OIL FUEL PROJECT
CONSTRUCTION OF AMERICAN PIPE LINES THROUGH CANADA TO ALASKA AGREEMENT CONCLUDED ■• ‘.Ssu.«al£i®i' OTTAWA, November 23. Correspondence between the United States and Canadian Governments issued today details arrangements that have been- made for the construction by the American Government of a pipe line from Fort Norman, North West Territories, across Canadian territory with a refinery at White Horse. This is the project that is popularly known as the Canol Project. The purpose is to extend the fuel supply of the United States Army in Alaska. Two pipe lines are concerned. One will be approximately 500 miles in length from Normal Wells to White Horse and the other 110 miles from Skagway to White Horse.
The correspondence opens on June 27, 1942, with a letter from the American Minister proposing that the Government of the United States should be authorised to construct a Norman Wells-White Horse pipe line of a size sufficient to deliver 3,000 barrels of oil daily and to establish a refinery at White Horse. During the war the pipe line and the refinery would remain the property of the United States. After the war they would be valued by two valuers, one named by Canada and the other by the United States with power, in the event of disagreement, to appoint an umpire. The valuation would be based upon the then commercial value of the pipe line and the refinery and the Government of Canada would be given the first option to purchase at the amount of the valuation. If the option were not exercised within three months, the pipe line and refinery would be offered for sale by public tender with the amount of the valuation as the reserve price. In the event that neither’ the Canadian Government nor any private company desired to purchase the pipe line and refinery at an agreed price, disposition would be referred to the Permanent Joint Defence Board for consideration and recommendation.
PROPOSALS ACCEPTED Additionally, the United States proposed that unless both Governments agree they may not themselves order or'allow the dismantling, of either the pipeline or the refinery until dismantlement has been recommended by the Joint Defence Board. For its part, the Canadian Government would acquire any necessary land and rights of way, the title remaining in the Crown in right of Canada. It would waive during the war taxes on equipment and supplies and remit royalties on oil production. By letter two days later the ' Canadian Government accepted the ■ proposals. A further letter from the American Minister, dated August 14, 1942, outlines a supplemental project involving transportation in tank cars of gasoline destined for the use of the United States Army in Alaska to Prince Rupert where authority is requested for the American Government to build by con-1 tract suitable storage and landing facilities thence by barge to Skagway. A 4-inch pipe' line would be laid from Skagway to White Horse. The United States proposed that'the terms of the previous agreement • mutatis mutandis should apply to the supplemental project. To this also, by letter- dated August 15, the Canadian Government agreed. 27 PRODUCING WELLS Construction work on the Canol Project has proceeded in 1942 and 1943. It is reported that 26 wells have been completed in the Norman field by Imperial Oil under contract with the United States Government. Of these 23 have found oil. With four wells that were drilled before the Canol Agreement there are 27 producing wells. It was estimated that by July 1, 1943, enough new wells had been drilled to produce the 3,000 barrels daily. Since I then potential production has consider- | ably expanded. The Norman-Wells-White Horse pipe line is expected to be completed next January. The Skagway-White Horse line is already operating. According to the present schedule the White Horse refinery should bp completed by May, 1944.
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Wairarapa Times-Age, 27 November 1943, Page 5
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636OIL FUEL PROJECT Wairarapa Times-Age, 27 November 1943, Page 5
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