NORTHWEST TERRITORIES
Many communities across the territory are not about to reap the benefits of lower diesel prices, at least not just yet.

The price of diesel may have fallen 26 per cent in the last year in the NWT but both diesel and gas prices remain stubbornly high in the territory's smaller communities. - NNSL file photo

The NWT Bureau of Statistics has released figures showing that in December, the price of heating oil and other fuels including diesel had fallen 26 per cent since December 2014.

The reason lies in the way these communities receive their fuel. Larger regional centres such as Yellowknife, Inuvik, Hay River, Enterprise, Fort Providence and Fort Smith have privately run fuel distributors, which are constantly resupplied and prices are adjusted based on market conditions. Nobody has set up shop to sell fuel in smaller communities, so the territorial government takes on the responsibility.

Mike Burns, assistant deputy minister for the Department of Public Works, explains why the government doesn't lower fuel prices when the cost of oil goes down.

"In the majority of our communities our fuel is delivered once or twice a year, either by barge in the summer and/or winter road in the winter or both in some communities," Burns said. "As a result, what we're paying for heating oil and gasoline in many of our communities is the price that was landed last summer."

The good news for the communities, according to Burns, is that once the winter roads are completed and the fuel resupply gets underway, the fuel could be coming at a cheaper price, but Burns warned it is not as simple as the government buying and stockpiling fuel right now while prices are down.

"We're talking about a crystal ball here. We're not in a position to speculate with public funds. We'll make decisions as we get closer to resupply as to whether we completely fill our facilities beyond what the community will need for a year," Burns said. "We may decide not to overfill our facilities beyond what our needs are ... if we feel there is an opportunity to get better prices in the winter next year."

Mackenzie Delta MLA Frederick Blake said that he is frustrated by the high cost of fuel in the northern part of the territory.

"The prices really haven't changed up here in the last couple of years," Blake said. "The way it's going I don't think we'll ever see the price drop up here. Cost of living is supposed to be priority with the 18th assembly. We should have similar fuel prices throughout the territories."

Blake said he will be bringing the issue up when the assembly begins sitting again on Feb. 18.