Williams Sets Record Straight at the National Post

As soon as the news hit the wires that the federal government had settled a NAFTA challenge from Abitib-Bowater over the expropriation of the assets in Newfoundland and Labrador pundits for the so called "national papers" coudn't wait to take another shot at NL and Danny Williams (or as they often refer to him, Danny Chavez, Village Idiot, or some other less than flattering term).

Today Premier Williams decided to set the record straight at the National Post. Here is what he had to say:

Danny Williams, Special to the National Post · Friday, Aug. 27, 2010

I am disappointed, yet not surprised, by the nasty attacks on me in the National Post ( "From Newfoundland, another tantrum," editorial; and "The Cuckoo of Corner Brook," by Peter Foster; both of Aug. 26). I certainly can take the criticism. Where I draw the line is at mean-spirited insinuations and inaccuracies about our province and its people.

In regard to the recent financial settlement between the Canadian government and Abitibi Inc., which resolved the company's NAFTA complaint, let me point out that Abitibi operated in our province for 100 years. After reaping untold millions in profits and also providing substantial employment for our hard working people, the company closed two mills, threw hundreds out of work, and walked away without even paying the severance these people were owed.

There is no doubt that the pulp-and-paper industry is facing difficult times globally. However, Abitibi broke its covenant with our government under the original terms of its operations in the province. We could not simply allow it to desert the workers while keeping rights to our timber, hydro and lands; valuable natural assets that were entrusted to this company based on certain terms and conditions. Our expropriation of those natural resources was the right thing to do for our people.

Additionally, I am compelled to respond to the following inaccuracies:

- From Peter Foster's Financial Post column: "[Williams] appeared to pull off a coup when the owners of Hebron-Ben Nevis offshore prospect ... returned [with] an agreement that included provincial participation and a 'super royalty' that kicked in if prices remained high...When oil price hit $147 a barrel in 2008, Williams looked like a hero. The oil price is now less than half of that."

Fact: Our super royalty kicks in when prices exceed $50 a barrel. Still seems pretty lucrative to me, despite Mr. Foster's further assertion that this was a "wealth destroying" game I had played.

- From the National Post's editorial: "The Premier's demands for super royalties from oil companies caused them to scale back development of the Hibernia South and Hebron offshore fields, which, in turn, caused the federal taxpayers to indirectly subsidize Newfoundland's budget for lost revenues."

Fact: What kind of logic does one use to say the federal government compensated us for projects that didn't even yet exist? Secondly, the paper fails to admit that because of our government's strong stance and ultimate success in these negotiations, both of these projects are proceeding as originally planned. These two projects alone will generate billions of dollars of revenue for Canada and all Canadians.

- From Peter Foster's Financial Post column of: "[Williams'] attempts to force oil companies to do expensive but unspecified R&Din the province led to a further request for NAFTA arbitration."

Fact: The referenced action was in fact taken by the Canada-Newfoundland and Labrador Offshore Petroleum Board (CNLOPB). This is a joint federal/provincial board that operates at arm's length. The action was not taken by me or our government, but it certainly had our support.

- From the National Post's editorial, referring to the EU seal ban: "Ottawa had to play hardball with the EU to keep the meat, skins and byproducts flowing."

Fact: Despite best efforts, the EU ban actually proceeded -- though court action by the Inuit people of Canada has temporarily paused the ban, which we hope will result in a rethinking of the issue by the EU. In any case, I think all Canadians would be proud that our government defends our interests against other countries.

I will never apologize for fighting to protect our natural resources and for getting fair benefits for the people who own them, even if that means taking on big corporations.

Let me close by saying this: Upon completion of Newfoundland and Labrador's current oil and mineral projects, the result in net revenues after expenses will be in excess of $225-billion for Canada. Criticize when you must, but it is time for the Post to start recognizing the contribution made by our province to this country. I am heartened that ordinary Canadians are much more inclusive and generous of spirit, and acknowledge the contribution not just of Newfoundland and Labrador to the Canadian Federation, but indeed of all people, provinces and territories.

- Danny Williams is Premier of Newfoundland and Labrador.

Ottawa Settles Abitibi NAFTA Challenge of NL Asset Expropriation

When Abitibi-Bowater closed its paper mill in Grand Falls-Windsor, Newfoundland and Labrador, in 2008 the provincial legislature immediately enacted legislation to expropriate the company’s assets in the province.

The move was made in an effort to ensure that Abitibi-Bowater did not retain control of land, timber, water and hydro generation rights it had been provided with under a 100 year old agreement that allowed the company to supply its logging and paper making activities in the province.

The provincial government, under the leadership of Premier Danny Williams, as well as many citizens, viewed the move as a necessary one to ensure that Abitibi-Bowater could not simply close its doors, throwing hundreds out of work, while continuing to tie up valuable resources that might be of use to other industries, or to use its power generation facilities to sell power in direct competition with the provincially owned utility.

At the time of expropriation the provincial government said it would pay Abitibi-Bowater fair market value for its buildings and infrastructure but not for the resource rights, which government maintained were directly to the mill staying open. The province said it would assess the environmental impacts left behind by the company and reduce any payment by the amount required to perform cleanup activities.

Although Abitibi-Bowater is often thought of as a Canadian company, with its corporate headquarters in Montreal, the company is in fact incorporated in Delaware.

Almost immediately Abitibi-Bowater launched a NAFTA challenge, essentially saying the Province had no right under the North American Free Trade Agreement to expropriate the property of a foreign owned corporation and seeking $500 million in compensation.

While the expropriation was conducted by a provincial government, Canadian provinces are not signatories to the NAFTA agreement, meaning the challenge landed squarely in the federal government’s lap.

Today, after nearly 2 years, the federal government has reached a settlement with the company valued at $130 million which is to be paid out after the company’s restructuring activities are complete and it emerges from bankruptcy protection.

At this point there has been no formal comment from the Newfoundland and Labrador government beyond a short statement saying, “we are pleased the matter is settled”.

It isn’t known at this point whether or not the province will help foot the bill but it has no obligation to do so since NAFTA is a federal agreement. Any payment from the province is unlikely however in light of the deep divisions between the Provincial Premier and Prime Minister Stephen Harper.

Williams to Charest: Butt out (again)!

UPDATE:

New numbers today. It appears that the "ask" by NL and NS for a federal contribution to the cost of the undersea cable between the two provinces is $375 million (the entire effort is expected to cost between $800 million and $1.2 billion). Both provinces have requested the funding from Canada's green innovation fund through the public/private partnership program.

This is not a lot when you consider taht the cable would rest in federal jurisdiction (under the ocean), would supply clean power to Atlantic Canada and beyond and the amount is only, as one individual noted today, about 1 third of the cost of security at the G8/G20 conference held in T.O. recently.

Continuing with the topic of Quebec Premier Jean Charest's latest attempt to gain a stranglehold on all electricity generated, transmitted and sold in Eastern Canada here is an opinion piece from the Times and Transcript out of New Brunswick. It speaks volumes about the predatory tactics that are the norm with our neighbour to the west.

Quebec's meddling in the affairs of its neighbours may profoundly annoy Atlantic Canadians, but it's hardly surprising. La belle province sports a long history of promoting its interests, at others' expense, through back channels.

The latest example is a letter Premier Jean Charest recently sent to the Prime Minister's Office objecting to Newfoundland and Labrador's and Nova Scotia's joint application for federal funding to construct an undersea power cable between their two provinces. Apparently, granting such a request would constitute an unfair subsidy to the two Atlantic provinces.

If that's a joke, it's a good one.

Over the years, successive federal governments have poured countless billions of dollars into Quebec's aerospace and defence industries. They have propped up its dairy and pork producers, and extended preferential treatment (read: extra-equalization formula) to many of its state-supported social programs.

Less amusing, perhaps, is Quebec's peculiar definition of equity in the delicate balance of provincial interests that proscribe Confederation. It has built its energy behemoth - arguably, the most successful in the nation - on the bones of a patently unfair, 65-year-old deal that permits it to resell power from Labrador's Upper Churchill facility and reap the profits with no consideration for Newfoundland. And, despite repeated injunctions, it refuses to renegotiate the arrangement.

It also refuses to entertain the Government of Newfoundland and Labrador's recent request to wheel hydro-electric power from the Lower Churchill River through its transmission lines, a move, it surmises correctly, that would introduce competition to its currently hegemonic lock on U.S. and Ontario energy markets.

No province is ever expected to act against its own interests. But Quebec's heavy-handed approach to inter-provincial relations leaves a bad taste in the mouths of even its most ardent admirers, one of whom, it's entirely correct to say, is not Newfoundland and Labrador's easily angered, eminently quotable premier.

After learning about Charest's attempted fiat, Williams was practically beside himself last week, spouting a string of trade mark "Dannyisms."

What gives Quebec the right, he thundered, to interfere? Specifically: "What gives Quebec, or the Government of Quebec, or the premier of Quebec, the right under any circumstances to object to an application for funding by other provinces that have nothing to do with Quebec?

They don't want us to go through Quebec, and now they don't want us to go anywhere. I think these are really very predatory practices and I don't like it, and I'm not going to put up with it."

Nova Scotia Energy Minister Bill Estabrooks echoed these sentiments in a CBC interview: "In my opinion, the premier of Quebec should mind his own business. He's dismissing a very valid idea which comes from two provinces that have worked very carefully in terms of giving a reliable energy service to our provinces."

And not just "their" provinces. An undersea power cable would be the first step towards a true Atlantic energy grid - supplied with clean, renewable hydro-electricity - that could reduce costs for all classes of consumers in all parts of the region. It would also vastly improve the East Coast's position as an international energy exporter, stimulating robust economic development in all partner provinces.

Quebec's purpose, of course, is to savagely curtail these opportunities any way it can. Its aborted bid last year to buy the major assets of NB Power has left it in a bitter, petulant mood. If Charest can't secure access to the U.S. northeast through New Brunswick, then nobody can - certainly not dear, old King Danny for whom he holds no special regard.

In all of this, the federal government appears to be playing its cards exactly as it should.

Prime Minister Stephen Harper reportedly told Nova Scotia Premier Darrell Dexter that Quebec has no "veto" on matters that quite properly fall within the framework of national decision-making. Which may be another way of saying the feds will consider the joint funding application on its own merits.

If so, then Charest's meddling is moot, if no less annoying for the squalling, squawking selfishness it represents.

By: Alec Bruce, a Moncton-based journalist. He can be reached via www.thebrucereport.com

Documentary Takes Stock of NL's Satisfaction with Canada

This past weekend award winning journalist and documentary film maker, Guylaine Maroist, traveled to the fair province of Newfoundland and Labrador from her home in Montreal. Her purpose: To help define the TRUE Canadian experience, a tall order by anyone’s estimate.

In an effort to uncover the underlying sentiments about our place in Canada Ms. Maroist and her crew spent several days in the province interviewing local residents, political figures and journalists, a process I was more than happy to participate in myself.

The discussions were broad and wide ranging but with a single underlying current: What do we really feel about the federation as a whole (or as some would say “a hole”, but that’s another story) and why do we feel that way?

I know from my discussions with her over the past several days that she found what she came for. Newfoundlanders and Labradorians may be called a lot of things, shy isn’t one of them.

The concept of Ms. Maroist’s upcoming documentary is a simple yet enlightened one.

As she tells it, the idea grew from her life in Quebec and what she witnessed there.

Most people in Quebec, according to Ms. Maroist, see Canada, with the exception of Quebec itself, as one homogenous nation of people. They see the issues facing Quebec as a case of “us against them”. Having traveled extensively Ms. Maroist says she knew there was a lot more to the nation than a single culture and that many other parts of Canada are also dissatisfied with their experience in the federation. She decided to capture those stories.

From a growing separatist movement in Alberta to decades second class citizenship in Newfoundland and Labrador, a lot of dissent exists across the Country, Ms Maroist hopes to bring this story to the nation and, perhaps as importantly, to those in Quebec, in an effort shed light on the truth about the real Canada.

During the shoot, which is expected to take several months, Ms. Maroist and her team will travel the length and breadth of Canada, visiting as many provinces as possible. Her film, tentatively titled “Dis-United States” is expected to be released nationally next summer.

Good luck Guylaine. It’s a story that needs to be told and I look forward to seeing the outcome.

One American Appears to Understand NL better than Most Canadians

I came across an interesting blurb today in the Rutland Herald - out of Vermont. It seems that Vermont is the next state on Hydro-Quebec's radar for negotiating a long term power sales contract. It's interesting to see that some individual south of the border is aware of the situation existing between Quebec and NL, even it most Canadians, including those living in Quebec, are not.

Here's the piece, it can be found online at:
http://www.rutlandherald.com/article/20100810/OPINION02/708109991/1037/OPINION02

While negotiating hydropower contracts, New Englanders and New Yorkers should understand Hydro-Québec’s power from the north.

Québec is slightly larger than Alaska, adjoining Newfoundland and Labrador are slightly smaller than California. Precipitation is plentiful, and so is hydropower, much of it still undeveloped.

Americans are accustomed to electricity freely generated and sold via shared power grids. Government-owned Hydro-Québec does not share its grid, requiring ownership of electricity that it transmits. Buying the output of Newfoundland and Labrador’s huge Churchill Falls hydropower plant at a declining rate of about 0.2 of a cent per kilowatt-hour, then reselling it at market rates, Hydro-Québec’s gross profit, at Newfoundland and Labrador citizens’ expense, is approximately $1.7 billion annually on electricity for which it paid about $63 million.

In 2009, Hydro-Québec electricity exports were 10 percent of net sales and 22 percent of net income at an average cost of 2 cents and price of 6.8 cents per kilowatt-hour. Hydro-Québec compels Newfoundland and Labrador to subsidize electricity sales to us at lucratively competitive rates. Unsold hydropower is worthless. Buying it from Hydro-Québec, New Englanders and New Yorkers should ensure that Newfoundlanders and Labradorians are repaid fairly for their power.

Working together, we can drive a hard bargain with a hard bargainer that is fair to all.

Now isn't that something. Cheers to the writer from Web Talk.

UPDATED: Williams accuses Quebec of trying to scuttle power cable from Labrador

From VOCM News:

N.L. premier accuses Quebec of trying to scuttle power cable from Labrador
August 12, 2010

ST. JOHN'S, N.L. - Premier Danny Williams of Newfoundland and Labrador is accusing Quebec of trying to scuttle a plan to get surplus power from the province to Nova Scotia.

His government and Nova Scotia are trying to get funding for a subsea cable from Labrador across the Gulf of St. Lawrence to Cape Breton.

He says both provinces have applied to the federal infrastructure program for help as a public-private partnership project.

Williams says he's been told that Quebec has sent a letter to Ottawa objecting to the application.
He says Quebec has no place sticking its nose in the affairs of Atlantic Canada.

UPDATE:

The Globe and Mail is reporting today that:

Nova Scotia Energy Minister Bill Estabrooks said he learned of the objection from his staff.

“It disappoints me that Premier Charest would stoop to this level. He's out of line,” Mr. Estabrooks said.

“Mr. Charest, stick to your own business. Advocate positively on behalf of your province or region and don't put down another province or region for a purely political reason.”

Neither Mr. Charest or Natural Resources Minister Nathalie Normandeau were available to comment on Thursday.

But Quebec Justice Minister Jean-Marc Fournier, speaking on behalf of the government, said sending the letter to Ottawa is simply a matter of Quebec sticking up for itself.

“It's not putting our nose in any other province's matters,” Mr. Fournier said in a telephone interview.

“The fact that when a province asks the federal government to pay for transmission lines when Quebec or others paid by themselves, it's an unequal treatment of one province over the other.”

Mr. Fournier said sending the letter to Ottawa was necessary and his province's position is reasonable.

Web Talk has a question for Mr. Fournier: Why would Quebec consider transmission lines within a province to be the same as an undersea cable between provinces? Clearly they are not.

Since Ottawa controls the oceans inside the 200 mile limit (note how they control the fish stocks, oil, etc.) then it is natural that the provinces would expect any development outside provincial jursidiction (in other words under the ocean) to involve Ottawa. Perhaps when Quebec decides to run an undersea cable someplace (if they ever do) they should also contact Ottawa about having them pay a portion of the cost, until then perhaps he would be better advised to stick to his own business and butt out of the business of others.

Speaking of "subsidies" for power, hell Quebec residents have had their power subsidised by Ottawa and the Canadian taxpayers for decades.

They have the lowest power rates in Canada, why? Well, partly because of the cheap power they suck out of the Upper Churchill but also because they don't want to raise them and don't have to.

Hydro-Quebec is a Crown corporation owned by the government of Quebec. If they raised power rates to what most of us would consider to be "normal" levels it would increase the profits of Hydro-Quebec and in turn show up on the balance sheet of the Quebec provincial government. Those additional revenues would be deducted from Quebec's federal equalization payments. So they keep the rates low and still provide top notch government services by using equalization.

How's that for a power subsidy?

Clearly Mr. Fournier and his cabal of idiots are doing what everyone in Newfoundland and Labrador has come to expect from the Quebec government - Meddling for their own benefit at the expense of other provinces in Canada. Certainly nothing new in that.