It’s the gift that keeps on giving. Well, it’s the gift we keep on paying for, anyway. Tuesday, the provincial government announced it had settled with Fortis over the seizure of that company’s interests in a hydro project that had been jointly owned with AbitibiBowater, and was caught up in the province’s 2008 seizure of Abitibi’s Newfoundland assets.
The latest settlement? More than $76 million — $22.4 million in lost profits for the company, and the assumption of $54 million in debt still outstanding for the Exploits River hydro project. (An interesting aside about that $54-million debt? AbitibiBowater held a 49 per cent interest in the Exploits River Hydro Partnership, and the partnership had $59 million in debt in 2010 when Nalcor took over the partnership’s loan payments. So, effectively, the province just took AbitibiBowater off the hook for $26.5 million in debt.)
In 2011, the province settled with other partners in a different hydro project at Star Lake, paying Enel Green Power North America $32.8 million and assuming a $40-million loan obligation from Sun Life Assurance in exchange for its interest in the dam. The total? In all, $148 million.
Those assets were seized in 2008, when the province rushed legislation through the House of Assembly to strip AbitibiBowater of all of its Newfoundland assets — and, in the process, accidently seized the company’s contaminated Grand Falls paper mill as well.
At the time, the government maintained it was repatriating valuable forestry and water rights.
Well, the forestry rights have been so valuable that, over the last five years, the province has been unable to interest anyone in setting up shop to use them.
The water rights?
They may well be valuable to the province for years, but the taxpayer has paid dearly for them.
The federal government has had to fork over $130 million to settle a NAFTA claim by AbitibiBowater over the seizure.
The province tried to take Abitibi to court for environmental cleanup costs — and lost, all the way to the Supreme Court of Canada.
The numbers in that case? Somewhere between $50 million to $90 million in cleanup costs at a minimum, and perhaps as much as $150 million to $270 million — the province’s own estimates vary. Not only that, but the government had as much as $10 million in legal fees.
Total tab? Somewhere between $338 million and $558 million across the two levels of government.
That’s pretty pricey for what looks like somewhere around 54 megawatts of power, when all of the former papermaker’s hydro assets are considered.
And in the current fiscal situation, there isn’t enough money to provide security at one of our “assets.” Security staff were told they were being removed from the mill on April 1.
Yet, here’s Natural Resources Minister Tom Marshall in the House of Assembly Tuesday: “It was a great project for the people of the province. These are assets that belong to the people. With the land and the timber and the water rights, these assets, we couldn’t let them go, we couldn’t let them be sold off to somebody else at a bankruptcy sale when the province couldn’t get them. … We had to do it, and we had to move quickly, and you know, we’ve protected the assets that were owned by the people of the province.”
And Tory MHAs sit there and clap rapturously.