Chretien asks Bush for single gas pipeline

Posted: Sunday, July 22, 2001

GENOA, Italy -- Canadian Prime Minister Jean Chretien told President George Bush on Friday that he would like to focus on one pipeline project in the Pacific Northwest -- and Chretien made it clear he prefers the Mackenzie Valley proposal opposed by Alaska lawmakers.

An open microphone at the G-8 summit here picked up Chretien telling Bush that, while there are two proposals along alternate routes for moving Alaska natural gas to U.S. markets, a single northern gas pipeline is preferable.

"If we only build one pipeline, we could save a lot of money," Chretien was heard telling the president.

Later, Chretien explained his comment to reporters.

"We have Canadian gas from the Canadian Arctic from the (Mackenzie) delta that we want to get into the market," Chretien said.

"This gas is owned and managed by the natives there and part of the problem is we want this natural gas to go to the market as quickly as possible."

Pressed on the matter, Chretien added: "No doubt about it that there will be a pipeline in the Mackenzie Valley. It's the only way you can get the gas from the delta down to the market. There is no other way. There will be a pipeline there."

Until Friday, the Canadian government had remained neutral on the competing pipeline proposals.

One route would take gas from Alaska's North Slope south along the Alaska Highway, a path that cuts through the southwest corner of the Yukon and the mountains of northeastern British Columbia. The other proposal would travel under the Beaufort Sea and down the Mackenzie River valley.

The governments of the Yukon and the Northwest Territories have been lobbying to get the pipeline in their respective territories. In addition, Alaska Gov. Tony Knowles and other lawmakers in the state favor the Alaska Highway route, saying it will provide jobs and an opportunity for communities to tap into the pipeline.

The Northwest Territories argues that if the Alaska Highway route is built, it will kill the need for a pipeline project into the Canadian gas fields for years to come.

The Alaska Highway route is about 200 miles longer and would cost about $2 billion more than the Mackenzie valley route, but environmentalists are concerned about building a pipeline under an Arctic sea that is scoured by massive ice flows.

The Mackenzie route could handle both Alaskan gas and the rich reserves of the Canadian delta.

Chretien said President Bush raised the possibility Friday of yet another option for moving Alaska's gas.

Chretien would not elaborate, but it has been suggested in the past the gas could be liquefied and shipped south on tankers down the Pacific coast.

"He mentioned to me that there was a third idea coming up and I never heard of it," Chretien told reporters.

"So I said: 'Wait a minute. We have already two (proposed) projects and if we had only one pipeline it's easier than two.'"

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