While the Yukon and Alaska claimed the lead, Canada’s NorthwestTerritories remained far from forfeiting as action heated up onboth sides of the international rivalry to be first to takeadvantage of surging natural gas markets with Arctic supplies.

Canada’s Yukon Territory saluted the American side when thebig-three owners of Alaskan gas put a dollar figure on theirpreviously-announced commitment to collaborate on devising ways totap and ship south about 35 Tcf of gas reserves made available bydeclining oil production at the 32-year-old Prudhoe Bay field. TheAnchorage-based, Alaskan branches of BP, Phillips Petroleum andExxon Mobil declared intentions to put US$75 million into a programthat involve up to 100 employees of the companies and generate”significant” supporting work by contractors.

The Yukon was especially encouraged when the U.S. producers saidthe effort will center on transportation issues and gave theproposal a name, the Alaskan Gas Pipeline Project. As in the past,the producers refrained from saying who they want to build andoperate the system, leaving open a door for the campaign byTransCanada PipeLines’s Foothills Pipe Lines to revive the dormantAlaska Natural Gas Transportation System.

The American companies said their work will concentrate ondesign, costs, obtaining permits, the eventual commercial structureof a northern megaproject, and its economic viability. The declaredobjective remains to evaluate and select a route, then fileconstruction applications with authorities in Canada and the U.S.

Simultaneously, on the Canadian side of the northern gas race,government authorities moved into position to respond quickly toarctic pipeline proposals. The National Energy Board and theMackenzie Valley Environmental Impact Review Board signed amemorandum of understanding on cooperation. NEB chairman KenVollman described the arrangement as a first major step towardestablishing an orderly, efficient method of dealing with northernpipeline proposals.

NEB officials have been keeping close tabs on the northernpipeline revival and say they expect to start seeing applicationsas early as mid-2001 arising from one or more of up to half a dozenschemes that have been under increasingly active discussion in theindustry since tightening gas supplies began driving up prices morethan a year ago. The proposals are variations on three themes: arevival of the ANGTS route along the Alaska Highway through theYukon Territory, a revival of Mackenzie Valley pipeline proposals,and alternatives for connecting the two into a vast new northernpipeline grid.

In Whitehorse, a delighted Yukon Premier Minister Pat Duncansaid it is obvious that support for construction of the AlaskaHighway Pipeline is gaining momentum. She pointed to a unanimousresolution in support of their project that was passed by theannual meeting of the U.S. Western Governors in San Diego. Theresolution called on the U.S. and Canadian federal governments towork together on advancing the Alaska Highway route. The governorsurged all sides to try completing a project within six years.

But the Northwest Territories is far from giving up on hope fora project centered on gas reserves in the Mackenzie Delta-BeaufortSea region. The Canadian federal government gave fresh signs thatit intends to cooperate with the ambitions. Expanding on successfulauctions in 1999 and earlier this year of drilling prospects in theMackenzie Valley and on the Delta, Indian and Northern AffairsCanada issued an invitation to another big sale.

The invitation called for “nominations” of drilling targets fora new auction, tentatively scheduled for February, from among morethan 100 million hectares (about one million square kilometers or400,000 square miles) of the Delta, the Beaufort Sea and thewestern Arctic Islands. The region being thrown open reaches fromthe eastern boundary of the Yukon east into the new northernterritory of Nunavut, and from the Inuvik region on the Delta northto 80ø latitude.

The new invitation raises possibilities of activity on theCanada’s Arctic Islands for the first time since surpluses andfalling prices in the mid-1980s brought an end to a marathondrilling campaign by the Panarctic Oils consortium.

Gordon Jaremko, Calgary

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