Kerry McCluskey
Northern News Services

Iqaluit (Nov 18/02) - Northern Transportation Company Limited (NTCL) has suffered its second major blow in as many weeks.

Kirk Vander Ploeg, a manager in Iqaluit for the Inuit-owned corporation, announced Nov. 14, that the Government of Nunavut awarded the fuel delivery contract for the Kivalliq and Baffin regions to a another corporation. NTCL had shipped fuel to Kivalliq communities for the last 27 years and to Baffin communities for the last six years.

"We are really, really disappointed," said Vander Ploeg.

NTCL did however, manage to salvage the contract to continue fuel delivery in the Kitikmeot region. That responsibility is worth about $5 million.

Public Works Deputy Minister Ross Mrazek refused to comment on the government's decision. He also would not name the company awarded the contract. Mrazek said Public Works Minister Peter Kattuk would address the situation this week.

The loss -- valued at roughly $20 million -- has the potential to cripple NTCL given the approximate $75 million hit the shipping company took last week.

On Nov. 7, Vander Ploeg told News/North that NTCL's fuel resupply contract was awarded to Shell Canada and Imperial Oil. NTCL held that contract since 1996. Shell Canada is now responsible for supplying fuel in the Baffin and Kivalliq regions. Imperial Oil will look after communities in the Kitikmeot. The contract, lasts for three years and has extension options.

Vander Ploeg said NTCL was "vigorously reviewing (their) options" and assessing precisely how the hit will impact business. He could not say if layoffs of their some 420 staff will follow or how the government's decision will effect the delivery of the dry cargo sealift.

In both the Kitikmeot and Kivalliq regions, NTCL shipped fuel and dry cargo aboard the same vessels. The economy of scale Vander Ploeg said, allowed NTCL to keep prices down.

"We are re-evaluating our positions to see what our options are. We have to make some hard decisions here " said Vander Ploeg.

"Our bid was comprehensive and the best value. We struggle with the idea that the government is saving a huge amount of dollars here," said Vander Ploeg.

"It appears as if the fact that NTCL is owned by the Inuit of Nunavut wasn't taken into consideration when this decision was made."

There has been no cry of support for NTCL from many Kivalliq residents concerning its loss of the Nunavut government's fuel purchasing contract.

Rankin Coun. Justin Merritt says the only impact on the Kivalliq region is NTCL not getting the contract to deliver the fuel.

Even then, he adds, it will be mostly transitional in nature.

"If NTCL (had won) the delivery contract, it (would) be the same as it was about 10 years when the GNWT would purchase the fuel from Shell or Esso and have NTCL do the delivery," says Merritt.

"If not, people will go through Montreal for their dry goods, which was always cheaper to begin with."

Merritt says the downside to such an arrangement is that the region will only get one or two ships a year, late in the season, which may delay some construction projects.

"Basically, people will have to deal with different merchants and learn to become more organized in ordering their goods, but that will be more of a transition than anything else."

Baker Lake businessman Leo Lareau says the worse case scenario without NTCL in the Kivalliq is that Baker residents would have to get used to dealing with Quebec merchants.

He says that will bring about changes during the next few years, but residents will quickly adapt.

The main issue, he says, is that cheaper, high-quality gas benefits everyone.

"You're, basically looking at two questions here, what do we spend more money on and, taking the word of the Nunavut government that prices will go down with the new purchase contract, who does that benefit the most?

"We spend more on fuel and gas and lower prices benefit everyone, especially our hunters and elders."

Lareau says he has to give the Nunavut government the benefit of the doubt in that it has studied all the ramifications of the new purchase contract and is convinced the Kivalliq is not going to be negatively impacted by the move.

"Let's just wait and see what the bottom line is going to be before we get all up in arms.

"NTCL hasn't done much in the past to address the concerns of its customers, especially in its partnership with Gardewine North, whose bills are often higher than NTCL's."

NTCL is owned by the NorTerra Group of Companies, a joint venture between the Nunasi Corporation and the Inuvialuit Development Corporation.