HomeMy WebLinkAboutINS-19-012 - 2019 Gas Pipeline ProjectsREPORT TO:Community & Infrastructure Services Committee
DATE OF MEETING:August 12, 2019
SUBMITTED BY:Greg St. Louis, Director, Utilities, 519-741-2600 x4538
PREPARED BY:Sylvie Eastman, Utilities Engineer, 519-741-2600 x4178
WARD (S) INVOLVED:All Wards
DATE OF REPORT:August 1, 2019
REPORT NO.:INS-19-012
SUBJECT:2019Gas PipelineProjects
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RECOMMENDATION: That the 2019 budget for Gas Pipelines be increased by$2.1Mto be
funded from the Gas Delivery Capital Reserve Fund.
BACKGROUND:
The Gas Pipelinesbudget is comprised of the following accounts:
Replacement Mainsincludes replacing existing gas mains and associated services for
variousreasons including: conflict with proposed infrastructure, insufficient capacity, and/or
condition. Gas infrastructure must be replaced/relocated if required by the road authority per
the Public Utilities on Highways Act. To the extent possible, gas infrastructure replacement
is coordinated with road reconstruction to minimize project costs and inconvenience to
residents.These projects are typically done by a contractor due to the size of these projects.
New Mainsincludes the installation ofnew gas mains to service customers in new
subdivisions or to increase the capacity or reliability of the existing gas distribution network.
Projects are developer-driven, and may be constructed by a contractor or by internal crews.
New Servicesincludes installing gas services in new subdivisions or redevelopment of
existing areas.Projects are customer-driven, and may be constructed by a contractor or by
internal crews.
The gas pipelines construction contract with NPL Canada Ltd (NPL), is for the period March 15,
2017 to March 15, 2020 and has an annual value of $6,147,264.92 (plus HST). This contract
has an option to renew for an additional two years.
REPORT:
The gas pipelines budget is utilized to ensure the gas utility is able to respond to both internal
drivers (replacement of aging infrastructure) and external drivers such as utility relocations
associated with road reconstruction works and service needs for new customers
(developer/customer driven). Road infrastructure work at the requestof external agencies such
as the Ministry of Transportation or the Region of Waterloo cannot be refused by the Utility,
under legislation. The vast majority of the gas pipeline work and associated budget are
influenced by external drivers as demonstrated in Figure 1.
***This information is available in accessible formats upon request. ***
Please call 519-741-2345 or TTY 1-866-969-9994for assistance.
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Customer-driven projects include new mains, new services, and replacement to increase
capacity.Road Authority-Driven projects are those replacement projects required by the road
authority (City or Region) due to conflict between existing gas infrastructure and proposed road
infrastructure.End-of-Life projects are required because the infrastructure is nearing the end of
its design life, and are coordinated with road work.
The gas pipeline construction contract was tendered in 2017 as a 3-year unit price contract. It
was awarded to NPL Canada Ltd (NPL), for the period March 15, 2017 to March 15, 2020 and
has an annual value of $6,147,264.92 (plus HST). Due to the significant amount of external
demands for pipe replacement/relocation and newservices, the gas pipeline budget is
forecasted to be in a deficit by end of 2019. Staff has reviewed the scheduled work and priority
of projects, deferring projects into 2020 where possible;however,there remains a large body of
work that must be completed in 2019, requiring an additional $2,100,000 in the gas pipelines
capital budget.Staff are recommending funding the additional budget requirement from the Gas
Delivery Capital Reserve Fund.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
The
the delivery of core service.
FINANCIAL IMPLICATIONS:
The existing balance in the Gas Delivery Capital Reserve Fundis approximately $2.5M with a
transfer of $2.1M to the Gas Pipeline project would leave a balance of $400,000.
COMMUNITY ENGAGEMENT:
INFORM
council meeting.
ACKNOWLEDGED BY: Denise McGoldrick, GM Infrastructure Services
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