The one geothermal well in Moose Jaw that supplies Grant Hall and Temple Gardens Mineral Spa is now the property of SaskWater.
City council voted unanimously during its Feb. 16 regular meeting to transfer ownership of the rehabilitated well and have the mayor and city clerk execute all agreements related to the sale.
Council also voted 6-1 to have city administration pay SaskWater $133,087 as per the asset transfer agreement.
Coun. Dawn Luhning was opposed.
A small metal building on Manitoba Street East now sits on top of the well, which has a well casing of 11.4 centimetres in diameter and is 1.35 kilometres deep. The rehabilitation occurred last year during the summer and fall.
Background
SaskWater drilled a production well and an injection well in 1989, with Temple Gardens Mineral Spa — and later Grant Hall — becoming the main user of the geothermal water in 1991. However, in 2019 the Crown corporation notified the city that the wells needed to be rehabilitated due to age and high-pressure operations, a city council report explained.
The company proposed splitting the $501,719 cost of the project, which included rehabilitating the injection well — which was commissioned and never used but is now the main well — and decommission the production/supply well. In return, the city would transfer ownership to the Crown corporation and charge the company less for water rates.
City hall also agreed to split the cost — $133,087 for the city and $368,632 for the corporation — and agreed to pay SaskWater $133,087 in compensation for rehabilitating the now-defunct production well, the report continued. This amount represented the yearly levy of $15,500 that the company paid from 2011 to 2018.
The municipality also agreed to waive the water levy charges for 2019 and 2020.
SaskWater will now pay the water disposal rate of $1.4572 per cubic metre for the water volume that Temple Hotels disposes into the city’s water system, the report added. The hotels dispose of roughly 5,700 cubic metres of water per year into the sanitary sewer system.
Council discussion
This is a good deal for everyone involved, especially since this will support Moose Jaw’s tourism industry, city manager Jim Puffalt said.
Luhning wasn’t convinced and had concerns about giving SaskWater a refund of almost $134,000 collected in levies since 2011. She didn’t think council should pay the Crown corporation retroactively, while she thought the payment should be left out of the main motion.
This was about cost-sharing, especially since one well had to be decommissioned, Puffalt said. Neither party knew that both wells were an issue when they signed the agreement to rehabilitate the infrastructure. Rather than spending taxpayers’ money, it was decided to share the project, transfer the wells and avoid significant costs altogether.
City clerk Myron Gulka-Tiechko agreed, explaining that this was about finding a source of money for that refund versus taking the money from somewhere else. This essentially helped the city avoid a large liability of $500,000.
City council has spoken about water issues for nearly three years, especially with agreements with users outside the community, Mayor Fraser Tolmie said. SaskWater participated in those conversations, which provided the opportunity to speak about the wells in which the company was interested.
This decision found a middle ground so that citizens were not on the hook for a half-million-dollar project, he continued. He was initially concerned about the project, but — even though it’s not revenue-neutral — it saves Moose Jaw money since SaskWater now maintains the well.
Councillors Heather Eby and Jamey Logan agreed with the well’s transfer, saying this allows SaskWater to maintain the infrastructure in the future and saves the city money.
The next regular council meeting is Monday, March 8.
