It’s a lot
to expect from a Premier still trying to make his first decision.
But Nalcor CEO Ed Martin, having failed to do the honourable thing at last Thursday’s Nalcor AGM, will have to be pushed. Still, it is increasingly clear it won’t be Ball who will do the pushing.
But Nalcor CEO Ed Martin, having failed to do the honourable thing at last Thursday’s Nalcor AGM, will have to be pushed. Still, it is increasingly clear it won’t be Ball who will do the pushing.
One of the few
items of substance that came out of the AGM was confirmation that Muskrat will
be delayed and the cost will climb even higher, though I am unsure who is left
to claim surprise.
Martin
also said we won’t get a cost and schedule update until the end of June,
leaving us to wonder if he will tell the Premier the E&Y March 31 deadline will
also have to be extended.
One
attendee at the AGM commented: "the new government has not taken a feather
out of Ed Martin’s smooth-as-silk insouciance. He has risen above petty
concerns about budgets and schedules to extol the longevity of hydroelectric
projects, such as the Hoover Dam, while sacrificing the government’s commitment
to open the books on the altar of “commercial sensitivity”.
There were few
other disclosures, but the Nalcor CEO took time to invoke blame at the AGM; something
he excluded from those self-imposed “commercially sensitivity” latitudes.
Gil Bennett,
Nalcor’s Mr. Pop Up, did not appear with any new claim of “float time” in Astaldi’s
schedule, as he did when this Blogger accused Nalcor of “poor planning”; the Italian contractor having tore down an unfinished $120 million “dome”.
“Obsessing
over every bit of wastage on a job site is not the proper way to move ahead
with a project as large in scope as Muskrat Falls”, CBC quoted the Nalcor V-P,
a year ago, counselling as much as chastising, that milestones were more important
than processes.
Back then,
the “experts at Nalcor” were a pretty cocky bunch; even a $120 million
temporary steel/concrete structure was elevated to the status of a “bit of
waste”.
Defeat now greets both milestones and processes; boast
has turned to blame.
At the AGM,
the Nalcor CEO could be heard invoking the name Astaldi, but in less glowing
terms. "We do have an issue with the powerhouse that Astaldi is
constructing," Martin said. "They have fallen behind significantly”. That
lag will have "schedule implications," he acknowledged, "and
with schedule implications, there will be some cost implications", the CBC
reported.
Astaldi seems
unbowed; a fact to which more space will be given next time.
For now, in
contrast to Ed Martin’s assertion, Astaldi claims in its Full Year 2015 Annual
Report released March 9, 2016, a mere few days ago, (see excerpt below) that “today the production (at Muskrat Falls) achieved remarkable levels”.
Indeed, the
Astaldi CEO told securities analysts during and following release of the 2015 Annual Report, that “today negotiations are underway which obviously
have been very positive with the client”. He added, in the Q&A Session, “we
expect that in the short term it will reach a conclusion”. The Report said
“severe weather conditions had delayed the works”.
Martin did
not tell the AGM or reporters of any "positive" negotiations with
Astaldi or that the two parties are about to revise Astaldi’s contract; though
based on the expectation, Astaldi intends to report a profit from Muskrat in 2016.
Ostensibly,
these matters are Martin’s business, alone. It is sufficient for ratepayers and
tax payers to know their tab for Muskrat is far from closed.
Muskrat
watchers are used to working through third parties to pry into the status of the
Muskrat Falls project. The NS UARB, for example, confirmed Nalcor shares a very different narrative with others than it shares with us. Now, the official Reports and audio tapes of Astaldi’s official
comments have a similar usefulness.
Of course, the
Astaldi CEO is obligated to comply with the transparency requirements of the Italian and London Stock Exchanges.
As Head of a
Crown Corporation, Ed Martin has few brakes; he is not even controlled
by a Government with the capacity or the political will to stop him before he breaks
us. Even the Auditor General recoils from paying him a visit.
As MUN
Professor, Dr. Tom Baird, recently noted: back in June, 2014 when Ed Martin
announced Muskrat costs would reach $6.99 billion (plus IDC) the CBC reported Martin
stating “90 per cent of Nalcor’s Muskrat Falls contracts are essentially
complete. The reporter quoted him saying ‘those prices are fixed, helping
provide some cost certainty’. "I believe that we have narrowed down the
risk of additional cost increases very, very, very significantly”, Martin was quoted saying.
The figure was raised to $7.65 billion (plus IDC) in September, 2015. Now, the CEO warns again. Evidently, nothing is "fixed" at all, and the project is years away from completion.
That this Premier would let the Nalcor CEO announce the new schedule
delay and cost increase, before firing him, is difficult to contemplate.
It seems the election has changed nothing except for the people who owe fealty to Ed Martin.
It seems the election has changed nothing except for the people who owe fealty to Ed Martin.