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Gaz Metro to Buy Quebec Biogas, Canada Government Backs Project

July 26 (Bloomberg) -- Gaz Metro Inc., Quebec’s largest natural-gas distributor, agreed to purchase and inject bio-methane into its pipeline system from a citywide waste treatment project in Saint-Hyacinthe, Quebec.

The company, based in Montreal, will buy the city’s surplus biogas produced by a project that will treat 132,000 wet tons of organic waste a year, the Canadian government said today in a statement.

As much as 6 million cubic meters of biogas may be produced in the first year, and the amount may increase to 13 million cubic meters a year, according to the statement.

The project is part of a Quebec government initiative to recycle 60 percent of the province’s organic waste by 2015, which will reduce the amount of material sent to landfills while increasing renewable energy production.

The Quebec government previously invested C$5.67 million ($5.62 million) in the Saint-Hyacinthe project and today said it’s contributing an additional C$14.4 million. The federal government may also provide as much as C$11.4 million if the project meets the conditions of its Green Infrastructure Fund, according to the statement.

The investments will enable Saint-Hyacinthe to install new infrastructure to handle and process waste and produce biogas, including two anaerobic digesters. Anaerobic digestion technology use naturally occurring microorganisms to break down organic waste. The resulting biogas can be burned to generate power or steam, purified into pipeline-quality natural gas, or processed further into other fuels for vehicles.

Gaz Metro will install the infrastructure needed to inject the biogas into its distribution network, it said today in a separate statement.

To contact the reporter on this story: Andrew Herndon in San Francisco at aherndon2@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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