July 15, 2002
(Government Services and Lands)


The following is being distributed at the request of the Petroleum Products Pricing Commission:

Petroleum Products Pricing Commission regulated prices July 15, 2002

A review of world markets over the past month has resulted in slight changes for fuel prices.

Consumers in Newfoundland and Labrador overall will see a minimal increase in automobile fuel and stove/heating oil effective July 15, while the price of propane will decline.

The Petroleum Products Pricing Commission (PPPC) has determined that, with the exception of zones where prices were frozen, regular unleaded, mid-grade and supreme fuel will increase by 1.1 cents per litre (cpl), and diesel will rise by 0.3 cpl.

In the case of home heating fuel, stove and heating oil experienced a 0.2 cpl increase, whereas propane will decrease by 1.9 cpl.

"It�s important to note that this is the maximum pricing set, and companies still have the freedom to be able to sell below the maximum price as determined by the commission," said George Saunders, Petroleum Products Pricing commissioner. "I think this indicates that prices are generally stable, although slowly edging upwards. We can look for a fairly stable atmosphere in world markets, but they are leaning towards an increase."

According to the commissioner, a combination of recent events over the past month has contributed to this month�s changes. There were a number of unexpected refinery shutdowns, and OPEC announced its decision to continue with reduced output quotas.

The American Petroleum Institute has reported that inventories have fallen by 2.39 million barrels to 214 million barrels in the week prior to July 11 � the cutoff date for the PPPC to regulate prices for this 30-day period.

Unrest in Venezuela, a supplier of petroleum to the United States, has also caused concerns among fuel buyers about shipment disruptions as well as the security of supply.

These, as well as other factors, have led to increases in fuel prices over the past month.


On the provincial scene, the Labrador region, which includes Zone 10a (Mary�s Harbour/Charlottetown), Zone 11 (Labrador South) and Zone 14 (Labrador North), has benefitted from frozen fuel prices since November 15, 2001.

These areas were spared the overall price hikes experienced by other zones, particularly the large increases evident during March and April of this year, because their fuel supply for the winter and summer months was received this past fall.

Deliveries have since resumed, and the price freeze will be lifted during the summer and fall. Variations to world market prices have resulted in a 6.9 cpl increase in regular unleaded fuel, a 6.4 cpl difference for diesel and an adjustment of 1.5 cpl for stove oil for July 15 - August 15, 2002.

"There has been a very long period of a set price in effect," said Mr. Saunders. "During this period, consumers in other parts of Newfoundland and Labrador, as well as throughout the country, have had to endure a number of significant increases. These increases, when factored into the new prices based on supplies being delivered to Labrador, account for the significant increase that now must be sustained in these particular areas."

The commissioner also noted that as the Labrador highway from the Straits is extended, new territory serviced by roads will be opened. People living there can expect to see more reasonable prices being charged for fuel in the future as more storage infrastructure is added, said Mr. Saunders.

At the time of the pricing freeze, stove oil could be purchased for 64 cpl plus HST, while regular unleaded fuel was 99.2 cpl and low sulphur diesel was 96.2 cpl.

The price in Labrador over the next 30 days represents an adjustment that brings the region back in line with world and local market conditions.

It should be noted that Labrador zones 10a, 11 and 14 will again see frozen prices this winter because of their special fuel delivery circumstances.


The PPPC has also addressed the need for recovery of additional costs by suppliers to areas of Zone 5 (described as Springdale and the Baie Verte Peninsula) so that continued delivery to island communities in this jurisdiction might be secured.

As a result, two new sub-zones have been created as of July 15 � Zone 5a (described as Long Island) and Zone 5b (which includes Little Bay Islands).

Media contact: George Saunders, Petroleum Products Pricing Commissioner, Tel:
(709) 489-8877, or toll-free 1-866-489-8800.

Petroleum Products Pricing Commission
Newfoundland and Labrador Pricing Zones

Zone 1 � Avalon Peninsula
West along the Trans Canada Highway to the intersection with Little Harbour. Included are all routes established on the Avalon Peninsula, north and south of the Trans Canada Highway and all communities and service areas contained therein, including Little Harbour.

Sub-Zone 1a � Bell Island

Zone 2 � Burin Peninsula / Bonavista Peninsula / Bonavista Bay
Trans Canada Highway from Little Harbour to boundary of Terra Nova National Park, including all communities along the highway, all of Route 210 (Burin Peninsula Highway), and all routes established on the Burin Peninsula, including all communities and service areas. All points west on the TCH to Clarenville, all of the Clarenville-Bonavista Bay area, including all of the Bonavista Peninsula through to Port Blandford and the eastern boundary of Terra Nova National Park.

Zone 3 � Central Newfoundland / Notre Dame Bay East / Fogo
All points along the Trans Canada Highway west of Terra Nova National Park from Port Blandford intersection through to Gullbridge access west of Badger. Included are all communities of the Gander Bay Loop from Gambo around to Gander, and all communities established along the Trans Canada Highway. Also included are all communities located on all routes established in Notre Dame Bay East from Lewisporte to Twillingate, and all of Fogo Island; all communities west, including the Exploits Valley from Buchans to Leading Tickles and Fortune Harbour.

Sub-Zone 3a � St. Brendan�s (Island)
Sub-Zone 3b � Fogo Island
Sub-Zone 3c � Change Islands

Zone 4 � Connaigre Peninsula
All communities along Route 360, through to Harbour Breton in the south, including all communities along Route 361 through to St. Alban�s, Route 364 to Seal Cove, Fortune Bay, and Routes 362 and 363 to English Harbour West, Belleoram and to Coomb�s Cove. All communities and service areas contained therein.

Sub- Zone 4a - Gaultois to Francois / English Harbour East
Includes the south coast serviced by marine service from Hermitage to Gaultois and all points south west by marine service to Francois, and marine service east to English Harbour East.

Zone 5 � Springdale � Green Bay / Triton / Baie Verte Peninsula
All points along the Trans Canada Highway west of Gullbridge access to Sandy Lake, including Jackson�s Arm (route 420) and Hampden Junction (Route 421). Included are all communities in Springdale and the Green Bay area, and Route 380 to Triton, as well as all communities on the Baie Verte Peninsula.

Sub-Zone 5a � Long Island
Sub-Zone 5b � Little Bay Islands

Zone 6 � Deer Lake / Corner Brook / Bay of Islands
All points along the Trans Canada Highway, from Sandy Lake west to the intersection with Gallants, including Howley, Deer Lake and Route 430 to Wiltondale, to Gros Morne National Park boundary. All of the city of Corner Brook � Bay of Islands region, through to Lark Harbour and Cox�s Cove, and all communities and service areas in the region.

Zone 7 � Stephenville / Port au Port / Codroy Valley / Channel Port aux Basques
All points along the Trans Canada Highway west of Gallants intersection to Port aux Basques, including Stephenville, Port au Port Peninsula, all communities in St. George�s Bay, Codroy Valley, and along the southwest coast to Rose Blanche/Harbour LeCou, including Burgeo.

Sub Zone 7a � Ramea to Grey River
The island of Ramea and along the coast to Grey River, serviced by marine transport are designated as a sub-zone of Zone 7.

Zone 8 � Northern Peninsula � Gros Morne National Park to Bellburn�s
Route 430 from Wiltondale north to Batteau Cove, including all communities within Gros Morne National Park to Norris Point, and then along the coast north to Bellburns.

Zone 9 � Northern Peninsula to Englee and St. Anthony
Remainder of the Northern Peninsula, from River of Ponds north to St. Anthony along Route 430, including all communities and service areas therein, and along Route 432 to Roddickton and Englee.

Zone 10 � Labrador Straits to Mary�s Harbour / Charlottetown
From the Quebec-Labrador border west of L�Anse-au-Clair Eastward to Red Bay, and all points on Route 510 therein.

Sub-Zone 10a - Mary's Harbour Charlottetown
East of Red Bay along Route 510, Mary's Harbour / Charlottetown is a Sub-Zone of Zone 10. Communities connecting to the new Labrador Coast road as it progresses North will then become part of this sub-zone.

Zone 11 � Coastal Labrador South
All communities along the coast of Labrador South of Groswater Bay which are now serviced via marine tanker.

Zone 12 � Central Labrador
Central Labrador including Happy Valley-Goose Bay, Mud Lake and North West River and Sheshatshiu.

Zone 13 � Western Labrador
Western Labrador including Labrador City / Wabush.

Sub-Zone 13a � Churchill Falls
Churchill Falls.

Zone 14 � Northern Labrador
All Northern Labrador coastal communities including Rigolet and all those North of Groswater Bay to Nain which are currently serviced by marine tanker.

1. Automotive Fuels - Maximum Retail Pump Prices - Effective June 15, 2002
2. Heating Fuels - Residential Propane - Maximum Tank Wagon Prices - Effective June 15, 2002
3. Heating Fuels - Maximum Tank Wagon (or ** Tank Farm) Prices - Effective June 15, 2002

2002 07 15                                11:00 a.m.

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