sr' COl. 0' ~ (J:) HC;", C ~, </;>- I/;: \ S . ' COW pr~.OVINCE OF BRITISH COLUMBIA BRITISH COUJMf'U\ UTILITIES COMMISSION IN THE 1\1/\ TTEI~ OF thE' Utiliti(>s Commission S.B.C. 1980, c. (,(), as amended and IN THE MATTER or an Application by Inland Natural Cas Co. Ltd. nEFOR[~: J.e. Mcintyre, Chairman; J.n.v. Newlands, Deputy C::hairrnan; N. Martin, COlllrnissionN: W.I\;1. Swanson, ('l.C., COfll missioner OHDER -.~"------~-Wl:IEH.EAS Inland August 2, 1988 for approval of a Natural Gas Service Agreement daten April 11, 1988 for 1r<:l ion service from the Inland system to Pope & Talbot Ltd.'s ("P&T") sawmill at Midwav, R.C:.; and WHEREAS P&T presently takes natural gas service under Hate Schedule 5.4 - Large Firm Service - Industrial and is modernizing its Midway sawmill to include the conversion of three dry kilns to consume natural gas instead of wood waste as a source of fuel: and WHEI<EAS P&T is desirous to reduce its energy costs and has entered into a Transportation Service Agreement with Inland at a rate of $0.43/GJ for a five year period; and WHEREAS Inland calculates that the proposed transportation service rate of $O.l+3/CJ will result in a lost margin and requests that a revenue shift of $ J 6, 500 be effective November 1, 1988; and WHEH EAS the COllllllission has considered the Application and is sa tisfied that the Agreement is in the public interest. fiilJllf!'! If>('p. rVHj (~Mtjllr C; r \//VJCOt!'JfH In ["llH()Nl (f'U4) 66(1 ,HOO u DRnlSH COLUMBiA ~<S> '/ UTrllTlES COMMISSION 17 ~ ~ e:,'" OROER tl l l \~0 NUMBER G-89-8 -8 ) ) ) ) ) September 21, 1988 ) ) ) Gas Co. Ltd. ("Inland") appl ied . .. /2 VG7 ;~'ri CAN/\f)A 04 G45JS fV~PJCOM 120 (601) ti60-1102 w 110:)
NOW THEREFOr~E the Commission hereby orders as follows: I. The Natural Gas service between Inland and P&T reflected in the Letter of Intent dated April 11, 1988 is approved and attached as ix 2. The Executed Contract is required to be filed for approval as a Tariff, Tariff Supplement within 30 days of the date of this Order. 3. The revenue deficiency of $1 resulting from P&T taking transportation service, and requested to be hed to other customers, is unjustified and therefore DATED at the City of Vancouver, day of 311/31 BRITISH COLUMBIA UTILITIES COMMISSION ORDER 2 NUMBER G-89-8 $'P 8 "'''' Agreement for transportation 500 as calculated by Inland, the Province of British 1988. BY ORDER McIntyre Chairman
I.' I., '. L' APPENDIX A INLAND NATURAL GAS CO. LTD. .APR 1 B J988 BOX 12503. 1066 WEST HASTINGS SIREEl. VANCOUVER. BRITISH COLUMBIA VSE 3G3 TElEPHONE(604) 684·0484 April 11, 1988 Mr. Abe Friesen, President, Pope & Talbot ltd., P. O. Box 39, Grand Forks, B.C. VOH lUO Dear Sir: RE: NAJURAL GAS SERVICE AGREEMENT We wish to confirm that Pope & Talbot Ltd. ('P&T') intends to contract for natural gas transportation service from Inland Natural Gas Co. Ltd. ('Inland') for the Midway Sawmill. Upon acceptance of the terms and conditions outlined in this letter. Inland will proceed to prepare an application requesting the British Columbia Utilities Commission ('BCUe') approval of same. 1. Inland agrees to provide finn transportation service for P&T effective November 1, 1988. Transportation terms and conditions have yet to be approved by the Commi ss ion. However. it is expected that tariffs will be in place by August, 1988. 2. The rate for transportation service has been negotiated to be competitive with the alternate energy options available to P&T and wi 11 be set at 0.43 $/GJ for a five year period. The rate will not be subject to change and will be effective upon the completion of the conversion of the 3 existing stearn-heated kilns to natural gas. It is understood that the annual consumption of natural gas for kiln drying of lumber and space heating is projected to be 200,000 GJ/year. 3. Should P&T wish to return to full sales service. the transportation rate will be considered as the margin for the development of a rate for firm gas sales. 4. P&T agrees to contract with Inland for firm transportation or gas sales for a 5 year' peri od, ending November 1, 1993. Pia wi 11 be subject to terms and condi t ions for transportat ion and sales approved by the BCUC. 5. lhis proposal remains subject to the approval of the BCUC. We wish to further express our understanding that subject to the approval of funds, the conversion project may be completed as soon as September 1. 1988. Whnlly ()Wflf'tf ~ "t>~,dl,1I Y C"mp;III1('S COl tlMBI'" Nfl I \111111 (1"~; I 11.111 In • r flfll M I ":ntl nA <; I 11) • INI I\Nfl (11\<; ,.. nil f'n I II) • INI I\t III III VI I OJ 'W NI CO I III
APPENDIX A - 2 Please confirm acceptance of this understanding by signing where indicated on the enclosed copy of this letter. We trust the above meets wi th your approval and look forward to continuing our relationship with Pope & Talbot. Yours truly. INLAND NAlURAL GAS CO. LTD. Petet J. Hill, P. Eng .• Marketing Engineer Industrial Accounts. PJU/sfb Ene 1. LTD. this iXt-i. day of April, 1988. By:
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