Thorunn Howatt
Northern News Services

Yellowknife (Jan 09/02) - Whether a Mackenzie Valley natural gas pipeline is ever built remains to be seen, but Northerners moved one step closer Monday to seeing the revenue tap worth millions -- and potentially billions of dollars -- turned on

Gas producers, teamed up with an aboriginal pipeline group, announced they intend to file a regulatory application and begin the next move to moving Arctic gas southward.

The producers anticipate spending up to $250 million on the regulatory application process.

The step forward, called the project definition phase, is likely to take about four years, they say. This week's step reassures edgy workers and investors in the natural gas-rich Mackenzie Delta.

"To us it's a green light that we needed to turn on," said Mackenzie Valley Aboriginal Pipeline Corporation chair, Nellie Cournoyea. The announcement will help settle jitters for those banking on a $3 billion pipeline proposed to get Canadian natural gas out of the ground and off to market.

"People wonder sometimes whether anything will come to fruition or not."

Intention to file regulatory applications needed to produce and ship onshore natural gas from the Mackenzie Delta to market was announced by the Mackenzie Valley Producers Group - ExxonMobil, Shell, Imperial Oil and Conoco along with the Mackenzie Valley Pipeline Corporation made up of membership from the aboriginal regions of the Northwest Territories.

The pipeline would follow the path of the Mackenzie Valley starting just north of Inuvik and move southward. It could mean thousands of jobs and millions of spin-off dollars.

Cournoyea led Northern aboriginal regions to band together in the drive for the pipeline. She sees it as a way to take advantage of economic opportunities that follow with development. But so far the aboriginal group doesn't have financing secured to pay for its one-third share of the line.

Pipeline spinoffs

Pipeline construction will have a $338 million impact on the Northwest Territories economy according to a Government of the Northwest Territories study.

The spin-offs from further exploration total $235 million territorially while the impact on the national economy tops $1.4 billion.

"We are putting together a business plan. We have already talked to several federal agencies," she said adding that her group's share of the project definition stage and related hearings will add up to about $60 million.

Cournoyea is confident the federal government will see the pipeline as a national employment issue. "Our business plan would show the positive benefits of supporting the aboriginal people in ownership rather than in just a few token jobs here and there."

The much-anticipated application announcement came on the heels of completion of a two-year feasibility study meant to gauge aboriginal and Northerners' support. In 1977, producers' dreams of a Mackenzie pipeline were halted after the Berger Inquiry pointed to aboriginal opposition. Some investors were financially devastated when the proposal fell through.

"We are sufficiently encouraged that longer term demand for natural gas will remain strong both in Canada and the United States," said Imperial Oil Limited's public affairs spokesperson, Hart Searle. "We know that the prices are volatile. That just reinforced the need to base our outlooks on the longer term fundamental market forces."

The next three years will include technical and environmental work supporting application as well as agreement of benefit and access plans.

Related link:
Route to a road