Accounting for the Abitibi mill

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If I lived and played in the political world, I would take the time here to encourage a wonderful (read: excruciating) and spirited (tired) exchange on the rights and wrongs of the government of Newfoundland and Labrador expropriating the former Abitibi paper mill at Grand Falls-Windsor in 2008.

Instead, let’s begin with the simple fact it happened.

And in 2012 — as reported by my colleague Barb Sweet — the Supreme Court of Canada decided it was up to the province to deal with the aftermath, specifically the cost of any required environmental remediation.

The cleanup work has yet to get underway. And the big dollar figure on cost is undetermined.

According to Department of Finance briefing materials recently released under an Access to Information request (see page 128 of 171), the province has booked an environmental liability of $2.5 million as of March 31, 2013 for the expropriated Abitibi properties, with a contingent liability of $265 million.

That contingent liability represents what is considered an uncertain cost, largely dependent on a future event — like a court case or, say, negotiations around a property sale.

The numbers should not be considered the total cleanup costs.

That story is yet to be written.

Save one report from 2008, I have seen little detailed information on the state of the properties and certainly few hard numbers in the form of even consultant estimates on the nitty-gritty of cleanup work.

Also worth considering: the province may yet find a company willing to shoulder at least part of the long-term burden.

That seems to, at least, be the hope of Transportation and Works Minister Nick McGrath, given recent comments made to TC Media — to me here at The Telegram, and to The Advertiser in Grand Falls-Windsor.

Under McGrath, the province has issued a call for proposals, looking for curb appeal with significant surface remediation work. The call is for companies capable of demolishing the asbestos-laden mill buildings. It closed Aug. 1.

Companies have previously been courted to take over the property, with no success. But between security costs and fears of liability if people enter the sites and get hurt, the province is looking to get a wrecking ball swinging, so to speak.

It may help with a sale. It may also simply be the way to one more, firm number on the list of costs resulting from the mill expropriation.

In that political world, representatives for the provincial Liberals and the NDP have been demanding the numbers, an accounting of a total.

To get there, you need to look at so many factors: the timber resources, the cost of security for the mill buildings, the cost of maintenance work undertaken at the hydroelectric power assets once associated with the site, the cost of peripheral legal fees — say, the labour kerfuffle with former mill workers as Nalcor began operating said power assets for the island grid.

There is also the credit of what the power assets have meant to the province, as noted by the sitting Progressive Conservatives.

On grand figures, in March 2013 then natural resources minister Tom Marshall said that in settling disputes with Abitibi and with owners of the mill’s hydro dams, taxpayers have paid about $150 million for the expropriated assets, with the federal government paying another $130 million to settle a NAFTA challenge.

But the ultimate bottom line on the cost of the expropriation to the province, to date, is unknown.

One thing you can rightly say: it was — it is — not cheap.

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