What would
you think, having received these comments from a long time professional engineer
on the Muskrat Falls project? He writes:
“I could not put up with falsifying
information anymore.
To begin with, the original cost of $6.2 billion on which the project was approved was a complete falsification. The
estimate was deliberately kept low — below $7 billion, so as to appear
favourable relative to the cost of thermal power generation.
The likely costs were known about
three years ago, but Nalcor Management kept it a secret, steadfastly denying
that there were major schedule delays and cost overruns, until it was no longer
possible to hide the true status with the election of a new Provincial
Government.
The Astaldi contract, at the time of
award, had left out many items. The Canadian bidders were in the $1.8 billion
range — the present renegotiated cost...
Now that EY are coming up with the new cost…
Whatever final figure EY generates must be confirmed by a completely separate
entity, who are not paid by Nalcor.
The new leader of the "Oversight
Committee" [should] specifically look into the costs of all the mechanical
contracts, civil contracts and the service contracts. With the three year
project delay, there will be a huge impact. The $11.7 billion interim figure,
which includes interest during construction, looks too low… I know how the game
is played. Expect a cost of about $15 billion!!
This will be a big burden for
the people of Newfoundland. They must know the truth.”
Those were
the comments of one engineer. He was not exactly enamoured by the "independence" of the Independent Engineer either — but that's another story.
I have received comments from a good many engineers, all so similar that they
reinforce each other’s veracity.
One writes: “soil and weather
conditions” have been blamed for cost overruns. He says it has nothing to do
with weather or soil — "just a lack of ability by both the contractor and
SNC-Nalcor... weather has been on a par with conditions anyone who has worked in
Labrador might have expected…"
Another engineer
wrote about the untendered contract given to Vallard: “The job was Vallard's even
before the tender call (which was cancelled).” He also states: “… No one
I have encountered [on the LIL] actually worked in Labrador before… it's like
the blind leading the blind…”
Yet another
engineer took issue with a cost figure I had used to replace the
"popped" cable which, from the factory to the towers, went either unnoticed
or ignored by everyone. The engineer says the actual cost to Nalcor will be “closer to
$300 million (2 lines of 140 kms)…” He states that this will be a tough issue
because “… it was a spec'd [item] via SNC… the supplier warned of a
potential failure prior to production but [they] pushed ahead with
production/installation anyway…”
An engineer who
understood large project logistics wrote to me reviewing Nalcor's management structure and
the number of people on the Lower Churchill Project payroll. He comments: “With all
these very highly paid people you might expect to have a project that would be
so organized that it would be ahead of schedule and on budget.” He asks: “Do we need to have all these people with no hydro-electric construction
experience? And what about SNC, what are they doing and what is their contract
value now? And what about Ed Martin’s constant comments about being ahead in
engineering — that the risks and costs would be better managed?”
There is a pattern
of dysfunctionality here — all within Nalcor. And, to give it a different dimension, when Nalcor’s screw-ups run into the tens or hundreds of millions of dollars, the corporation can’t be honest about the source of the problem. It tries to
use the full cover of public and media indifference — and ignorance of the
issues — to keep its incompetence hidden.
Nalcor
appears now and again to fess up to a new, higher level of cost overruns —
only to go back into hiding because the government has given it unfettered
access to the public purse.
There is
dysfunction, dishonesty, and incompetence at Nalcor. The 46% of the public who still support the project would have a different view if they had a better understanding of the degree to which their money is being wasted. Soothing words and other blarney from Danny Williams only serve to extend public misunderstanding as to Muskrat's reality.
Also aggravating is Nalcor's deceptive practices — even under Stan Marshall.
It is worth
calling attention to a recent episode involving retired Canadian hydro engineer James L.
Gordon, who has written extensively on this Blog. Jim was persuaded, briefly, to
conclude that Nalcor’s design to remediate the North Spur was safe. The
comments caused Nalcor’s PR machine to go into overdrive — aided by a compliant
mainstream media — hoping to validate Nalcor’s refusal of independent review of the
instability problem.
But, within
days, the hydro engineer realized he had erred — and, to his credit, publicly said
so. Wrote Gordon: “This new data indicates that it is now absolutely essential
to have an independent Review Board undertake a comprehensive assessment of the
stability of the North Spur.”
Nalcor treated
Jim Gordon’s reversal with complete silence — unwilling even to acknowledge the
engineer or the faulty analysis it had vigorously embraced just a few days
earlier.
This is
sleaze.
But so, too,
is falsifying information to warrant project sanction.
And when a
phrase like “cost pressures” (one of Ed Martin’s favourites) is used to
explain egregious cost overruns — when incompetence is a far bigger problem, as in the
example of the faulty cable — you know this is an organization not deserving of
the public trust.
In a more
sensible world, public exposure of those engineers’ indictments would cause a
furor.
But not
here.
In a well-run
organization, such comments would incite the Nalcor CEO to action — especially given
that they are made by current and former Nalcor engineers.
But not
here.
Within a thoughtful and prudent government the Minister of Finance would descend on the
free-spenders — and wring their bloody necks.
But not here.
Even the
Auditor General cowers under Nalcor’s stare.
It has been
a tough slog for a good many engineers. Some, who couldn’t stomach the
incompetence, left the project long before they wanted to. Some of them found
in this Blog an outlet to express their concerns.
Each of
their emails was accompanied only with a simple request for confidentiality —
which will always be honoured.
One of the
engineers who asserted that the project cost estimates were
contrived - falsified - suggested his comments should cause a “firestorm” of protest in the province.
I wrote him back and advised: "...anywhere else. But not here."
