by Glenn Taylor
Northern News Services

INUVIK (Dec 19/97) - The NWT Power Corporation has committed $3 million to a project linking Inuvik to natural gas.

Power Corporation CEO Leon Courneya signed an agreement last week with the Inuvialuit Petroleum Corporation, to purchase gas from IPC's Ikhil gas project for 15 years.

The agreement will allow the corporation "to reduce the cost, over time, of electricity to Inuvik residents by up to 20 per cent over 15 years," said Courneya.

Courneya estimates the corporation will spend about $3 million to convert its fuel burners to use the natural gas for electricity production. Pun Chu, Power Corporation director of western operations, said details of the conversion plans will be announced by next month.

IPC's $30-million project to link Inuvik to natural gas is the first of its kind in the NWT. Dozens of residents came to the signing ceremonies at the Inuvialuit Corporate Centre last week, symbolizing the importance many are placing on the project to restart Inuvik's battered economy.

IPC chair Russell Newmark said residents and businesses will see their power costs drop 15 to 20 per cent below diesel fuel costs, thanks to the project.

The project involves the drilling of two or three wells and construction of 45 kilometres of buried gas pipeline to Inuvik, as well as an in-town distribution system.

IPC has formed a partnership in principle with Alta Gas, a mid-size company from Alberta that offers a wealth of expertise in field production to the corporation.

Newmark said IPC is also looking for a second partner with pipeline building expertise, which could potentially split the risk and returns on the project three ways, with each partner paying $10 million.

IPC has been looking at such a project for years. But three years ago, it looked again. IPC considered whether it would be economical to build systems for Tuk and Inuvik. Tuk was close to having its own plant twice in the past, but both plans fell through. The most recent look at that prospect also showed it wasn't economical. Inuvik looked good, however, and IPC moved ahead.

But Newmark said if more reserves are discovered at Ikhil -- he hopes drilling project this winter will reveal that Ikhil contains not one but several pockets of gas -- that Tuk could be linked up to Ikhil, meaning only a pipe would have to be built, not an entire production system.

He said IPC would consider down the road whether such a project was feasible.