Hydro deal spawns opportunities

Moira Baird
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Nalcor president says Maritime link makes gas-to-wire a possibility

Nalcor Energy CEO Ed Martin spoke Wednesday to the St. John's Board of Trade luncheon meeting at the Sheraton Hotel. Martin was effusive in his praise for the Muskrat Falls development plan, saying it will have a profound effect on the province's bottom line, especially for the next generation.

Armed with a laser pointer and a map of the Lower Churchill transmission route, Nalcor Energy president and CEO Ed Martin walked business people through the details of the $6.2-billion hydro agreement Wednesday.

The word opportunity was liberally sprinkled throughout his speech to 300 people attending the St. John’s Board of Trade luncheon.

Many of those opportunities flow from the Maritime link connecting the island portion of the province with the rest of the North American electrical grid.

One example: the possibility of generating electricity from natural gas, also known as gas-to-wire. It’s also an alternative to building pipelines to export natural gas.

The idea came up during a question and answer session with the audience.

Martin said gas-to-wire is not a key focus for Nalcor right now, but it could be a long-term opportunity.

“We’re always looking for any opportunities,” he told reporters following the speech.

“It’s no secret that we’ve hit gas at Parsons Pond. We don’t know the quantity yet.”

Nalcor has drilled two onshore exploration wells on the province’s west coast and reported gas shows in both. It will flow test those wells to figure out how much gas might be there.

“What I was trying to talk about here today was the types of opportunities that a line like this — the Maritime link — opens up,” Martin said.

“If we happen to have a commercial find — if we did — and we happen to have excess capacity on this line, which I expect we will as we pull power back … we could take natural gas and turn it into electricity for export.”

The Maritime link is the last of the three-stage plan to develop 824 megawatts of power from Muskrat Falls and build an 1,100-kilometre transmission line to bring that Labrador power to the island.

Martin said converting natural gas to electricity would also require a small gas turbine plant and a lot of study.

“Our focus right now, no question, is the Lower Churchill … and that’s going to be a five- to six-year construction project.

“We’d have to see if gas was there, we’d have to run the economics, it would be sometime after that. But, once again, five or six years is not that long a time.

“These are long-term deals. It gives long-term opportunities.”

Martin was also asked if the deal with Emera Inc., which will contribute $1.8 billion to the hydro project, includes sending power to the province if it’s needed.

“Power can flow both ways,” he said.

Nalcor hasn’t figured out the financial details, but Martin outlined one scenario in response to the question.

“If we wanted to, we could take a terawatt-hour of power — the amount of power we’re selling to Nova Scotia. We could take our reservoirs and drop the levels lower than we’ve been carrying them for the past 30 years, because we have so much reliability coming either way we don’t have to store water.

“We can pull power from elsewhere if we get caught.

“I wish I could put more value on it.

“The point is … the reliability improvements here are immense.”

 

mbaird@thetelegram.com

Organizations: Nalcor Energy, Board of Trade, North American Emera Inc.

Geographic location: Parsons Pond, Muskrat Falls, Nova Scotia

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  • Wayne Bennett
    December 20, 2010 - 06:39

    Nasty Nate With all due respect to my Labrador 'Liberal' friend ()that who I suspect you are) it is not reasonable to run transmission lines to the coast of Labrador. The work around, as I see it, is to generate hydro via wind power similar to the pilot project not being conducted on Ramea. Power in places like Mary's Harbour and Hopedale can be cost effectively generated by wind with the DG as back up. Your rates should then be the same as they are on the island portion of this great energy warehouse province.

  • dogloc
    December 20, 2010 - 00:07

    People must realize that if Quebec is making $billions of Churchill Falls ,then you know N.L.will make money on this deal.What is wrong with sharing the wealth with the rest of the Atlantic provinces?That is what confederation is all about,if Quebec were to think this way the whole of Canada would benefit.The east-west hydro grid should be the way of the future to create a prosperous & united Canada.

    • Bill Bolt
      December 21, 2010 - 21:00

      Since the Lower Churchill is becoming a reality, the government of NL should offer Quebec a one time deal of partnering with NL on this project, by opening the Upper Churchill contract. Failure to get the Upper Churchill back on the table NL would put into law that when the Upper Churchill contract ends, all available power will be transmitted via the Maritime Link to the U.S.A. and illegal to be sold to Quebec !!!!!!!!!!!

  • nasty nate
    December 19, 2010 - 05:13

    The only deal NALCOR has is the one they made up. The people of Labrador have the final say in any of this. Once the power demands of the residents of Labrador are met maybe we will permit some to be sold and exported to the island province. If the little island thinks it can just walk into another province and start development it has another thing coming. Danny Williams knows the error he made with this deal, no wonder he will forever be known as a washed up has been quitter.

    • albert
      December 19, 2010 - 19:57

      Nasty Nate, you are a moron. If we decide to develop lower Churchill, you and the other few Labrador pansies that oppose the deal will be destroyed. Remember what we done to the boethucks. Better move way back up north and into a new igloo.

  • Willi Makit
    December 16, 2010 - 07:13

    The only ''opportunity'' that this project opens up is the opportunity for utilities and their suppliers to rape the customers of NL Power. NALCOR has yet to demonstrate the need for the surplus power, has shown no market opportunities that would support it's inflated costs, nor have they justified a project that will double or more power rates in the province. To suggest that the process of building a mega-dam will result in business is a positive is as flimsy as it comes. If we spent $6.5 billion of taxpayers dollars on building a monorail it would add just as much opportunity - for just as questionable benefit. We don't need a monorail though, and we also don't need this dam. The whole idea should be scrapped until a proposal is generated that will actually benefit the taxpayers and ratepayers of THIS province, not Nova Scotia.