Opposition reacts to loan guarantee delay

James McLeod
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Opposition politicians are split over how the government should handle delays on the Muskrat Falls loan guarantee: push harder or sit back and wait.

Comments from federal Natural Resources Minister Joe Oliver this week indicate he's still waiting for more project details before he signs off on a loan guarantee.

Last month Premier Kathy Dunderdale said they've given Oliver all the information he's asked for, and it's Nova Scotia utility Emera that's holding things up.

Liberal MHA Andrew Parsons says Dunderdale and Natural Resources Minister Jerome Kennedy should press Emera to turn in its financial numbers.

"This is our project," Parsons said. "It's our resource that they're trying to develop with this partner, so no, they have to steer the ship here and if it means that they have to put some pressure on Emera to meet these deadlines, then I think they need to."

The federal government has committed to providing a loan guarantee to help with the financing of the $6.2-billion hydroelectric project.

Nalcor CEO Ed Martin has said the loan guarantee will reduce borrowing costs by about two percentage points, which could net savings of roughly $600 million.

But before the federal government gives its blessing, it wants to hire an independent team of financial advisers to scrutinize the project's numbers.

Originally, the loan guarantee was supposed to be finalized before Nov. 30, or within eight weeks of Ottawa getting all the financial details. This week, Oliver said he still doesn't have all the information he needs.

"It seems that the federal government is doing its due diligence here. They're not going to plow ahead without having the information that they need," Parsons said.

"I'd like to think that timelines and deadlines could be met. It doesn't seem like they've ever been met in this matter, but again, I would also say that they can't just plow ahead without having the information they feel they need."

NDP Leader Lorraine Michael said that as far as she can tell, the only thing to do is try to be patient.

"I think Minister Oliver's comments are pointing out the fluidity of this whole situation and the fact that the Government of Newfoundland and Labrador really doesn't have control over this whole process," she said.

Michael said Dunderdale shouldn't rush a debate on the issue in the House of Assembly until all the information is in, including the details of the loan guarantee.

jmcleod@thetelegram.com Twitter: TelegramJames

Geographic location: Nova Scotia, Ottawa, Newfoundland and Labrador

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Recent comments

  • John Smith
    April 23, 2012 - 15:13

    This project was costed without the loan guarantee, and without emera. So, even if those two parts do not come through, the project is still 2.5 billion cheaper than an isolated island system.

  • Maurice E. Adams
    April 23, 2012 - 10:57

    natural gas has cut electricity costs in the U.S. to 2 to 3 cents/KWh. How do you make money off Muskrat Falls when it will cost island ratepayers 35-40 cents/KWh to produce and get that power to market? That does not include cost overruns, high debt servicing costs, etc...... SNC Lavelin last year won a contract in Tunisia to build them a brand new 420 MW gas fired power plant for $340 million Canadian ----- We could do the same ---- no debt, no debt servicing costs, no risk, no high cost for fuel, very little pollution, no significant cost overruns, no reliability problems, no free power for Emera, no political risk/fallout.

  • H JeffORD
    April 22, 2012 - 22:37

    To build the Muskrat Falls and to produce as Joey would say not tens of millions not hundreds of millions, But billions of dollars worth of power, to sell in Newfoundland and the mainland of canada , I would think it would be sold at a profit ,as the demand for clean,safe,reliable power,increases the cost of water when the development is completed the cost of water to turn the turbines will remain the same, There got to be a profit some where if power is sold at a reasonable rate,The muskrat falls when built will not burn billions of barrels of oil a year like Holyrood generating plant,or be one of the top ten air poluters in Canada as Holyrood is, since water will be turning the turbines in muskrat falls it has to be cheaper to run long time than Holyrood and will if run like a buisness pay off

    • Canmore Mike
      April 26, 2012 - 09:25

      How can you sell it at a profit if it costs 30 - 40 cents to produce and get to market. Every other source of electricity in North America doesn't cost one-third of that to produce. The answer is: It will be done on the backs of the rate payers of NL.

  • William Daniels
    April 22, 2012 - 07:38

    Harper has been hanging the loan guarantee carrot in front of Dunderdale to buy her silence on all the federal slashing and burning in this province. Her desparation was evident when she put on her sunday best and danced on stage for Harper during the election. In the end Harper will burn her.

  • roy
    April 21, 2012 - 08:56

    Is this the same Loraine Michael who wanted the house to open so the muskrat falls could be debated. Thank god they are not leading the govt. The province elected who they wanted in a democratic process.