U.S. Senate finds friends, foes in Canada on ANWR, pipeline loans

Environment minister says Canada must remain ‘very vigilant’ to ensure ANWR drilling remains a ‘mistake;’ Kakfwi opposes ‘heavily subsidized’ Alaska gas

Gary Park

PNA Canadian Correspondent

Canada has been a reverse image of Alaska in its response to U.S. Senate decisions in mid-April on the Arctic National Wildlife Refuge and loan guarantees for an Alaska Highway gasline.

Environment Minister David Anderson, a relentless campaigner against drilling in ANWR, was “happy” with the Senate verdict, but added: “I don’t think we owe them (the senators) anything for it ... I just hope it’s the end of the game (for drilling).”

Word that the Senate has endorsed $10 billion in loan guarantees for the gasline provoked an equally strong reaction from Northwest Territories Premier Stephen Kakfwi, who “jokingly” suggested Cuban President Fidel Castro “must have infiltrated the institutions of government in the U.S.” to undermine the free market.

On ANWR, Anderson said the Canadian government will be “very vigilant to make sure this is the end. ANWR drilling was a mistake when it was first proposed, it’s a mistake now and it will be a mistake in the future.”

Permanent protection the goal

Anderson said that if forecasts are accurate that it would take 10 years for any ANWR oil to reach market “the Americans have a much bigger problem than they’ve been willing to admit on the issue of supply of energy.”

Loan guarantees to support development of a pipeline from the North Slope through Canada to the Lower 48 would destroy the economics of gas development in the Mackenzie Delta, said Kakfwi at the same time that he welcomed the Senate stance on ANWR.

“We are afraid that the Americans, who are supposed to be champions of free enterprise, are now starting to talk about subsidizing these huge volumes of Alaska gas,” he said.

Subsidies a threat

He said he has pressed Prime Minister Jean Chretien and other cabinet ministers to challenge the prospect of loan guarantees.

“If we are going to see heavily subsidized, politically chosen routes for American gas to go across Canadian territory, then the Canadian government has to ... take a clear stand in the national interest.

“The Americans are supposed to be the capitalists and entrepreneurial champions of the world. All of a sudden they’re talking about subsidies and telling the private sector what they can and can’t do — for political reasons — and it’s alarming,” Kakfwi declared.

He said the Canadian government should not allow any subsidized Alaska gas to cross Canada if that effectively strands Mackenzie Delta gas and urged the government to break its route neutrality for Arctic gas by making positive moves to speed up a Mackenzie Valley pipeline.

“Canada must send strong signals to the president and administration that market interference is counterproductive to the efficient operation of the North American gas market,” he said.

Kakfwi told Chretien the government has “a responsibility to make strategic investments necessary to achieve the vision and encourage responsible accelerated development of the Northwest Territories’ resources.”

He also urged the industry to become partners with the Northwest Territories in ensuring the Mackenzie Valley project does not slip away.

There’s still hope for ANWR, Herrera says

Kay Cashman, PNA publisher

If the Senate bill passes, the next step is to send both the House and Senate versions of the energy bill to a House-Senate conference committee to iron out the differences between the bills — the two most significant being an ethanol provision that is watered down in the House version and language in HR4 that opens the coastal plain of the Arctic National Wildlife Refuge to oil and gas development which is missing from the Senate version.

Herrera believes it is because of the ethanol provision that Senate Majority Leader Tom Daschle allowed the Senate energy bill to go to conference committee.

“The presence of the ethanol provision will be a huge benefit to his state, to South Dakota farmers. … The ethanol provision in the Senate bill is much more advantageous to farmers than the watered down version in the House bill,” Herrera explained.

“Daschle’s fellow senator, Johnson, a Democrat from South Dakota, is up for election this fall. Johnson is very much at risk; a very strong Republican candidate is running against him,” he said. “South Dakota is a very conservative state.”

The fact that President George W. Bush has visited South Dakota twice this year “indicates the importance of the South Dakota Senate race,” Herrera said.

“There will intense negotiations around both the ethanol and ANWR issues in the conference committee.”

The loss of the strongly-worded Senate version of the ethanol provision “could cost Johnson his seat,” Herrera said.

If the Democrats lose one seat in the next election, they lose control of the Senate and Daschle, a strong opponent of drilling in ANWR, loses leadership, he said. “The leadership of the House is also very close, seven or eight seats.” But ANWR does not face as much opposition from Democrats in the House, where approximately 15 percent of the Democrats voted for ANWR drilling in August.

If the energy bills “flounder in conference committee, they will die” and have to be reintroduced in the 108th Congress which convenes in January, Herrera said. “That could be good or bad, depending on your position and what happens with the leadership after the fall elections.”

Filibuster unlikely

“If the Democrats kill the entire energy bill because of ANWR, then they will have to take the blame for that politically,” he said.

The conference committee for the energy bill, which will contain an equal number of members from both chambers of Congress and an equal number of Republicans and Democrats, is scheduled to be chaired by the House, which is a good sign for ANWR drilling, Herrera said, because it is “rumored that Sen. Billy Tauzim from Louisiana will chair the committee. … He’s very much pro-ANWR and very articulate on the subject.”

Bush support uncertain

But while the Bush administration lobbied heavily in the House for the ANWR amendment last summer, Herrera said, it did not lend the same support to the Senate ANWR amendment this past month.

“No one knows why,” he said, although there is some speculation that they want to stay away from environmental issues prior to the fall elections.