Opposition asks for figures on Muskrat Falls cost overruns

James
James McLeod
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Blacked out pages of engineer’s report cause concern in House

On Tuesday morning, Nalcor provided 209 pages of Muskrat Falls information in the form of an independent engineer’s report, but just hours later the Liberals were in the House of Assembly demanding more information.

Nalcor Energy CEO and president Ed Martin (left) and vice-president Gilbert Bennett speak to media Tuesday about the independent engineer’s report regarding the hydroelectric project.

The independent engineer’s assessment is a broad and mostly positive study done as part of the federal loan guarantee agreement, but Nalcor has meticulously blacked out sections of the report that might hint at cost overruns or delays, and that’s exactly what Liberal Leader Dwight Ball wanted to know about.

“The CEO of Nalcor admitted today that the cost of Muskrat Falls is under pressure and that it will go up due to labour and material costs,” Ball said, in his first question in the House. “I ask the premier: have you had any discussions with Nalcor about these increasing costs?”

Premier Tom Marshall said he’s had conversations with Nalcor officials about project expenses, but he doesn’t have an updated figure on how much the whole thing would cost.

Marshall was also on the defensive over the pages of blacked-out information in the independent engineer’s report.

When the report was released Tuesday morning, the media was not provided with a copy of it until after Nalcor CEO Ed Martin finished speaking, so reporters were unable to ask questions about specific parts of the report which were hidden behind black ink.

Ball wanted to know why censors had blocked information about how much electricity the dam will produce.

“Some things around a project the size of this is justified as being commercially sensitive. Blacking out how much power Muskrat Falls will produce just does not make any sense,” he said. “I ask the premier: you stated many times in this House that Muskrat Falls will produce 824 megawatts of power, so why is this information blacked out in the engineer’s report?”

Later in the afternoon, a spokeswoman for Nalcor said the average output of the dam — 824 megawatts — is public information, but when it comes to a detailed breakdown of how much electricity is generated under “various scenarios,” it becomes secret.

The issue, it seems, is that if Nalcor is selling power into the North American market, and competitors know how much electricity the dam can generate under a variety of circumstances, that could potentially prevent the company from getting the highest possible price.

Unnecessarily secretive

Ball told reporters he doesn’t think what Nalcor is holding back should be kept secret.

“This is not commercially sensitive information. We have a right to know,” he said.

The bigger issue, though, was the total cost to build Muskrat Falls and the associated transmission lines.

Martin doggedly refused to say how much it’s going to cost, and he said he won’t provide any sort of update until all the major contracts have been awarded.

He did, however, hint that some aspects of construction cost are coming in higher than originally estimated, and the project might not be finished in 2017 as planned.

Natural Resources Minister Derrick Dalley said that makes perfect sense, and if they can space out the work evenly so it’s not as expensive to build the dam, Nalcor will go that route.

NDP Leader Lorraine Michael also tried to get more details about cost overruns out of the government Tuesday, without much luck.

She said it’s no surprise that some of the project costs are coming in higher than originally forecast. She pointed out that she’s been asking about this for months.

“I was mocked by the premier of the day and the minister, and what we have now is a validation of the questions I asked in December and the concerns I raised,” Michael said. “We have no idea how much over they are, and it’s going to continue to be like this. I have absolutely no doubt.”

In Nova Scotia, Energy Minister Andrew Younger said news of the possible delay completing construction of Muskrat Falls would have “zero impact” in his province in terms of cost or delivery of power.

Younger said that’s because under the project agreement, a delay requires Nalcor to deliver its promised allotment of energy by some other means or reimburse Nova Scotia Power for the cost.

He said the cost overruns relate to the dam project and have nothing to do with the construction of the subsea cables between Newfoundland and Cape Breton.

“The Maritime Link remains within the budget approved by the (Nova Scotia Utility and Review) Board and it remains on schedule,” said Younger.

jmcleod@thetelegram.com

Twitter: TelegramJames

With a file from The Canadian Press

Organizations: North American, Nova Scotia Power, Canadian Press

Geographic location: Nova Scotia, Newfoundland, Cape Breton

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Recent comments

  • Tony Rockel
    April 17, 2014 - 03:35

    With such fantastic figures, you'd think NALCOR was trying to enter a beauty contest, but really they're just a hopeless body.

  • I'm confused on what I thought I heard.
    April 16, 2014 - 13:56

    Did I hear from Mr. Martin that for cost purposes the Muskrat Fall Project might have to be pushed into the future, in other words delayed somewhat? Also did I hear it said at the beginning of the the Muskrat Falls Project, the quicker the project progressed and was completed, the least costly it would be? I am a bit confused on what I thought I heard.

    • Tony Rockel
      April 16, 2014 - 15:14

      Confused? Yes, that's exactly how NALCOR wants us to be. As the old saying goes, "never lie when you can bullshit your way out of a situation" and if nothing else, Ed Martin is the master purveyor of bovine excreta . He obviously knows nothing about 21st Century energy technology and seems proud of the fact, but when it comes to fluency in bullshit, he's da man!

  • I'm confused on wht I thought I heard.
    April 16, 2014 - 13:55

    Did I hear from Mr. Martin that for cost purposes the Muskrat Fall Project might have to be pushed into the future, in other words delayed somewhat? Also did I hear it said at the beginning of the the Muskrat Falls Project, the quicker the project progressed and was completed, the least costly it would be? I am a bit confused on what I thought I heard.

  • Tony Rockel
    April 16, 2014 - 10:23

    Tom Marshall tells us that NALCOR "belongs to the people", so what gives these arrogant fools the right to waste our money with no accountability and no disclosure of what they're doing with it ?

  • Jon Smith
    April 16, 2014 - 09:59

    A suggestion for the title of the book which will likely be prepared and published when the information is finally leaked out to the public: " MUSKRAT FALLS - THE CONSPIRICY AND THE COVERUP" ( a win- win must read in a lose-lose deal)

  • Virginia Waters
    April 16, 2014 - 09:53

    So they call a press conference to answer questions about a report on Muskrat but they don't give the report to the media until the press conference is over. Not to mention that the most important pieces of the report have been blacked out. And now they won't even tell us how much power Muskrat will actually produce. So is this part of the new policy of 'openness and transparency' promised by Marshall and Steve Kent? Meanwhile, Nova Scotia is laughing all the way to the bank. 'Delay? - Cost overruns? - Not our problem? The price of our power is fixed for 30 years. And if Muskrat isn't ready, Newfoundland has to buy the power elsewhere to meet its obligation to us'. When this sequel to the Churchill Falls horror show blows up in our face, who will we blame this time? You have to wonder at times if Newfoundlanders are genetically programmed for failure.

  • Not surprised
    April 16, 2014 - 06:17

    So it begins,,this project needs to be scrapped before we are bankrupt,,cost overruns,longer project times and compensation to Nova Scotia due to project extension,it will never end,maybe at 10 billion or more,,we are royally screwed,,add non-renewable resources to that when they run out,,woe to our children and grandchildren,wake up nfld. People before it's too late.

  • Susan
    April 16, 2014 - 06:05

    One thing about the people of N & L. all talk, no action. Then they wonder why. they wake up to a cold house, and not a warm home. Their just to lazy to stand up and be counts. We have three provincial party. who wouldn't find their way out of the dark with a search light. You got Tom Marshall who cry, when some one don't call him premier, you got Dwight Ball, who couldn't give you a straight answer concerning anything, but you got to love his one liner ( Elects Me Then Find Out ), Then its Lorraine Michael. everything with her is spend. Simple question, required simple answer. Once more Mr Ball, if you were premier, would you put a stop to MUSKRAT FALLS, YES OR NO.

    • Robb
      April 16, 2014 - 09:38

      Now susan, you don't mean to tell me you don't know the answer to that question. I will spell it out for you...the liberals and ndp are only pis**d off because it is not them doing this project. They tried everything to delay it in hopes of getting into power, and then you can be sure it would be full steam ahead. These liberal and ndp creeps with their doomsday chanting's are getting a little boring. We all know Ball has nothing, no policy, no foresight, and the ndp would give everything to the unions. So thank gawd the PCs have done such a great job at running this province properly, and not into the ground like the opposition would do. Things have never been better in this province and you all know it. If you disagree with this notion, you are either a supporter of the opposition, or you are too lazy to get up a do anything. And then you hear the same old, same old from the liberals....change, we need change....well, who in the hell wants to change the great life we live here in the province now. This change concept is such a stupid cop-out. So don't "change" anything please, things are just fine, and never mind the pointless banter of the liberals and ndp.

  • Charles
    April 16, 2014 - 05:09

    Never mind the B/S, put a stop to the dam project, before every Newfoundlanders and Labradorians is starving.

  • Tony Rockel
    April 15, 2014 - 23:31

    "He did, however, hint that some aspects of construction cost are coming in higher than originally estimated,"-------like, maybe 96 percent higher?