The revival of interest in Canadian Arctic gas has spawned aproject looking for sponsors and support in the NorthwestTerritories. Harvie Andre, a prominent Calgary engineer-businessmanand former conservative member of Parliament, trekked north tosound out the possibilities at the end of October. It was disclosedin northern communities that Andre was dispatched by aninternational group called Alaska Resources Co., with backers suchas Municipal Energy Resources Corp. of Houston.

The project, tentatively priced at C$8 billion (US$5.3 billion)revives 1970s grand designs for a pipeline megaproject to collectgas from Prudhoe Bay as well as the Mackenzie Delta-Beaufort Searegion, then deliver it 1,500 miles south through the MackenzieValley to enter the mainstream transportation grid in Alberta.

Andre’s name and high-profile trip, including a touch of stardomon Canadian national network radio, only heightened the profile ofa revival of interest in the Arctic which was already well known tobe on the rise. With Canadian pipeline capacity, export volumes andprices on the rise, 16 companies from both sides of the borderfinanced an elaborate study of Arctic gas by the Calgary branch ofthe Purvin & Gertz international consulting house. It concludedan Arctic development is feasible if prices stay firm at levelsequivalent to US$2.50 per MMBtu or better at the Henry Hub, whilean executive reorganization at TransCanada PipeLines Ltd. created anew post of vice-president for northern development.

In limited disclosures of the study results, author RolandGeorge has also urged the industry to be realistic by incorporatingin its planning cycles five- to eight-year delays to clearenvironmental, regulatory and native land-claims hurdles. The ideatalked up in the north by Andre suggests that provided thosehurdles can be cleared, a Prudhoe-Delta-Beaufort project could makeeconomic sense by achieving economies of scale with deliveries on amammoth scale in the range of 6-8 Bcf/d.

In Canada, Exxon Corp. affiliate Imperial Oil, Shell Canada andGulf Canada Resources continue to hold a licence from the NEB toexport 13 Tcf of Delta-Beaufort Gas. In Ottawa, Washington andCalgary, the Foothills Pipe Lines-Northern Border system and anallied export route to California continue to hold official statusas the southern “prebuild” of the dormant Alaska Natural GasTransportation System.

Gordon Jaremko, Calgary

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