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EAGLE MOUNTAIN — Questar Gas has reached an agreement with Eagle Mountain to purchase the municipality’s natural gas system, contingent on meeting the purchase agreement terms.
The city will present the proposed agreement at a town hall meeting June 19 at Frontier Middle School. Questar and the city expect to complete the purchase by the end of the year, making it official January 1, 2015.
"It all comes down to what is best for residents right now and in the long term," Eagle Mountain mayor Christopher Pengra said.
And that is why Pengra said the time is right to sell its electric utility to the South Utah Valley Electric Service District and it's natural gas interest to Questar. The deals will allow the city to retire $26 million in bonds, cutting its debt in half.
Officials believe the deal will allow residents to count on consistent utility bills, after some unstable rates in recent years stirred controversy at city hall.
"We think this is a benefit that we won't have to raise rates ourselves," Pengra said. "The operations of the companies that will be taking over the utilities are much better poised to keep those rates steady over time."
The Eagle Mountain gas distribution system is the largest municipally owned system in the state. The city's municipal gas system consists of 6 miles of steel, high-pressure pipeline and 120 miles of intermediate high- pressure main lines and service lines.
Incorporated in 1996, Eagle Mountain had an initial population of 250 residents. Today, the population is 24,000, and, at 44 square miles, Eagle Mountain is the state’s third-largest city geographically.
“This municipal natural gas system serves more than 6,000 homes in one of Utah’s fastest-growing areas,” said Craig Wagstaff, Questar Gas executive vice president and chief operating officer. "The purchase will provide Questar Gas with operational advantages and a good return on our investment.”
