Province Encourages Natural Gas Distribution

More Nova Scotians will have access to natural gas sooner thanks to a $7.6-million loan to assist the expansion of a distribution system to homes and businesses in the province.

The Nova Scotia government has approved a loan to Heritage Gas Limited from the Gas Market Development Fund. The loan will enable the company to advance construction of its distribution network into Dartmouth, Burnside, Amherst and the Halifax International Airport.

The Gas Market Development Fund was created by the province using money from the Sable Offshore Energy project partners. Government administers the fund, but does not contribute to it. The fund's current balance is about $13.1 million.

"Nova Scotians need more choice in their energy supply," said Economic Development Minister Ernest Fage on behalf of Energy Minister Cecil Clarke at a ceremony today, Sept. 23, in Amherst. "The arrangement we've made with Heritage Gas is a prudent way to make that happen, without placing taxpayers' money at risk."

The $7.6-million loan accounts for one-third of the construction costs. Total construction costs are estimated at $22.8 million. Interest on the loan will be waived until Heritage Gas meets revenue targets from customer connections. Heritage Gas can elect to repay the loan in one lump sum on July 31, 2014 or in five equal annual installments starting July 31, 2012. Heritage Gas shareholders have guaranteed repayment of the principal.

"This loan will allow more Nova Scotia families and businesses to take advantage of the benefits of natural gas more quickly," said Mr. Fage. "And that will contribute to better air quality and reduced greenhouse gas emissions. These are key objectives of Nova Scotia's energy strategy."