Antle calls Muskrat Falls an ‘irresponsible’ risk

James
James McLeod
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Paul Antle says that when he heard about a billion-dollar contract for Muskrat Falls, awarded last week, alarm bells started going off in his head.

Liberal leadership candidate Paul Antle sat down with The Telegram Saturday to talk about Muskrat Falls.

Antle is running for the Liberal leaderhsip.

He isn’t one of the Liberals calling for the Muskrat Falls project to be cancelled or wildly retooled, but he’s not exactly an enthusiastic supporter, either.

It’s not that he’s against building a hydroelectric dam at Muskrat Falls, necessarily — or at Gull Island, for that matter — but Antle says the way Premier Kathy Dunderdale is going about things is incredibly risky.

For starters, he said, the provincial government just agreed to a billion-dollar deal to do work on Muskrat Falls, and it hasn’t yet nailed down financing for the project.

“What really set me off was this billion-dollar contract. I (couldn’t) care less whether it was an Italian company or a Canadian company or whatever. That’s not the point,” Antle said. “We don’t have the financing. We never went out and got the loan to support the project. Now we’re really stuck. Now we’re really over the barrel.”

During an inter­view with The Tele­gram, Antle ex­plain­ed his concerns, and a lot of it comes down to risk.

Antle isn’t convinced that electricity demand in Newfoundland and Labrador is rising, which means he doesn’t accept one of the foundational pieces of the Nalcor case for Muskrat Falls.

Also, he says the provincial government should still send the project back to the Public Utilities Board for a full review, even though the project has been sanctioned and construction has started.

But the No. 1 thing he says Dunderdale and Nalcor should do is nail down the financing to eliminate risk for taxpayers when it comes to borrowing costs.

Antle would also like things to be more solid regarding the Maritime Link and Emera as a partner. The Newfoundland government says everything is fine, but the partners haven’t publicly revealed how they’re going to satisfy the Nova Scotia utilities regulator to make the Muskrat Falls deal work.

“I think it’s reckless. I think it’s irresponsible. It’s unprofessional,” Antle said. “No businessperson in their right mind would go off and start spending a million dollars a day on a project when they still have all these assumptions floating around out there.”

Beyond the specific criticisms, there’s a broad divide between the way the Progressive Conservative party is running the government and Antle’s vision of things.

It all comes down to risk.

Dunderdale has trumpeted the government’s equity stakes in offshore oil projects.

And it was under former premier Danny Williams that Nalcor started selling recall power from Churchill Falls directly into the United States instead of selling it at a fixed price to Hydro-Québec.

Both of these moves potentially earn the government more money, but also expose taxpayers to more risk.

And when it comes to risky plays, Antle says Muskrat Falls is the big enchilada.

“Government should never be in business,” Antle said. “It’s a bureaucracy. It’s not there to generate profit. Government is not there for that purpose. You’re there to administer a tax base and provide services to people you govern.”

 

jmcleod@thetelegram.com

Twitter: TelegramJames

Organizations: Public Utilities Board, Maritime Link

Geographic location: Newfoundland and Labrador, Gull Island, Nova Scotia United States

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Recent comments

  • Pierre Neary
    October 15, 2013 - 16:16

    Had an opportunity to meet Mr. Antle while he was out campaigning. Mr. Antle came across as very intelligent and committed. Definitely a good candidate for the leadership.

  • Harvey
    October 15, 2013 - 13:19

    Make it a business deal,Paul and like all big corporations suck up the profits. Wasn't it the PC gov't under Danny Williams who secured the royalty ..5% from an offshore development? I just hope that Antle , Dumberesque or Bennett fail to become leader.

  • Too Funny
    October 15, 2013 - 12:21

    Sounds like this guy has already mastered the political skill of fence sitting.

  • Jon Smith
    October 15, 2013 - 11:57

    Whether one half the cost of the Muskrat boondoggle is $4 billion, 5 or $6 billion, it is the cost of going around Quebec and includes the link giveaway package to Nova Scotia and it represents the subsidy the Newfoundland ratepayer will pay to dump power into mainland electrical grids. Whether that money is in handouts to the unaccountable Nalcor or the coming $6.2 billion loan, it still represents money which could be well spent on health care and the deplorable roads and a list of other necessities. And all of that excess cost to produce electricity will fall on the backs of the Newfoundland taxpayer. Joey's deal for the Upper Churchill will look like the best deal we ever made.

  • Observer
    October 15, 2013 - 10:54

    "Government should never be in business.....it's not there to generate a profit". So, would you disband the Liquor Corporation while you're at it, Paul? And take away all the profit it generates for the provincial treasury ? Would Norway disband STATOIL, their version of NALCOR, if they followed Paul Antle's logic? What an incredibly stupid thing to say! And this guy thinks he can be Premier? Am I the only one who finds Paul Antle arrogant, extremely self-centered and in way over his head? His words speak for themselves.

  • concerned taxpayer
    October 15, 2013 - 10:50

    I agree that spending a million dollars a day on Muskrat Falls is incompetent at best. We don't even need the power so why are they putting us in the hole. Let private companies take all the risk in projects such as Muskrat Falls and offshore oil projects as well as mining . We should concentrate on better royalties with less risk involved to the taxpayers of NL.

  • Observer
    October 15, 2013 - 10:49

    "Government should never be in business.....it's not there to generate a profit". So, would you disband the Liquor Corporation while you're at it, Paul? And take away all the profit it generates for the provincial treasury ? Would Norway disband STATOIL, their version of NALCOR, if they followed Paul Antle's logic? What an incredibly stupid thing to say! And this guy thinks he can be Premier? Am I the only one who finds Paul Antle arrogant, extremely self-entered and in way over his head? His words speak for themselves.

  • concerned taxpayer
    October 15, 2013 - 10:49

    I agree that spending a million dollars a day on Muskrat Falls is incompetent at best. We don't even need the power so why are they putting us in the hole. Let private companies take all the risk in projects such as Muskrat Falls and offshore oil projects as well as mining . We should concentrate on better royalties with less risk involved to the taxpayers of NL.

  • Jay
    October 15, 2013 - 09:44

    Paul Antle seems to be turning into quite a phony. Is he going to shut down the Department of Business, which all Liberal governments before supported? He was for Muskrat Falls before he became involved in the leadership race. He pretends to have grown up in the Battery. I'm starting to wonder if I can believe a word he says.

  • Stephen D Redgrave
    October 15, 2013 - 07:57

    A "no risk to taxpayers" scenario is unrealistic for a project of this size--and Dunderdale has very little say in the markets that will finance Nalcor. On the plus side Nalcor's credit rating is above world average giving them options for the very best financing partnerships in a long term proposal. It's a deal that is way past the point of return. At this point, failure is not an option.

  • Calvin
    October 15, 2013 - 07:34

    Hahaha, so Antle's arguement is that government shouldn't be worried about providing a surplus in the provincial budget? After all, he is using the words "turning a profit" here, when another politician is going to call it "budgeting a surplus." I have said it numerous times, whatever anyone thinks about the state of the current PC government, we as residents of Newfoundland and Labrador are lucky that they were in power when the world discovered our abundance of valuable natural resources. The Liberals would have taken the first offer that all the big oil companies put forth and then would have claimed it a victory, where the PC's have pushed for more at every turn and gotten it. Good or bad idea, Muskrat Falls is moving ahead now, and it is time for the opposition to find a new stance to take on their election platform, because this is old news.

    • Kev
      October 15, 2013 - 08:46

      You hear people joke about it, but holy hannah... PCs really do believe they put the resources in the ground. Arrogant much? Bye bye PCs.

    • Muskrat Math
      October 15, 2013 - 09:33

      How do you explain to a 6 yr-old that she will be 56 by the time she makes her final monthly payment on Muskrat? Or how about a 20 yr-old who will be 70 by the time he gets it paid off?

    • Robb
      October 15, 2013 - 09:40

      You see Calvin, when you spell it out like that, it makes bug sense, but the liberals and ndp would love to put the worst twist on this as they can. You know it, I know it, and just about everyone else knows that the liberals would have given everything away....they are famous for it, and just want to make the quick score for the short term.....very short-sighted of course......Now I know The Telegram will post this, but if you go to vocm to post anything, if it supports the gov't in any way, they will not post it....have a look......99.9% of the vocm posts are anti-govt....they have not posted anything from me in like forever....but this really shows the level of dependability and trust that you can put into vocm's reporting.

    • Brian
      October 15, 2013 - 11:28

      A surplus and a profit can be two very different things. When a government runs a surplus, it could simply mean that they didn't effectively manage their spending programs. Government is supposed to be 'non-profit', just as Mr. Antle suggests ie. a 'balanced budget'. Muskrat Falls is indeed a very risky venture, and proceeding to let a $1B contract before project financing is secured would be foolhardy indeed, in my opinion. The fact that private industry is not developing the project speaks volumes about the amount of risk involved.

    • Happily Retired
      October 15, 2013 - 13:49

      No, the PCs didn't put it in the ground. You obviously forget John Efford's "take it or leave it" ultimatum. Beware of Liberals like Antle who speak out of two sides of their mouths. He was all for this project at the beginning

  • Stephen D Redgrave
    October 15, 2013 - 07:15

    Of course, with a deal as big as this, the financing is going to be a major issue. We can not finance this deal without support from global markets in the USA, Europe, and others. Nalcor has a credit rating sufficient to secure financing from a wide range of sources, and can afford to bargain for the very best rates. It is risky, but, once global markets have taken us under their wing, it will be in their best interest to make sure we succeed. It is the global marketplace that supports the most financially prosperous provinces. To have any more reviews of how this will be done would be a financial disaster for Newfoundland.

  • Mauric E. Adams
    October 15, 2013 - 06:57

    Mostly good words -- but words are cheap. The $1 billion contract has not yet been awarded. Nalcor said only that the Italian company is the "preferred" contractor and that they are still on negotiations with the Italian company. Nalcor does not (as Mr. Antle has said), have the financing --- so that contract CAN AND SHOULD be put on hold by government, and Mr. Antle, if he is deserving of being premier, should demand government do so.

  • KK
    October 15, 2013 - 06:56

    Bright guy but won't win the Liberal leadership race. Came in tolate (on the last day to enter) and was left with a third rate campaign team because all the quality strategists had signed on to the other campaigns.

    • A. Gillingham
      October 15, 2013 - 17:39

      He should get some data from the dealings of Italian contractors in McMurray, that would help his argument as well.

  • John Smith
    October 15, 2013 - 06:18

    Well Mr. Antle, you hit the nail on the head...government is not there to generate a profit, and muskrat falls was never ment to generate a profit, it is a means to generate electricity for NL. That's why the link is nice, but not necessary. Financil institutions are ling up to give us money, they have rate payers as collateral, a very safe bet. Mr. Antle is the weakest of the five running for the leadership...and that's saying something...

  • Concerned
    October 15, 2013 - 06:12

    The provincial government will state that they have complete confidence in Nalcor to delivery this project. They have washed their hands of fiscal oversight that would normally be provided on a public works project. There has been no public update in project estimates in over 1 year. There has been no public update on how the UARB condition will be met. There has been no public update on the impact of the HQ court case, and the impact should we loose. There has been no public update on the terms of reference for the negotiations with Quebec. There has been no public update on federal loan garuntee, and financing. Yet there has been millions of public dollars spent. The government are also about to commit to a 1 Billion dollar contract. This is 2000 $ for every man, women and child in the province. There is complete dependent on Nalcor to do what is right? But who are monitoring the gate keepers? Antle is correct. In normal business there would be checks and balances. No business would commit to a contract which is effectively 1 years revenue without having the many questions answered. The normal checks and balances in business does not appear to exist at Nalcor. How did we let this debacle happen.