AN INTERESTING COMPROMISE is now being hammered out on the route for a natural-gas pipeline from the Arctic - if one should ever be built. That condition is important, for the nature of the debate is shifting. Until recently, it's been a heavily lobbied competition between three routes and the companies sponsoring them. But now, as the quarrel over the location seems to be approaching a resolution, the sheer cost of the undertaking stands out more starkly than ever.
The likeliest line would require some 2,750 miles of pipe through Alaska and Canada. With its connections into the lower 48 states it would cost, according to its designers, nearly $7 billion. The Canadian government, like a good many other people, thinks that even $7 billion in a substantial understatement. Transportation will make this gas extremely expensive, while the U.S. government's policy is otherwise to keep gas artificially cheap. Energy pricing is once again breaking loose from attempts at legal controls.
The U.S. and Canadian governments have agreed to arrive at a firm decision on routing before the end of the year. This process of making up the collective continental mind has turned into the most complex in the long history of the two countries' cohabitation of North America. An intricate counterpoint has developed between the two governments' successive inquiries and clearances. This spring the U.S. Federal Power Commission pretty well eliminated an elaborate and grotesquely expensive scheme to liquefy the gas in southern Alaska and move it by cryogenic tankers to West Coast ports. Next, a Canadian commission eliminated, on ecological grounds, the direct land line from Prudhoe Bay to the Canadian fields in the MacKenzie River delta, then straight down along the river. Here in Washington the Council on Environmental Quality seconded that verdict last week and said that the least harmful route would be the one following the Alcan Highway.
Now Canada's National Energy Board says that it too likes the Alcan route - with one significant amendment. It wants the route bent over to Dawson, in the Yukon Territory, where the Canadian gas from the MacKenzie delta could be fed into it. The effect would be to raise the cost of the American gas about six cents per thousand cubic feet (on a total transportation cost running somewhere over $2) and reduce the cost of Canadian gas about 12 cents. Compared with the other costs of the 2,750-mile line, the price of the Dawson diversion seems modest enough since, presumably, a certain measure of Canadian good will and cooperation would come with it.
But no part of this immensely ambitious project would be cheap. It would deliver gas to Midwestern cities at prices similar to those at which it is profitable, for example, to make gas from coal. Is it wiser to put that $7 billion-plus into a pipe from Prudhoe Bay to Montana, or into plants to manufacture gas from Montana coal? Quite possibly the pipe is a defensible choice, on grounds that the technology is better known and a pipeline can be brought into operation faster than gas plants. But the scale of the investment demands a bit more discussion of the point. In any event, the pipeline project has already demonstrated that America's next major source of natural gas is going to come to consumers at prices sharply higher than any they have known before.