Meaningless Muskrat milestones
“This project will have a tremendous impact on the people of Newfoundland and Labrador for years to come.”
— Premier Kathy Dunderdale, talking about Muskrat Falls, Oct. 30, 2012
When Kathy Dunderdale made that pronouncement nearly three years ago, she finally had her tea leaves straight.
The problem is, the impact it will have on us may not be the one she was promising when she boasted at the same news conference that, “Muskrat Falls sets the stage for us to finally take control of our destiny and achieve the enviable position of total energy independence in the international marketplace.”
The revelations this week that Muskrat Falls is overbudget and behind schedule doesn’t leave me feeling independent, but shackled financially by a behemoth that could cripple this province for generations to come.
Does anyone else feel misled, here? Is anyone else pissed off? Because I tell you, I am. Looking back at Telegram coverage of this project from its inception, time and again voices of reason and urgings of caution were ignored.
We’ve got contingency funds, they said. This has been carefully studied and planned. We’re being open and transparent with taxpayers.
Dunderdale liked to boast that there was more information provided by the government on Muskrat Falls than on any other project, ever.
Well that’s not of much value if the information is wrong.
Three years ago, The Telegram noted in a Q&A on Muskrat Falls that, “Those opposed to the project have suggested oil prices might not increase as predicted, and there is a greater risk in the potential for cost overruns on Muskrat Falls construction”
Later that same year, Nalcor CEO Ed Martin was saying that with more than 50 per cent of the engineering work done, and bids received on the major tenders for the project, they had a much better sense of how much the whole thing will cost. Guess not, eh? The only thing I feel assured of in light of this week’s news is that costs will go up again and the project will be further set back.
Keep collecting those performance bonuses, though, right b’ys? Just send us the bill.
Danny Dumaresque, a wellknown card-carrying Liberal, has often been dismissed in this province as a kind of boy-who-cried-wolf or Chicken Little character, constantly expressing foreboding about the government’s actions when it comes to energy policy and practices.
Well, to give him his due, his warnings back in 2011 don’t quite seem as far-fetched now as they did to some people at the time.
“Realistically, (Muskrat Falls) is a seven-year project …” he told The Telegram back then — a timeline that’s bang-on, according to the information provided this week.
“Who knows what’s going to happen there, but the potential for major unknown expenses in that particular situation is very, very ripe indeed.”
Ripe? How about over-ripe? With a whiff of rotten.
Dumaresque pointed out then that cost overruns are simply not something the provincial government can afford — and we’re in worse financial circumstances now than we were back then. Martin’s response at the time? That Nalcor has done detailed engineering and field work, so cost estimates are very precise, and should be very accurate.
“We understand the business from top to bottom,” he said.
I’d hate to see the state we’d be in if they were less cocksure.
Last year, Martin was still brimming with confidence in the budget and the timeline, saying he was comfortable with how the project was proceeding, even in the face of $800 million in cost overruns at the time.
“We’ve reduced our risk of cost increase significantly, just because of where we are in the project,” he assured the public.
Even in March of this year, Martin was saying project milestones were holding.
Six months later, it’s off the rails.
I’ll give Danny Dumaresque the last word on this one. He had it dead to rights four years ago.
“We have the potential to really seriously damage our financial situation, to the point where we may have to be bailed out, like Iceland or something,” he said.
“We could be in for one helluva shock.”