Work has begun on the new transmission line from Carmacks to Pelly Crossing, and into the Minto mine, Yukon Energy president David Morrison announced this morning.

He said Challenger Geomatics of Whitehorse has been in the field for about a week and a half, beginning the centre-line survey of the 98-kilometre main line to Pelly, and the 27-spur line running west off the Klondike Highway to the mine site.

Brushing and clearing of the right-of-way by Pelly Construction and its partnership with the three Northern Tutchone First Nations could begin as early as tomorrow, Morrison said.

'We are excited, and we are very pleased,' said the president of the publicly-owned utility. 'It has been, I think, a very comprehensive process.'

He pointed out there have been three hearings before the Yukon Utilities Board, and then the first-ever executive level review by the Yukon Environmental and Socio-economic Assessment Board.

'I think we have been able to develop a very good relationship with the first nations, and as I said, we have the permits in hand.'

The assessment board issued its approval of the project on Nov. 23.

Yukon Energy then received the necessary land use and work permits from the Yukon government, the Little-Salmon Carmacks First Nation and the Selkirk First Nation of Pelly

Crossing.

Construction of the main line is pegged at $27.8 million, to be paid for largely by Yukoners, with a $7.2-million contribution from Sherwood

Copper.

The spur line is budgeted at $8.8 million, the entire cost of which will be paid for by Sherwood Copper.

The centre-line survey contract was awarded to Challenger for $693,000, while Pelly Construction and the first nations were awarded the brushing and clearing work for $3.4 million.

Challenger president Joe Iles said this morning he has hired nine workers from Carmacks, four from Pelly and 11 from Whitehorse who are dedicated to the job.

'We are pretty proud it's an all-Yukon crew,' Iles said.

Keith Byram, president of Pelly Construction, said the clearing work was subcontracted to two Yukon companies and one from Alberta. Altogether, he estimated, there will be about 30 on the job for 2 1/2 months.

Crews will be clearing a 30-metre-wide right-of-way for the main line, which follows the Klondike Highway for the most part. The spur line right-of-way will be 15 metres wide.

Morrison said clearing is expected to be complete by March, when the actual construction will begin.

Yukon Energy is under contractual agreement with Sherwood Copper and its new Minto mine to deliver power to the mine site by the end of next

September.

The schedule calls for the delivery of power to Pelly Crossing in the same time frame.

The proposal calls for crews to build the main line and the spur line at the same time.

Morrison said he expects the project will be within budget and on time.

The approach, he said, is much different than the one used for the Mayo-Dawson City line, which was already under construction but stuck in a standoff between Yukon Energy and Chant Construction when Morrison took over the helm.

The project eventually went way beyond its original $27.2-million budget with a total cost that may go as high as $50 million, according to Energy Minister Archie Lang and was more than a year behind schedule.

The Auditor General of Canada sharply criticized Yukon Energy in a subsequent audit. The project is still before the Yukon Supreme Court, with claims and counter-claims filed by both Yukon Energy and Chant Construction.

'There is nothing in this project that has not been turned upside down and looked at in six different ways,' he said.

There will be no trespass issues on first nation land, as the first nations have been kept abreast every step of the way, he said.

Valard Construction, a nationally recognized expert in the field of line construction, and Arctic Power of Whitehorse bring a wealth of experience to the project, working in partnership with the three Northern Tutchone first nations, Morrison said.

He noted Wardrop Engineering, the national company awarded the job to manage the construction project, was the same company contracted to engineer and design the two lines, so it's already intimate with the details.

Yukon Energy has also contracted its own expert, Ron Threlkeld, as the in-house eyes on the project, he said.

Threlkeld, Morrison explained, is the former vice-president of B.C. Hydro's power supply division who was hired by the Auditor General to assist in the audit of the Mayo-

Dawson line.

The idea of extending the grid from Carmacks north has been around for decades.

It was taken off the shelf with Sherwood Copper's decision to buy the Minto property in 2005 and put it into production.

Heralded as a means of selling surplus hydro power on the Whitehorse-Aishihik-Faro grid, the transmission line will also cut greenhouse gas emissions by displacing the need for diesel-powered generators at the mine site and in Pelly Crossing.

Morrison reiterated this morning by earning $3.5 million to $4 million more in annual energy sales to the mine, electical rates for Yukoners could

come down.

Yukon Energy has also stated that phase two of the proposal, a line from Pelly to Stewart Crossing to link the two grids, will likely occur in the near future.

Morrison said there are currently about 80 gigawatts of surplus hydroelectricity on the Whitehorse-Aishihik-Faro grid, of which the Minto mine will use about 40 to 50 when it's running at peak capacity.

If the proposed Carmacks Copper property goes into production, there won't enough hydro-power left on the system to supply it without making improvements to hydro-generation facilities, he said.

He said even with the third turbine added to the Aishihik dam expected to be online by the end of 2009 there will still be no certainty as to whether Yukon Energy will be able to supply Carmacks Copper without using the diesel generators.