Thank you, Mr. Speaker. My questions are directed to the Minister responsible for PPD, petroleum products division. It’s in regard to the price of products, especially in the community I represent of Tsiigehtchic where the price of gas is $1.71 a litre, yet it’s a government-run operation.
I understand there’s a $5 million Petroleum Revolving Fund that’s there to subsidize these isolated communities to allow them to have a price that’s close to being competitive with the regional markets. I’d like to ask the Minister why it is that we are not using the Petroleum Revolving Fund to offset the high cost of petroleum products in those communities that we have an operation.
Thank you, Mr. Krutko. The honourable Minister responsible for Public Works and Services, Mr. Michael McLeod.
Thank you, Mr. Speaker. We do have a Petroleum Products Revolving Fund that we use to soften the blow of any price increases and we have been using it. We use it in a lot of our communities. However, the petroleum products program is based on full-cost recovery. The costs are based on what it takes to purchase the fuel, deliver the fuel, and have somebody, an agent in the community be responsible for the community delivery.
I believe the program must have been working at one time, because you were able to get the cheapest gas in the region from the community of Tsiigehtchic where this petroleum products division operates. Now they are the highest in the region. Other suppliers of those products are cheaper from other outlying communities, whether it’s Aklavik, Inuvik, or Fort McPherson, which are adjacent to this community. I’d like to ask the Minister, can you look into if the subsidy was applied in the community of Tsiigehtchic and why is it their rates are the highest in the region?
We certainly can check. I believe any time there’s a price increase in the community, the community is notified along with the MLA. So that notification would have been made. We also notify and get permission from Cabinet to use the fund that is in the Petroleum Products Revolving Fund. The prices include product costs, transportation costs, sales commissions, any O and M costs for the tank farm, and our fuel is purchased on a different format than the private industry does. In many cases, such as Tsiigehtchic, there are, and have been, occasions where our fuel was the lowest in the region. It all depends. It depends on what the purchase prices are at the time that we buy it and what it costs to land it on the ground. We will certainly follow up and see if a subsidy was provided in the case of Tsiigehtchic.
I had an opportunity to speak to the operator in Tsiigehtchic and the regional director of petroleum products division in Inuvik, and he says that their understanding was that the subsidy was not applied, for one reason or another. So I would like to ask the Minister if you could check if the subsidy was applied to the operation in Tsiigehtchic, and if so, could you give me a response back? Also, can you give me something in writing so that I can provide it to the community?
The fuel subsidy is not always automatically applied. We try to utilize the fuel subsidy to lessen the impact when there is a fairly huge or large discrepancy in what was being charged for fuel from one year to the next. That’s the situation that we look at. It’s not an automatic issuance of the subsidy. We don’t provide subsidies to every community. In some cases, in some years we don’t provide any.
Thank you, Mr. McLeod. Final supplementary, Mr. Krutko.
Can the Minister tell me, out of the $5 million revolving fund how much money is left in the fund, and how has it been allocated and distributed?
There’s no $5 million fund. It’s, I think, $700,000 and there’s... Sorry. There’s $420,000 left in the fund.
Thank you, Mr. McLeod. The honourable Member for Kam Lake, Mr. Ramsay.
