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Imperial Oil said it plans to spread the cost of airfare for fuel to Norman Wells out over a longer period of time — meaning people will pay less right now, but they'll pay more than they otherwise would once fuel starts being trucked in again.
Company plans to cut price by $1.69 per litre for heating oil
CBC News
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Imperial Oil says it intends to temporarily slash the price of fuel being flown intoNorman Wells, N.W.T., by $1.69 starting Tuesday, as the town grapples with an affordability crisis — but there's a catch.
In a Facebook post Monday, Imperial Oil said its wholesale fuel price for Norman Wells includes air transportation at a cost of $3.38 per litre. It plans to slash that part of its pricing in half, bringing down the wholesale price of heating oil by $1.69.
The catch is that once the company can truck fuel in again, they'll still keep charging the air transportation cost until they recoup that money.
"This air transportation cost is expected to remain in place until the air transportation costs have been offset, which will be longer than when diesel shipments are being flown," the company said Monday.
"Imperial is closely monitoring the amount of fuel required to be airlifted to the Norman Wells area to prevent runouts until the winter road season can replenish supplies."
The move comes after a debate in the Legislative Assembly last week over financial support for the town, where the price for home heating fuel had reportedly topped $5per litre. Earlier last week, the town's council passed a motion to declare a state of emergency, and asked for $6.6 million to cover the cost of getting more heating fuel into the community.
All that is tied to historiclow water levels on the Mackenzie River, grounding barges that would usually resupply the community from the river and forcing fuel to be flown in — a costly alternative.
Roughly 750 people live in Norman Wells, which is in the midst of a municipal election Monday to elect a new mayor and council. Last week, Sahtu MLA Danny McNeely said people in Norman Wells are paying about $6,200 to fill a standard residential fuel tank.
The company said it doesn't include a profit margin in its wholesale price and it doesn't set prices at the retail level. Though the company supplies all the fuel in Norman Wells, that fuel is distributed by local resellers.
Shortly after the announcement, N.W.T. Finance Minister Caroline Wawzonek andMcNeely issued statements.
"While this price reduction provides some relief, further steps are needed to fully address the economic challenges residents are experiencing," wrote Wawzonek.
McNeely called Imperial Oil's decision "a positive step."
"This measure reflects progress, and I look forward to seeing how it benefits the community in the coming months," he wrote.
More gov't relief
The announcement by Imperial Oil came the same day the N.W.T. government said it has donated $150,000 to the food bank in Norman Wells as the affordability crisis in the town continues.
In a news release Monday, the territorial government announced its food bank donation as a measure to "alleviate the financial burden" residents are currently carrying.
"This $150,000 donation will help ensure that families in Norman Wells have access to essential food supplies throughout the winter," the release states.
It added the government will keep monitoring the situation and "explore options to provide further support where possible."
- MLAs debate financial relief for N.W.T's Sahtu region, gripped by affordability crisis
- As fuel prices skyrocket in Norman Wells, N.W.T., locals want answers from Imperial Oil
The situation in Norman Wells has taken centre stage so far during this sitting of the legislature. The food bank donation is the latest support announced by the N.W.T. government.
On Friday, the territory announced it was doubling the home heating subsidy for seniors in Norman Wells from $750 to $1,455 per month.
Earlier in October, the territory unveiled a new funding program that would provide up to $30,000 to businesses and governments in the Sahtu and Beaufort Delta regions affected by the barge cancellations.
Clarifications
The headline of this story has been updated to reflect that Imperial Oil was responsible for the price hike.
Oct 24, 2024 10:56 AM CT
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