Yellowknife (Apr 14/03) - The federal government may yet enter into loan guarantees to help the Aboriginal Pipeline Group finance its share of the Mackenzie Valley pipeline.

Those loans could amount to about $1 billion dollars for the APG's one-third ownership if the pipeline is built.

Robert Nault, Minister of Indian Affairs and Northern Development, made the comment to reporters last week after speaking at the Ziff Energy Conference in Houston, Texas.

Nault said federal loan guarantees remained "an option" although the government still wants the private sector to carry the project on its own.

That's a flip-flop from Ottawa's earlier refusal to back a $70 million loan for the APG's share of the project assessment phase.

The industry has been awaiting an APG announcement on start-up funding for several weeks, with Trans Canada Pipeline the rumoured backer.

Nault said he was optimistic that deal would be unveiled shortly, with a Preliminary Information Package (PIP) on the project coming soon after.

APG head Fred Carmichael was travelling and unavailable for comment.