N.L. signals renewed interest in buying feds’ share of Hibernia

James McLeod jmcleod@thetelegram.com
Published on November 14, 2013
Premier Kathy Dunderdale speaks to reporters outside the House of Assembly Wednesday afternoon. Dunderdale said that she’s going to take another shot at buying the federal government’s equity stake in the Hibernia project, but only at the right price. — Photo by James McLeod/The Telegram

Premier Kathy Dunderdale said she’s definitely interested in buying the federal government’s equity stake in the Hibernia oil development, but only “if the price is right.”
On Tuesday, federal Finance Minister Jim Flaherty said that he’d be willing to look at selling the 8.5 per cent stake in Hibernia.

“It would be an expensive buy, but you can imagine the return on investment would be very significant as well,” Dunderdale told reporters Wednesday.

The Hibernia stake has been of interest to the provincial Tories for years, but they’ve never managed to get Ottawa to agree to a deal.

Then premier Danny Williams suggested back in 2008 that Prime Minister Stephen Harper turn over the equity stake to the province; at the time, the federal government said that it would only sell it at fair market value.

Then, in 2009, Dunderdale wrote to the federal government — she was natural resources minister at the time — asking for a deal on the equity stake.

At the time, Flaherty made it sound like that was unlikely to happen.

“Canadian taxpayers have in-curred significant costs to develop the Hibernia project and assumed significant risks,” Flaherty wrote in 2009.

“In this context, the federal government will manage this investment in order to maximize its value to all Canadians, and in accordance with best commercial practices.”

The issue reared its head again in the 2011 federal election. Dunderdale, who was premier by that point, wrote all three political parties asking them a series of questions relevant to Newfoundland and Labrador.

At that time, all three parties said they’d look at it.

Harper wrote: “A re-elected Conservative Government will promptly make our minister of finance available to meet with your representative in order to further review the possible sale to the province of the federal government’s ownership share of, and working interest in, the Hibernia project.”

More than two years later, nothing has happened.

Dunderdale said there was a fundamental gap in how Ottawa values the 8.5 per cent equity stake and how the provincial government values it, which is why the talks broke down.

But she said she’s encouraged to hear this week that Flaherty is still open to talking.

Both opposition parties said they support the province going after the Hibernia stake, although New Democrat Leader Lorraine Michael said that the government shouldn’t pay fair market value for it.

“It’s our resource; it’s the resource off our shores, and you know, one can dream and say, really, the federal government should be turning it over to us,” she said.

Liberal natural resources critic Dwight Ball said he also supports the idea of the province buying the stake in Hibernia, but he doesn’t believe Dunderdale can get it done.

“If this deal makes sense, this is something that can be done,” he said. “But again, I think the big question is, do the people of this province, right now, have the confidence in this government to pull this off?”



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