THE QUEBEC SUPERIOR COURT GIVES NALCOR NOTHING: WATER MANAGEMENT A PIPE DREAM

Introduction

Just as the pilot signaled readiness for take-off to Saglek in northern Labrador, word arrived that the Quebec Superior Court had delivered its verdict on Quebec Hydro's challenge to Nalcor's interpretation of the Upper Churchill Renewal Agreement. 

Delayed two days in Goose Bay by foggy conditions on the coast, the other members of small group heading out for two weeks of hiking and kayaking seemed energized by the sheer thrill of the opportunity to complete a northern Labrador adventure including the uncertain expectation of committing to the outdoors in an often harsh cold region, 150 miles north of Nain. 

Though I hate the cold, it was less the thought of subzero temperatures and rough seas that sent a chill down my spine. Nalcor, a reckless and uncontrolled crown corporation, one seemingly determined to bankrupt the province, instills in my bones an even worse terror. 

Let's face it: the Quebec Court was never expected to diminish the powers vested in Quebec Hydro under the 1969 Upper Churchill contract. Sober watchers knew that Nalcor had thrown caution to the winds in its bid for Muskrat sanction long before Hydro Quebec acted. Hubris, compounded by hapless government oversight, created the conditions for the Nalcor leadership to ignore the impact of a total judicial loss in a Quebec-centric Court. 

BULLSHIT STILL SELLS IN NEW YORK

The only surprise contained in Moody’s decision to downgrade the Province’s credit rating from Aa3 to Aa2 was that it wasn’t lower. Whether the Ball Administration realizes it or not, Moody’s incomplete analysis of the province’s fiscal position constitutes a small break for a crowd that has so far handled the crisis with hamfisted dexterity.

Possibly it is no break at all. The “market” may well be ahead of companies engaged in the bond credit rating business.  After the U.S. mortgage meltdown in 2007/8, precipitating the U.S. financial crisis (when bondholders discovered they held useless “paper” based upon unwarranted high ratings), no one would be surprised if investors were a tad more savvy these days.

Certainly, if the recent record of borrowing by the Province — which is still dominated by short-term treasury bills (T-Bills) — is any indication, this is a place under careful scrutiny.

Still, for an outfit of Moody’s reputation, it is surprising how poorly it accounted for the so-called “equity” flowing into the Muskrat Falls project.

HYDRO ENGINEER WRITES "OPEN LETTER" TO NALCOR CEO STAN MARSHALL

Guest Post Written by James L. Gordon, P.Eng. (Ret'd)

OPEN LETTER TO NALCOR CEO STAN MARSHALL 

Dear Mr. Marshall,

I write concerning safety issues with respect to the Muskrat Falls Project, and specifically concerning the North Spur.

You have probably been advised by your staff that, while the North Spur does indeed present significant technical challenges, they have been addressed by competent professionals, and so are no cause for concern.

In my professional opinion, such a conclusion is incorrect, and dangerously so.

Let me summarize the current situation at the North Spur, as I see it:

The North Spur Dam at Muskrat Falls will be the first dam ever built containing quick (or marine) clay in the dam body, and on a quick clay foundation.