ENERGY

The value of gas

Support grows in the North for exports

BARBARA WICKENS May 1 1989
ENERGY

The value of gas

Support grows in the North for exports

BARBARA WICKENS May 1 1989

The value of gas

ENERGY

Support grows in the North for exports

Twelve years ago, Mr. Justice Thomas Berger, who carried out a public inquiry into a proposed Mackenzie Valley natural gas pipeline, shocked the oil industry by agreeing with concerns voiced by residents of the Northwest Territories. Berger recommended—and for the most part Ottawa accepted—a decade-long moratorium on pipeline construction in the river valley. But last week, as the National Energy Board held hearings in Inuvik into a bid by three oil companies to export huge quantities of arctic natural gas to the United States beginning in the 1990s, many northerners proclaimed that they supported the proposal. “This time around, we feel more in control,” said Nellie Cournoyea, the Territories’ energy minister, who originally opposed the pipeline. “Our small communities are stronger, more organized.” As well, some native groups, such as the Inuvialuit, are more inclined to favor resources sales now that they have control over extensive oil and gas reserves—and for the first time stand to profit directly from sales to southern markets.

The issue facing the NEB, which opened the current round of hearings in Ottawa on April 10 and moved to Inuvik last week, is whether to grant an export licence to three Calgary-based companies for an estimated $11 billion in natural gas exports. Gulf Canada Resources Ltd.,

Shell Canada Ltd. and Esso Resources Canada Ltd. applied between September and February to ship 9.2 trillion cubic feet of arctic gas to the United States over a 20-year period starting in 1996. If the NEB approves the exports, separate hearings would have to be held on applications to build a gas pipeline.

Before the hearings began, oil industry critics said that Canada could leave itself short of energy by exporting nearly one-third of the country’s known natural gas reserves. Last week, in Inuvik’s Family Hall—against the backdrop of a mural depicting a polar bear battling a team of husky dogs—environmental issues were a major concern among northerners. “We used to make a living off the Athabasca River before Syncrude developed its tar sands plant,” James Rogers, a non-native trapper from Fort McMurray, Alta., told the hearings. “But the river is now polluted, and the danger is the Mackenzie will be polluted.” But others said that they support the project if northerners benefit directly from the sale. Said Roger Gruben, chief regional councillor of the Inuvialuit Regional Corp., which was set up to administer the land claims settlements: “The North to date has been exposed to energy costs I two or three times that in other parts of I Canada. The availability of inexpensive energy g will be an important potential benefit to 5 northerners.”

“ Spokesmen for the Inuvialuit Regional Corp.—which owns a major gas field near Tuktoyaktuk—had several other demands. While insisting on stringent environmental safeguards and jobs for northerners, corporation officials urged the creation of four new national parks in the Arctic as a way of helping to preserve the environment. Said Gruben: “Establishing the gas export project along with these national parks adjacent to oil and gas developments would balance developmental and conservation interests.”

The tone and emphasis of the submissions to the NEB differed markedly from testimony heard by the Berger inquiry. Appointed by the Liberal government of thenPrime Minister Pierre Trudeau in 1974, Berger—a justice of the British Columbia Supreme Court—investigated the likely social, environmental and economic impact of a pipeline that would have carried natural gas from Alaska and the Canadian Arctic to southern U.S. markets. After hearing testimony from many northerners who feared the pipeline would destroy their traditional way of life, Berger in 1977 recommended no pipeline be built until native land claims were settled.

But now, Berger says that the region may be ready for a pipeline. Added Berger, who now runs his own law firm in Vancouver: “The native orDrilling for oil: a blend of opportunism and optimism ganizations are now important players in resource deci-

sion-making. The changes that I thought should occur appear to have taken place.” Indeed, the land claim settlements may be the most significant legacy of Berger’s report. In addition to a $ 152-million cash settlement, the Inuvialuit won clear title in 1984 to 30,000 square miles of land along with subsurface

rights to an additional 5,000 square miles. The settlement also provided them with rights to hunt, trap and fish in an area of 350,000 square miles. A tentative agreement reached between Ottawa and the Dene and Métis last year provides for the handing over of about 70,000 square miles of land and $453 million in cash to settle land claims by the two native groups.

In the meantime, native leaders say they have learned from experience how to deal with resource developments in the region. Some natives claim they failed to gain any real benefits from construction of a four-year-old oil pipeline from Norman Wells, N.W.T., to Zama Lake, Alta. According to local residents, plans for employing native workers were abandoned when southern contractors and unions took control. Said Frank Pope, manager of the Sahtu Development Impact Zone, a predominantly native group that monitors development of renewable resources: “Nobody bothered to explain the system to natives—that you have to pay dues all year round to maintain union membership. This time, we want a piece of the action.”

At the same time, several organizations are trying to prepare northerners for the business opportunities that may lie ahead. The Inuvik/ Sahtu Community Futures Society, a federally funded group, provides loans to potential entrepreneurs. As well, the cash-rich, Inuvikbased Inuvialuit Development Corp., fuelled by annual federal payments on the Inuvialuit land claims settlement, is ready to exploit any opportunities that a pipeline provides. The conglomerate now owns, among other things, a local airline and a Calgary-based oil company that holds oil and natural gas reserves.

Despite the progress made during the past decade, some northern residents say that there are still urgent social problems that could be aggravated by economic development in the region. Said Donald Morin, a member of the legislature: “Alcoholism is the No. 1 disease up here.” He added that the pressures of working in the petroleum industry and the additional income could lead to an increase in alcoholism. Noting the problems of suicide and violent crime, James Evoy, a columnist with Yellowknife-based Native Press called earlier this month for alcohol to be banned throughout the territory. Wrote Evoy: “Beneath all today’s hoopla about economic development and the emerging North, there is social chaos. And underneath the social chaos is alcohol. There is an answer, prohibition, the total banning of all alcoholic beverages in the N.W.T.”

For others, concerns surrounding the pipeline are primarily practical ones. Said Peggy Curtis, Inuvik town recreation co-ordinator: “This time around we are a bit blasé about any project, but favor it so long as it is good for the town and we get connected to the gas supply.” That blend of opportunism and optimism is clearly the biggest change of all among northerners since the Berger hearings, which may have helped to prepare the region for another stage of development.

BARBARA WICKENS

with

JOHN HOWSE

in

Inuvik and

HAL QUINN

in Vancouver