Union Gas improvements will cost $250 million

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Union Gas' Dawn facility at night

Union Gas will inject a quarter of a billion dollars into its Dawn site.

The company is in the middle of rapid expansion to take advantage of the increased availability of natural gas in the US Midwest which was discovered through the practice of fracking. Union Gas expects to spend $2 billion over the next few years to take advantage of the increase in gas.

The company announced earlier this spring it would build a new compressor station at its main North American hub at Dawn but it had only given a rough estimate of what the scale of the investment would be.

Recently, the company held an open house in Wilkesport to talk about the project and told The Independent about $250 million will be spent on the compressor station.

Bob Wellington, Union Gas’ manager of station design, says the compressor station itself is not bigger than what is already on site, but because of the site – a now vacant farm field connected to the complex – there will have to be more pipeline laid than normal.

“There is a lot of pipeline within the existing yard, but not here,” he says. “It’s likely about 50 per cent of the cost.”

Because the new compressor station will be attached to the current complex, the open house for the Environmental Assessment drew more Union Gas representatives than neighbours. About 10 people came to the open house “curious” officials say to see what will be going up.

Doug Schmidt, the lead Environmental Planner at Union Gas says the main concerns from neighbours were the potential for noise and light from the new compressor. He says nearby woodlots should muffle any sound coming from the new compressor but Union Gas will also be building berms around the site to limit the noise.

As it works to complete an Environmental Assessment, it also is preparing for Zoning hearing with Dawn-Euphemia.

The host municipality is in the middle of changing its official plan to designate an industrial area around the Dawn plant, however it has been held up as the council tries to get Lambton County to agree to allow 50-acre farm plots.

The delay means Union Gas will have to have an amendment to the current plan to change the agricultural land to industrial to allow the expansion. Schmidt says the rezoning application is fairly complex and the company has been working with Dawn-Euphemia’s planners from the County of Lambton to answer all questions.

“The idea is to get both the Environmental Assessment and rezoning done at the same time,” says Schmidt. “The site plan is a long process and takes lots of planning and design and there is a long process to review it. It has to start around the same time as the Ontario Energy Board work to get the approvals at the same time.”

If all the approvals are received officials say construction on the project could begin in 2016 with the compressor in service by 2017.

The Dawn compressor is one of four being built by Union Gas from here to Milton.

Aside from the spinoff from the $250 million construction, officials say the community will have an ongoing benefit from the project, as the company’s tax bill will likely increase $368,000 by 2018.