A Calgary-based consulting firm is not mincing words when it comes to the possible affect the Alaska pipeline could have on Canada’s natural gas industry and offshore drilling projects.  It has described the Alaska pipeline as a “wolf in sheep’s clothing” stating that once it is built, it will force Canada’s natural gas producers into seeking out other export markets besides North America.

On last Friday Alaska governor Sarah Palin granted a licence to TransCanada Corp, allowing the company to build a pipeline from Prudoe Bay to the Alberta border.  The company was also awarded $500 million in matching US funds to get the project underway.  It was the granting of this license that sparked the remark from Ralph Glass, AJM Petroleum Consultants’ vice- president of operations.  Glass goes on to say that the building of the Alaska pipeline will most likely force Canadian gas producers to search for alternative export markets outside of the US Midwest. Currently 100% of Canada’s gas exports goes to the US.

According to Glass, “While construction of the Alaskan pipeline will likely have a positive impact on Canada’s economy in the shorter term, once it is up and running it will make Alaska into a direct and effective competitor for Alberta and B.C.’s natural gas industry. This could keep natural gas prices low in future years–low natural gas prices will have a significant impact on future drilling here in Canada.”

He also states that with the Alaska pipeline, Canada’s own proposed MacKenzie Valley pipeline and new shale plays like Horn River could be suspended, possibly indefinitely.

Palin disagrees with the consulting firms position, telling Canada AM in an earlier interview that she thinks the Alaska pipeline will benefit both the US and Canada. She also urges the incoming administration to strengthen ties with Canada.