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Pam Frampton: Report warned of grave risks; a shame nobody read it


Published on July 15, 2017

A rally and march were held to protest the Muskrat Falls project in St. John’s Monday.

©Joe GIbbons/The Telegram file photo

Somewhere out there, a 24-page risk assessment report on Muskrat Falls is hovering in mid-air, seemingly invisible.

Pam Frampton

Compiled in April 2013 by SNC-Lavalin, the company that holds a key engineering, procurement and construction management (EPCM) contract for the hydroelectric project, it warns strongly of cost overruns and delays, with 25 of the 40 aspects of the project it examined rated as “Very High Risk.”

“The risk team reviewers have serious concerns…,” someone has underlined in the copy of the report I read.

“SNC-Lavalin, as the project’s EPCM, has the legal obligation to advise its client of any major risks that will cause prejudice to the project and which deviates significantly from its budget and schedule. … Client has limited experience in huge civil work and earth-filled dam work, power line and power station works.”

That client was Nalcor, and SNC-Lavalin was anxious to discuss its findings with Nalcor’s high-level management.

Indeed, a SNC-Lavlin spokesman confirmed the company “attempted to hand it over to Nalcor.”

We’re being sold a bill of goods. Someone is withholding the truth.

And yet then Nalcor CEO Ed Martin has said the report was never “transmitted” to him. Paul Davis never heard of it during his time as premier from 2014-2015.

Premier Dwight Ball learned of the report from current Nalcor CEO Stan Marshall, who found out about it by happenstance last year.

Ball says he was told Martin was in the room when the report was presented. Martin says he wasn’t and that Nalcor had identified all the same potential problems anyway, and was putting mitigation plans in place.

At the time, Muskrat Falls was only 20 per cent complete and the report warned of potential cost overruns of 39 per cent.

Now, the project is more than 75 per cent finished, two years behind schedule and 70 per cent over budget.

I’d say those mitigation plans didn’t work so well.

So, we, the public, are on the hook for electrical rates expected to roughly double what they are now by 2021, and be three times as much by 2040, and we’re supposed to believe that SNC-Lavalin produced a report akin to red flashing lights and blaring sirens, anticipated it would be made public, presented it to Nalcor, and nothing happened.

No one got it, no one took it, no one read it, no one acted on it.

We’re being sold a bill of goods. Someone is withholding the truth.

I contacted SNC-Lavalin media relations this week to ask: when the report was presented to Nalcor, who was in the room? Who was the report given to? If it was refused, who did so and why? I got no reply.

I emailed questions to Gilbert Bennett, Nalcor’s executive vice-president in charge of power development. If anyone should have been in that room besides Ed Martin, it was him. He didn’t acknowledge my email or provide any answers.

Instead, I got an email from Nalcor communications manager Karen O’Neill, pointing to a June 28 statement from Stan Marshall saying he had “asked Nalcor Energy executives about the report but no one was aware of it” and was told by SNC executives that “senior SNC representative(s) had met with my predecessor in 2013 to present the report but the report had not been accepted.”

Not accepted? Accepted and ignored? Accepted and shredded and then burned and buried? Which was it?

Billions of dollars have been spent since that report issued its clarion call — debt that will financially hobble the people of this province for years to come.

And no one feels obligated to be accountable and answer questions?

Just eight months after the report was written, in December 2013, Premier Kathy Dunderdale was hailing Muskrat Falls as “a project with tremendous vision” that promised “stable electricity rates."
“We are shouldering our unshrinkable responsibility to leave no stone unturned, no resource untapped and to ground Newfoundland and Labrador’s future firmly and securely in the solid bedrock of sustainable and renewable prosperity,” she said.

Well, the only people shouldering the “unshrinkable responsibility” are the ratepayers of this province.

We are the resource being tapped — and Muskrat Falls will tap us out.

Demand answers.

 

Pam Frampton is The Telegram’s associate managing editor. Email pframpton@thetelegram.com. Twitter: pam_frampton