"NATURAL GAS COMES TO TORONTO"
An Address by OAKAH L. JONES, Vice-President and General Manager Consumers' Gas Company of Toronto
Thursday, March 17th, 1955
CHAIRMAN: The President, Mr. James H. Joyce.
MR. JOYCE: We welcome as our speaker today, Mr. Oakah L. Jones, Vice-President and General Manager of Consumers' Gas Company of Toronto, who will tell us of some of the problems connected with bringing natural gas to Toronto and indicate what natural gas may mean to us.
Mr. Jones has had a wide experience in the utility field. Born in Boston, Massachusetts, he started his business career with Cape Breton Electric Company in Sydney, Nova Scotia. For 13 years, from 1923 to 1936, he was with Blackstone Valley Gas and Electric Company in Rhode Island.
In August 1936, Mr. Jones joined Oklahoma Natural Gas Company as Assistant Treasurer, Secretary and Comptroller. On November 1, 1950 he was promoted from that capacity to the top administrative post of Division Manager of that Company's Tulsa district. Mr. Jones left there to come to Consumers' Gas Company of Toronto in July 1954.
He will speak to us on the timely subject of "Natural Gas Comes to Toronto".
MR. JONES: In this week's MacLean's Magazine I was attracted by the heading on Beverly Baxter's London Letter: "I Would Choose Toronto".
I think all of us are always interested in reading articles on our home towns, but in this case I was doubly interested, for, as many of you who are my friends and acquaintances in this audience, know, I too chose Toronto recently to be my home.
Mr. Baxter went on to say: "Toronto has a character entirely its own. It is not the capital of Canada any more than New York is the capital of the U.S.A., but it grows in strength and size and power-just like New York. The city fathers try to keep pace with the development, but Toronto continues to outgrow itself like a boy and his school clothes. Toronto was intended by nature to be a city of infinite beauty."
And after completing the article, my mind went back to that sentence: "Toronto was intended by nature to be a city of infinite beauty". And thinking further I decided I did not want to give the talk I had prepared on "Natural Gas Comes to Toronto" but did want to keep just the title and so prepared a new one thinking along the lines that we in The Consumers' Gas have an obligation, we the shareholders, the employees, want to make TorontoMetropolitan Toronto and the communities close by "a city of infinite beauty" so that others too as the letter was headed "would want too to choose Toronto".
And how can a company like Consumers' Gas and Natural Gas help, and be helped toward that aim? To begin with, we have 3,900 shareholders right here in Toronto. That is out of a total of 6,700 and the majority of the rest are in Ontario or the other provinces. So we are not plagued with absentee management or holding company ownership-our owners are our neighbours and customers.
Then we have 1,179 employees - men, women - with husbands-wives-mothers, fathers, sons, daughters living here-again interested in the same thing you and we as citizens are interested in. Sincerely sorry when a job is not well done and they are justifiably criticized. Happy when a customer calls or writes and tells me of something, someone of them has done well. And speaking of that they are rather proud that in this winter conversion from manufactured to natural gas they, starting November 7th and finishing February 17th, they did the job without a single solitary accident-not a fire, explosion-not even a dented fender throughout all that winter weather.
So here we have over 5,000 shareholders and employees interested in the future, yes in the present of our community and since the common practice is to assign 4 members to a family-it can be said that Consumers' Gas through wages and salaries and return to shareholders is helping support directly over 20,000 people. Now this income, Consumers' Gas must meet, comes from the prosperity of the area, for we are not like a store or a bank or a wholesale house, etc., we can't close up and move to some other place. If business is not too good here, if it is not a good place to live, we still have to stay here for our right to do business, our pipelines, our customers are here. So it behooves us to want to make this Toronto a good place to live in and to help other people to want to choose Toronto.
And that's what we did recently for when we found that the cost of manufacturing gas was so costly both labour and material-wise as to be pricing ourselves out of business, we started looking for a new source of supply which could eventually result in establishing new lower competitive gas rates.
Yes, that is where natural gas comes into this picture for the first time. We had to look for a less costly gas that would meet competition. Coal was out-we'd used it for years and couldn't compete. Oil was out for we also have machines whereby we made gas from oil but that couldn't compete. We also have propane tanks and again that method was too costly.
So with the approval of the Queen's Park and the Dominion Government we negotiated for a supply of natural gas in the only area where it was available to us (pending building of the line from Western Canada) and that was in South Texas and Louisiana. There eventually with the approval of the Federal Power Commission in Washington we contracted on a firm, irrevocable basis for a 20-year supply and made a contract too to transport the gas by pipeline 1,600 miles to the Niagara River where we pick it up in a 20" line at 850 pounds pressure and bring it here to Toronto and distribute it to you, our customers.
Natural gas is interesting. It was formed hundreds of millions of years ago by tremendous pressures on minute occupants of prehistoric seas. It is said that the only way to find it is to drill for it and gas is found in wells all the way from 500 feet deep to 12,000 feet in depth and in spite of the hundreds of thousands of dollars spent on geology, geophysics, etc., companies still drill about 4 dry holes for every one productive of oil and gas. For again, may I remind you that natural gas is part of the same great hydro-carbon family as is oil, and that the natural gas we get seldom comes from a field in which there is nothing but gas but comes from gasoline plants which have removed the sulphur, the water, the oil, the natural gasoline, etc., before starting delivering this clean fuel into the pipeline for delivery to us.
And as a hydro-carbon it has many more uses than those of which we normally think, heating, cooking, water heating, cooling in the Summer, clothes drying, etc., but is used as a raw source of chemicals, fertilizers, synthetics and the like. Did you know there are 25,000 industrial uses for natural gas? Just think of what that means to the future development of this area and the placing of us in competitive position with other countries and communities having natural gas.
Oh but you say we don't want to ruin our city with industrial smoke for you said Mr. Jones that you wanted to see it more beautiful. And that I do, but natural gas can also help with its cleanliness in industry and the home.
I admire our city fathers for their efforts on behalf of smoke abatement. How many times in driving downtown from the clear blue sky of a winter morn a few miles out have we driven into what we believed was an overcast sky when really all we were doing was driving in under a cloud of smoke and soot with its attendant adverse effect on health and property.
Mr. Baxter with tongue in cheek also said: "I am told, in whispers, that snobbery still exists in Toronto, and that the old families, or what is left of them, look down their noses on those of lesser antiquity."
But I have never over the years on my visits here from Cape Breton and the States found Canadians that way. We are a friendly people. Reserved slightly? Yes, but basically, fundamentally, friendly and helpful. Where could you find more courteous police, fire and other civil servants? Our clerks in the stores, our waitresses, our taxi drivers are all salesmen for our city. And there again is where our employees, our Consumers' Gas family can, does and will help. Whether it is working in the Church of their choice, or in a civic club helping with crippled or handicapped children, in the Community Chest, Salvation Army, Y.W.C.A., or Y.M.C.A., men and women of a company must not just support these organizations financially but to an even greater extent support them with their time, and with their ideas.
We must take the positive approach. A few years ago you remember that there was a popular song, "Accentuate the Positive", and that always reminds me to remind our salesmen "Tell the positive side of natural gas, don't knock the other fellow's product. There is plenty of business for all, but tell of natural gas, its cleanliness, economy, ease of use, safety and so forth."
I like to have our street crews when asked a question by a spectator tell what they are doing and why and by the way, you'll see a lot of these crews around this area this year and next for we will be spending about 10 million dollars per year of our investors' money running gas lines into every section of the city, every new sub-division until we have gas within a quarter to one-half of a mile of every prospective customer. No, we will not run out of gas, for our lines will carry every foot we will sell and also for peak loads and standby capacity we are maintaining part of our oil gas and propane plant and our storage holders available on an instant notice.
Yes, natural gas has come to Toronto and sometime in the near future natural gas will arrive from Alberta and the West and as soon as it does, we are permitted under our contracts to discontinue the supply from Texas and Louisiana and start taking this Western Canadian gas. And that will be a good thing for our Canadian economy for we'll be using a natural resource now either being wasted or not in production. We'll be spending our dollars in Canada and with that line also will be helping develop our Canadian communities all along the new line. Our efforts towards load building will be helpful toward the day when that line is built and its capacity utilized for the good of all the people.
I have been asked numerous times what is Consumers' Gas greatest job ahead of it right now. My answer is that over the years with the old rates we had in effect we couldn't build the average consumption per customer as other natural gas companies here and in the states were doing. Our job now is to build up our sales as fast as possible. Yes, faster even than possible! We have started on that by setting the competitive rates which became effective on February 17th last, regardless of the fact it reduced our estimated net income far below the cost of doing business temporarily. We need to get as much house heating, as much industrial load as we can, for by building those sales we will be in a position to make further rate reductions, and further rate reductions will mean still further sales.
A company, a community, is known for the service it gives. Our Company's contributions must be:
Good Dependable Service Competitive and Fair Rates Fair Salaries and Wages
A fair Return to our Investors And Being a Good Citizen.
The proof of the pudding is in the eating. We are proud of our 106 years of tradition but, we want next year and the year after to be even more proud of the way you will feel about us and to make Beverly Baxter and all other citizens here say:
"I'M GLAD I CHOSE TORONTO".
THANKS OF THE MEETING were expressed by Mr. Alexander Stark.