Norman Wells electricity not a concern: NTPCPower corporation says diesel plant in good shape if it has to be used
Northern News Services
Published Monday, November 4, 2013
LLI GOLINE/NORMAN WELLS
Norman Wells has nothing to worry about in terms of electricity generation once the natural gas stops flowing to the community, according to an NWT Power Corporation spokesperson.
"Presently, the power corp has a purchase agreement with Imperial Oil to sell electricity to Norman Wells, buying power directly from the oil and gas giant," said Todd Roche, acting communication manager.
That agreement means the residential rate for power is $.4241 per kilowatt hour, approximately 12 cents cheaper than other communities in the thermal zone.
Norman Wells, similar to diesel communities, also receives a GNWT subsidy that matches the Yellowknife rate of $.2628 per kilowatt hour for the first 600kw in the summer and the first 1,000kw in the winter.
When the purchase agreement expires in September 2015, concerns are the power corporation might have to switch to using the community's back-up diesel generation plant. However, Judy Goucher, the power corporation's chief financial officer, said presently all indications are Imperial Oil will renew its agreement with the power corporation.
"We're in discussions to renew for another five years," she said. "We have not heard anything to suggest another five-year term is not what we're talking about."
However, if those negotiations fall through, Roche assures the diesel plant has the capacity to power the community.
"That might mean our plant has to run flat out all the time," he said.
While running a generation plant at max might sound like a recipe for problems, Roche said the Norman Wells facility has advantages over other diesel generation plants in the NWT.
"We have been maintaining that plant well. It has been on standby if Imperial Oil has a problem," he said.
"Also, unlike other power plants, it does not have the thousands of hours worth of wear and tear others do," he added.
As Imperial Oil prepares to shut off its supply of natural gas to the community of Norman Wells as a heating source, there is a misconception that the shutoff corresponds to the oil and gas giant ceasing operations.
Pius Rolheiser, public affairs adviser with Imperial Oil, says that is not the case.
Imperial Oil is continuing its operations in Norman Wells, however it has had to cut back on its natural gas usage due to a dwindling supply.
The natural gas - a byproduct of the company's oil production - provided to Norman Wells for heat is also used to power Imperial Oil's facilities and to generate electricity purchased by the power corporation.
However, as the excess supply of natural gas dwindles, Rolheiser said the choice was made to cease providing gas to the town out of concern the supply would run out and leave the community without heat. He added given the climate in the North, that was of serious concern if it occurred during the winter months.
"The termination of our agreement with the town is for natural gas and not for electricity," said Rolheiser.
Rolheiser would not confirm if the negotiations with the power corporation are for a five-year purchase agreement. He also said he could not say what the remaining life of the oil field is as it depends on too many factors, including reservoir performances, technology and crude prices.
"All of which can change. So, I'd only be speculating," he said.