Nalcor potentially overstated value of Muskrat Fall: audit

Brian Gallant is bringing in some campaign help ahead of Monday’s New Brunswick election: Atlantic Canada’s other Liberal premiers.

Nova Scotia’s Stephen McNeil, Prince Edward Island’s Wade MacLauchlan, and Dwight Ball of Newfoundland and Labrador will join New Brunswick’s Liberal leader Sunday.

Gallant, who is in a tight race with Progressive Conservative Leader Blaine Higgs, says the premiers’ support is “much appreciated.”

He notes in a press release that the Atlantic premiers have “worked together in unprecedented ways” to help the regional economy.

The region is also represented federally entirely by Liberal MPs. N.B. Premier and Liberal Leader Brian Gallant participates in the CBC provincial election Leaders’ debate, in Riverview, N.B., on Wednesday.

An audit found Newfoundland’s Nalcor Energy may have overstated the potential value of its Muskrat Falls hydro megaproject and prematurely dismissed alternative electricity options for the province.

Accountants from Grant Thornton are testifying Friday at the inquiry into cost overruns of the $12.7 billion Labrador dam, presenting a report on the provincial Crown corporation’s early financial analysis and consideration of other power options.

David Malamed and Scott Shaffer found that Nalcor’s early estimates for the project excluded $500 million of strategic risk exposure, and could have used a more precise model when estimating its capital costs.

Experts consulted for Grant Thornton’s report said a different calculation model would have increased the project’s capital cost estimate by $767 million.

Nalcor initially forecast annual operating and maintenance costs at $34 million - an estimate that has since risen to $109 million.

The report also found that Nalcor did not formally discuss importing power from HydroQuebec and dismissed the option of waiting until 2041 to import power from the Churchill Falls dam, when the longstanding contract with Hydro-Quebec expires.