GNWT hopes agreement comes before pipeline
Richard Gleeson
Northern News Services
Yellowknife (Dec 04/00) - The territorial government supports pipeline development even though it will not be collecting the royalties that will flow from oil and gas development.
"We're proceeding on the assumption we would have a devolution agreement -- we have no other choice right now," said territorial Finance Minister Joe Handley.
 Joe Handley |
The federal government has stated it is willing to give the territorial government a greater share of resource revenues as soon as the government and aboriginal groups agree on how to share them up.
"If it came right down to it and we had no resource revenue sharing agreement, then everything else becomes very questionable," Handley said.
"I mean, what's the benefit for northerners?"
The Finance Minister said the territorial government would not be looking to shut off all the valves on the pipeline if no revenue-sharing agreement was in place by the time it is built, if it is built.
"Ethel (Blondin-Andrew, Western Arctic MP) in her campaign stated that that's her top priority," Handley said.
"We've got to take her word on that and hope she's going to deliver on it."
Under the current royalty scheme, the federal government collects one per cent of gross revenues the first 18 months of production.
The rate increases one per cent each subsequent 18-month period to a maximum of five per cent until the capital costs of the project are covered.
Once the project is paid out the federal government chooses between 30 per cent of gross revenues or five per cent of net revenues, whichever is higher, for the remainding of the life of the project.
Estimated gross revenues from the Beaufort-Delta are around $16 billion.
