Feds will support Muskrat Falls: Dunderdale

Sue Bailey
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Newfoundland and Labrador Premier Kathy Dunderdale says she isn’t worried by news that a loan guarantee for the Muskrat Falls hydroelectric project won’t be in Monday’s federal budget.

Federal support for the $6.2-billion venture doesn’t require budget approval through a vote in Parliament, she said in an interview Friday.

“The minister of finance has the authority, with cabinet approval, to enter into a loan guarantee with Newfoundland and Labrador.

“We just went through an election. The government is just back and functioning now. We’re very pleased with the progress of the loan guarantee, and both the federal government and our own negotiating team feel that all of this will be concluded by the end of the summer.”

The promised loan guarantee or equivalent funding could save the province hundreds of millions of dollars in interest costs.

Comments from Gerry Byrne

Dunderdale refuted comments by Liberal MP Gerry Byrne, who has said the federal Conservative government needs parliamentary approval through a budget vote to offer a loan guarantee.

A senior government source told The Canadian Press that the Muskrat Falls loan guarantee won’t be in Monday’s federal budget, but fiscal support can be offered and then accounted for in future.

Byrne has asked the parliamentary budget officer for an official opinion on the matter.

“It would be better for it to have parliamentary oversight and authority granted to it in Monday’s budget because the deal would then be cemented forever and nobody can change it,” he said Friday.

It took mere weeks in December 2008 for Ottawa to negotiate multibillion-dollar loans and loan guarantees for the failing auto industry, Byrne said. Those measures were accounted for in the federal budget that followed a month later. By comparison, Muskrat Falls talks have been going on for months, Byrne said.

Dunderdale is in a tricky political position, he suggested. “As long as this gets drawn out in a protracted discussion ... she’ll never be able to voice any concerns, any criticism about any federal-provincial issue,” Byrne said.

“If she does, there will be a quiet telephone call made by the Prime Minister’s Office ... informing Premier Dunderdale that there are some ’technical issues’ surrounding the loan guarantee, and it may be delayed for a little bit.”

The provincial Liberal Opposition also asked Friday why Dunderdale hasn’t taken a higher profile in a dispute over halibut and turbot quotas that has seen irate fishermen occupy federal Fisheries offices on Newfoundland’s west coast.

Fisheries critic Marshall Dean asked in a news release whether the Muskrat Falls loan guarantee “has crippled the Dunderdale government from speaking out.”

Dunderdale said the hydroelectric megaproject is viable and will go ahead — with or without Ottawa’s help. She took flak from political rivals for attending a Conservative rally in St. John’s, N.L., in March as Prime Minister Stephen Harper promised support for the plan to harness power from Labrador’s Lower Churchill River.

Her critics accuse Harper of breaking his word to the province before, most notably on a promise to shield offshore oil profits from federal transfer fund clawbacks.

Organizations: Canadian Press

Geographic location: Newfoundland and Labrador, Ottawa

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Recent comments

  • Will we have to pay for the loan guarantee for ever
    June 08, 2011 - 08:21

    Because the Muskrat Falls development financing, a development that will benefit the Maritimes and the rest of Canada much more than NL is getting a loan guarantee from Ottawa, is that the reason now for every last Federal job to be cut by Ottawa from the province of Newfoundland and Labrador and given to some other province? We just saw yesterday that the few very important life saving jobs that were with the Coast Guard in St. John's, where they are needed more than any other part of Canada because of the heavy traffic, are going to Halifax. Any location in Newfoundland and Labrador would be more strategic for the Coast Guard to be situated than Nova Scotia. Newfoundland and Labrador sees all of its natural resources being utilized by Ottawa to create vibrant economies for other provinces' economies and for Ottawa itself. We have no Federal Regional offices here in Newfoundland and Labrador, Nova Scotia has seventeen, we have no Military base here despite the many in Canada and how important our location was during the Second World War, and we supply 10 per cent of the Military and 20 per cent of the Navy recruits for the Canadian Military machine. It is shocking how we are treated in Canada by our Mother Government. We are treated as a Cinderella and we are one of the most important provinces for Canada's economic survival, in the wonderful manner it has been surviving for the past 62 years. It is time for a Referendum. Given our strategic location and our resource base, the province of Newfoundland and Labrador should be able to make it on our own steam. Look at how well the province of Quebec did by having its Referendums. The gratuities going to Quebec from Ottawa never stops, it is a daily ritual to see monies belonging to other provinces being allotted to Quebec. There was an article in this newspaper yesterday by Gerry Byrne, Federal MP on that very subject. where he said Quebec got $1.5 BILLION dollars that belonged to our province. Keep up the revealing work Mr. Byrne, we appreciate it.

  • Willi Makit
    June 07, 2011 - 13:48

    Dunderdale is confident? She was pretty confident about "the polluter pays'' as well, wasn't she? In my opinion, she is in a position that is way over her capabilities.

  • What if the U.S. doesn't rebound, what then
    June 07, 2011 - 11:37

    How will we sell the extra energy if the United States does not bounce back from the awful recession the World has been experiencing since 2008. Canada's economy depends on the U.S. Market, it is after all its number one trading partner. According to all news reports the United States's economy is very sluggish with very little movement towards creating jobs. The U.S. has all the infrastructure it needs in place and there are millions of homes on the market that its citizens lost during the 2008 recession. So, yes, what if the worse happens and it takes the U.S.a long time to rebound economically , what will happen to the Muskrat Falls Project., will we lose control of it?

  • WTF
    June 06, 2011 - 13:00

    'there are some ’technical issues’'. Is that the voice of experience Gerry? Is that what Paul Martin said to Danny when he tried to renege on his deal, before the flags came down and Gerry, with a smile on his face, stood side by side with Martin. It's not like Byrne's word is worth anything.

    • holy smokes
      June 10, 2011 - 17:51

      Paul martin????? Try Harper......The ink was dry and the document delivered..Harper tried to rework it to screw us out of the monies guaranteed.....And if there is no "legal" commitment signed for Muskrat Falls.....I can see the same thing happening again.......Gerry Byrne is right......I'd trust the Feds as far as YOU could throw them....

  • Steve
    June 05, 2011 - 23:40

    The Feds will support it eh? I'll file that statement with "It use less gas", "This won't hurt a bit" and "The cheque is in the mail". In other words unless I see signed legal documents all she's spouting is complete and utter BULL (typical of someone who's all kissy-face with Harpo).

  • bill
    June 05, 2011 - 22:47

    I have to laugh at Marshall Dean's comment!! This coming from a guy who has told people that he doesnt even want to live in the district. If I was the Premier I certainly would not be getting advice from Mr Dean. Although i hear he is really good at writing emails!! And as for Gerry Byrne...during the Federal Election he was all for the Lower Churchill deal. I remember seeing footage at the Geo Center when the Liberal leader was visiting, saying they would guarantee the money if they won power. Looks like Gerry changed his mind fast. Funny the guy has NO power at all these days...most he can do is tweet all day from the back of the HOC. He is so far back he won't even know what is going on! And Mr Byrne I am sure there are discussions going on with the Federal government on various issues. The fact is you are no longer part of the official opposition so you would not be aware of any talks. As a friend of mine once said ..."Gerry you don't count". The real issue here is that both Gerry & Marshall are afraid that some of these deals will be made by this government. Oh you bunch of wanna bes!! Now go back to tweeting & writing emails, its what you both do best!

  • karla ryan
    June 05, 2011 - 20:52

    at the end of the day people should be asking government to begin a major program to help homeowners reduce energy waste in order to make the cost of greening holyrood bearable. we cant predict the future in terms of costs but we can improve our household energy use/waste with a measurable degree of certainty.

  • howie
    June 04, 2011 - 19:23

    I find the Mr Byrne is fear mongering again as he usually does when he doesn't know what he's talking about . First he said the loan guarantee would have to budget approval . When government officials have confirmed that this need not be a budget item he attacks the premier of this province for supporting Harper./ Why does't this fellow grow up and give up his childish antics. I know Mr Byrne and the only thing he knows how to do is campaign and he is good at hugging old women and fooling the simple minded in his riding. apart from that there is not much more that he is capable of doing. Be a man Gerry and stop your childish antics and have fun because your are the MP for the most simple minded district in the country.

  • BR
    June 04, 2011 - 18:23

    So Dunderdale is not worried. Wasn't it only a few years that Danny wasn't worried about a promise Harper made??? Here we go again, another lesson in politics for the premier of NL.

  • I expect details of project to be revealed
    June 04, 2011 - 12:47

    I don't think we need to worry that the Federal Government will renege on this deal because it is so rich for the rest of Canada, especially the Maritimes and Ottawa, as well. I would like to hear our politicians explain the assets this deal will provide for the ordinary Newfoundlander and Labradorian and the province. All that I have heard so far is that our electrical bills will double in a few short years, and since that will be catastrophic to my family who is on a single fixed provincial pension, with no indexing I am presently against the deal. I just heard recently on CBC that Germany is scrapping all of its nuclear plants by 2022 and it will be buying electricity from France and other countries in the region, subsidized with fossil fuel energy. I am sure Ottawa is wringing its hand with glee that Newfoundlanders and Labradorians are thinking about developing this project, while taking on all of the risks. It will provide a much needed economy for Nova Scotia and New Brunswick, 2 provinces with very few resources of their own. If it can be demonstrated to me that this project has more assets in it for me, a Newfoundlander and Labradorian and my province, with my family on a fixed income, I am only too willing to listen to all the details. Before this contract is signed off on, I do expect responsible governance on this matter and that the details of the contract will be revealed to us.