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Yk motorists 'suffering' due to Co-op gas prices
Store manager defends policies, says shareholders benefit

Danielle Sachs
Northern News Services
Published Wednesday, February 6, 2013

SOMBA K'E/YELLOWKNIFE
Longtime Yellowknife Co-op member and former board member Randy Freeman says people in Yellowknife are suffering from high gas prices because of Co-op board policy.

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Former board member Randy Freeman says if the Yellowknife Direct Charge Co-op dropped its prices, prices across town would also go down. - Danielle Sachs/NNSL photo

While regular gas prices in Yellowknife continue to sit around $1.389 a litre, no one seems to have any answers about why prices are so much higher than in other communities a few hours down the road. Yesterday, the price of regular gas in Hay River was $1.219 a litre. Last week it was $1.129

"Everyone in Yellowknife is suffering because of it," said Freeman.

Freeman served on the Co-op board of directors for two terms in the 1990s. He has been a member of the Co-op for more than 25 years and said he has a lot invested in it.

He said because the Yellowknife Co-op refuses to compete with other retailers on the price of gas, consumers are being left behind and the board policy runs contrary to what the Co-op stands for, fair prices and great service.

Last week, after learning that gas prices in Hay River were 26 cents per litre cheaper than in Yellowknife, Gastown owner Roy Ferrier told Yellowknifer he takes his lead from the Co-op.

"If anyone should drop, it should be the Co-op and they are the leader," said Ferrier.

"The Yellowknife Co-op gas bar was not created to be profit-making," said Freeman, who was on the board of directors when the gas bar opened.

"Because the Co-op refuses to compete on the price of gas, other retailers are free to charge what they want to charge."

But Ben Walker Sr., general manager of the Yellowknife Co-op, said they're not the bad guys and it's not their objective to stand up to big oil companies and demand better prices.

While the Co-op gas bar might be the gas station with the most volume, he said 60 to 65 per cent of Yellowknifers still gas up their vehicles at other locations.

That majority of Yellowknifers choose to support big oil companies, said Walker. The difference is at the Co-op, when profit is made it goes back to the shareholders, some 4,000 Co-op members.

"It's not about fairness, or what the price is, that's irrelevant," said Walker.

"The more you support us, the more you get back."

Walker said they sell gas at the market price, less nine cents per litre for members, which they then get back through twice-yearly rebate payments.

But Freeman said even with the rebate, it still works out to $1.30 a litre and that price just doesn't make sense, especially when it's been at the same level for months while Hay River and Fort Providence have seen their prices drop to as low as $1.12 per litre.

The market price is part of the problem, said Dan McTeague, who was a member of Parliament for 18 years and now runs the website Tomorrow's Gas Prices Today, which tries to predict the day-to-day gas prices in different cities.

Based on the price of gas, there shouldn't be more than a two-cent-per-litre difference between Hay River and Yellowknife, said McTeague.

In terms of gas prices, the distance between the two communities is negligible, said McTeague.

With a base price of 80 cents a litre, you add 20.7 cents in combined territorial and federal taxes. Once the retail margin and transportation costs are added, there's about 16 extra cents per litre tacked on, giving you a price of $1.16 a litre.

"That's not bad money, but where are the other 22 cents going. There isn't a lot of transparency on price," said McTeague.

"In the case of motorists in Yellowknife, who depend on gas for transportation, it's important we get all the price factors to make sure nobody is being held hostage."

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