CVI refutes preferential treatment claim

REGINA — Henry Jaffe, the Ottawa businessman whose company, Climate Ventures Inc., was alleged to have received untendered, unwritten and inflated contracts worth millions of dollars from IPAC-CO2, is fighting back to defend his reputation and set the record straight.

In a statement posted on his company’s website, ClimbIT.ca, Jaffe denied media reports suggesting CVI received preferential treatment from IPAC-CO2. Jaffe also confirmed that Malcolm Wilson, former acting CEO of IPAC-CO2, and Ian Bailey, director of the University Industry Liaison Office, were not directors of CVI in 2009. He added he attempted several times to obtain written contracts with IPAC-CO2, but was refused by its board of directors.

“We are proud of our accomplishments and hope that the negative light cast on us will someday shine a positive light on our earnest efforts to build on the excellent capabilities within Saskatchewan to demonstrate world-class leadership,” the statement said.

Here are the key points from Jaffe’s statement: ■ In 2006, Gordon Owens, then-head of the University Industry Liaison Office at the University of Regina, invited Jaffe to work with the U of R’s Office of Energy and Environment.

Headed by Wilson the meeting was requested to develop strategies for commercializing Saskatchewan technologies.

■ A business plan was prepared and submitted to Enterprise Saskatchewan, which became the basis for the creation of CVI in August 2008. Jaffe was named the founding shareholder of CVI, but after incorporation, the university decided it was inappropriate for its faculty or administrative staff to be shareholders and requested Wilson and Bailey resign from the corporation. The university also asked Jaffe to acquire the balance of CVI shares owned by the two U of R officers, as well as assume the legal expenses.

■ In 2009, Jaffe was approached by the university to help secure funding for IPAC-CO2. Jaffe prepared funding submissions to the federal government and Shell Oil, which helped secure $6 million to $7 million in funding for the creation of IPAC-CO2.

■ In February and March 2009, the university asked if CVI could design and build an IT infrastructure for IPAC, which would enable researchers around the world to share high performance computing resources for assessing the environmental risks of, and developing standards for, geological storage of CO2. Jaffe provided detailed specifications, plans and budgets for this purpose, “without any payment.”

■ In April 2009, CVI was asked by the university to do the work on a “sole source” basis and without a written contract since the incorporation of IPAC-CO2 was taking longer than expected and deadlines in the funding submission to Shell and the federal government were looming. Jaffe said CVI agreed to start the project on a month-to-month basis, with the understanding that once IPAC-CO2 was incorporated it would either negotiate a contract or participate in the procurement of IT infrastructure. Jaffe said the IPAC board refused to enter into a written agreement, but asked CVI to continue work on a month-to-month basis.

■ To help secure funding for IPAC-CO2 from the province, CVI was asked to produce a business plan with Crown Investments Corp., which was completed in the fall of 2009. In May 2010, the project was completed, “on time and within the budget allocated by the federal government and Shell Canada,” the statement said.

“What could have been a celebration of Saskatchewan’s achievements in IT were dampened by the introduction of a new management team (at IPAC-CO2) which undertook to marginalize the accomplishment,’’ the statement said. No contract was extended to CVI nor was CVI invited to participate in any procurement opportunities. In fact, the operation of the system was contracted by IPAC to another vendor in Quebec.

“Needless to say the disappointment of the team was profound.”

Far from costing taxpayers, Jaffe said the loss of the IPAC contract resulted in the demise of CVI. “At the end of the day, I lost a lot of money on it,’’ he said, estimating his losses at $700,000.