Negotiations on whether to use up to $161 million in federal stimulus money to help finance a proposed Canadian-owned power line in northern Montana may continue into the fall, a federal official said Friday.

Developers of the 215-mile Montana Alberta Tie Line have been talking with the Western Area Power Administration, a federal power agency, about the financing.

The two entities had a letter of agreement to negotiate until Friday, but that nonbinding letter has been extended to Oct. 31, said Theresa Williams, a spokeswoman for WAPA in Lakewood, Colo.

";Negotiations are progressing, but they're not complete," she said Friday. ";It's hard to predict what will come up in the negotiations. I would say it's progressing."

Officials with Montana Alberta Tie Ltd. or its parent company, Tonbridge Power Inc., couldn't be reached for comment Friday.

The proposed 230-kilovolt power line from Lethbridge, Alta., to Great Falls is expected to move wind power from projects in Montana and southern Alberta.

Bob Williams, vice president of regulatory affairs for MATL in Calgary, said last month that if the stimulus money is made available, it would be a loan to be repaid.

The available funds are part of $3.25 billion in stimulus money intended to help get renewable power onto power-transmission ";grids" and into wholesale markets.

Williams said WAPA and Tonbridge are negotiating whether they can work together to finance and build the power line.

The Schweitzer administration also is behind the idea.

";Right now, you'll find that it's really still tough to get projects financed," said Evan Barrett, Gov. Brian Schweitzer's chief business officer. ";The credit markets have not been really freed up yet. ... We have urged (WAPA and Tonbridge) to consummate a deal."

Williams said the power-line project would take a year to build, creating 75 jobs.

The main contractor is an American company and the project will use American materials, labor and supplies whenever possible, he said. About two-thirds of the project is on American soil.