Discussions begin on gas distribution lines
Inuvik Gas and town in talks: Ikhil Joint Venture
Shawn Giilck
Northern News Services
Published Thursday, December 5, 2013
INUVIK
The Town of Inuvik is looking to purchase Inuvik Gas Limited, or at least its distribution system.
Inuvik town council has asked its administration to make efforts to purchase the fuel distribution system owned by Inuvik Gas, which is represented by general manager Kevin MacKay, shown in front of the company's sign. - NNSL file photo
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After an in-camera session last month, town council ordered administration to open negotiations to "acquire" Inuvik Gas, which owns the town's distribution system.
Councillor Derek Lindsay made the motion, which was endorsed unanimously by council.
"No one else is doing anything, so we have to do something," Lindsay said in a telephone interview.
Mayor Floyd Roland responded to the issue in e-mails to the Drum.
"After the notice went out regarding the intention not to renew the existing franchise agreement, it became clear we needed to look at all the options, which included purchasing the gas distribution system," he said. "Acquiring the gas distribution system allows us to take control of our heating needs and requirements for the present and the future."
The negotiations will involve the Ikhil Joint Venture (IJV), which includes "the Inuvialuit (Petroleum Corporation), ALTA Gas and ATCO," Roland stated. The town is not a partner, but has a franchise agreement with Inuvik Gas, which will not be renewed.
There is no immediate estimate as to how much it might cost to buy Inuvik Gas out and take over its distribution system.
"While the Ikhil Joint Venture has put a position on the table, we as the town have not set a dollar figure at this time," Roland said. "At our meeting yesterday evening we agreed to hire a negotiator to helps us prepare options on how to proceed.
"There is no official timeline. We are all facing the August deadline of the old agreement coming to an end."
Time at a premium
That means time is at a premium to get something done between the town and Inuvik Gas.
"Once we have a mandate to go forward with, we will need to sit down with representatives of the IJV to discuss timing and location and method of negotiations," Roland said.
The IJC released a statement that read "Inuvik Gas and the Town of Inuvik are currently in discussions regarding the Inuvik Gas distribution system.
"We have met with the town to explore the transition of the distribution system to the town and we are open to exploring all options that the town or the GNWT would like to present.
"As we are currently in discussions and no decisions have yet been made, we cannot comment any further."
Coun. Terry Halifax said, "As it sits, we have two choices here. Do nothing and hope that Inuvik Gas Ltd. (IGL) continues to provide us with a fuel source, or take control of the situation and negotiate a fair price for this utility.
"Should we do nothing and Inuvik Gas Ltd. walks away, the Town of Inuvik, along with the NTPC (Northwest Territories Power Corporation) and some 900 customers will likely take legal action, but that won't keep the toilet from freezing over."
Halifax said "if we can negotiate a deal with IGL to take over the distribution system at a minimal cost and purchase the remaining stranded Ikhil gas at a set cost, IGL minimizes their losses and the people of Inuvik gain control over their energy future."
Coun. Alana Mero declined to offer an opinion at this point because she has been out of town on personal business for most of the last month.
