Manitoba

Steep hike in gas price is 'frustrating,' 'disheartening,' Churchill mayor says

Omnitrax is being accused of gouging Churchill residents once again after a steep hike in the price of gas.

Federal government OKs 43-cent-per-litre subsidy to help offset sudden 84-cent spike

Dave Daley, president of the Churchill Chamber of Commerce, says Omnitrax is taking advantage of northern residents by hiking the price at the pumps. The company has told the town that market rates and shipping costs are the reason for the high costs. (CBC)

Omnitrax is being accused of gouging Churchill residents once again after a steep hike in the price of gas.

The price at the pumps rose from around $1.70 to $2.54 per litre on Wednesday, said Dave Daley, president of the Churchill Chamber of Commerce.

The company said market rates and the costs associated with taking fuel to the community are responsible for the price surge, the Town of Churchill said in a news release.

"It's frustrating. It's disheartening," Churchill Mayor Mike Spence said.

Daley blames the price hike on Omnitrax, the company that delivered the fuel on a ship and has thus far refused to repair the northern town's only land link to the south, a rail line damaged by flooding in May 2017. The cost of repairs has been estimated at as much as $60 million.

"It's just another example of Omnitrax's games and punishing the north," Daley said.

'Exorbitant amount of money'

"You have to realize that at $2.54 a litre, just to fill up a five-gallon jerry can cost almost $60. If you're a local or a business person, it's an exorbitant amount of money."

A spokesperson for Churchill's petroleum storage facility, which is owned by Omnitrax, said the fuel price reflects the higher cost of transportation and factors outside the company's control.

"We understand that this cost increase is an additional challenge for everyone in Churchill that comes at a difficult time."

It's another antic of Omnitrax to punish the people of Churchill and to gouge and disrupt our lives- Dave Daley, president of the Churchill Chamber of Commerce

Spence said he expected the town's application for a subsidy through the federal Churchill and Region Economic Development Fund would be approved. 

Sure enough, the town announced via Twitter late on Thursday afternoon that its fuel support application was successful and a subsidy of 43 cents per litre would be applied.

In February, the federal government provided a $133,000 grant to help with the sky-high gas prices.

Daley said the most recent hike in price is the talk of town.

"They say it's another antic of Omnitrax to punish the people of Churchill and to gouge and disrupt our lives and our livelihood."

Daley runs a tourism business and needs gas to get to town and ferry customers back and forth. 

The fuel shipment is being held in new 85,000-litre storage tanks in the community.

The infrastructure was built late last year after the province ruled the previous tanks were not suitable for continued use. 

The decision prompted Omnitrax to cancel its shipment last fall. Local airline Calm Air, however, averted a fuel crisis during the winter by using its own storage facility to bunker gasoline for town use.

ABOUT THE AUTHOR

Ian Froese

Provincial Affairs Reporter

Ian Froese covers provincial politics and its impact for CBC Manitoba. He previously reported on a bit of everything for newspapers. You can reach him at ian.froese@cbc.ca.

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