Yellowknife (June 02/03) - A memorandum of understanding with Akaitcho chiefs that will clear the way for large-scale hydro-electric developments in the NWT has been stalled by last-minute revisions.

Finance minister Joe Handley met privately with the chiefs in Yellowknife Thursday to sign the memorandum on behalf of the territorial government, but came away requests for changes.

Drew Williams, press officer for the executive council, said Friday that the memorandum was being revised before going back to the chiefs for final approval.

Details of the memorandum and the changes were not immediately available, but Handley said at a public meeting earlier in the week that it would make aboriginal groups and industrial electrical users joint venture partners and owners of hydro projects.

Industrial customers are key to developing hydro potential and until now the government has been unable to persuade mining companies to buy into its long-term energy vision for the Northwest Territories.

But now De Beers has "agreed to take a serious look" at buying electricity from the Talston River if it can be delivered to its mine by 2007, Handley said.

If De Beers signs on, Handley said there will be further development of the Talston's hydro-electric potential.

Judy Langford, communications administrator for De Beers, said the company has designed its Snap Lake mine to operate on diesel generators, but is "not opposed" to switching to hydro-electricity "if it's reliable and cost-effective."

Handley said the government also has pumping stations on the Mackenzie Valley natural gas pipeline on its list of potential hydro-electric customers.

The stations at Inuvik, Norman Wells, Fort Simpson and on the Alberta border will each require 28 megawatts of electricity and Handley says that demand can be met with run-of-river electrical generators on the Bear River.

Handley said the same generators would produce electricity for residential users in Deline, Tulita and Inuvik.

Handley said the government is looking at a model developed in Manitoba where Northern communities near hydro-electric projects pay rates subsidized by industrial users for power.

"They pay around four cents a kilowatt hour; we pay 20 cents," Handley said.

"As long as we are dependent on diesel there will be rate riders. Hydro is the only long-term solution."