of the energy in this country is supplied by natural gas. We must have it if we are to survive. This year we expect a shortage of 2.7-trillion cubic feet. My advisers and the Federal Power Commission expect that in the area from Chicago and Detroit through to New York and Boston alone 20% of our industrial capacity will have to be shut down for the extremely cold parts of the winter. Apartment buildings and houses will be without heat; schools, hospitals and homes for the aged will have to be closed. In other words, Mr. Prime Minister, we are facing a national disaster.
“I recognize that there is absolutely nothing I can do in the short term to overcome this problem completely, but what I want to put to you is a long-term program that we can get working on right away.”
Robert Porter leaned forward in his chair. “Mr. President, we’re tremendously concerned about the problem up here. If there is any way Canada can help …”
The President cut him short. “That’s just the trouble. For years now we’ve been trying to get you people to help, and all we get is a lot of talk. Now let me finish. I realize that you have most of the facts, but I want to get across to you the position exactly as I see it.
“Our shortage of natural gas is caused largely by lack of transportation. While gas is produced in Algeria, the Middle East and Venezuela, there is no existing tanker fleet large enough to carry it to the United States. We’ve been trying desperately to build ships of our own. In late ’72 we gave two contracts worth $569-million to General Dynamics and Newport News. We now have ten tankers in operation and ten more near completion, but that’s only a drop in the bucket.
“Therefore, it’s absolutely essential for us to obtain natural gas on the North American continent or in the Arctic Islands. And the gas is up there, all right. I’m told we can get 1½-trillion cubic feet a year out of Prudhoe Bay and the Mackenzie Delta by the Mackenzie Valley pipeline. The fact is, you have natural gas, and we’re suffering because you’ve consistently refused to give us access and you’ve failed to plan intelligently. Look at the Mackenzie Valley pipeline. Almost all the financing has come from the United States, and we’ve worked with you people all the way to see that the economic impact of the construction would be good for Canada, and that the environmental boys would be kept happy. That pipeline is still being tested. It should be finished by now. I was counting on it being ready to start delivering gas next month. Now God knows when it will be completed. It must be at least six months behind schedule. And what’s worse, because you didn’t take our advice in dealing with the claims of the native peoples in the Northwest Territories, they started blowing up the pipeline ten days ago.”
“Mr. President, you know the RCMP are investigating the bombings.”
“Hell, you don’t have a hope of finding anything. Those people can move in and blow up the pipe any place they like and any time they like, and there’s no way you can do a thing about it.
“For years we tried to convince Canada to follow our example and recognize aboriginal rights to a share of the natural wealth. When we settled with the people of Alaska in the early 70’s we gave them $500-million, 40-million acres of land, and another $½-billion from a royalty of 2% on the oil and gas production from Prudhoe Bay.
“What did you people do? You got on your high horse and denied that the Indians and Eskimos had any claim to compensation, even though your government had signed treaties with some of the native groups in the Mackenzie Valley Corridor. I tell you, you have a moral obligation to them just as you have a moral obligation to see that the rest of us have natural gas so we can live and so our industries can keep going. But not one cubic foot of gas will flow in that pipeline until an agreement has been reached with the natives.
“Now, let’s look at the Arctic Islands. Firms such as Imperial Oil, Tenneco, Columbia Natural Gas, and a host of others have poured more than $300-million into Pan-arctic’s exploration program. The proved up gas reserves now total at least 60-trillion cubic feet. Melville Island is sitting on a bed of natural gas, and enormous finds have been made on King Christian, Ellef Ringnes, Thor, Axel Heiberg, Ellesmere, and other islands in the Sverdrup Basin. There’s absolutely no doubt that by the time a transportation system is set up from the Islands to the mainland, the reserves will far exceed the 60-trillion mark. And virtually all the money for this exploration and development has come from the United States.
“The fact is, Prime Minister, Canada has the natural gas. The United States has paid for its discovery, and by rights we own the stuff. We must have it, and must have it fast.”
Porter interrupted. “Now just a minute. I realize you people have put money into the Arctic. So have we. We’re prepared to make a deal to supply gas from the Islands on fair terms, but we have to protect.…”
“Now, Prime Minister, you know that’s not true. God knows we’ve been trying for years to get your government to come to grips with the situation. We’ve cajoled, wheedled, got on bended knee, and got absolutely nowhere. All we hear is the maddening response that Canada won’t let us have any gas until its own needs for the future are determined and you see if there is any surplus you can afford to sell.”
The President paused and cleared his throat. “Now let’s get down to brass tacks. The United States can’t put up with this situation any longer, and we’re not going to. We must have three unconditional commitments from the Parliament of Canada, and we must have them by six o’clock tomorrow night.
“The first is that the aboriginal rights of the native people of the Yukon and the Northwest Territories will be recognized and that a settlement will be worked out with them at once along the lines of the Alaskan model.
“The second is that Canada will grant the United States full access to all the natural gas in the Arctic Islands without reference to Canada’s future needs.
“And finally, I want a commitment that the United States will be allowed to create the transportation system necessary to move the gas as quickly as possible from the Arctic Islands to the United States. This commitment will have to include free access to the Islands across any Canadian territory which may provide a practical route.
“Now let me make this clear. I want these commitments by six o’clock tomorrow night, and they must be given by the Parliament of Canada, not simply the government. I know your Parliament isn’t in session, but that’s your problem, not mine.”
The Prime Minister’s eyes were wide with disbelief, and his voice betrayed his anger.
“Now hold on. If you think you can try to blackmail us into giving you people the right to take control of our resources, you’d better do some more thinking.”
“Well, Mr. Prime Minister, it’s up to you. I’ve given Canada an ultimatum. As you know, we have plenty of muscle to back it up — economic levers too numerous to list. I expect to hear from you by six o’clock tomorrow night. Good-bye.”
Ottawa / 9:10 a.m., EDT
The Prime Minister put the receiver down. His face was white with anger and astonishment. He reached for the intercom and punched the button for his chief executive assistant.
Tom Scott responded immediately. “Yes, sir.”
“Tom, get in here fast, and alert your entire staff to stand by. We’ve got real trouble on our hands.”
Scott burst into the office. The Prime Minister motioned for him to sit down.
“Tom, I’ve just had a telephone call from the President of the United States, and this is what he said. …”
When
