SOMBA K'E/YELLOWKNIFE - Last year's Conservative candidate for the Western Arctic said he won't be surprised should rumours hold true that a new $50 million federal agency will go to the capital of Nunavut instead of Yellowknife.

"Nunavut has an advantage in that they have a cabinet minister involved in a lot of those discussions," said Brendan Bell, who ran on the Conservatives' behalf during last fall's federal election. He lost in a narrow race to the NDP incumbent Dennis Bevington.

"I'm sure (Health Minister Leona Aglukkaq is) working hard to advocate that Nunavut is a great territory with lots of potential too."

An unverified report this week by National Post columnist John Ivison reported that Prime Minister Stephen Harper will announce Iqaluit as the home for the Northern Economic Development Agency when he makes a yet to be confirmed visit there next month.

"I know all three territories would love to be the headquarters," said Bell.

"I would make the case it's logical to have it in Yellowknife. It's centrally positioned. I think we have a number of things on the horizon that are going to be very important to us, including the pipeline and others.

"You gotta believe that the other territories are making their best case as well. Nunavut, from a mining perspective, is really booming, while the other territories are lagging behind. There are a number of things going on in the Yukon as well."

Bell added there has been no official announcement about the headquarters for the new agency and that the National Post column is just "speculation."

"I think it's premature to conclude this is going to Iqaluit but I know we're all working hard to see it wind up here in Yellowknife," said Bell.

Ellie Sasseville, executive director of the Yellowknife Chamber of Commerce, said the business group has heard the rumour and are disappointed.

"It would have brought jobs and opportunities. It's good for economic development," she said.

Chamber president Patrick Doyle echoed Sasseville's statement, adding Yellowknife "is such a logical choice."

"We will be contacting (Bevington) to hear what he's done on that file," said Doyle.

"It's disappointing if that's the case," said Joe Handley, former premier and Western Arctic Liberal candidate hopeful. He said if it is true the headquarters for the agency ends up in Iqaluit, "It's a real slap to the NWT."

"We have by far the strongest economy. They should have looked at where the economy would be most robust over the next five, 10, 20 years," he said.

"It seems to be a political move by the Conservatives."