TICONDEROGA — International Paper and Vermont Gas have signed an agreement to extend a natural-gas pipeline under Lake Champlain to the Ticonderoga paper mill.
Mill spokeswoman Donna Wadsworth said it’s expected that service to the mill will begin by the end of 2015.
The pipeline is currently being extended from Chittenden County, Vt., into Addison County and then south to Rutland.
“I can’t overstate the importance of this agreement,” Ticonderoga Mill Manager Chris Mallon said in a press release.
“Our business is highly competitive, and cost-reduction projects such as this will help the long-term viability of the mill and retain jobs for the region.
“This agreement provides a unique opportunity for the mill to reap the benefits of a fuel that is much lower cost, while positioning us to significantly reduce greenhouse-gas emissions.”
‘HALF THE COST’
Natural gas has been projected to cost the Ticonderoga mill only about half of what it now pays for the fuel oil it burns in its power and product-recovery boilers. Currently, natural-gas prices in Vermont are 44 percent less than fuel oil and 50 percent less than propane, Wadsworth said.
“This is a great opportunity for the mill, Vermont and for the region,” Vermont Gas President and Chief Executive Officer Donald Gilbert said in the release.
“We continue to hear from Vermont communities that they want natural-gas service as soon as possible. That’s why serving the paper mill in Ticonderoga is so exciting — it will expand and extend our pipeline network further south toward Rutland, sooner, and at no additional cost to our customers.”
Vermont Gas will submit requests for permits for the first stage of the Addison Natural Gas Project this December. The Addison project is the first step in expanding service
further south in Vermont.
The project is in the engineering and permitting phase and is to bring natural gas to Middlebury, Vt., in 2014.
A smaller pipeline lateral will then be constructed to the Ticonderoga mill, crossing below the bottom of Lake Champlain using a technique called directional boring, Gilbert said.
“This is the same technique used to install natural-gas pipelines in Vermont under the Missisquoi and Winooski rivers, and it will provide a direct route to the plant that avoids potential disturbance to the lake bottom.
“The addition of the Ticonderoga mill to this project will support a larger and longer pipeline network.”
Empire State Development President Commissioner Kenneth Adams said in a release that the pipeline extension was designated a priority project by the North Country Regional Economic Development Council.
“These improvements, the conversion of the plant from oil to gas, will allow the company to improve its operational efficiency and reduce costs, and as a result, better compete in the industry,” he said. “We look forward to working with the council and local businesses to spur lasting economic growth throughout the region.”
International Paper’s Ticonderoga mill moved to its current site in 1971. Located on the western shores of Lake Champlain, it is less than a half mile from Vermont.
The mill produces 850 tons a day of high-quality opaque, technical-grade and offset paper under the brands Hammermill, Accent Opaque and Williamsburg, the release said.
IP in Ticonderoga employs about 600 workers and contracts with 650 loggers and truckers in New York and Vermont.
“The mill is a significant economic driver in the region,” Wadsworth said.
Email Lohr McKinstry: