Thursday, 8 February 2018

MF INQUIRY: UNCERTAINTY THE FUEL OF SCEPTICS

If Judge Richard LeBlanc feels like he is being watched, perhaps he will delay judging the cynics until after he has judged Nalcor. 

Each decision taken by the Commission of Inquiry into the Muskrat Falls Project is understandably scrutinized as watchers assess whether the Commission is capable enough to undertake the enormous task for which it has signed on, and whether the Commission will be transparent enough to imbue public confidence in its mandate, procedures and processes. Arguably, perhaps, the Commission is already making decisions whose side-effect is enabling this result.  The Premier could have given the Inquiry a head start had he submitted a draft Terms of Reference (TOR) to the public and sought input. That job fell to Judge LeBlanc.


The Commissioner acknowledged that the TOR were “fixed” but that, until February 15th, he would accept written opinions with respect to how they might be interpreted.  
The announcement by the Commission on Monday that the firm of Grant Thornton was given a contract to perform a Forensic Audit is likely a good news story.
Why only likely? 
Since January 2017 when this Blog quoted the “Anonymous Engineer” on allegations of falsification of the project estimates, the drumbeat in support of a review of the data, decision-making processes, and assumptions on which sanction was awarded, has grown louder and louder. Obviously, the Commission had seen the necessity of a Forensic Audit from the ‘get-go’; it must have issued a call to qualified parties within days of its formation together with Terms of Reference based upon which, ostensibly, all the auditing firms competed. 
So far, at least, the public has seen only a couple of sentences describing exactly what the forensic auditor will examine. We have not seen the full TOR and we need to.
Indeed, the timing of the announcement of the Forensic Audit may have had a linkage with the approval by the Lieutenant Governor-in-Counsel (the Cabinet) of an exemption for the Commission of Inquiry under Section 4 of the Access to Information and Personal Privacy Act (ATIPPA). The announcement that such an exemption was sought  — and granted — was made public late last week. Was there a linkage? We don't know. But we ought to.
Under the Act governing access to information, an exemption can be granted when the House of Assembly is not sitting, provided the Lieutenant Governor-in-Council (Cabinet) also has the approval of the House of Assembly Management Committee. It is noteworthy that the exemption's effectiveness does not extend beyond the next sitting of the House of Assembly. 
The request did not get a pass in some quarters. Former Premier Brian Peckford, for example, wrote The Telegram to express indignation that the House was not called back into Session, allowing Members to vote on the Judge’s request. As one who spends more than the usual amount of time extolling the virtues of transparency in both government and its regulatory and oversight institutions, the suggestion ought to have triggered almost knee-jerk support from this Blog. Not this time. But the position takes nothing away from Peckford who has been a vigorous opponent of the project and an advocate for a forensic audit of the project.
There are fundamentally good reasons why the Commission ought to be exempted under ATIPPA. While I agree that exemptions should be hard to get, I had a different preoccupation in this case. 
The CEO of Nalcor has the right, under ATIPPA, to deny release of information he considers commercially sensitive. It would be unacceptable if the CEO of Nalcor — the entity under investigation — retained this right and the Commissioner enjoyed a similar exemption, too. Fortunately, that is not the case. Under the Energy Corporation Act, the Nalcor CEO is required to release all information in the possession of Nalcor to the Commissioner; see the excerpt below from Clause 12 (3):

That was one consideration.
Another is that the Inquiry uses procedures similar to those employed in a Trial in carrying out aspects of its investigation.  
Judge Richard LeBlanc
Judge LeBlanc outlined his reasons for seeking the exemption in a letter to the Speaker of the House of Assembly. He noted that the Royal Newfoundland Constabulary and records of investigations performed by the “statutory offices”, such as the Child and Youth Advocate and the Chief Electoral Officer, are also exempt. He argued that the absence of the exemption will affect the Commission’s ability to collect evidence and deal with “privilege claims” — without which some people may not testify. A third reason offered by the Judge was one of cost; the Commission would be required to employ more staff to handle the inquiries. 
I believe the first two claims are reasonable and that, likely, the exemption is important to making the Inquiry function effectively. The third reason — cost — seems inappropriate given the circumstance. ATIPPA management would have required an additional four people, not forty or four hundred.
That said, the February 15 deadline is fast approaching for Submissions regarding the Inquiry Terms of Reference, following which the Commissioner will make a statement giving the last word on the issue. The Commissioner's view of his mandate will dictate whether the public should ask the Premier to revisit the Inquiry's TOR.   
If the Commission releases the Terms of Reference governing the Forensic Auditor, too, the public will be able to assess both documents and make a determination if this long-sought Inquiry is for real.
Until then, uncertainty will provide plenty of fuel to this Blogger and to all the sceptics.

31 comments:

  1. This comment has been removed by a blog administrator.

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  3. And here we have the collateral damage resulting from Danny, Ed Martin, and the colossal naivety of Kathy Dunderdale, with her sickeningly besotted preening over her "world-class experts" at Nalcor....

    http://vocm.com/news/poll-reports-grim-outlook-on-provinces-future/

    What a disgraceful legacy to burden the grandchildren with.

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    1. I am not sure a good proportion of those respondents truly realize the effects of provincial bankruptcy, defaults, etc.

      At the end of the day, a majority of the populace bought into the PC governance model---no good for a majority to now all claim they though was bad from start.

      We live in a majority rule (same as everywhere in the Commonwealth)---its not a governance model issue, its an issue with a particular group of government members.

      Everybody that sat in the house from 2003 through today shares the blame for this mess.

      PENG2

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    2. PENG2
      That is not correct. In actual fact very few people had the facts put before them and those that were skeptical were dismissed by the Tories as heretics and traitors. Even after he left politics, Danny Williams was trying to tear a piece of critics like Stan Marshall when Stan declared Muskrat Falls a boondoggle and a far worse deal than the Upper Churchill. And let’s not kid ourselves here. There is also the question of hiring of upwards of 5000 extra civil servants, lowing taxes all at a time when we needed those jobs the least and the extra taxes could have went to help reduce the debt. The offshore was never the boom that Norway experienced simply because the fields weren’t as big (and I say “weren’t” because three of them are now passed the half full point-within about ten years, these three will be drained dry). This is the other half of the equation. We traded royalties in Hibernia and Hebron for short term construction jobs in Bull Arm which as far as I am concerned was a HUGE mistake. We are now seeing the results of this mistake in Hebron were it will be upwards of 13 years before any royalties are earned by the province but yet the construction jobs are already gone and after 13 years, the Hebron field itself will be half gone to market. This sort of overly optimistic viewing of newfoundland as a great treasure house of resources has got to stop and we must also stop trying to develop a heavy construction industry that simply ca not compete o n a world scale. This is obvious since the completion of both the Hibernia and Hebron GBS zero work has come to Newfoundland. We are a very expensive, poorly managed and low productivity work force.

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    3. Anony @ 10:19:

      Not sure why you say my posting was not correct---the points you mention prove my point, the public was generally love blind with anything DW proposed and the facts were there but most chose to ignore. Maybe my wording wasn't ideal--but my main point is that we have the same governance as other provinces, but we created our problem in NL.

      The fact is DW had unheard of approval ratings, had about 60% of the populace supporting MF and experienced popularity among the general public unseen since the days of JS and the baby bonus (infact didn't DW bring in a $2k 'baby reward').

      On CBC, VOCM and other media 15yrs ago I remember the hacks such as 'froggie', 'betterthan***' and many others destroying many of those who claimed anything that wasn't DW positive.

      The populace bought DW and his line in 2003 pretty hard at the expense of the coming generation.

      PENG2

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    4. world class experts

      There were some at NL Hydro before big Ed arrived. Many were sent home by big Ed.

      Big Ed brought in his pals from oil and gas, experts perhaps just not in Hydro!

      Wonder why ..............

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  4. I am of the opinion that the inquiry ToR are broad and it is a positive that interpretation is left to LeBlanc. Likewise, the audit ToR are also broad despite what DD said in todays media.

    Both sets of ToR contain phrases such as 'including whether' or 'including'---neither of these is limiting scope, just defining minimum deliverables. Granted for the audit (which I personally think has no value) when going to an outside consultant they might go with a minimum.

    What will be key is whether LeBlanc is willing to push the interpretation and provide more than the minimum requested. For the forensic audit, I think is a waste of more money---no one is going to be punished for this and we will get all we need to know from the inquiry itself.

    On this posting UG, I disagree with your opinion. I would also suggest that the exemption was necessary and shouldn't have gone to discussion in the house---there has been enough bipartisan BS over MF and at least now with the exemption we all know LeBlancs investigative reach.

    My report card for Ball on how he has handled the MF scenario to date is about a B- with opportunity to improve.

    PENG2

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    1. PENG2 You seem to have misread the Post. UG takes the same view as yours. It was Brian Peckford who suggested the ATIPPA exemption should not be granted.

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    2. PENG2, I hope Leblanc delivers as you expect. You say you have reviewed his inline background as a jurist.
      I think his record is good with respect to family law, where most of his career has been. But I am disturbed by his decisions as to the Mount Cashel scandal, which I expect few realise he got involved in this in the civil litigation. Are you aware and approve of his decisions in that?
      AG

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    3. Anony @ 22:32:

      As aware of his rulings as I can be via media and online searching---I try to not pass opinion as I am not a lawyer and reading a published summary gives a partial viewpoint. I think his Mt Cashel case (JD vs Guardian??) was overturned, and I also think he was involved in early stages of certifying moose class-action?


      Anony @ 19:42:

      Fair--poor wording on my part. Generally on this, I think the process is working its way OK so far, I know most of the populace is clamoring for more activity but I think patience here and realizing the scope of what is being undertaken is key.

      To all:

      Would be worthwhile for most to review the history of the various inquiry types in Canadian history to realize just what is involved for LeBlanc and his team.

      Understanding what is being done (ie what can be done via the law vs what the populace ideally wants done) and just what the outcome will look like would prevent a lot of BS later.

      PENG2

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  5. Noun: cynic si-nik 1. Someone who is critical of the motives of others - faultfinder

    Is there a reasoned person among us suggests that we should be WITHOUT cynics in our society? If so. I unabashedly, (and yes cynically), question their motives.

    Without them (us?) how much more of ours and our descendants' futures would have been pilfered by now? Without cynics, would we have an Inquiry or an Audit?
    Cynics, are very often simply critically thinking realists. For sure, some are too vitriol in their communications, but even if/as we moderate those messengers,we should still read the mail they ride in with. Otherwise we become ostriches.

    Muskrat proves this point with an everlasting and painful poignancy.

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    1. PA:

      Need proper balance of cynic, realist and skeptic. Cynics alone (as are any other political thought at the exclusion of all others) are dangerous.

      PENG2

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  6. "Public input has to have meaning" http://www.thetelegram.com/opinion/letter-to-the-editor/letter-public-input-has-to-mean-something-184144/

    And my written comments to the commission of inquiry www.vision2041.com

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    1. You end your piece with "Not unlike our previous government, not unlike our current government, not unlike Nalcor itself. Public input? What’s that?"

      Public input is a charade just like our elections. It perpetuates the illusion that the general population has significant control via democracy. Decisions like this (which could land powerful people behind bars or in exile) will not be left up to the general public. They will be made in advance to serve the elite as part of damage control. To help disguise this they will pretend to listen to the public with charades like this in carefully controlled venues.

      Does anyone remember that NL government site where people could post ideas for cleaning up the mess? There were lots of good ideas on it and appeared for awhile that maybe government was listening or cared? Then it disappeared as if it never existed. I think ministers were afraid of it and they had to nip in in the bud.

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  7. A little diversion, if the UNCLE permits;
    Does lots of dogberries mean a hard winter? I raised this question in the fall, as we had the most dogberries I have have ever seen. There is still a lot on some trees. Things may yet change, but seems the dogbeery thing is a myth, as we are having a mild winter, especially Feb so far.
    And what has that to do with Muskrat?
    Climate change my man. I have jokingly said that within 30 years our climate will be like Bermuda. But MUN researcher has done an ananlysis showing several degree rise expected. Did Nalcor , Hydro and Fortis (Nfld Power ) consider this for MF and our winter loads .
    Our winter avg peak load is about 1550 MW
    What so far for Feb? 1408 Mw excluding Feb 6 data , which is missing, and a very warm day.
    Estimating for Feb 6 , I get a Feb avg of 1370 MW, that is a whopping 180 MW lower than normal. PUFF,,,,,one of the large Holyrood units not needed with this warming. Our peak is usually 1750 when having a cold snap......but we are hitting 1219 MW or lower, (531MW lower than our winter peak, on some days, such that our island hydro can almost carry it alone). This drop on warm winter days causes a drop off as much as MF can deliver on average! When we thought all of the MF risks have surfaced....up pops climate change. So, we may not need it, but NS is a different story.
    Must be very worrying for shareholder profit, whether Nfld Power or Nalcor.
    Perhaps lucky too that it has been mild .....we had little rainfall and our water supply was low this fall, with Hydro burning oil to compensate.
    Now James Feehan is trying to discourage heatpumps, by wanting power rates not to exceed 17 cents. Who do we appeal to, to discourage warm winters ( which makes heatpumps even more efficinet) , to keep revenue high for the power companies? Dammed if I know.
    And is heatpumps already taking effect?
    Of the 7 days listed for Feb, peak loads show 3 in the morning and 4 in the afternoon, around supper time. Despite the Scallywags at Take Charge encouraging the silly and stupid idea of programmable thermostats for baseboard haters, ramping up morning peak loads, there seem a shift is taking place to supper time peak loads. I have not must studied that, but I get that impression form a casual look, and Feb shows that.
    Winston Adams

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  8. For those wondering how to know about our peak loads, here is what I do
    1. Go to vision 2041 blog (by Maurice Adams) and under his heading NEWS
    2. Just scrol down a little and see the link to the PUB in yellow , titled Investigations and Hearings.........that brings you to the PUB
    3. On the right hand side , the third item down from the top says : Hydro Supply and Demand Status Reports, click that.
    4 These go back to 2014, Dark NL times, and are listed for each year, month and day. See the loads ramp up in the morning (baseboard heater impacts, and again before supper time, cooking and hot water impacts.

    You will see the lines showing the power available and the peak demand curve, and other info as to which generation units are available and which may be down, and predictions for the day ahead vs weather forecast.

    There are 2 new colors added, or mentioned, which I have not yet seen on these charts: Purple, intended for when Island generation is exporting power to NS via the Maritime link, now up and running I assume, thought I have not seen it on the charts.

    But here is the latest Newfie Joke: the Red line.
    Now a RED LINE is a rather important if not startling line, Obama used one in Syria, that was meaningless. Trump.......well he's crossing lines every day, of all colors. The latest supporting wife beaters, other days , supporting the KKK. But I digress.
    Our Red line .......get this, and see if you laugh or cry: This is intended to show our island system peak load MINUS Maritime Link imports from Nova Scotia! Imports from Nova Scotia?
    Now this will be needed when Muskrat goes down, and Holyrood is decommisioned.......and we are shivering in the dark here in Sin John's. The MYTH of imports from Nova Scotia......Stan Marshall saying this for almost 2 years.........and nothing firm........as where does such power come from, with no surplus capacity in NS, and no transmission capacity from NB to NS.
    So when can we expect to see this red line on this chart. And PENG2 saying MF should be built and not operated.......does he expect a big red line component....doubt it.
    Red Line........a Newfie Joke or what? And the import power, at what cost? Maybe the Red Line will be the Mounties in tunic,on horseback, holding back the crowd, when rates go to 23 cents? Polls now showing over half of Nflders thinking we will go bankrupt. Oh my....God Guard Thee Nfld.
    Winston Adams

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    1. Maybe the red line is when muskrat lines are down, and as you said holyrood gone, and as you mentioned we only need just over 1200 MW of island hydro for the province. And since we can't send any muskrat power to ns , or none available, because of power lines down, is the amount we will have to pay ns, in hard cash to get their power elsewhere. Imagine, the only reason we built muskrat was to supply ns with free power, and we would pay 23 cents a kW as a substity to NS for 57 years. My God can that be a reality. Seems like it could. Hate saying this again, but you could not make, or dream this shit up, it had to be planned, by whom?????

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    2. WA:

      Last going off in mid January, testing on the link to NS was still ongoing---so not in operations and thus no purple line.

      For the red line---it is already on the plot, just showing under the island peak load line, same line since no imports from NS to account for(I am thinking you meant as a joke, and it is a good one).

      To be clear to all reading, I only say build MF to completion since the effect of default are not very pretty---but yes, there was no going back on MF construction since 2003.

      PENG2

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    3. What is the much-to-be-feared consequence of defaulting before commissioning rather than after? Why or what is the dramatic difference? Why spend the last 1-2 billion to complete when it could be avoidable?

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  9. Here's a most troubling example of the lamentable ignorance afflicting many NLers as to basic economic principles.

    This particular individual actually believes that Tom Osborne granted NAPE a no-lay off clause because if he didn't, it

    "creates an atmosphere of impending and possibly continuing layoffs, he would see the province’s credit rating drop and the amount we pay in interest on our loans escalate. The province must maintain a reasonable climate of employment and income or else we will be seen by the credit rating agencies as a basket case like Puerto Rico, which announced it will be not be paying on its debts for the next five years."

    Never mind that the polar opposite is in fact the case... but yes indeed, this is what this poor, misguided individual actually believes, astoundingly enough.

    Total ignorance as to the necessity of a solid GDP as the foundation of a sound economy.

    Total ignorance as to the fact that a government that builds a false economy by taxing and gouging the populace so as to perpetuate the most bloated public service in all of Canada, still contributes exactly zero dollars to the provincial GDP. It's the macro-economic version of paying off one credit card with cash advances from another credit card.

    I ask you... is it any wonder, in view of this lamentable level of ignorance afflicting many NLersas as to the brutal fiscal realities of capital-based economics... is it any wonder at all that the government can get away with such twisted, asinine, and ultimately self-destructive economic policies? Policies that are primarily motivated by the cynical calculation of partisan political expediency?

    Just like taking candy from a baby...

    http://www.thetelegram.com/opinion/letter-to-the-editor/letter-napes-deal-not-as-sweet-as-some-would-have-you-believe-184113/


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    1. "The province must maintain a reasonable amount of employment and income......." Agree with you, but is that what muskrat was all about, borrow 8 or 10 billion to have employment and big incomes, that people would pay big income taxes, and it would appear we had a vibrant economy, and some say lets get gull island going so that we can borrow another 10 billion to make our economy look good...the same mind set or even worst than the ministers no lay off clause. Think you should have added that one too.

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  10. Justice Richard LeBlanc's "Forensic Audit Investigation" should prove beyond reasonable doubt, at very least on proven health, safety, and environmental grounds that the Nalcor Boondoggle hydro dam Muskrat Falls, Grand River Mishtashipu, NL, Canada should never have been built in the first place. Therefore Nalcor Governments of NL and Canada: #ShutMuskratDown @protectlabrador

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  11. Mary, Mary, quite contrary, is at it again, that the sky is falling in. She needs a shot of reality, and not pie in the sky, , motherhood and apple pie. She just can't say it is not as bad as in the nineties, without producing some numbers, what was our debt then, and our deficit, the population base is basically the same and we are borrowing 2$ million a day. How does that compare to the nineties, pray tell me Mary. 14 percent unemployment, yes, guess you got that one right, seems similar to the nineties. But I know back then we were not facing power rates of 23 cents, and a 15$ billion boondoggle that we are now.

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    1. Net public debt in 1994-95 reached a little over $6B and per capita public debt stood at about $10,000. Current public debt hovers around $15.2B and per capita debt is around $28,700. Statements by Mary Shortall and published by VOCM are INCORRECT. Amazes me that this crap actually gets published as news. "VOCM News" is more like a tabloid than a professional news service. This is not the first time that VOCM published incorrect statements from Mary Shortall.

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  12. Question... can we assume that the Inquiry into the Muskrat Falls Fiasco will explicitly identify the individual who signed off on the stability of the North Spur? In the event that judicial action may at some point be be warranted...

    http://www.cbc.ca/news/canada/newfoundland-labrador/nalcor-says-no-damage-by-landslide-1.4530664

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    1. Read the comments by Claulk and Jim Learning. Photo sems to be taken from the south side of the river , looking north, and adjacent to the North Spur so called stabilized area.
      Learning says this Kettle Rapids drainage area. The blog Vision 2041 has detailed the rsik from the Kettle Rapids area, and for my part, always assume a massive earth works downstream of the Spur, to wrap around taking in this area of the slide was essential if the Spur could be properly stabilized.
      Need I remind readers that no Nalcor employee or consultant would take my offer of 4 to 1 odds that the North Spur would fail ........just to prove they lack confidence in their own design.
      Chaulk calls for the reservior to be lowered, and I think that is prudent. But when has Nalcor ever been prudent. Liberty in one report uses the word imprudent about 70 times to describe Nalcor. Same old, same old..........
      Please comment PENG2.........as you have no faith in the stabilization, right? And the pumps are near this area, but did nothing to prevent this. More pumps....hundreds of more pumps? Not really a solution for quick clay.
      Winston Adams

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    2. Pumping water from the dam may also cause instability by reducing the salt content of the marine clay. There are videos showing liquid marine clays that stiffen enough to hold up a fork when salt is added. This salt was in the soil when it was a marine sediment. If the water comes from the river and rain fall and we pump it out, we will be washing out the salt. If the dam turns to liquid, the entire thing will flow downhill with the reservoir behind it.

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  13. There is a short, simple one minute video here: https://www.youtube.com/watch?v=LgDQsYAcS3o that shows how quick clay liquefies when disturbed and how salt affects it. I worry that the pumping of water from the spur will reduce the salt content of the soil and change it's characteristics. Has any research been done into the salinity of the spur and how pumping from wells will affect it?

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    1. WA, Anony @ 9:04 and Anony @ 11:41:

      The principal of desalinating the clay is effectively removing the flocking agent--I mentioned 3-4 months ago that a real world sampling/testing program including shear box, tri-axial and centrifuge testing was not undertaking. In my experience an advanced sampling/testing program was required to properly determine the parameters of liquefaction, internal shear stress etc there is no other way that I know of to do this.

      Otherwise assigning parameters based on a few rudimentary sieves/hydrometers, or experience with comparable materials, in a near-by-area etc is not sound engineering.

      Add to this a general lack of advanced geotechniques experience/knowledge on the Labrador peninsula and the outcome is predetermined and anticipated.

      PENG2

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    2. PENG2, your opinion on this and other technical issues that you are aware of that is not sound engineering, I suggest,should be filed by you by Feb 15 to the Inquiry that Leblanc consider the extend of how this project could have been sanctioned and go so far, without adequate engineering analysis and principles being followed, and the economic impacts on the project cost, and the provincial debt.
      While this project was pushed by DW, it took a lot of engineers, and engineering consultants, turning a blind eye and also enabling the project to proceed with manipulation or avoidance of sound principles. You have more than 2 cents worth to contribute to this Inquiry, and I trust you will be filing before Feb 15? Just way to many engineers staying silent.
      Winston Adams

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