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Monday 7 September 2015


Recently, I received some comments in an email from a person who served at a senior level both in government and international industry.  I was pleased that he was maintaining a watchful eye on the Muskrat Falls project, especially the plethora of self-justifying utterances from the Nalcor CEO.   Likely, he had read Ed Martin's remarks to reporters during a scrum on July 14th, too; and felt nauseous along with many others.

Certainly he had heard enough.

The following formed part of his narrative:

“In the course of a large project in which I was involved many years ago, the (concept of) "Six phases of a big project" was brought forward to keep us from becoming too cocky.In the years which followed, I have found this reference to be both useful and often true.

I recently retrieved the document from Wikipedia believing it well worth sharing…”  
The 6 Phases are:

           1.        Enthusiasm
           2.        Disillusionment
           3.        Panic and Hysteria
           4.        Search for the guilty
           5.        Punishment for the innocent, and
           6.        Praise and honor for the non-participants

That writer's facetious portrayal of the drama now unfolding on the lower Churchill River may seem a cynical take on a serious and risk-laden business; but the abysmal performance history of mega projects throughout the world confirms that no amount of scepticism is adequate. In the case of Muskrat Falls, a seriously deficient management team, a plethora of unwarranted assumptions, and the dreaded words "schedule slippage", serve only to narrow the most optimistic side of limited expectation.

The email writer understands the inherent tendency of all large projects to descend into chaos.  The challenge of even the strongest management is to steer a steady course, to invite rather than eschew independent review; to seek out the best expertise available. 

He knows that’s the current condition of the Muskrat Falls project; his sense of frustration with Ed Martin and Gilbert Bennett is palpable.

The writer notes that "the Six Phases..." has been reprinted in slightly different variations in any number of project management books, as a cautionary tale.

His interpretation of how they apply to Nalcor and Muskrat runs like this: “At this stage of the Muskrat project, I would guess that the public is entering stage 2 – “Disillusionment”.

Within Nalcor, I would think that they are quietly entering stage 3 – “Panic and Hysteria”, a condition which will rapidly spread to the general population.

He continued: Especially with an election looming, we will rapidly proceed to stages 4&5 which are, respectively, "Hunt for the Guilty" and "Punishment of the Innocent".

The final stage - "”Reward for the uninvolved" may take longer to emerge, probably when a "white knight" comes forward to acquire the assets at a fire sale price.”

This latter comment is an enormous condemnation of the folly, and of those who inspired it, for it implies failure on a massive scale. The full implications are almost too great to contemplate. 

But the writer does not pull punches; he has never allowed himself the luxury.

In the private sector, excuses and obfuscation won’t work when failure threatens a company’s viability and shareholders’ equity.  

As David Vardy described in a recent post on this Blog in reference to the project: there is no equity; Muskrat is just a mountain of debt and only one captive group is expected to pay it all back.

Little wonder the former official asks rhetorically:

Who are the likely nominees for a "Wall of Shame"?
What will the appropriate punishments be?
How will it end? 

These are tantalizing questions; but mostly, they are disconcerting.

He has followed the Muskrat narrative, and watched as Premier Dunderdale sanctioned the project based upon contrived fundamentals.

He watches, now, as continuing schedule slippage, overruns, bogus oversight, and the urgency to keep the deepening problem under wraps lest it becomes an issue in the general election.

Can Nalcor Ed Martin hold back the truth for another 3 months? 

Can Premier Paul Davis continue to feign ignorance of an economic and technical debacle?  
Does Liberal Leader Dwight Ball even understand what he and the Liberal Party have been supporting these past three years?

Will the media eventually acknowledge most of them have been willfully complicit, mostly by their ignorance? 

Muskrat boosters, like Dr. Wade Locke, are now on the media citing a revisionist economic narrative for the province, and not an optimistic one. With oil at about one-third the price used to to justify Muskrat, sweaty palms replace ill-considered advice; the luck has run out.

Of course, Nalcor may have reached Stage 3 - "Panic and Hysteria", as the writer suggests, but, unfortunately, the public has some distance to go.

When they do, four Premiers, their boosters and shills, both inside and outside Nalcor, had better hope the public plans only to punish the innocent.