them as soon as next week."

Carmichael says he's unaware if the Gwich'in dissension is shaking the confidence of the producer's group.

"I get the sense that they're certainly not happy about it, but they also realize that it's the very smallest minority who are making these statements," he said.

Carmichael is expecting the report to be complete by mid-summer.

"We can't wait forever and I'm hoping to bring a recommendation to the Gwich'in people at our annual general assembly," he said.

Borrowing a billion

The ArcticGas proposal calls for 100 per cent debt financing through the sale of bonds that would be guaranteed by shipper contracts.

The Mackenzie Gas Project would be paid for by producers and proportionally with the land groups of the Aboriginal Pipeline Group (APG).

Approximately 20 percent of the proposed pipeline will cross Gwich'in land, so their cost will be 20 per cent of $1 billion.

Carl Chala, vice-president of business development for the Gwich'in Development Corporation said the Gwich'in portion of the APG's $1 billion will be $70 million.

The GDC have prepared several drafts of a business plan that will be submitted to the federal and territorial government for a grant or a loan guarantee for the money.

"The government's going to take a very hard look at our business plan before they guarantee our loan," he said. "In addition to that, we have four major oil companies that are partners in this and they are not going to get into this, unless they think it's a feasible project."