With drilling rigs ready to roll onto the Mackenzie Delta as soon as the tundra freezes for the winter and producers courting consent for more activity, Canadians are starting to believe their entry is pulling ahead in the Arctic gas sweepstakes.

The deputy premier of the Northwest Territories voiced the mood at a Calgary seminar held to coach industry representatives on doing business north of the 60th Parallel. Jim Antoine, a leader of the native Dene Nation since the 1970s, said “winning conditions are making a Mackenzie Valley gas pipeline a reality.” Not the least of those conditions are the relative sizes of the Alaskan and Canadian projects. A Mackenzie Valley line is projected to cost C$4 billion (US$2.6 billion), or as little as one-fifth of the enormous pricetags being described for an Alaskan counterpart that would include an “express” route across the continent as well as the longer northern stretch needed to reach Prudhoe Bay, either along the Alaska Highway or beneath the Beaufort Sea to the Delta.

Antoine pointed to the Prudhoe Bay producers’ statements that they have yet to find an economic project and Alaskan state calls for help from Washington. The Canadian declared it is becoming obvious that “the only economically viable development of Arctic gas today is Canadian Mackenzie Delta gas.

“Instead of the Alaskan government’s 10-point Alaska Highway plan that calls for mandated routes, declarations of national interest and subsidies to companies, our government has a one-point plan: It is a stand-alone Mackenzie Valley gas pipeline.” Antoine drew no quarrels when he predicted a start will be made on regulatory filings this fall by the Mackenzie producer group of Imperial Oil, Shell Canada, Conoco Canada (formerly Gulf Canada) and ExxonMobil.

Prospects improved with a fall ceremony in Yellowknife, where the territorial Aboriginal Pipeline Group signed an agreement for up to one-third ownership of a Mackenzie Valley line. The group represents about three-quarters of the native majority in the Northwest Territories. A light showed in the murkiest side of northern native relations when participants in the deal included one of 10 tribes in Antoine’s Deh Cho Nation, which has been holding out for a land-claim settlement first.

At the same time, Arctic specialist Akita Drilling finished barging three rigs into position on the Delta to move short distances by ice roads to work sites as soon as winter takes hold. The contractor, which operates its northern rigs as business joint ventures with native communities, is already firming up arrangements for a busy 2002-03 winter season too.

The assignments reflect the growing breadth of the Canadian Arctic exploration revival. The Mackenzie producer group is busier on the pipeline planning front than in drilling because it already has more than 10 Tcf of Delta-Beaufort Sea gas discoveries made in the 1970s and ’80s. The 2001-02 drilling season will star Petro-Canada, Devon Energy (formerly Anderson Exploration) and Japex.

Next in line, currently mounting seismic surveys to pick 2002-03 winter drilling targets, stand Alberta Energy Co. and Chevron Canada. Extensive preparatory work is also under way in northern communities by the Mackenzie Delta Partnership, an exploration alliance of BP Energy Canada, Chevron and Burlington Resources Canada. The territorial government pledged to take an increasingly businesslike approach to industrial activity that in the last round of Arctic exploration was used as a bargaining chip in land claims conflicts. Antoine said “our government’s vision is to develop a long-term stable oil and gas sector as Alberta, Texas and Oklahoma have done.” Territorial leaders still press the federal government for help – but nowadays, Antoine said they want money for “infrastructure improvements” such as roads and trade training programs “to support resource development.”

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