While exports to the United States drive the expanding natural gas sector on Canada’s East Coast, it remains unclear whether there will be a domestic distribution grid in Nova Scotia. The Nova Scotia utility commission has set a deadline of Jan. 14, 2002, to receive applications for a second run at building a gas distribution system in the province. A hearing has been called for Nov. 19 on issues raised by the withdrawal of Sempra Atlantic Gas from the project, including what to do with C$50 million (US$30 million) in installations that the company was able to construct in the Halifax-Dartmouth area.

Sempra told the Nova Scotia Utilities and Review Board that the provincial government failed to grant regulatory and construction approvals in a timely manner. The stumbles began with a refusal by provincial transportation authorities to allow gas-distribution lines under roads and road shoulders, which in turn prevented completion of construction planning and delays to environmental approvals. When the road authorities relented and allowed some access, it was under “unreasonably burdensome” conditions that had “a substantial negative impact” on the gas franchise, Sempra said.

Sempra won the franchise in a contest with 13 other bidders two years ago, with a commitment to build a C$1 billion (US$650-million) grid reaching at least 60% of the homes in all 18 Nova Scotia counties (or two-thirds of the province’s 940,000 residents). Besides provincial road authorities, the plan ran afoul of reluctance among homeowners accustomed to fuel oil to switch to gas. The marketing campaign was not helped by the steep gas-price spike last winter.

Large-scale, industrial gas users and the biggest cities in Nova Scotia are close to the route of Maritimes & Northeast Pipeline and use supplies delivered directly by the long-distance transmission system.

©Copyright 2001 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.