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Natural gas not considered for Newfoundland and Labrador power, engineer tells Muskrat Falls Inquiry

Memorial University professor Stephen Bruneau says Nalcor Energy and the Government of Newfoundland and Labrador never fully considered using natural gas from the province’s offshore as a way of meeting the island’s power needs.
Memorial University professor Stephen Bruneau says Nalcor Energy and the Government of Newfoundland and Labrador never fully considered using natural gas from the province’s offshore as a way of meeting the island’s power needs. - Joe Gibbons

Local expert describes his concerns about speaking out publicly

On the stand at the Muskrat Falls Inquiry, engineer and university professor Stephen Bruneau was asked if — before the hydro project was given the green light — he feared unfair criticism and professional consequences in suggesting an alternative.

“You better believe it,” Bruneau told inquiry co-counsel Barry Learmonth Friday morning.

Years before the Muskrat Falls project was decided on, or brought to the province’s Public Utilities Board (PUB) as an option, Bruneau was expressing his view of the alternative potential in natural gas in offshore Newfoundland and Labrador.

From the publication of the province’s energy plan in 2007 to the sanctioning of Muskrat Falls, he said, he didn’t see public evidence that natural gas was being fully explored.

He told Commissioner Richard LeBlanc that in his opinion, it never was.

Bruneau said he thought a lot about where and how to talk about it.

“Clearly speaking out against the policy of the government is not endearing yourself to the government,” he said.

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He set aside his misgivings. In 2005 he had presented to the oil and gas association, Noia, on bringing offshore natural gas to the island, and in 2006 he had given a talk hosted by the Newfoundland and Labrador Environmental Industries Association.

In 2012, he offered a submission to the PUB on using natural gas to meet Newfoundland’s power needs and, in March of that year, gave a public presentation at Memorial University of Newfoundland. The talk was followed by a submission on the same subject, published in the Newfoundland Quarterly.

“I felt it was necessary for me to speak about it because I had some fairly unique insights given my background, having worked in this area for a long time and having the opportunity to do so as a somewhat independent, from an independent viewpoint, and I felt it was a duty, a professional duty, to provide that information,” he said, adding he was encouraged by individuals behind the scenes.

The Muskrat Falls hydro project was sanctioned at the end of 2012.

Bruneau still argues natural gas was technically and commercially a viable option for Newfoundland and Labrador, and would solve what he described as a “gas storage problem” for oil companies operating offshore.

“We could pay a lot for (the gas) and we would still be much better off,” he said of the need to deal with oil and gas companies, including ExxonMobil and Husky Energy, who hold gas at their oilfields, stranded from the North American market.

The gas is currently used in a mix of storage, re-injection and flaring, each to varying extent by oil development. The Canada-Newfoundland and Labrador Offshore Petroleum Board governs how much natural gas can be disposed of in flaring.

On the stand, Bruneau spent time reviewing reports from Ziff Energy Group (October 2012) and Wood Mackenzie (November 2012) in detail, rejecting their findings. The reports have been used to support the province’s decision to undertake Muskrat Falls and for not pursuing natural gas for local power.

“Full cycle liquid natural gas supply costs will likely be similar, or in excess of, the current oil-fired power generation at Holyrood (thermal power plant) and higher than the proposed Muskrat Falls Project,” the Ziff report concluded.

Wood Mackenzie reviewed the Ziff report and found the “analysis and conclusions relative to natural gas as a fuel source for Newfoundland to be reasonable,” and suggested a contract for gas for Newfoundland might be hard to achieve, given the cost of production and low level of local demand.

Bruneau was critical of both documents, questioning sources on certain points, and the assumptions behind others, and responding publicly for the first time to certain statements.

Bruneau was not certified as an expert witness for the inquiry. The initial understanding, as LeBlanc suggested in his comments following the engineer’s presentation, was that he would be reviewing comments he had made publicly in the lead-up to sanction of the Muskrat Falls project.

But given the introduction of new points, and the assertions made in relation to the expert reports, a request was made from the parties with standing for additional time before Bruneau was cross-examined and to allow for a review of the points made and to get instruction from clients.

LeBlanc agreed. Bruneau’s cross-examination was set over to a later date.


Coming up

The inquiry will not sit on Monday, given the Thanksgiving Day holiday.

On Tuesday, Oct. 9, economists Wade Locke and James Feehan, both with Memorial University of Newfoundland, are scheduled.

Wednesday brings a panel of Muskrat Falls Concerned Citizens Coalition members Ron Penney and David Vardy.

Roberta Benefiel of Grand Riverkeeper Labrador and Philip Raphals with the Helios Centre are scheduled.

The inquiry is also working on the rescheduling of chief Jean-Charles Piétacho, with the Conseil des Innus d’Ekuanitshit, as well as rescheduling cross-examination of engineer Stephen Bruneau.

The schedule is subject to change.

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