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Construction started on gas back-up
Inuvik Gas should have propane air system done by end of October

Samantha Stokell
Northern News Services
Thursday, September 8, 2011

Inuvik Gas Ltd. has started construction on a propane air system, which will provide back-up fuel to the town in case of an emergency.

NNSL photo/graphic

Inuvik Gas Ltd. has started construction on its contingency plan – a propane air system, which will provide fuel for five days in case of a shortage of natural gas. The site is located at the old Akita site. - Samantha Stokell/NNSL photo

The system will be built at the Akita site at the corner of Muskrat and Navy Road in Inuvik. Dowlands Construction has the contract to clear the area, currently filled with trailers and equipment, and replace it with four large tanks and a small control facility to deliver fuel.

"In case of an emergency there will be a seamless transition," said Bud Seens, general manager of Inuvik Gas Ltd. "We will be able to turn it on and no one will know we turned it on. It's the latest technology in this situation."

In August, Inuvik Gas and its stakeholders decided to construct the back-up system to provide a contingency plan in case it loses the natural gas supply due to something happening to the company's only pipeline, well or gate station – at the end of the pipeline.

Although originally Inuvik Gas had two gas wells, one closed in November 2010 and repairs to it in early 2011 failed, leaving the company with only one operating well.

The plan is to construct a $5 million system that will simulate natural gas. By mixing air and liquid propane, the system can produce propane gas which is compatible with natural gas appliances. This means the 87 per cent of homes in Inuvik that use natural gas will still have a five-day supply of fuel in case of an emergency.

The decision to create a contingency plan came after a preliminary study of the Ikhil gas pool, where Inuvik Gas gets its fuel, found it has less fuel remaining than originally thought. Inuvik Gas is in the middle of a 20-year contract to deliver natural gas to the community, but it could have fewer years than that of fuel left.

"We're still valiantly working to see if there's a possibility of what the reserves have left," Seens said. "We're still trying to determine what's left. People have to realize that geologic sciences aren't always exact."

Once the study is complete, the board of directors will decide what direction to go in. With only one well working and uncertainty about how long the remaining well will last, the company is looking for long-term solutions such as drilling a new well or investing in a new deposit.

Although the cost of the air propane system is estimated at $5 million, Seens said the cost is not yet finalized. How the costs will be met has not been announced either, although ATCO Midstream, which manages Inuvik Gas, has said it will come from "undetermined rate increases" to its customers.

"The cost to IGL’s customers has not been finalized at this point in time," said Meigan McDonald, an ATCO Midstream spokesperson, in an e-mail statement. "We are in the process of determining the exact impact to customer rates, but expect that natural gas will continue to be cheaper than the diesel alternative."

Construction of the propane air system is expected to be complete before winter begins.

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