News
Castroville council will wait to amend gas contract
By William Hoover
Anvil Herald Correspondent
After receiving a briefing from the city
administrator on city natural gas prices being proposed by West Texas
Gas, the city’s natural gas provider, Castroville City Council took no
action on its three-year contract. Administrator Paul Hoffman told
council the current price of gas from WTG is tied to a monthly index,
but WTG was willing to enter into a fixed price contract.
If the city amended the three-year contract approved
in December 2009, it could purchase natural gas from May through October
at $5.25 per MMBTU (1,000,000 British Thermal Units). The city’s
average cost for gas from December 2009 to February 2010 was $6.19 per
MMBTU. The current contract with WTG expires in November 2012. But if
the cost of fuel drops, council will then considering amending the
contract, according to Mayor Bob Lee.
“Council believes the price of natural gas is going
to continue to go down,” said Lee on Monday. “It would be silly to
lock in a price now, so the indication is to continue buying gas at the
spot price and we will see how the price tracks down. If it gets down to
a good price, compared to the last several years, we can go ahead and
lock in the price for 12 or 24 months. We just have to stay abreast of
the market.”
