Premier encouraged by term sheet signing

Colin MacLean
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Premier Kathy Dunderdale speaks with reporters at Wednesday’s Royal St. John’s Regatta. — Photo by Gary Hebbard/The Telegram

Premier Kathy Dunderdale expressed her approval Wednesday of the finalization of a term sheet to develop the Lower Churchill.

The term sheet is a collection of 13 contracts, 1,500 pages, detailing the construction of the Muskrat Falls hydroelectric dam in Labrador and the transmission lines to get the power to market.

Dunderdale made the comments in response to a reporter’s question at the 194th Royal St. John’s Regatta.

“I’m delighted. It’s one more milestone. It’s not anything we had any concern about,” said Dunderdale.

“It’s important for the province, when we’re doing any kind of agreement with anybody, that we extract every ounce of value we can find in our arrangements. If that takes six months, 10 months, 18 months, then so be it. We’re satisfied we’ve done that. It’s a good deal, a really good deal for the people of Newfoundland and Labrador and it’s a good deal for the people of Nova Scotia,” she added.

The basics of the deal are that Emera will pay to build a subsea cable from Newfoundland to Nova Scotia; in exchange, it will receive roughly 20 per cent of the electricity generated by Muskrat Falls.

During the first five years of the agreement, it will get close to 25 per cent of the electricity.

After 35 years, ownership of the maritime link will revert to Nalcor.

Nalcor will be able to transmit electricity to sell in the Maritimes, and will have access to Emera's transmission capacity to sell electricity in the northeastern U.S.

But the finalization of the deal still has some significant stepping-stones before it gets final approval.

The province still has to finalize cost estimates, which then need to be scrutinized by Manitoba Hydro Inc.

There is also going to be a debate in the House of Assembly this fall.

That is something Dunderdale said she is looking forward to.

“There has been quite a bit of spin about the development of Muskrat Falls, and my goal in this is to make sure that the facts, not the spin, are before the people of the province and that they are extremely well informed before we make a decision as to whether or not we are going to move ahead,” she said.

Twitter: @TelegramMacLean

With files from The Telegram

Organizations: Manitoba Hydro Inc.There

Geographic location: Muskrat Falls, Newfoundland and Labrador, Nova Scotia Northeastern U.S.But

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Recent comments

  • Maurice E. Adams
    August 03, 2012 - 07:31

    No problem Casey. There is sufficient information available to see the 'big picture'. Just a few ---- No outside the province sales that would not be at A HUGE LOSS, no sales to the mining giants in Labrador that would not be at A HUGE LOSS, the project has to be paid for lock stock and barrel by captive island ratepayers --- who don't need the power, Nalcor's total, island demand forecast track record is 10 times as much in ERROR as the industry standard ( the project depends on demand from ratepayers), they say we need to do Muskrat Falls to avoid the 'volatility' of oil prices --- yet the so-called least-cost advantage of Muskrat depends on a 50-year oil forecast (how can anyone forecast 'volatile' oil prices out 50-years ---- and on and on it goes. These just represent the tip of the iceberg.

  • crista
    August 02, 2012 - 17:33

    you speak of electric, power, money, nova scotia, northeastern usa, and the article that we read here now and nalcor has to be protected does any one remember upper churchill falls and what is going on with that deal,just say the US wants into this deal in the future.Who is going to have to pay for this now and if that happens who is protected then, you talk about some ones VISIONARIES. Can any one remember VALDMANIS WANTS TO SPEAK TO SPEAK TO SMALLWOOD ON THE FRONT PAGE OF THE TELEGRAM ,APRIL7/1964 what i am saying is what happens if some one is wrong how is any one going to talk therir way out of this one.YOU ARE TALKING NATURAL RESOURCES.YOU ARE TALKING GOVERNMENT, BUSSINESS, SHARE HOLDERS AND YOU ARE TALKING ABOUT WAY OF LIFE FOR WHO???? NOT ONLY MUSKRAT FALLS,WHO IS GOING TO BE RESPONSIABLE???? FOR THESE PROJECTS IF SOME THING GOES WRONG????

  • Cold Future
    August 02, 2012 - 14:30

    Any clear thinking individual has to question this Muskrat project because there are so many less risky options to supply power to meet the provinces demands which are being overlooked in favour of this venture. 1. Have Emera build the sub sea cable and buy the power from the mainland.2. build the interconnection to Labrador and bring back the recall power and if additional power is required buy it from Quebec at rates about 5 cents/kW now. This option would cover the closure of Holyrood if this is practical and makes sense to do. 3. proceed with the isolated island option which builds the project to meet the demands - not build the warehouse for sale at low rates while NL consumers pay through the nose. Then prepare for the repatriation of the Upper Churchill power in 2041 ( a considerable warehouse of energy, 2 thirds of the plant capacity of 5500 MW - very little risk. The risk and potential for considerable cost overuns is much less for any of these options. On top of all that MHI cautioned that the Kruger mill closure and cost above $ 6.2 B. would favour the isolated island. Kruger is teetering and requires subsidies from workers and the province already. Add it all up and it looks like Muskrat is only going to stubornly go down a risky road to prove that a majority government can assume its mandate is to do exactly what it likes. Who out there is comfortable with this project who does not have something to gain personally?

  • Maurice E. Adams
    August 02, 2012 - 13:56

    CASEY, you are mistaken (IN ERROR) if you look so much to peoples' 'credentials' in order to make a judgement about Muskrat Falls.......... By all means, read, analyze and understand the best you can all of the facts, opinions and arguments about Muskrat Falls ---- and then make your own, informed, decision........ Don't rely on, or put so much emphasis on my or anybody else's "credentials"...........Manitoba Hydro International has all kinds of 'credentials' --- yet a $900 Million dollar hydro project in Manitoba is 85% over cost and has no demand/markets (profits making revenue) for its power.

    • Casey
      August 02, 2012 - 16:16

      Mr. Adams: My comments were not meant to offend, and I apologise if I've done that. I just think that there are many unknown factors that the average Joe has no access to due to the nature of this kind of big BUSINESS venture. Also, it is easy to say I'm against this project when we cannot see the big picture due to lack of certain information and/or misunderstanding. If this project turns out to be as bad as some of you say, then a lot of people who are pushing for it will need to leave NL for their own safety.

  • Casey
    August 02, 2012 - 13:31

    If some of you are so sure that Muskrat Falls is such a bad deal for NL, then why are you limiting your response to posting comments on the internet. Organise, demonstrate, demand a meeting with government officials and debate this issue face to face. What is this tactic you are now using going to get you, or are just nervous about the whole deal? As for this vision2014 site there are a lot of assumptions and unknown factors. How the hell do we know the cost of oil is going to go down, because some economist says so?

  • Winston Adams
    August 02, 2012 - 12:52

    John Smith, Energy efficiency flies elsewhere. World class companies make these products which are ideal for our climate. If they cut electricity for heating by only 5 or 10 percent I'd agree with you, but these systems reduce it by 50 percent and more. Units sold in Canada in 2011 jumped by 46 percent in one year. Millions of these systems are being installled worldwide. So the real world see efficiency as a solution to avoid expensive new generation. I would suggest that our province is out ot touch with reality if they ignore this. 600 Mw of waste here is no chicken feed. Tell me what is not real- the ability to reduce this much waste? the very low comparative cost to do so? the reliability of the equipment? Or just a lack of will to adapt- this seems to be a problem. And a bit of a mystery. People will line up to save 5 cents on gas. But won't invest in something to save them 50 percent on their heating bills, but will complain like hell when electricity jumps 40 percent with MF. Our government ignores this technology which can help our citizens bigtime. And what does "beaucollic " mean?My Oxford don't show it . Not an efficiency term. I got a feeling these very efficient systems are not beaucollic. Even an average Joe like you should appreciate the fine advances in technology to reduce waste. Granted, a few conversion to efficiency offers little. That's why we need to do like Vermont and other places- wonder why our Premier and Energy minister didn't go to see how the real world there is keeping electricity prices stable. Pity Nalcor can't do it.

    • jordan
      August 02, 2012 - 13:18

      I put convect air energy effecient heaters in my home 4 years ago. Best thing I ever did. My heat bill was reduced by 50%. I recommend it to everyone!!

    • John Smith
      August 02, 2012 - 13:46

      Winston, I am 100 per cent in favor of conservation. I love convective heating and heat pumps... they are wonderful, I love insulation and state of the art windows etc. However, I don't think they are the answer to our future energy requirements. Oh, and it's spelled bucolic, sorry, I forget my spelling when I start banging away sometimes.

  • Cyril Rogers
    August 02, 2012 - 10:35

    The Premier should be looking in the mirror when she talks about the "spin" around the Muskrat Falls project. They have changed their reasoning on where and why we need it so many times they must be spinning in their Cabinet chairs. You can't make a bad project good, no matter how you "spin" it!

    • John Smith
      August 02, 2012 - 11:38

      How is it bad? If it is bad, what do you think would be a reasonable alternative?I am just your average Joe, I have read most of what's available on the subject. I have come to the conclusion that we will need several hundred additional megawatts of power within the next 20 years or so. The question is what is the lowest cost option? I think hydro is the way to go. Not gas, or oil, or wind or solar, but hydro. Just like the 650 megawatt dam at Bay d'espoir. Which raised all kinds of controversey when first proposed, now most people don't even know it's there. I would like to hear what the naysayers propose. Oh and Wince b'y, you got to get off this conserv ain't gonna fly. It's a nice beaucollic thought, but in the real world we need electricity, and lots of it. So bring on this development...the sooner the better.

    • Eli
      August 02, 2012 - 11:59

      Average Joes are not wingnuts!

    • Naysayer
      August 02, 2012 - 12:54

      Here is my reasonable alternative. DO NOTHING. It appears that the only people who need this power are the people of Nova Scotia and Industry in Labrador and I think it is unfair to expect the people and future generations of this province to subsidize this project for their needs. Sure it would be great to get off oil but with the price of oil where it's at and where it's predicted to be, it does not justify the construction of this project. I could spend tens of thousands of dollars retrofitting my home to make it the most energy efficient it could possibly be but I would never live long enough for those retrofits to pay for themselves so I am smart enough not to do it. That's what Muskrat Falls reminds me of. Angreat idea that makes 100% sense to do but also unfortunately un-affordable. We got this far without Muskrat Falls and I'm sure we can last another 100 years without it.

  • Eli
    August 02, 2012 - 10:25

    Anybody but me hear that energy analyst from Manitoba on CBS's Morning Show today? He spoke of soft markets for energy transborder but what floored me is the cost overrun on their $900-million dollar project has balooned to $1.6 billion and the selling of energy into the U.S. is being financed by the people of Manitoba.! Sound familiar with comments in NL? And we're getting an analysis of Muskrat from Manitoba Hydro? Jeeezzz, have Dunderdale and Kennedy got their lights on?

  • Cold Future
    August 02, 2012 - 10:16

    If the Muskrat should continue and it appears we may be too far gone down the path with NS to get out of it, it will be a win win situation for mainland who will be supplied with a cheap source of power. It will be win win for all who work on its construction and supply materials for it. The sole loser will be the NL ratepayer who must pay exhorbitant rates to subsidize it. The government should state exactly what they are doing which is building a loss leader in the hope that the Upper Churchill power can follow the same route and be sold for rates which will make it attractive. And Gull Island may also be attractive if the power buyers can be found. You cannot sell power for 20% of its cost to produce and not subsidize it out of the NL pockets. Its a big gamble. Muskrat is economically viable at about $3 billion ( half the budget of $6 billion). If its cost goes to $9 billion, the subsidy to be provided by captive NL rate payers will be huge.

  • Winston Adams
    August 02, 2012 - 09:34

    Maurice, it seems that like nalcor and John Smith, you have tunnel vision. Whats with the argument of 100 million in water spilled still on your site?Last year was a record wet year and spilling will happen. You present no argument that this is economic to not spill. And it seems silly , and gives John Smith reason to spin and discredit all your arguments.

  • Too Thick
    August 02, 2012 - 09:22

    I do not believe that Premier Dunderdale is qualified to make any decisions of the magnitude of the Muskrat Falls project. Hold a Referendum. Let the people speak and decide if increasing our electricity bills to pay for this project is acceptable to the people. Anything less is dictatorial.

    • Jordan
      August 02, 2012 - 12:07

      I guess you are better qualified then the government who were voted in by a majority of voters.

    • Too Thick
      August 02, 2012 - 13:59

      Jordan, I challenge you or any of you colleagues to produce a PC Blue Book by Dunderdale or Williams that says the ratepayers in NL will have their electrical rates increased to pay for Muskrat Falls. Danny Williams never said it and neither did Dunderdale, even if they knew it at the time. ratepayers increases were NEVER disclosed to the electorate. Never. By the way, can you tell us in your wisdom how much the project will cost - no one else seems to know, including manitoba hydro and nalcor.

  • Maurice E. Adams
    August 02, 2012 - 08:49

    What is important CASEY is whether or not my analysis (here and at ) is sound. Please feel free to prove, or even argue, otherwise.

  • Winston Adams
    August 02, 2012 - 08:46

    John Smith, my alternative is to reduce the 600 mw of waste from inefficient heating, which can be done at about one fifth the cost. And we use rebates to promote this as other jurisdictions are doing. Since you avoid including this with the other nutty ideas you list, it suggests my figures are real .You do not dispute them. Wonder why. Nalcor must know this too. And it brings power costs for heating down to the equivalent of 5 cents average per kwh since so little electricity is needed for the efficient systems. And if Muskrat goes ahead and then people install these due to the higher electricity costs, this would then kill the demand from Muskrat falls on the island here. So I see it as a no win. Either promote efficiency now and avoid this big expence, so go ahead and effieiency will take hold anyway and kill the demand. What's your answer to that? Use it for mines in Labrador ?

  • Maurice E. Adams
    August 02, 2012 - 08:29

    JOHN and CASEY, go to and you will get answers to:---------- "Do Muskrat Falls constitute a 'rational energy strategy'?", "Do the island need the power", "Are there better options?", "Will Muskrat Falls stabilize rates", "Do Holyrood burn 18,000 barrels of oil a day in winter?", "Why is it that the Premier recognizes that oil companies need to be 'protected' against LOW oil prices, but with Muskrat Falls, ratepayers DO NOT?", "Why is it that Nalcor needs to be 'protected' (by way of a locked-in, 50-year, TAKE OR PAY contract) against lower than forecast island demand, BUT RATEPAYERS ARE NOT?", "Why is it that island ratepayers will be LOCKED-IN to a minimum 2% ANNUAL rate increase, when oil has increased over the last 6 years on average by only 3/10ths of 1% annually (6 times less)?", "Why are island ratepayers locked in to an escalator clause when Nova Scotians are NOT?", "Why is it that Nalcor gets NO REVENUE from Emera to help cover the $10.5 BILLION in debt servicing and operating costs that island ratepayers have to pay over the 35 year Nalcor/Emera deal?" Just to name a few. See

  • John Smith
    August 02, 2012 - 07:43

    Facts...not spin...well that would be nice. Like Maurice's comment here. Not one iota of truth anywhere in it, total fabrication, lies and innuendo, not even a hint of factual data. But long as it gets out Maurice? As for the rest I will ask again...if not Muskrat, then what? What is your answer to our coming power needs? Oh, and if you don't think we have a need for more electricity in the next 10-20 years you are living in a fantasy world. The question is not do we need the power, we will indedd need more power. So, the question is how should we create that power? Wind, solar, tidal, coal, nuclear, oil, gas, LNG, moonbeams and butterflies, or Hydro? Intelligent, well educated, well experienced Newfoundlanders, who work for Nalcor looked at the problem, and all the answers, and came back with the answer that Muskrat was the lowest cost option. Not good enough for Maurice, and the rest of the b'ys, so we go outside to Navigant, nope not good enough, MHI, nope not good enough, Wade Locke, nope not good one is good enough. Unless you are a nutjob, touting bringing gas onshore, or daming every little river on the island then you are not considered worthy by the naysayers. The naysayers continue to say muskrat is a bad deal,, but they can't say why. They also can't come up with a good alternative. That's what I want to hear. What do you propose to do about our coming need for electricity? Oh right...I forgot we don't need any power here in NL, we will all go sit on the end of the wharf and go on the dole...

  • Casey
    August 02, 2012 - 07:35

    Mr. Adams I've been reading some of your critical posts on the deal. Would you be so kind as to tell us what your occupation and background is, so that we can get some idea if your analysis is credible? Or are you just a very negative person?

  • Maurice E. Adams
    August 02, 2012 - 07:04

    The debt servicing and operating costs alone for NL ratepayers for just the 35 year period covering the Emera deal is $10.5 BILLION. NL is getting NO REVENUE whatsoever from Emera to help cover that cost. But then again, Nalcor will be able to sell surplus power that cost NL ratepayers 30-40 cent to produce and supply for 2-4 cents. Ratepayers will only lose about $90 million for every $10 million in revenue FOR NALCOR.

  • Cold Future
    August 02, 2012 - 06:43

    It is heartening to see in print that the premier woul possibly cionsider not proceeding with this bad deal for the NL ratepayers-even though the die may already be cast on tghis one and the NL payers well on the hook already.

  • greyhound
    August 02, 2012 - 06:42

    Yes Kathy we get every ounce of value, Newfoundland pays for the overruns, which I am certain they wll be very large. Maybe you should return to what you know best, and what is that?