with natural gas study
By Liz Dadson
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Huron-Kinloss council is prepared to ante up its share of the cost for a feasibility study into bringing natural gas to the area.
At the general committee meeting last night (June 6), Kincardine deputy mayor Anne Eadie and Jim Prenger of the Penetangore Regional Economic Development Committee, outlined the three-phase proposal.
Phases 1 and 2 of the feasibility study would see Union Gas assess the customer and volume base, update the pipeline routing, and update the capital cost to construct the pipeline and distribution system.
The cost for Phases 1 and 2 would be $40,000 - split between the local industries and municipalities. Kincardine would carry half of the municipal share ($16,250), with Huron-Kinloss paying $8,125, and Arran-Elderslie paying $8,125.
If the result of the study proves favourable, Phase 3 would be an Environmental Assessment (EA) for the $44-million project, said Prenger. The EA would cost about $100,000, with Kincardine paying 25,000, and the two townships paying $12,500 each.
Prenger said besides the major savings for commercial and industrial customers, natural gas would provide huge savings in heating costs for residential users. He said annual heating costs are about $600 for natural gas, $1,900 for electricity, and $2,400 for furnace oil.
There are some risks, said Prenger. The gas supply from Dornoch, south of Owen Sound, may not be sufficient to meet the demand, so a pipeline would have to come from Highway 401. Or compressed natural gas could be trucked in to bridge peak gas demand.
The capital costs could be too high to make the project viable, he said, or the financing costs could be too high for the average residential user.
Eadie said that Kincardine has agreed to be part of the study, and Arran-Elderslie is interested.
Prenger, as chairman of the Penetangore Regional Economic Development Committee, will head up the project group which also includes Jack Smit of CanAgra, John Creighton of GreenField Ethanol, Kincardine councillor Ron Coristine, Gerry Taylor (technical assistance), and Kincardine chief administrative officer John deRosenroll (staff resource).
The Municipality of Kincardine will be the point of contact with Union Gas, for this study.
"All the municipalities around us have natural gas," said Prenger. "We can save residential users a lot of money and help our businesses and industries. We have a couple of larger companies that are depending on this to try and survive."
Councillor Carl Sloetjes asked if there is not enough supply whether Lucknow, Ripley and Point Clark would get bumped from the project. "We're at the end of the line, so do we lose the money we put into the study?" he asked.
"That's what Phases 1 and 2 are supposed to tell us - who's in and who's out," said Prenger. "We didn't get a warm reception at first from Union Gas. They want somebody else to pay because they're tired of paying for studies and then no projects are built."
"If we don't get on the bandwagon, we won't get natural gas at all," said councillor Jim Hanna.
"We've had discussions about this already and we're all in favour," said mayor Mitch Twolan. "Let's proceed."
A motion will come to the June 20 council meeting for final approval.
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Monday, June 06, 2011