Nalcor Energy CEO Stan Marshall is reporting $90 million in profit for the Crown corporation in the first quarter of 2018, up $33 million over the same period in 2017.
The increase comes largely from electricity rate increases that came into effect in January, paired with higher oil prices and production.
Nalcor’s Oil and Gas division — which will be separated and turned into its own subsidiary sometime this year — recorded 897,775 barrels of oil, with an average price in Canadian dollars of $85 a barrel. Both those numbers are up from 826,532 barrels, and $67 a barrel, respectively, in the first quarter of 2017.
The increase in revenue from oil production was partially offset by the lack of a tenant at the Bull Arm Fabrication site. Nalcor is currently in negotiations with two companies about the use of the site. It’s unclear when the new tenant is expected to be announced.
When it comes to the Muskrat Falls generating station, the Crown corporation spent $99 million in the first quarter of 2018, down by $44 million over the first quarter of 2017.
In total, Nalcor has spent just over $9.2 billion on the project to date, which was originally estimated to cost $6.2 billion when the project was sanctioned.
Total capital expenses for Nalcor, excluding the Maritime Link, were at $304 million in the first quarter of 2018 — down by $244 million compared to the same quarter last year. Nalcor says that’s because construction is winding down on various aspects of the Muskrat Falls project. The power generating station on the Churchill River is primarily what Nalcor has left to complete with the project.
The company provided the update in its first-quarter results presentation, released Friday.
Nalcor says first transmission over Emera’s Maritime Link took place in February. Previously, Marshall estimated bringing over a small amount of electricity through the link will generate about $50,000 a day, which he says would help offset expected electricity bill increases once Muskrat Falls goes online.
First power is still expected in December 2019, with full power anticipated in the summer or fall of 2020.
Elsewhere, the new switchyard at Churchill Falls for the Lower Churchill Project was fully energized for the first time in March. Nalcor says energizing the switchyard is a “significant step towards delivering power to the island through the new transmission assets.”
The company says about $9 million is left to be paid to customers through the rate stabilization plan refund, which began being paid out about a year ago. A total of $141 million will be refunded to customers who were overcharged.
Nalcor says the appeal date for the dispute over the 1969 power contract between Churchill Falls and Hydro-Quebec is expected to be in December.