From www.theobserver.ca The Observer
The $360-million natural gas plant project in Mississauga abruptly cancelled by the Liberals last year will be relocated to St. Clair Township, Energy Minister Chris Bentley said Tuesday.
The plant will be built by the privately-owned Greenfield South Power Corporation on a 12-acre portion of the Ontario Power Generation’s Lambton Generating Station site.
Sarnia-Lambton’s leaders immediately applauded the announcement and the 200 construction jobs required to build the plant over the two years.
When complete, the plant will employ about 25 people, said Bentley.
“Our area accepts and welcomes these kinds of projects,” said George Mallay, general manager of the Sarnia-Lambton Economic Partnership.
The region has been lobbying Queen’s Park for several years to convert the coal-fired Lambton Generating Station (LGS) to natural gas.
Tuesday’s decision does not impact LGS, which is on track to close in 2014, but a new 300-megawatt natural gas plant is a boon to the area, Mallay said.
Bentley said Lambton’s willingness to host a natural gas plant is one of several reasons a deal was inked Monday with Greenfield South Power.
“The Lambton location is a good fit. You’ve got transmission there, you’ve got gas nearby, you’ve got skilled trained workers, and you’ve got a community that’s long been known as an energy hub,” Bentley said.
In contrast to Lambton’s enthusiasm, the residents of Mississauga aggressively lobbied against having the plant nearby. Just days before the 2011 election, the Liberal’s agreed to shut down Greenfield’s construction, despite serious legal ramifications.
The deal announced Tuesday will cost the government $180 million, including a settlement agreement with the financier of the Greenfield South Power project.
“The $180 million is the costs that cannot be recovered at the new site,” Bentley said.
About $85 million covers engineering and the cost for goods and services already used at the Mississauga site, he said.
The financier of the original Mississauga plant — which was about the same size that Lambton’s plant will be — will receive $88 million in the deal.
“Lawsuits on both sides of the border have been withdrawn,” the minister told The Observer.
Another $7 million will be paid out to various parties involved in the construction that was abandoned at the MIssissauga site.
Some of the equipment, including gas turbines purchased for the original site, will be relocated to Lambton, Bentley said.
“We expect the plant to be up and running by 2017.”
St. Clair Township Mayor and Lambton County Warden Steve Arnold said Bentley called him about the announcement and specifically wanted to know how the community would view it.
“I told the minister the community would view it as a very positive thing for us all,” said Arnold.
But the community hopes there will be a subsequent announcement about LGS converting to natural gas, Arnold added.
Bentley said the Ontario Power Authority continues to consider the future for LGS.
“We’re looking at the site, what to do and what the system needs,” he said. “We’re looking at all possibilities and no decision has been made.“
Local tradespeople are glad to learn a natural gas plant will be constructed at the LGS site, said Ray Curran of the Sarnia Construction Association.
“It’s been a slow summer for us,” he said. “At least 30% to 40% of the 5,000 in our workforce aren’t working. This is very good news.”
Curran said he and many others in Sarnia-Lambton were surprised by Bentley’s announcement.
“We’ve been so focused on trying to get them to convert LGS. We still want LGS to stay open,” he said. “But I guess this solves some of (the government’s) problems.”
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