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Letterkenny inks contract for gas line

May 01, 2000|By DON AINES

CHAMBERSBURG, Pa. - A natural gas pipeline to the Cumberland Valley Business Park could open the way for more industries there, according to Letterkenny Industrial Development Authority Executive Director John Van Horn.

"If you're an industrial park, gas is the first or second question asked" by potential tenants, Van Horn said Monday after the authority's board of directors authorized a line extension agreement with PPL Gas Utility.

The contract requires PP&L to build a 21,500-foot gas line from an existing line near Exit 8 of Interstate 81 to Letterkenny Army Depot with another 12,000 feet of lines inside the park and depot.

The project would cost approximately $2 million with the Army and the authority sharing the cost of the lines inside the depot and business park, according to authority spokeswoman Judy Chambers.

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Van Horn said the authority's share would be about $300,000 paid over five years, but "There's a chance it might not cost us anything." That depends on the amount of gas purchased by customers, he said.

PPL would pick up the cost of installation if customers buy more than 300,000 decatherms of gas a year, Van Horn said.

To put that in perspective, the average home with gas heat and appliances uses 100 decatherms a year, said Christine Elser, a PPL industrial sales representative and project manager for the line extension project. Elser said the agreement is between PPL and the authority, which negotiated a separate agreement to provide gas to the Army.

At this point, Van Horn said there is not enough potential processing and heating load among park and Army customers to reach that goal, but if it is attained within the first two years of the agreement installation costs would be picked up by the PPL.

Van Horn said an example of a company requiring large amounts of natural gas for processing would be a plastics manufacturer. Earlier this year a group approached the authority about building a gas-fired, 250-megawatt power plant at the park.

Van Horn said that project would probably require another gas line and is not addressed in the agreement.

"A lot of businesses aren't going to go there unless there is gas there," Elser said about industrial sites.

The line would come into the depot from Pa. 433 near Gate 6 and could be installed by the end of the year, Van Horn said. Elser said PPL will put the project out for bids on Thursday, May 11.

Approximately 1,500 acres of the depot are in the process of being transferred from the Army to the authority for development as an industrial park. Since the 1995 Base Realignment and Closure Commission decision to downsize the depot, 17 businesses have located there creating 247 jobs, according to Van Horn.

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