Clearwater County is being asked to pump another $2.7 million into a project to build a natural gas pipeline to Nordegg.
The project was initially expected to cost less than $6 million but a variety of factors have driven the bill up to $8 million, says contractor Rocky Gas Co-op in a letter to the county.
Provincial regulatory barriers that got in the way of a plan to build the pipeline along Highway 11 meant a "costly reroute," says the March 27 letter from the Co-op's finance chair. Inflation, additional permitting requirements and terrain challenges further boosted costs.
"This funding is essential to keeping the project on schedule, enabling construction to move forward without further delays," says the Co-op.
The county, which previously pledged $1.4 million for the project, has been asked to nearly triple its contribution. The Co-op is contributing $2.5 million through a Rural Gas Co-op Program, which is run by the Alberta Federation of Gas Co-ops and is designed to help offset the cost of building natural gas infrastructure. The Co-op says it also intends to seek additional provincial funding.
Nordegg residents and businesses currently rely on heating oil, propane and electric heat. Natural gas is a cheaper, more convenient and safer option than propane tanks. Besides the benefits of not having numerous propane tanks grouped together, a natural gas line can be shut off if a wildfire threatens.
"Propane tanks can become explosive hazards ('bombs') when exposed to extreme heat, posing a serious risk to residents, emergency responders, and infrastructure," says the Co-op. "Transitioning Nordegg to a safer, underground natural gas system will greatly reduce the risk of catastrophic explosions, helping to protect both people and property in the event of wildfire."
The Co-op says the project is also a "pivotal step in strengthening the economic viability and sustainability of Nordegg …"
County council is expected to consider the request on Tuesday. A report from staff offers a number of options for finding the $2.7 million. It could be redirected from another project, pulled out of a surplus account or come from additional taxes, or a combination of all three. The county could also borrow the necessary money or deny the funding request.
