 | E-mail this story |  | Write letter to editor |  | Order a classified ad |
| E-mail this story | | Write letter to editor | | Order a classified ad |
Thorunn Howatt
Northern News Services
 Nellie Cournoyea, chair of the Aboriginal Pipeline Group, warns they will pull out of a Mackenzie Valley natural gas pipeline if it doesn't secure funding. - NNSL File Photo  Open letter to the Prime Minister On Oct. 15, 2002, we will reach the first anniversary of the signing of the historic Memorandum of Understanding between the Aboriginal Pipeline Group and the Mackenzie Delta Producers Group. With your assurance and support, we can continue to progress this important project for Canada and all the peoples of the North. The Mackenzie Gas Project has reached a critical crossroad; only you can signal whether the project will go ahead or stall, once again. Imperial Oil, Shell Canada, ConocoPhillips and ExxonMobil Canada (the Producers Group) are ready to proceed to the next phase of preparation -- the filing of a Preliminary Information Package (PIP) with the National Energy Board and others. The PIP is on the critical path for this project. The Producers Group will not proceed with this project without APG participation. That participation includes a financial commitment to the Project Definition Phase as an equity owner, giving the APG a one-third interest in the project. The Producers Group are ready to proceed and so is the APG -- once the financial commitment has been made. APG has requested a loan guarantee of $70 million to help us participate in this phase and the GNWT is prepared to participate in such a loan guarantee. This is spelled out in a business plan that was submitted to Indian and Northern Affairs Minister Bob Nault and Natural Resources Minister Herb Dhaliwal in June 2002. To date we have not received any adequate response from Canada. v The PIP is complete, ready to be filed when APG has arranged funding. Delays in filing the PIP will send a very negative signal to explorers and markets; lack of funding will erode aboriginal support and potentially kill, or at least significantly delay the project. v An immediate resolution to this impasse is required. The Producers Group and APG are prepared to meet with you and any minister that you may need to get this resolved, at your convenience. Nellie Cournoyea Chair |
Nellie Cournoyea, APG chair, sent the warning to the prime minister last week.
"The producers group will not proceed with this project without APG participation," Cournoyea wrote in a letter to Prime Minister Jean Chretien. The APG needs $70 million for its share of pipeline research as a one-third partner in the $3.3 billion pipeline to carry Arctic natural gas to Southern Canada.
Imperial Oil and a contingent of energy producers planned to submit a preliminary information package (PIP) to the National Energy Board early this month detailing the plan.
There's one problem though - the APG can't be a real player in the venture until it has cash. And it's running out of time to raise it.
About a week ago APG representatives visited the prime minister's office in Ottawa, hoping to get federal funding guarantees. The federal government hasn't responded to the request.
Alistair Mullin, a spokesperson from the office of Indian Affairs Minister Robert Nault, wouldn't say what the roadblocks are.
So the APG is pulling out all the stops.
It wants the federal government to give it loan guarantees for the financing. Or else.
"The Mackenzie Gas Project has reached a critical crossroad; only you can signal whether the project will go ahead or stall, once again," wrote Cournoyea to the prime minister. She was referring to a similar Northern pipeline project that was halted in the 1970s after aboriginal peoples raised an uproar.
Aboriginal support critical
The pipeline project never achieved the aboriginal support to go ahead. That's where the APG comes in. A partnership between the APG and the producers' would secure aboriginal support.
"Delays in filing the PIP will send a very negative signal to explorers and markets; lack of funding will erode aboriginal support and potentially kill, or at least significantly delay the project," Cournoyea wrote.
The APG represents most of the aboriginal regions of the Northwest Territories.
The group wants ownership in the pipeline project so it can have a say in how development will affect the people living in the regions. Most oil and gas projects in the past have left a bad taste in the mouths of aboriginal people living close to them.
Imperial Oil Resources officials say they want gas flowing down the pipe before the end of 2007. But they aren't surprised by the Aboriginal Pipeline Group's stance.
"We were aware of their frustration. That wasn't a secret," said Imperial Oil's Hart Searle. He added that the PIP won't be submitted until the APG is on board.
But the producers still expect the APG to come up with its own cash.
"Everybody knows that without the support of the aboriginal people this thing is not going to fly," said Searle.
Over the telephone from Calgary, Cournoyea said the APG doesn't have collateral to get money through private banks, so that's why it needs the federal government's loan guarantee.
"We have nothing yet. We are just getting started," she said.
If the APG gets its cash and the Mackenzie pipeline project goes to the construction phase, it will still need another $1 billion.
