Yellowknife (Sep 05/03) - A gas pipeline project not heard about for 30 years has renewed interest, but this time the gas will be flowing the other way.

The Dempster Lateral was first proposed back in the mid-1970s, when the Berger pipeline moratorium came down, as a way to move Mackenzie Delta gas south.

Yukon Premier Dennis Fentie brought the Dempster Lateral back to life in his 2003-2004 budget speech, as a way to get stranded Yukon resources out from Eagle Plains and the Peel Plateau.

"The construction of a Mackenzie line would eliminate the need to construct the Dempster Lateral, connecting with the Alaska Highway Natural Gas Pipeline," Fentie said in the address. "It might then be more feasible to build a Dempster line eastward to connect with the Mackenzie line."

Not long after his election, Fentie met with NWT Premier Stephen Kakfwi to discuss the Dempster Lateral, as well as other items of shared concern. The two signed an agreement that they would pursue projects of mutual interest.

"We're looking at options to get the resources in the Eagle Plains and Peel Plateau areas to market," Fentie said. "If the Mackenzie Valley line is a go, we want to discuss the possibility of flowing that resource to the line."

"Otherwise, we are solely dependent on what might happen with the Alaska line and that wouldn't be the prudent thing to do."

Having a transportation line for the known resource would also spur exploration for other resources in the area, Fentie said.

"If we had a commitment to go to the Mackenzie line, it's obviously going to increase the interest in North Yukon with the reserves that are there," he said.

In the 1960s and 1970s, there were 18 wells drilled in the area, but activity had fallen off to nil, until last year, when Houston-based Hunt Oil bid on a 40,200- hectare lease in the area.

Energy Mines and Resources estimates the gas reserves in the area at about four trillion cubic feet and potential for 40 million barrels of sweet crude oil.

Northern accord

Fentie said the Dempster project is one of many projects he hopes his government will be working on with the NWT.

Fenti, Kakfwi and Nunavut's Paul Okalik are scheduled to sign a cooperation accord this week that will provide the Northern leaders a unified voice to Ottawa.

"We did it with health care, we're certainly going to do it with education," Fentie said. "We are working collectively on inadequacies in the base rate for territorial transfer payments."

Fentie was elected on Feb. 4, and he said he called NWT Premier Stephen Kakfwi the next day, seeing an opportunity for a better relationship than the Liberal Party's Pat Duncan had with Kakfwi.

"The need for us to build a relationship with the NWT and Nunavut was not lost on us," Fentie said. "More specifically with the NWT, because of the connection with the Dempster, but we also have other cross-border issues."

The three leaders hope to resolve the per capita funding issue with the federal government and increase the profile of the North in the south.

"We happen to be one-third of Canada's land mass and that speaks volumes for what kind of reception we should be getting on the national stage."