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Friday, May 6, 2016

Natural gas project first in state

Thursday, April 23, 2009

The possibility of Sharp County getting natural gas looks good. If the project is completed it will be the first county wide natural gas project in the state. The other systems that have been created are towns and municipalities, rather than entire counties.

Sharp County Judge Larry Brown and all the city mayors, with the exception of Williford, have passed resolutions in favor of the project and are ready to move to Phase 2. Brown said, "If the people want it, we want them to have it."

Last week, Stewart Noland, an engineer with Crist Engineers in Little Rock, spent time making presentations to the governing bodies in Sharp County. He spoke with members of the Sharp County Quorum Court, Highland and Cherokee Village City Councils, as well as the public, in addressing any questions they might have regarding the potential natural gas project for the area. Noland also recounted the findings of the feasibility study that was done in 2007.

Due to last year's floods, tornado and ice storm, this project has taken a back burner to the ongoing clean up effort. The county is ready to move on to the second phase of the project and that is securing potential funding and sending out user agreements.

Judge Brown signed the pre-application form as a commitment to secure funding for the potential project. This was mailed on April 14.

Due to an increase in money available in the Stimulus package, the USDA has $15 million dollars in grant money that can be utilized for this project. This funding amount has grown from $1 million at the onset of the feasibility study until the current time. At a total cost of nearly $26 million, Noland explained that by signing this preliminary application form, it would help secure secondary funding through such things as revenue bonds with the USDA to make this project a reality.

He further noted that the natural gas project would be paid for strictly by the sale of the commodity, not increases in taxes in the county as was the concern with one Highland alderman. Other concerns were also addressed at these meetings.

Since the study, there has been legislation passed at the state level that will allow Sharp County to service customers who are in these towns, yet reside in Fulton County. This was one major concern with many potential customers as Ash Flat, Cherokee Village and Hardy have residents who live in Fulton County.

Nolan's presentations were follow ups from a feasibility study completed in 2007. He explained the findings to the members. The user surveys that were returned showed a much higher rate of return than other surveys of this type. Of the 2000 customer surveys sent out in 2007, 37 percent of Sharp County residents polled returned their surveys and of that population an overwhelming 70 percent were in favor of the project.

The towns that would be covered by this project include Sidney, Evening Shade, Ash Flat, Highland, Cherokee Village and Hardy. "The interest is definitely there," Noland said, "but we can't do it just because I say it is a good thing, we need people to champion this cause."

One of the most favorable things about the project is that there is an existing high pressure distribution line in Sharp County near Cave City. This line would allow gas to be purchased at competitive prices from a variety of potential suppliers. Noland said that the line is owned by Ozark Gas Transmission and is simply a distribution line available to any natural gas vendor. This 16 inch high pressure line will be stepped down several times prior to getting to customers homes.

Several members of the city councils and quorum court members had valid questions that were answered regarding this project.

Todd Price, alderman from Cave City, wanted to know if more rural areas would eventually be covered if there was enough interest. Noland explained that although initially the study was for residential use, the response would now be based on the number of people who agreed to sign up whether they would be residential or business customers.

Price explained there were several poultry houses within a close geographic area that would have high potential volume natural gas usage and Noland said that, "It would be more economical to serve clusters of people because they share the same distribution line." He further explained that everyone will pay the same, and that "the person who lives next door to the gas line will not get any better price than the man who lives further away."

Greg Prenger, alderman from Cherokee Village, was interested in a timeline as to when the project could begin.

Noland noted that the user agreements must first be signed and there must be enough subscribers. But, he said, if there is, "We could be under construction next year." The project could take from two-three years to complete and would initially serve customers on the main roads and then would branch out to serve others. Noland also explained that the estimate allowed for 50 percent or more growth potential in the system and stated that since the gas that came through the distribution line was housed at such high pressure (600 pounds per square inch) that percentage for growth could be even higher.

Another member voiced concerns over who would be responsible for billing and maintenance of the system. Noland explained that it would be up to the county to agree, "like a partnership between the towns," he said.

Others were concerned with the fluctuations in initial price with the market demand, and whether the new gas company could raise prices. Noland said that the price of the commodity would be determined by the supplier, but that there were contracts with gas suppliers and that they could be periodically changed if the need be, but it was something for the county to decide.

Many voiced concerns over whether or not their current propane appliances would be compatible with gas and if not what the costs were for modification or replacement. Noland assured the residents that if the customer currently has propane, the only modification is the orifice device and that the piping is the same for both propane and natural gas.

Other questions concerned whether or not the supply of natural gas would be available far enough into the future to warrant this expense for the project as well as the length of the financing. Noland made the group aware of the fact that there is drilling going on in many locations and that there is no indication the supply is or will be depleted anytime in the future.

One person raised the question as to whether or not these pipelines could carry other alternative commodities if the need ever arose. Engineer Noland said, "I am convinced that if the natural gas supply ever depletes that some type of like commodity will be transmitted through these lines, due to investment in the infrastructure."

Noland compared the investment in the pipeline to that of a highway system.

Along with the many questions he answered were a lot of advantages to the creation of this natural gas line.

Noland said the project would draw people to the area. To many persons contemplating relocation, whether it be a business or residential location, the availability of natural gas is a factor in their decision. The project will create new jobs such as office personnel, meter readers and maintenance workers. Nolan compared the system to that of a water system in implementation and billing aspects as both are metered utilities.

Because the price of natural gas is the most economical in comparison to the other methods of propane and electricity, this prospective system seems more attractive to the residents of Sharp County.

Nolan urged members who are in support of the natural gas system to allow their voices to be heard regarding the system.

User agreements will be sent out soon to residents in the areas that will have access to the services offered by this project. These may come in water bills or by other means, that is yet to be determined. The user agreement is a binding contract that says that the user will accept the service when it becomes available. These contracts are designed to get an accurate number to determine if the project will proceed. There will be no deposit for those who sign up during the initiation phase, but everyone may not get coverage at the onset of the project. Basically, the more residents who sign up, the faster the project will go.

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We now have more info on this proposed natural gas line. The only problem I see, those signing the "Agreement", will not have any idea on the costs, either startup, or monthly "service charges", and will not be able to cancel the "Agreement" once these costs are known.

This is not acceptable.


-- Posted by CVInternetForum on Thu, Apr 23, 2009, at 2:08 PM

The concerns over costs to the residents and those who sign up for service is valid. I would never sign any agreement or contract unless I know what detailed costs and other obligations I will be responsible for and when. Vague guesses will not be enough to get the majority of people to sign up initially. Once these costs are known, the resident will have to determine if it is a wise move to sign up based on their own personal situation.

As to what this project means to the future potential economic impact to the area as a whole, that is a different subject entirely and one worthy of much attention.

This issue is being discussed more in detail at http://tinyurl.com/csssqp and http://tinyurl.com/d4d5zu

Are you in favor of this natural gas project? Participate in a poll at http://tinyurl.com/c4e4mr

-- Posted by cver72529 on Fri, Apr 24, 2009, at 9:40 AM

First of all I respect the fact that everyone is concerned about the costs. As a former customer of Natural gas i can honostly tell you there are many hidden costs. But.....in the long run the costs of natural gas in our area as opposed to the rising costs of propane during the fall months into the winter. (provided that every customer of propane can "Prepay" I think it is a good deal. Its an endless supply ..noone has to deal with running out of gas during the winter and its a natural resource that is provided to us by the earth. Yes they generally have a meter service fee. but when you have heat during the winter and are not looking at your bill seeing if you can afford another fill of propane it can help. Give it a chance .....its new to the area its only a small price to pay but in the long run you dont have to worry about coming up with 500 dollars to fill your tank just to have heat during the winter as many unfortunates as well as the older folks that are living on a fixed income have to deal with. I look forward to any opposition on this subject.

-- Posted by emhjr on Thu, Apr 30, 2009, at 7:25 PM

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