Thorunn Howatt
Northern News Services

Inuvik (June 24/02) - Multinational executives, energy company bigwigs and politicians slept on couches and loaded planes to capacity. The Town of Inuvik was bursting at the seams, with everyone there for the most important energy conference of the year.

"Since the show last year Inuvik has become a phenomenon," said The Harbour Company's Dave Harbour. He produces an informational Arctic pipeline-watching Web site out of Alaska.

About two years ago, high-spiking natural gas prices pushed energy companies to look north for resources. Since then, Inuvik has been in the middle of an exploration feeding frenzy driven by talk of a Mackenzie Valley pipeline.

"The project that is the most important is the Mackenzie Valley pipeline and Inuvik is the starting point. It makes sense that the politicians and industry would be here," he said.

Last week's second Inuvik Petroleum Show was jammed between other energy symposiums held everywhere from Houston to Calgary. But the Inuvik show was the important one. Inuvik is where the seed of the Mackenzie Valley pipeline is germinating.

And this year's show is a "moment." It is suspended during a time 25 years after an inquiry placed a moratorium on pipeline, and coinciding with a push for a competing Alaskan pipe. There is a sense of urgency.

About $1 billion has been committed on Delta exploration. Imperial Oil, Conoco, Shell, ExxonMobil are sitting on significant natural gas resources. They are producers and also part of a group that wants to build a pipeline down the Mackenzie.

Drilling for natural gas is pointless if there is no way to transport the natural gas to southern markets.

Commitment needed

If pipeline talk doesn't get more serious pretty soon, energy companies are going to get more reluctant about spending their dollars in the Delta.

"The greatest restraint on exploration spending is the uncertainty of a pipeline. It is of no use to find lots of gas if it can't be moved from the ground," said ChevronTexaco northern gas program manager Rod Maier. He represents a group of Mackenzie-Beaufort explorers who do not belong to the Mackenzie Delta Producers' Group.

Right now they have no ownership or commitments to a pipeline. But they need one. "We don't want to be drilling today for something that is going to sit in the ground for another five, 10 or 15 years."

Inuvik has been in the middle of a two-year economic boom resulting from delta exploration.

Many fear that if a commitment isn't made to a Mackenzie Valley line very soon, then exploration dollars will dry up.

"I would have thought they would have accomplished more and done more in that length of time," said Maier, referring to the pace that it has taken the producers' group to move forward with the pipe proposal.

Never quick enough

But as with most development in the north, things never happen as quickly as developers hope.

The territory has a nearly new regulatory Mackenzie Valley Land and Water Board that is wrestling with the environmental impacts of huge diamond mining projects as well as the prospect of a pipeline.

The pipeline proponents also need to have the aboriginal groups on-side. Twenty-five years ago a pipeline proposal was shut down because of anti-pipeline uproar from aboriginal groups. So, last year, the Aboriginal Pipeline Group (APG) hooked in with the producers' group for a one-third piece of the proposed pipe.

That group is led by former premier Nellie Cournoyea and has representation from most of the Northwest Territories' aboriginal regions.

Now the team has moved from the feasibility study stage to engineering and community consultation studies.

The APG does not have secured financing though and needs to ensure gas for its part of the pipe.

Invitations out

Last week, Imperial Oil sent out invitations to other companies.

They want nominations for gas and expressions of interest for room in the pipeline.

"We're at odds with that," said Maier who noted that the exploration companies' projected timelines are out of synchronization with the pipeline prospect.

"Explorers aren't ready for that stage yet."

Explorers want to know more details though -- pipe size and toll costs -- before they commit to any pipeline.

And the APG-producers' group proposal has more competition in its own backyard.

A group called Arctic Resources Corporation (ARC) wants to build a completely debt-financed pipe from Alaska to the Mackenzie Delta and then south following the same route as the Mackenzie Valley Pipeline.

They are touting the proposal as 100 per cent aboriginal owned. Many are blaming the proposal for the hold-up, a diversion from the focus of a Mackenzie Valley pipeline.

Some groups think the ARC proposal is the way to go. Inuvik's Nihtat Gwich'in Council Chief James Firth signed on with ARC-linked Northern Route Gas Pipeline Corporation. But others aren't drawn by the temptation of 100 per cent ownership.

"My personal opinion is why do we need to own it anyway? What are we going to do with it at the end of the day?" said Fort McPherson's Tetlit Gwich'in Chief Abe Wilson. None of the reserves in the south own pipelines, he said, adding, "They just get the access agreement and fees. We have our own land claim."