The town of Madison has finalized a contract with Kennebec Valley Gas Co. that would return 5% of proceeds of natural gas sales to the town if the company's pipeline project moves ahead. In return, Madison agreed not to pursue a competing gas pipeline proposal.
Town and company officials signed off on the contract, which was first announced last month, according to the Morning Sentinel. At the same time, voters again rejected a $72 million bond to fund a town-owned gas pipeline. If voters had approved the bond, the town could have pursued its own project if the partnership with Kennebec Valley Gas fell through or to build additional gas distribution lines from Kennebec Valley's main line. The contract also says Kennebec Valley Gas must develop the Madison portion of the project first and by Dec. 1, 2013, and that the company will charge Madison the cheaper transportation rate it charges its wholesale customers if Madison decides to build its own distribution system from Kennebec Valley's main line, according to the paper.
The Maine Public Utilities Commission has given initial approval to the 56-mile, $80 million pipeline that would run from Richmond to Madison. Kennebec Valley Gas is working to get tax increment financing agreements from each of the 12 communities.