Thank you, Mr. Speaker. I mentioned briefly in my Member’s statement that residents of Tsiigehtchic are now paying $1.92 per litre for gasoline and also $1.87 for diesel and $1.73 for heating oil. I thought our fuel prices are supposed to be subsidized. How is the department subsidizing the fuel prices for Tsiigehtchic? Thank you, Mr. Speaker.
Thank you, Mr. Blake. The honourable Minister of Public Works and Services, Mr. Abernethy.
The Department of Public Works, through the petroleum products division, does not subsidize fuel. In fact, through the Petroleum Products Revolving Fund Act, we are required to recover full operating costs from the retail sale of our fuel products. So there is no subsidy, but there is also no profit added on.
When fuel prices are calculated and determined, it is based on the actual product cost to the GNWT, transportation costs to the GNWT, a slight sales commission that goes to the local provider, O and M expenses, some evaporation loss, and taxes. But under the act we have an obligation to do a full cost recovery, no profit. Thank you, Mr. Speaker.
Mr. Speaker, there has to be some profit there. The community of Fort McPherson, which is 57 kilometres away, is paying $1.65. There is a big difference there. How is that price difference of 57 kilometres roughly 30 cents more? Thank you, Mr. Speaker.
Mr. Speaker, I am not currently familiar with the actual price of fuel in the community of Fort McPherson. There are a couple of things to consider. Often, when people come to us and express concerns about the fuel prices, they are referring to the price of regular fuel. We do not purchase regular fuel in PPD. We purchase mid-grain, which is usually three to four cents higher than the regular.
With respect to the prices in Fort McPherson, they are a for-profit organization. We don’t know any of the criteria they use to price their fuel, but ours are based on actual purchase price for the GNWT, the actual transportation costs, sales commission which goes straight to the provider in the community, as well as some evaporation loss and taxes. We don’t have any profit margin on the fuel that we are providing. Thank you, Mr. Speaker.
Thank you, Mr. Abernethy. The honourable Member for Weledeh, Mr. Bromley.
Thank you, Mr. Speaker. I request unanimous consent to return to item 3 on the orders of the day.
---Unanimous consent granted
