Thorunn Howatt
Northern News Services

Yellowknife (Sep 18/02) - The gap is widening in the race to build an Arctic natural gas pipeline -- and it looks like the NWT is way ahead.

Ex-Alberta Premier Peter Lougheed's visit to Yellowknife this week and Imperial Oil's aggressive push to move quickly on the project signal the Aboriginal Pipeline Group (APG) is closer to getting the $70 million it needs for its one-third portion of pipeline research.

"We're meeting with (Lougheed) in Yellowknife this week," said APG member Doug Cardinal.

Lougheed is helping the APG get the cash for the $3.3 billion project. He is meeting with APG officials, Government of NWT members and speaking at a Chamber of Commerce lunch today.

"He's joined our team in helping us put that together," said Cardinal, adding the group will have more to say by week's end.

Imperial Oil Resources leads the Mackenzie Delta Producers' Group that wants to build a natural gas pipeline down the Mackenzie Valley. The consortium wants aboriginal consent before it goes ahead with the project though.

Until now, solid aboriginal support was a missing ingredient in the attempt to build the line.

"Northern support is essential and clearly, Northern aboriginal support is a big part of that in the Northwest Territories," said Imperial Oil's Joanne Young.

The producers group's best chance of bringing aboriginals on board is by giving the APG a one-third ownership.

But the aboriginal group didn't have money for the expensive venture.

The $70 million research money was probably the APG's biggest cash-related hurdle because there was nothing to secure it with. That cash is needed to pay for community consultations, environmental and engineering studies before the commitment to build the line is made. There's no guarantee to lenders they will get their money back because the pipeline isn't a sure thing.

That's why the APG wants a loan guarantee from the federal government and that's why they recruited Lougheed to help them get it. Lougheed was the man in charge of energy rich Alberta when deals were made to secure the province's wealthy future. He set up a trust fund securing energy royalties and made sure cash stayed in Alberta.

On Imperial's front, Tim Hearn, the company's new chief executive officer said last week the pipeline will be up and running by 2007 if efforts to speed up regulatory reviews and construction are successful.

The statement sends a strong signal -- aboriginal support looks like a reality. The APG is close to getting its funding guarantee.

If the pipeline project goes to the construction phase, and it looks like it will, the APG will need another $1 billion.

They should have an easier time getting that money though because then they can use the pipeline as collateral.