MLAs reluctantly accept new fuel deal

Though they’re worried about the future viability of the Inuit-owned Northern Transportation Company Ltd., Nunavut MLAs seem ready to accept a controversial fuel contract with a non-Inuit company in Labrador that will save the GN $19 million over three years.

“It’s very difficult for me as a politician to criticize that contract,” Baker Lake MLA Glenn McLean said Tuesday at a committee of the whole meeting in the legislative assembly.

The GN is dumping NTCL and turning to the Woodward Group, based in Happy Valley-Goose Bay, Labrador, to negotiate a contract to deliver fuel to the Kivalliq and Baffin regions over the next three years.

NTCL will continue to ship fuel to the Kitikmeot.

Like other MLAs and mayors in the Kivalliq region, McLean read an NTCL press release that says the firm is taking a second look at its position in the Kivalliq region.

In an interview last week, McLean said he was “horrified” when he first heard the news.

That’s because NTCL is raising the possibility that it will dump its dry cargo service in the region, a move that McLean said could lead to chaos.

“There’s a lot of uncertainty now in the Kivalliq,” McLean said. “I don’t think the residents of the Kivalliq are aware of what’s happening.”

He also said he’s worried about what the move may mean for Nunavut’s economic relationship with Manitoba, and the difficulties Kivalliq businesses may experience if they’re required to deal with suppliers in Montreal.

Ross Mrazek, the deputy minister of public works, told MLAs that in January the GN will solicit bids from companies interested in providing a dry cargo service to the Kivalliq and Baffin regions.

Although he didn’t name any firms in his remarks to MLAs, Mrazek said he expects that other Inuit-owned shipping companies may make bids for the dry cargo contract.

Some industry observers believe that Nunavut Eastern Arctic Shipping, an Inuit shipping company that moved into the eastern Arctic several years ago with an aggressive strategy of price-cutting and service improvement, may have a keen interest in the Kivalliq.

Nattilik MLA Uriash Puqiqnak said he’s pleased the government will save money on the contract, but that he’s worried about NTCL’s survival.

“It is now questionable whether NTCL can survive the loss of the contract,” Puqiqnak said.

Puqiqnak compared the loss of NTCL to a family’s loss of a snowmobile or some other essential piece of hunting equipment.

“I feel that something has been taken away from us, something that was essential to the survival of the family,” he said.

Nanulik MLA James Arvaluk asked Mrazek and Public Works Minister Peter Kattuk if the GN made any attempt to negotiate a reduction in NTCL’s price.

Mrazek responded by saying that the price difference between NTCL and Woodward was “so huge” that negotiations wouldn’t have been worthwhile.

But Mrazek said that it’s too soon to tell if Nunavut residents will pay less at the gas pumps next year, after new fuel supplies arrive in the territory under the new contract.

By then, fuel distribution may fall within the responsibility of a new energy corporation that the GN is proposing to create next year.

For his part, Uqqumiut MLA David Iqaqrialu says he doesn’t like the idea of a GN contract going to a company from Newfoundland.

“I’m very upset about this,” Iqaqrialu said.

Kirk Vander Ploeg, NTCL’s marketing manager, said last week that his company will make a decision soon about the future of its dry cargo service for the sake of its long-standing Kivalliq customers.

“We will come to a decision so that this will give ample opportunity for those people to do what they have to do next.”