INCREASED FUEL COSTS RESULT IN FARE INCREASE FOR STC RIDERS

Released on February 28, 2006

The Saskatchewan Transportation Company (STC) will increase its passenger fares by 4.5 per cent, effective March 1st, 2006, President and CEO Ray Clayton announced today.

"This increase is made necessary by the sharp increase in diesel costs during the last quarter of 2005," Clayton said. "Although the company's 2006 budget, which was put together in September, allowed for an increase in diesel fuel to $0.80 per litre (up from $0.65 per litre the previous year) by the end of 2005, the actual prices were considerably higher.

"Other bus companies, as well as other transportation and trucking companies, either raised their base rates or brought in a fuel surcharge in 2005 to deal with the increase in diesel fuel. STC was able to avoid doing so in 2005, but has no choice but to catch up in 2006."

With diesel fuel costs anticipated to remain at well over 80 cents per litre for the foreseeable future, STC could anticipate falling short of its revenue projections by $21,000 for every cent that the price a litre of diesel is over 80 cents. In order to avoid requiring a larger subsidy for 2006 operations, the passenger fare will be raised to capture some of this shortfall, Clayton said. As well, STC will be increasing its parcel express and charter rates in 2006.

STC's passenger fares are regulated by the federal Ministry of Transportation through the Highway Traffic Board (HTB) in Saskatchewan. The Board can approve or deny the request or call for hearings. STC anticipates no problems with HTB in terms of this increase. Because of the HTB approval process, STC fare increases are not subject to the Saskatchewan Rate Review Panel

STC's last passenger fare increase occurred in June 2004.

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For More Information, Contact:

John Millar STC Regina Phone: (306) 787-6807