SOMBA K'E/YELLOWKNIFE - The territorial government is contradicting a cabinet minister's comments which cast doubt on the proposed expansion of the Taltson River hydroelectric facility.

In a newspaper interview earlier this month, Michael Miltenberger was quoted as saying only one of the three existing diamond mines in the NWT seems interested in buying the power.

The diamond mines becoming customers for the new power is a cornerstone of the proposed $700-million project.

Miltenberger was unavailable for comment and Premier Floyd Roland responded for the government.

"Number one, Mr. Miltenberger may in that interview be working off his musings of what seems to be happening, but there are discussions with mines through the Hydro Corporation," Roland said. "We're expecting some work to be brought to our table as ministers in the near future with the latest information of how the project is proceeding and deciding on how we would take the next steps. So there are discussions going on with the mines."

Roland, the minister responsible for the Northwest Territories Power Corporation and its parent company, the Northwest Territories Hydro Corp-oration, said he has not had any information from the mines stating they're not in support of the Taltson project.

Roland said he had a "bit of a discussion" with Miltenberger about his comments, although he declined to say what was said between the two.

Roland said the government still stands behind the project.

The proponent for the project is Deze Energy Corporation, which is equally owned by the Akaitcho Energy Corporation, the Metis Energy Company Ltd. and the NWT Energy Corporation (03) Ltd., a subsidiary of NT Hydro.

Deze Energy would expand the Taltson River hydroelectric site and build a 690-kilometre transmission line to the diamond mines.

The hydroelectric site, 50 km north of Fort Smith, now produces 18 megawatts of electricity. An expansion would add between 36 and 56 megawatts.

In August, the Mackenzie Valley Environmental Impact Review Board approved the proposed project.

The review board submitted its report on the project to the minister of Indian and Northern Affairs Canada. The project is awaiting the minister's acceptance and approval of the report.

Roland said much of the work done in the environmental process has helped prepare the Hydro Corporation for its final set of discussions with the mines about power purchase agreements.

As for the controversial proposed route of the transmission line around the east side of Great Slave Lake, Roland said, "The environmental process that we undertook had a line identified and we're looking at slightly altering the route that would try to accommodate some of those concerns."

Lutsel K'e Dene First Nation objects to the transmission line crossing its traditional territory.

Roland said the proposed project is getting down to the late stages of deciding if it's a go or no go.

"I believe a decision on this project will be made during the life of this assembly," said the premier.

The next general election in the NWT will be held less than a year from now - on Oct. 3, 2011.

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