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Wednesday 5 July 2017


Guest Post by David Vardy and Ron Penney

The recently released SNC Lavalin risk assessment report identifies the dearth of geo-technical investigations as one of the highest risks of the Muskrat Falls project. In his Uncle Gnarley post of June 29, 2017 Cabot Martin cites this report to confirm his claim that the North Spur is one of the major threats to the project and to the people living and working close to the site. The SNC report refers to “major scope change.” Cabot states:

Now “major scope change“ with regard to an admittedly unstable dam component like the North Spur is engineer code for “Your proposed North Spur stabilization design could be unsafe and to make it safe will require as yet unknown and un-costed extra work.”

And also unstated is that geotechnical conditions may be found (like Quick Clay) which will in effect be impossible to cure.
And if you can’t cure that problem, you will have to cancel the whole project because use of the North Spur as a key (nearly 50%) component of the overall dam system is an essential element of the project.
This was the situation at the date of sanction (and still is) a real and present risk.
Because for all Nalcor’s bluster, the amount of geotechnical information on the North Spur is still totally inadequate – for instance, the drilling density on the North Spur itself is still far too low and large areas (particularly upslope toward the Trans Labrador Highway) are totally devoid of test drilling locations and drill results.
Yes – that’s correct - right up to this very minute when the reservoir is partially filled and lives downstream are in increased danger – catastrophic failure of the North Spur is a real and present risk.

We have been supporting the Labrador Land Protectors and the Grand River Keeper in their petition for government to appoint an expert panel on the North Spur. The North Spur poses a risk to the citizens of Labrador, to the workers on site and to the project itself. It is one of the critical risks of the project, impacting on the environment and on the cost.

We corresponded with CEO Stan Marshall on the need for a geo-technical panel to be appointed but he indicated that he was comfortable with the work that had been done. We repeated much of the argument we presented to Marshall when we wrote on January 16, 2017 to the Chair of the Oversight Committee. We recognized that the mandate of the Committee is limited but we are confident that the North Spur is a pervasive risk which spans all aspects of the project, impacting safety, environment finance, energy, and economics. The letter is quoted in full below.

We are writing to you in your capacity as Chair of the Oversight Committee to request that you consider the attached list of issues relating to the North Spur, compiled by retired engineer Jim Gordon, in collaboration with the undersigned and with other colleagues.

The North Spur is a hill 1,000m long which comprises part of the natural dam at Muskrat Falls, a dam which is both an advantage of the site, as well as its Achilles Heel. When the Muskrat reservoir is filled, this hill will form a natural dam containing the reservoir. The hill consists of two layers of sand, and two layers of quick clay, sloping downstream, on a deep foundation of quick clay, extending down to far below tidewater. Quick clay is similar to quicksand. It liquefies when disturbed or when it becomes saturated with water. There are numerous quick clay slides on the North shore upstream and downstream of Muskrat, including three large slides on the downstream slope of the North Spur.

NALCOR intends to increase these factors by flattening the slopes, adding a downstream berm, adding pump wells, placing an upstream impervious blanket to close off the upper sand layer, and building a cut-off wall filled with an impervious material to close off the lower sand layer. This means that the two layers of quick clay will remain within the body of the dam. To our knowledge, quick clay has never before been used to form part of a dam structure, nor has a dam been built on a quick clay foundation.

If the North Spur dam fails, there is a risk of loss of life in Goose Bay and Happy Valley. If the North Spur fails, the Muskrat Hydro facility would be left high and dry, and become a stranded asset, with a repair cost well over several billions. Power would be interrupted for several years. Since the design of the North Spur dam is without precedent, it is imperative to have the design reviewed by an independent panel of experts – a Review Board, to provide added assurance that the design is safe.

There has been no public forum for reviewing the North Spur and to test the research and remedial measures advanced by Nalcor’s geo-technical experts. The engineering design work had not been completed when the joint panel undertook its review so the panel could not test the effectiveness of the remedial measures that have been taken since the panel’s report of August 2011.

When public health and safety are at issue such critical independent assessment must be in public view, through a fully transparent process and conducted by a panel of geo-technical experts. It must be fully independent of the proponents and its engineering consultants. The “precautionary principle” requires that when a project imposes a potential risk to the public and the environment, and there is no demonstrated scientific consensus to refute such risk, then the proponent must provide evidence that the project will not be harmful. This applies in particular where extensive scientific knowledge on the matter is lacking. There is a social responsibility to protect the public from exposure to harm. The exercise of the principle calls for further scientific research and inquiry to provide sound evidence that no harm will result.

I am sure you share our concern that every measure possible must be taken to reduce risk, following the precautionary principle, even if it leads to an excess of caution over incaution by the project proponent. Not only is a huge financial investment at stake but, more importantly, failure of the dam has the potential to place people and communities at risk, through life-threatening unpredictable events! Better to err on the side of safety, when lives are in the balance!

We have been told that Nalcor has mitigated all the risks and that we should trust Nalcor to do the right thing.  Is there any basis on which the public can have trust that Nalcor has left no stone unturned in its quest to maximize public safety and to minimize the risk of a devastating dam failure or earth slide? Sadly we do not think there is!

We are all familiar with the egregious cost overruns which have increased estimated project cost from $6.2 billion in 2011 to $11.7 billion in 2017. We are all familiar with the delay for full power from 2017 to the second quarter of 2020.

We are all familiar with egregious lapses in quality control on this project, including the leaking coffer dam, the “popped” transmission strand and the collapsing concrete cribbing. These lapses, and others, make it clear that quality control has been weak and, furthermore, that Nalcor is not capable of being its own project manager.

The performance of Nalcor is far from exemplary and provides no basis for trust that everything has been executed in accordance with the highest quality standards. It is not clear to us that the new CEO has instigated a “root and branch” transformation which will make Nalcor more open, transparent and accountable. From the outside there is little evidence of structural change, other than the separation of generation from transmission, and little change in senior personnel. In our opinion major changes in structure and senior personnel are essential. We are disappointed that the new CEO has chosen not to initiate an independent review of the design plan for remediation. We believe government must undertake such an independent review and that it should be expedited.

The undersigned wrote to your predecessor, Julia Mullaly, and to the Deputy Minister of Environment and Conservation, Jamie Chippett, on November 22, 2014, providing a copy of the PowerPoint presentation made by Dr. Stig Bernander at the LSPU Hall on October 30, 2014.

In our covering letter we made the following statements:

If Dr. Bernander is correct and the right engineering research and associated mitigation measures are not undertaken, assuming that mitigation is even possible, the risks of a catastrophic failure of the North Spur, which include the loss of the project and downstream flooding, are significant.

The Joint Environmental Panel concluded that the loss of the Muskrat Falls dam would result in the "inundation" of Mud Lake and the lower part of Happy Valley Goose Bay, with only two hours of notice, causing immense property damage. Two hours’ notice would not provide sufficient time to evacuate all those who would be in the path of a wall of water and there would likely be loss of life.

If we were in your position we would want to know that we took all necessary measures to ensure that the risks of such an eventuality are reduced to the extent possible and urge you both to exercise your responsibilities by getting the best independent advice possible.

The attached list provides a compelling case for the appointment of such a review panel independent of Nalcor. It delineates the risks which remain outstanding and complements the work done by Dr. Stig Bernander.
Jim Gordon concludes as follows: It is essential that the dam design be reviewed by a panel of geotechnical experts. It is not too late to undertake such a review, since any changes resulting from the review can still be built. If there are no changes required, then there is the added assurance that the dam is safe.
An independent review of the geo-technical research and remediation for the North Spur should be embraced openly as a prudent course of action. This review should be initiated by government, given Nalcor’s defensive posture and its failure to take action on its own.

The undersigned would be pleased to meet with you to discuss this matter. We also recommend that you invite Jim Gordon to meet with your committee to explore his concerns, along with options to deal with this major problem.
You are now the most senior official in the government. Because of our own personal experience we know what an immense responsibility that is. You have both the opportunity and the responsibility to recommend that government take the prudent steps we suggest. We look forward to your response.

On March 31, 2017, two and a half months later, we received the following reply:

On June 19, 2017, another two and a half months later, we received another reply, similar to the first, but which indicated Nalcor has been “directed” to communicate with us.

The Oversight Committee turned down our offer to meet. We have heard nothing from Nalcor despite the “direction” they were given. The fact of the matter is that we had exhausted Nalcor’s willingness to respond to our request when CEO Marshall told us on July 26, 2016:

The engineers at SNC who are responsible for the design at the North Spur and are supervising the work are certainly qualified in these matters. Their design was thoroughly reviewed and approved by other qualified engineers at Hatch Associates. Two academic experts in the field of soil mechanic we also consulted. I've had conversations with the SNC engineers to assure myself that they are aware of all the concerns that have been raised and that they are absolutely comfortable with their design and the work that has been done or is planned to be done. I've reviewed the Hatch report and I've visited the site and spoken to those doing the work. No one involved in the design or execution of the work has expressed any reservation. I have forwarded your comments on to them but I'm comfortable that the North Spur is being properly resolved.
Three issues concern us. The first is how slow and unresponsive the public service is, operating at glacial speed, despite the gravity of the risks. Second, there is far too much deference to Nalcor on the Muskrat Falls project, both on the part of politicians and bureaucrats. Third, Nalcor has adopted an intransigent position, refusing to take action which will reduce the risk to life and property. This attitude is very troubling.

In light of these it is not appropriate for Nalcor to take the lead. The expert panel must be appointed by government and must be totally independent. It should be chaired by an eminent geo-technical authority such as Dr. Norbert Morgenstern, who chaired the inquiry into the Mount Polley mining disaster. It is urgent that this panel be appointed as soon as possible. Government must not wait for a disaster to happen before acting but should act immediately upon the petition presented by the Labrador Land Protectors and the Grand River Keeper Labrador on May 9, 2017.

Ron Penney and David Vardy