Lorraine Michael Question Period (12.03.2012)

MR. SPEAKER: The Leader of the Third Party.

MS MICHAEL: Thank you very much, Mr. Speaker.

On Friday, the Premier signed a term sheet for a loan guarantee contingent on a decision from Emera about the Maritime Link, which at best is months away, a decision which is in no way guaranteed to be in our favour. With no finalized loan guarantee in sight, government still insists on rushing their plans for the Muskrat Falls Project.

Mr. Speaker, I ask the Minister of Natural Resources: Why won’t this government put on the brakes and send this project back to the Public Utilities Board for a full regulatory review?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Natural Resources.

SOME HON. MEMBERS: Hear, hear!

MR. KENNEDY: Thank you, Mr. Speaker.

We have had numerous independent reviews conducted of all aspects of Muskrat Falls, Mr. Speaker, but one very telling statement that was made by the Prime Minister of Canada on Friday was that when they looked at the loan guarantee, there was minimal risk to the taxpayer of Canada. He went on further to say, Mr. Speaker, that there was zero risk. This is because, Mr. Speaker, the federal government has engaged in a rigorous economic analysis. They have looked the Decision Gate 3 numbers in detail; they have looked at the revenues projected.

What they are saying at the end of the day, they are convinced that this project is not only a good deal for the people of Newfoundland and Labrador, the people of Nova Scotia, and the people of Canada, but also, Mr. Speaker, one that does not require any further analysis because they can reach that decision themselves.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The Leader of the Third Party.

MS MICHAEL:Thank you, Mr. Speaker.

My question to the minister is: Is this project going to have a regulatory review, and if it is going to have one, who is going to do it if not the PUB?

MR. SPEAKER: The hon. the Minister of Natural Resources.

SOME HON. MEMBERS: Hear, hear!

MR. KENNEDY: Mr. Speaker, we have had this project reviewed by Nalcor at their Decision Gate 2 phase, then Navigant reviewed it but they were not independent enough. Then, Mr. Speaker, we went to the PUB, nine months and $2 million, they could not help us. We then hired the group that they hired, Mr. Speaker, MHI. We have had natural gas reports released; we have had wind reports released.

We have looked at all aspects of this case, Mr. Speaker. We have now had the federal government say that this is a good project, because we would not put the taxpayer of Canada on the line, Mr. Speaker, if it was not a good deal. Finally, Mr. Speaker, the fact that Quebec is upset must make it a good deal.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The Leader of the Third Party.

MS MICHAEL: Thank you very much, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

MS MICHAEL: Obviously, Mr. Speaker, the minister does not understand –

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: Order, please!

The Leader of the Third Party.

MS MICHAEL: Thank you, Mr. Speaker.

Obviously, the minister does not understand what a regulatory review is.

Mr. Speaker, the original Maritime Link term sheet was thirty-eight pages. The formal agreements when they were signed were more than 1,500 pages. The devil, as they say, can be in the details. For example, the detail that Emera has until 2014 to decide to proceed with the Maritime Link was not mentioned in the term sheet that was in the final agreement.

I ask the Minister of Natural Resources: How can government sanction Muskrat Falls without knowing the final details of the loan guarantee agreement?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Natural Resources.

SOME HON. MEMBERS: Hear, hear!

MR. KENNEDY: We do know the final details, Mr. Speaker, of the federal loan guarantee. We know the amount of the guaranteed debt. We know the debt-to-equity ratios that they are looking at, Mr. Speaker. The terms of the federal loan guarantee are outlined, the amortization profile, the conditions precedent, Mr. Speaker.

In relation to 2014, I would suggest that the member opposite read what is actually written there. If there was no sanction they had until 2014 to make a decision on sanction. What I am saying, Mr. Speaker, is that Emera and Nalcor are currently in the process of determining how to expedite the sanction process. What I can say from our perspective as a Province is that we will be in a position to make our decision in the near future.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The Leader of the Third Party.

MS MICHAEL: Thank you, Mr. Speaker.

I ask the minister: What bargaining power will this Province hold if Emera tries to drive a hard bargain on its Maritime Link deal after government has sanctioned Muskrat Falls and is well into construction? Emera holds the balls, Mr. Speaker.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Natural Resources.

SOME HON. MEMBERS: Hear, hear!

MR. KENNEDY: Thank you, Mr. Speaker.

Mr. Speaker, the one thing that Mr. Martin, the President and CEO of Nalcor, is very experienced at is negotiating complex deals. If the member opposite thinks that Mr. Martin has not foreseen all of these issues on how to dot every I and cross every T, she is underestimating that man and his team, Mr. Speaker.

What I can tell you, Mr. Speaker, is the federal loan guarantee is done. What is the benefit to the people of this Province? A billion dollars, Mr. Speaker!

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The Leader of the Third Party.

MS MICHAEL:Thank you very much, Mr. Speaker.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order, please!

MS MICHAEL:I am really trying to understand government’s approach. There are no solid markets for 60 per cent of the power, no firm agreement for a Maritime Link, thus no assurance yet of a loan guarantee, no regulatory review of the project, looming budget shortfalls, yet government is going to plow ahead with the Muskrat Falls Project.

Mr. Speaker, is this government determined to build Muskrat Falls at all costs on the backs of the people of this Province?

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The hon. the Minister of Natural Resources.

SOME HON. MEMBERS: Hear, hear!

MR. KENNEDY: Yes, Mr. Speaker, I stood next to an NDP Premier of Nova Scotia on Friday who talked about how this was a game changer and a nation builder. So, we have an NDP Premier with vision.

Mr. Speaker, what we are dealing with here is a project that is in the best interests of the people of this Province. One, we need the power; two, we have to get it from somewhere. Muskrat Falls is the

least-cost alternative.

In case the member opposite missed it, there is a paper on Labrador mining that you might want to have a read of, if you talk about the need for power in Labrador. At least the Opposition House Leader recognizes that need for power in Labrador and is saying to us: Develop Muskrat Falls so that you can supply that power to these mining companies.

Associated Caucus Members: 

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