Fracking Driving Construction Costs Way Up
MALONE - The project that will see a natural gas pipeline extend through the Tri-Town area and across Franklin County will be delayed, but St. Lawrence Gas officials say that when pipeline construction does get under way it will be built according to the original plans.
Those plans called for a 48-mile natural gas pipeline to stretch from the Norfolk to the village of Chateaugay in Franklin County.
St. Lawrence Gas officials told the Franklin County Board of Legislators on Thursday that ill still happen.
But construction initially scheduled to start in June 2011 will be pushed back again, according to St. Lawrence Gas Assistant General Manager James Ward, because of an unanticipated increase in construction costs.
“We continue to work on the project to make it happen as quickly as possible,” Mr. Ward said. “We’re not at the point where we can say we’re moving forward on this date, but wešre still working to get this project going.”
Because the project must have qualified contractors and those workers are Currently drawn to more lucrative natural gas extraction projects in
Pennsylvania, Mr. Ward said the company expects to pay double what it originally allocated for the contractors.
He said the company originally expected to spend $9.2 million for the work, but because of the high demand for natural gas and for qualified contractors the cost of the contractors could double.
To make up for the increased costs, Mr. Ward said the company will likely increase its own contribution to the project and search for additional public funding, including more grants.
The company will also ask the state Public Service Commission about extending the life of a temporary surcharge on customers to pay back the project costs and may seek contributions from large commercial customers.
“There are lots of different things we can look at there,” Mr. Ward said. “There may be more grants out there for this.”
The project has not received a funding commitment from the St. Lawrence County Legislature, but Mr. Ward said the company continues to be in contact with county officials about chipping in to build the pipeline.
Franklin County has committed $1.7 million toward the project. Mr. Ward stressed the company will not ask Franklin County for more money.
With the additional costs, though, Mr. Ward said the company may need to do its expansion project in sections. “We canšt say we will get all the way there [to Chateaugay] in one year,” he said. “We may have to get to wherever in one year then finish the next year.”
Mr. Ward said construction will begin as soon as the costs are in line and the contractors are in place.
“There’s never been a more shovel-ready project,” he said. “If we can
overcome this hurdle, we can start tomorrow. ... It all depends on how soon we can overcome this challenge.”
Mr. Ward said getting land easements for the pipeline from private propertyowners is not slowing the project down.
“We’ve got most of them addressed,” he said. “There are still a few that we haven’t addressed fully, but we don’t see that as a major issue.”
Mr. Ward also said the anticipated costs for materials have gone up because of higher steel prices, but he said the impact there is only minimal, noting the company had already purchased the piping.
