August 11, 2003
(Government Services and Lands)


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

Contract awarded for land transportation study

The Petroleum Products Pricing Commission (PPPC) has awarded a contract in the amount of $101,212 to David M. French and Associates Inc. of St. John�s to undertake a Study of Storage and Distribution Costs for Petroleum Products throughout Newfoundland and Labrador.

George Saunders, PPPC commissioner, is looking forward to the completion of this study, for a number of reasons critical to the future of pricing regulation in this province.

The scope of the study will deal with associated costs of petroleum products relevant to deliveries within the province, particularly considering land transportation costs, including trucking, bulk plant storage and distribution, and costs of terminal operations.

Moreover, and this is of particular interest to isolated communities, the cost of supplying products to small marine depots and distributions along the Labrador coast, and some depots along the south coast of the island portion of this province will be examined.

The study will also include detailed information on volume of sales in the many and varied regions of the province, and provide the commission with a comprehensive report relevant to the many factors that impact on prices in the marketplace.

The final report will include recommendations on zone boundaries, zone pricing differentials, based on the results of the research.

Overall, this research document will provide the PPPC with a solid body of information that will provide current information on associated costs concerning the major pricing factors impacting on the downstream petroleum industry in the province.

This study will complement the marine transportation study completed last year, and will provide the commission with an extensive, validated research base dealing with many of the factors impacting on pricing policies in the province.

Media contact: Michelle Hicks, Communications, 1-866-489-8800; (709) 489-8837.

2003 08 11                                     3:05 p.m.

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