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Arctic leaders try for pipeline peace without giving any ground
Gary Park
The Arctic trio — two tenors and a soprano — tried singing from the same song sheet, but ended up in their old roles, a trifle off-key.
Alaska Gov. Tony Knowles, Northwest Territories Premier Stephen Kakfwi (who were actually having their first face-to-face meeting) and Yukon Premier Pat Duncan told a Calgary news conference on March 8 that they want to work together to ensure all three benefit from shipping Arctic natural gas to southern markets.
Knowles and Duncan, while not wavering in their support of the Alaska Highway route, insisted there was no reason why a second line could not be built down the Mackenzie River Valley.
Knowles, almost cast in the role of mediator between the arch rivals from the NWT and Yukon, offered an olive branch to Kakfwi.
“My vision is two pipelines, with one goal: a stronger, more prosperous North, supplying North America’s energy needs,” he said, suggesting additional volumes from the Mackenzie Delta could result in lower tariffs for both lines.
“The demand for natural gas shows that two pipelines are both feasible and should be built,” he said.
Knowles said demand projections would “appear to accommodate” development of the Delta reserves, while the “infrastructure developed in Alberta for a highway route would be vital for a gas line from the Delta.
“Some might frame Alaska’s emergence in the market as competition to Canada. Alaska is not looking to take market share. We are looking to share in market growth,” he said.
Duncan reiterated her familiar line that the NWT and Yukon “are not locked in competition for a single pipeline route. I urge you to reject the fear mongering of those who would have you believe that an Alaska Highway pipeline project would somehow glut the market, lower the price and shut in other northern gas projects.” NWT fears glut of gas Kakfwi, whose major concern is that Delta gas could be stranded indefinitely, supported the effort to create a common front among the Arctic leaders. “The fact is, politically, we’d like to agree to support each other. There is no difficulty with that.
“It has become apparent to everybody that those of us who live in the North would be wise to start talking to each other more often,” Kakfwi said.
Knowles endorsed that sentiment, arguing “it would be good to have us working together so the producers can’t pit us against each other.”
But Kakfwi remains unhappy that the Canadian government has so far declined to take a stand in favor of getting Delta gas to the Lower 48 market at the same time as North Slope gas.
He noted that the U.S. Western and National Governors’ associations have unanimously backed the Alaska Highway pipeline.
“When I see 50 governors lining up behind one option and my option is not there it just makes me wonder, where is the Canadian government for me?
“We need the Canadian government to take a position so Alaska gas isn’t the priority here. We’re not going to sit on the sidelines and play catch-up later. We must get our gas to market at the same time.”
A spokesman for federal Natural Resources Minister Ralph Goodale said the government won’t “express any sort of opinion that may influence or be seen to influence” any pipeline decisions by the National Energy Board.
Even Kakfwi, along with Duncan and Knowles, conceded the final verdict should rest with the producers, to decide the economic and timing of Arctic gas development and resolve the pipeline options.
“We’re not paying for the pipeline, we’re not consuming the gas, we’re just the politicians posturing for our jurisdictions,” Kakfwi conceded. Mackenzie route most cost-efficient But the NWT premier got a substantial boost at the Arctic gas symposium from representatives of Gulf Canada Resources and BP, two of the key gas owners in the Canadian and U.S. Arctic.
Ron McIntosh, Gulf Canada’s chief operating officer, said his company preferred the Mackenzie route “because we believe it would be the most cost-efficient and have the least environmental impact. It’s a significantly shorter route.”
He said it would also present the most sensible option for shipping oil from the Mackenzie Delta and Beaufort Sea.
Ken Konrad, senior vice president for BP Exploration (Alaska), said a Mackenzie pipeline appeared to be less expensive than the Alaska Highway route, but he steered a wide berth around declaring a preference.
However, Konrad said it would likely take much longer to obtain regulatory approval for a Mackenzie pipeline, given that the Alaska Highway proposal received regulatory backing in the 1970s from both the United States and Canada.
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