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field price for crude oil are not valid.
Out cost estimates
indicate no significant difference in field price for North
Slope crude, regardless of which route is selected.
With respect to the environmental matters,
Secretary Morton has stated that the greater earthquake and
water leg risks of the Alaska route are offset by larger
unavoidable damage and increased risks to permafrost zones and at river crossings in the much longer Canadian route.
A Canadian pipeline route would cross over twice as
much permafrost and muskeg area as the Alaska pipeline.
Thus, about twice as much gravel would have to be mined
and used for the berm to carry the pipeline over the
a result of environmental concerns
reflected in the Interior Department's environmental
impact statement, the Alaska pipeline has been redesigned,
a threefold increase in projected costs. As now
contemplated, the Alaska pipeline is the most carefully designed pipeline, environmentally, ever conceived. In both routes, the lines would be constructed to prevent thawing of the soil in permafrost zones. In the seismic active areas along both routes, special designs would be
utilized to withstand even the most severe earthquakes.
Safety requirements that have been imposed in the maritime
oil transport from Valdez. to the West Coast
- will significantly reduce
the risk to the West Coast from accidental tanker spills.
In fact, if we don't ship our oil from Alaska, in specially
designed U. S. ships,
foreign oil will enter the West Coast
in foreign flag vessels that will not be subject to the
same rigid standards.
I am not minimizing environmental risks. I do believe, however, that the past delays and resultant research have greatly reduced the magnitude of these risks, and that the
overall hazards at this time are not sufficient to further
delay construction of the Alaska pipeline.
The above considerations, in my opinion, demonstrate that the Alaska pipeline is clearly superior to the Canadian
in terms of economic benefits, balance of payments, security,
and employment opportunities. Only in the environmental area does the Canadian route appear comparable, and here the risks and possible damage from either line have been
significantly reduced by research during the past few years.
Eventually there may be a need for a Canadian line, but
all evidence points out that we should move forward on
the Alaska pipeline now.
In view of the urgent necessity for early Alaska
production, I strongly recommend Congressional action to
allow construction of the Alaska pipeline at the earliest
Now I should like to amplify some of the statements
I have made.
If Congress moves expeditiously to amend the existing law to allow a wider pipeline right-of-way across government lands, environmental hearings and administrative procedures could perhaps be completed so that construction of the Alaska
pipeline could commence during late 1974 or shortly thereafter.
The Alaska pipeline could then be completed by late 1977
analyses, a longer construction period, and the logical
desire of Canadian Federal and Provincial Governments to
review carefully the pipeline proposals will cause inevitable delay.
United States governmental approval of a Canadian route
would be required and would be subject to the same types
of objections and delays as the Alaska pipeline. The major sequential steps that would be followed in obtaining Canadian permission, and constructing a Canadian pipeline
are as follows:
Final denial of the Alaska pipeline.
Soil borings and mile-by-mile pipeline design, and
Application to the National Energy Board (NEB).
that any work will commence on a detailed design of a Canadian pipeline prior to final denial on the Alaska pipeline.
This is because the North Slope reserves are needed to
justify a Canadian line.
Detailed soil testing and mile-by-mile pipeline
design took three years on the Alaska pipeline. This could hardly be completed in appreciably less time for the much
longer Canadian line.
The Mackenzie Valley Pipeline Research,
Limited, has made a preliminary feasibility study of the
Canadian pipeline but has not started detailed pipeline
design studies. They estimate 2-1/2 years for planning and engineering. It could be considerably longer.
The Territorial Lands Act requires that a detailed environmental impact statement be prepared before a right-of-way permit is issued or before easements are
allowed for construction.
Jean Chritian, Minister of the
Department of Indian Affairs and Northern Development, stated on March 1, 1973, that public hearings will be held under the Territorial Lands Act at an appropriate time after the Department receives an application based on a viable project proposal, accompanied by a detailed documentation of research pertaining to areas of social and environmental
D. S. MacDonald, Canadian Minister of Mines, on
January 24, 1973, stated that the decision on the actual
route to be followed must first be taken by DIAND in
conjunction with the territorial governments.
could then be made to the NEB for a permit.
In other words,
DIAND's approval must precede an application to the NEB.
Presumably, a favorable ruling by DIAND would be contingent
upon a prior native claims settlement.
before either DIAND or the NEB could be delayed by law
suits such as those brought in this country.