The price of gasoline, furnace oil and propane in Newfoundland and Labrador may go up if the Public Utilities Board (PUB) agrees to a request from Northen Atlantic Marketing Limited (NARL-Marketing).
NARL-Marketing is the distribution company for fuels produced at the refinery in Come By Chance.
In an Oct. 5 letter to the PUB, the company said their costs have risen as a result of the shutdown of the refinery.
The refinery, owned by American investment company SilverPeak Financial, has been importing refined products from New York and Europe for the past six months. The refinery went idle in March when fuel markets took a hit due to COVID as travel restrictions led to decreased demand for jet fuel and gasoline.
When it was operating, the refinery absorbed the costs of terminal operation and fuel storage. NARL-Marketing did not need to store fuel since it purchased from the refinery daily.
“With the refinery shut, NARL-Marketing needs to maintain inventory to support supply to the island,” the company told the PUB.
And that means extra costs for the company, costs that include shipping from New York Harbour and the use of third-party terminals or the Come By Chance terminal for storage.
“The current wholesale mark-ups established by the PUB are based on an operating refinery in the market,” NARL-Marketing stated in the letter. “Therefore we urgently request that the Board review the markup to establish prices for gasoline, diesel and furnace oil that reflect the current situation, which is a 100 percent import market.”
NARL-Marketing also asked the PUB to ensure a level playing field for all fuel suppliers on the island by implementing price increases at the terminals.
The company said this will ensure the viability of terminals and a long-term, reliable supply of fuel for the province.
“This uniform pricing structure will ensure that multiple suppliers can operate economically on the island of Newfoundland.”
A spokesperson for the PUB said the board is reviewing the application, but could not say when they would make a decision.