GN pays up, pumps out bad gasoline
NTCL in negotiations with government to determine “extent” of its involvement
The first of the Nunavut government’s payouts to snowmobile owners in the Baffin and Kivalliq regions for damage caused by bad gasoline were to be issued today, Finance Minister Kelvin Ng said.
The GN’s compensation package, announced last Thursday, will pay hunters 75 per cent of what it costs to fix their machines. Hunters must submit receipts and fill out a GN-supplied application form to get the money.
“I expect to see some of the money being issued by next Friday’s cheque run,” Ng said.
Last month, Ng announced the GN’s intention to act on its “moral responsibility” to reimburse hunters for damage caused by faulty fuel.
He said at the time that he hoped the GN could eventually “work it out with the supplier and the insurer.”
Kirk Vander Ploeg, marketing manager for Northern Transportation Company Ltd. (NTCL) confirmed that his company is in negotiations with the GN, but refused to disclose details of the negotiations.
“The extent of Northern Transportation’s involvement is being discussed,” he said.
Of the 225 claims the GN has received, it is paying out an average of between $2,000 and $3,000, Ng said. He said he expected more claims to roll in after the first cheques were issued.
And the Alberta Research Council is still conducting tests on vehicle engines to determine whether the gasoline is causing the same type of damage in cars and trucks in the territory.
While Ng does not yet know how much the compensation package will cost, the risk management division of the department of finance has determined a budget for it, which will go before the legislative assembly in October for approval.
Ng could not specify the figure before it went before MLAs.
In the meantime, the 10 million litres of fuel remaining in Baffin and Kivalliq tanks will be removed and replaced with a new shipment of gasoline, the GN announced.
The new shipment will arrive, as usual, by sealift, together with all other types of fuel used in the territory, Ng said. Heating fuel will be offloaded first, making room on the ship for the bad gas. Then, the new supply will be pumped in.
NTCL will return the fuel to the supplier, Vander Ploeg said, so it can be blended at the refinery and resold. The GN will likely get a refund for the returned product, he said, though he couldn’t say whether the government would receive a full refund.
“There would have to be some reimbursement to the government,” he said.
This is the final year of NTCL’s two-year fuel supply contract. The GN has issued the company a revised specification for 2002, Vander Ploeg said, but “there’s not that much difference,” he said.
The most significant area of change is that the GN is asking that the deposit-control additive missing from last year’s gasoline supply be added to this year’s shipment, Vander Ploeg said.
He said NTCL has not determined who this year’s supplier will be, but he wouldn’t rule out returning to the New Jersey-based refinery it used last year, owned by Duke Energy of Houston, Tex.
“We are searching for that supplier. If it is the existing supplier, they will receive a copy of the specifications.”