The federal government announced Feb. 16 that $132,870 from the Churchill and Region Economic Development (CRED) fund would be used to offset high gasoline prices in the community resulting from the suspension of rail service via the Hudson Bay Railway (HBR) last June.
The funding will enable Exchange Petroleum, a wholesale petroleum supplier owned by the Exchange Income Corporation, which also owns Calm Air and Perimeter Air, to reduce gasoline prices back to the levels they were at before rail service was suspended.
"The government of Canada is committed to ensuring the economic and social well-being of the residents of Churchill," said Natural Resources Minister Jim Carr, who announced the funding on behalf of Innovation, Science and Economic Development Minister Navdeep Bains, the minister responsible for Western Economic Diversification Canada, which oversees the $7.3 million CRED fund. "This funding will provide much needed support to Churchill residents and businesses during this difficult time."
Gasoline prices in the community went up dramatically Nov. 1, when the Churchill Marine Tank Farm, owned by OmniTrax, which also owns the HBR and the Port of Churchill, notified the town that gasoline prices would be increasing 30 per cent immediately.
“As you will remember, on July 15, as part of an emergency marine fuel supply operation, the Churchill Marine Tank Farm received a shipment of 300,000 litres of gasoline by vessel through the port,” said a notice from OmniTrax when the price went up. “The cost of purchasing and receiving the fuel was approximately 30 per cent higher than our last fuel shipment via rail. We made a commitment at that time to keep the price of fuel at the same rates until existing inventory was consumed, and we have reached that point today. We understand that this cost increase is an additional challenge for everyone in Churchill that comes at a difficult time. Unfortunately, we are unable to delay the cost increase any further.”
“Exchange Petroleum appreciates this support from the Government and CRED," said Exchange Petroleum and Calm Air CEO Gary Bell. "We are pleased to say that it means that we are able to sell gas to customers in Churchill at the price they paid before the rail disruption. We are stakeholders in the community so were able to use some of our existing jet fuel storage to make sure there would be a supply of gasoline in the community. Now, thanks to this funding the price will not be negatively affected.”
“When Churchill was faced with the prospect of running out of gasoline mid-winter, Exchange Petroleum stepped forward to purchase gas to assist the community in their time of need," said Jason Denbow, executive director of Community Futures Manitoba, which administers the CRED on the federal government's behalf. "The CRED Fund is proud to partner with Exchange to make their fuel available to Churchill residents and businesses at the same price as it was before the rail line closure. This project is a great example of how collaboration and partnerships can help lessen Churchill’s acute economic hardships, restore quality of life, and keep its entrepreneurs in business. We look forward to continuing to work with the people of Churchill as they address this crisis.”
A community-based management committee approves CRED applications that encourage sustainable economic development in the region of the Hudson Bay port town by diversifying the local economy, facilitating economic adjustment or enabling collaboration and partnerships that lead to development opportunities.
Manitoba NDP leader Wab Kinew said Jan. 24 that the provincial and federal governments should temporarily exempt Churchill from excise taxes on fuel. Gasoline was $2.20 a litre at the community’s only gas station that day, compared to $1.15 to $1.23 per litre in Thompson, Gillam and Flin Flon, and $1.09 a litre in Rankin Inlet, Nunavut. Removing the 14-cent provincial fuel tax and 10 cent federal fuel tax would reduce the fuel price in Churchill by more than 10 per cent.
“As of this morning, Churchill appears to be paying the highest fuel price in Canada," Kinew said at that time. "This rebate would put money back into the pockets of folks that have been struggling to get support from government while they don’t have rail access.”
Churchill Mayor Michael Spence said in Feb. 12 community update that he and town councillors are encouraged by what they've heard from the federal government regarding plans for the restoration of rail service and for the longer-term future of the community.
"Currently, a collaborative planning process is underway to form a solid business case for transferring the rail, port and tank farm assets to a new ownership group. We acknowledge that much of this work has been behind the scenes and we hope to be in a position to share more information in the near future. We know how challenging this situation has been for our community and continue to thank those working to support us and our efforts."
The update said the federal government had assured town officials that they shared their vision of Churchill as a strategic Arctic gateway benefitting the entire region and that work towards restoration of rail service this spring is continuing.
"While our desire to have the rail line repaired by the owner last summer was unsuccessful, we do believe we are well-positioned for restoration this spring," said the update.
