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Thorunn Howatt
Northern News Services
"Since there hasn't been a lot of pipeline construction here in many years, there is no infrastructure," said Robert Marshall, a Trans Canada employee on loan to the territorial government.
Marshall relayed details of economic impacts of a proposed Mackenzie Valley pipeline to a meeting of NWT Construction Association members last week in Yellowknife.
About $8.2 billion would go to wages and salaries of people employed from pipeline development and 53,428 person years of employment would be created in the NWT.
"With only 41,000 people there's no way you're going to take advantage of these employment numbers," said Marshall pointing to the territories' small population.
Right now the NWT has fewer than 2,000 people looking for jobs, according to Statistics Canada.
That means the NWT's workforce could not handle the workload. Jobs and contracts and the money that follows will bleed to the south. About 50 separate service companies are required to bring an oil or gas well to production, said Marshall, detailing some of the tasks related to pipeline construction.
He noted road building, camp catering and maintenance, as well as pipeline buoyancy control. That's where concrete weights are bolted to the pipe. Northern companies will optimize benefits if they team up with southern companies that specialize in the type of tasks required during pipe construction, he explained.
A proposal to ship Canadian arctic natural gas southward via a $3-billion pipeline following the Mackenzie Valley was made by energy producers known as the Mackenzie Delta Producers' Group, along with one-third partners Aboriginal Pipeline Corporation.
The producers include Imperial Oil Resources, Conoco Canada, Shell Canada and ExxonMobil Canada.
Following a feasibility study they committed $250 million to a project definition stage. If pipeline developments move as planned, gas could be flowing southward in six to eight years.
Pipeline contractors also need storage, office and living space if a pipeline goes through. With a vacancy rate of nearly zero, Yellowknife must ramp up its building construction if it is going to act as an operator base.
Marshall highlighted Inuvik, Norman Wells and Fort Simpson as possible key pipeline construction centres.
"Construction is really just a short-term peak," said Marshall, noting that part of the project will take only two years and go on only for four-month winter periods. Anyone looking to get into the pipeline construction game should look for longer-term opportunities advised Marshall.
"I can't see anyone benefitting directly," said the NWT Construction Association's Don Worrall, but added the financial rewards will come with economic growth. "People will want to build more houses."
But if an American plan to subsidize an alternate route that would ship natural gas from Alaska's Prudhoe Bay southward following the Alaska Highway then Mackenzie Delta gas will stay in the ground for years to come.
"Both proposals could not be built at the same time because of limited resources," said Marshall, referring to a shortage of steel and manpower that would be needed to build both pipes. In that case NWT natural gas could be stranded with no way out for years to come.
The Mackenzie Delta-Beaufort Sea has an estimated nine trillion cubic feet of proven reserves waiting to be shipped.
