Contractor cries foul on fuel deal
Department of Transportation defends practice of allowing storage of private supplies on government land
April Hudson
Northern News Services
Thursday, March 24, 2016
PEHDZEH KI/WRIGLEY
Wrigley's local fuel contractor is crying foul after being passed over by Ledcor in supplying fuel for the Mackenzie Valley Fibre Link.
Fuel tanks sit on Department of Transportation land in Wrigley. - photo courtesy of Michael Pellissey
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Michael Pellissey, who has run Mike's Tourism and Expediting Service for the past two years, discovered the Department of Transportation is allowing a competing Fort Simpson fuel business to store gas on government land which he says is unfair.
"Circumstances when the (Department of Transportation) assists a business to significantly access markets in another community should be considered market disruptive," Pellissey wrote in a March 16 letter to Transportation Minister Wally Schumann. "Business deals should stand on their own merit and not be propped up by government at the expense of a local aboriginal business."
Pellissey says he provided fuel to Rohl Enterprises, the original contractor for Ledcor, for the fibre project in the summer. However, when Ledcor and Rohl parted ways later in the year, Ledcor decided to use an out-of-town contractor - Rowe's Construction out of Fort Simpson - for its fuel supply instead.
Pellissey said he requested payment equal to what he would have received from fuel sales to Ledcor.
His March 16 letter followed a Feb. 29 letter from Schumann confirming that fuel is being stored in tanks located at the Department of Transportation's maintenance campsite in Wrigley.
According to that letter, the fuel is being managed and delivered through a business relationship with Rowe's Construction, Pehdzeh Ki First Nation, Pehdzeh Ki Contractors Ltd. and Ledcor. The fuel is not being sold to the public.
"Department officials have been advised by Ledcor that the company made its business decision to purchase fuel from the joint venture after having purchased fuel from Mike's Tourism and Expediting Service for the summer build ... and re-evaluating its business needs for winter operations," Schumann's letter reads.
Ledcor did not answer questions from the Deh Cho Drum pertaining to its use of out-of-town contractors. An e-mail from Ledcor representative David Hoff said the company does not normally comment on individual contracts.
Ioana Spiridonica, spokesperson for the Department of Transportation, confirmed in an e-mail the department "regularly allows storage of equipment and materials on department property when contractors are working on GNWT projects."
She stated this case is similar to any Department of Transportation highway campsite where contractors store equipment and materials, adding there is no preferential treatment given to a specific contractor.
When asked whether the department charges contractors to store materials on department property, Spiridonica responded that the department "does not charge for the storage of fuel on department property in the case of the (Mackenzie Valley Fibre Link)."
In response to the question of what would happen in the event of a fuel spill or other incident, Spiridonica stated companies working on projects in the Northwest Territories are required to obtain regulatory approvals and undergo regular inspections to ensure compliance with land and water licences.
"The Department of Transportation has completed inspections of the stored fuel and the joint venture has been compliant," she stated.
Joint venture refers to the business relationship between Ledcor, Pehdzeh Ki First Nation, Pehdzeh Ki Contractors Ltd. and Rowe's Construction. The Department of Transportation is not part of that joint venture.
Spiridonica said any incidents that might occur would be the responsibility of the joint venture to manage, contain and clean up.
"The GNWT and its contractors are accountable and subject to the regulations and the terms and conditions of authorized permits," she added.
Deh Cho Drum reached out to Rowe's Construction for comment but did not receive a response.
A Pehdzeh Ki First Nation spokesperson was not available at press time.
