Quebec and Ottawa Near Agreement on Oil Well Straddling NL Border

With a Quebec MP, Christian Paradis, in the role of Federal Natural Resources Minister, it'll be interesting to see the outcome of negotiations between Ottawa and Quebec over the Old Harry oil deposit straddling the Newfoundland and Labrador boundary.

The Canadian Press is reporting that a deal is near but what will this deal mean for the people of Newfoundland and and Labrador?

From the Canadian Press:
Federal government says Old Harry negotiations with Quebec going well

QUEBEC - Federal Natural Resources Minister Christian Paradis says talks with Quebec over a disputed underwater energy deposit in the Gulf of St. Lawrence are progressing.

Paradis says he is hopeful negotiations with his provincial counterpart over the Old Harry reservoir will be completed shortly.

Quebec has tried to secure exclusive rights to the reservoir in the past, but the energy deposit straddles the border of Quebec and Newfoundland and Labrador.

The dispute between the two provinces centres around ownership of the seabed and the territorial divide between Quebec and Newfoundland.

Paradis says negotiations are complex, but that it's important to reach a deal soon because Newfoundland already has an agreement in place with Ottawa.

The reservoir could represent billions of dollars in revenue for the two provinces and has a potential output of two billion barrels of oil and 5,000 billion cubic feet of natural gas.

A company has already started exploring the reservoir thanks to a permit from Newfoundland.

Content Provided By Canadian Press.

End of the Williams Era in Newfoundland and Labrador

The first rumblings that something was up began early Thursday morning. This was quickly followed by a brief news release from the Premier’s communications director simply stating that Danny Williams would be going before the microphones to “discuss his political future”.

By 11:30 am Newfoundland time Williams did just that, stepping before the microphones in the foyer of Confederation building where he was greeted by thunderous applause and a chorus of “Danny… Danny” that continued for some time until the Premier asked for the chance to speak.

During his address, which lasted several minutes he discussed his government’s accomplishments and, as he is known to do, quoted several well known figures including the late Orson Wells when he said, “…if you want a happy ending, you need to know when to end your story…”

Danny Williams then announced that he will be stepping down as the ninth premier of Newfoundland and Labrador on December 3, 2010. At that time Deputy Premier Kathy Dunderdale will assume the leadership role until a new leader is selected.

According to Williams the reason for his decision was one of timing. He noted that much of what he hoped to accomplish when he became Premier in 2003 was now in place and he saw this as the right time to hand over the reigns.

During his tenure the Williams government improved the Atlantic Accord revenue sharing agreement with Ottawa, improved royalty revenues and ensured a provincial ownership position on offshore oil developments and most recently announced a 6.2 billion dollar agreement to develop part of the Lower Churchill hydro project.

As federal Liberal MP Gerry Byrne said today, “He’s got his bucket list done, that’s the bottom line. He’s accomplished what he set out to do.”

In spite of less than flattering headlines and commentaries in the national news media where pundits often referred to him as “Danny Chavez” or a “dictator”, Mr. Williams’ accomplishments were substantial.

Beyond those accomplishments previously identified his government also instituted a nationally lauded poverty reduction plan that saw the province go from having one of the highest poverty levels in Canada to having the third lowest. It was also during his tenure that Newfoundland and Labrador paid down 4 billion in provincial debt (approximately 25% of its debt load), moved from being a “have-not” to a “have” province for the first time in its history and nurtured a level of pride among the population that has not been seen in decades.

As a result Premier Williams’ level of support remained strong, in fact even after two terms in office his consistent approval ratings of 80% or higher (one recent poll placed his voter approval rating at 93%) was the envy of politicians across Canada.

Accomplishments accepted, the Williams government was not without its share of problems as well, including an ongoing doctor’s dispute, and the mistaken appropriation of Abitibi’s mill property in Grand Falls-Windsor (a mistake that happened during the adoption of a bill to appropriate water and timber rights from the company, a move that overall was very popular in the province).

According to MP Gerry Byrne, “He’s a loved and hated politician among the political class, but today whatever feeling of animosity people may have is replaced with envy.”

Federal MP Scott Simms told the Globe and Mail today that there are likely a few politicians breathing a sigh of relief – including Prime Minister Stephen Harper”, who ignored Mr. Williams and suffered electoral losses in his province.

Simms was referring of course to Danny Williams much publicized “ABC” (Anyone but Conservative) campaign during the last federal election. A move that saw the Harper government completely shut out in Newfoundland and Labrador.

“Danny Williams doesn’t take the middle road,” said Mr. Simms, “He doesn’t relax. For Danny Williams it’s you’re either in for everything or you’re in for nothing. At that level of play it’s a pretty intense life,” Mr. Simms said.

“Williams has an iron fist and a golden touch. It’s going to be hard to find a similar successor in the Progressive Conservative party.”

“He’s one of a kind,” Mr. Simms said. “He just personified something that we wanted for so long. I think what [Mr. Williams] did was instill a sense of pride. ... I just thought he was the right guy for the right time.”

The question now shifts to what's next for Danny Williams.

Never one to sit idle it would be difficult to imagine he has plans to sit on a beach somewhere. No doubt someone with his resume has countlss opportunities in the private sector but unless it's a CEO position on the table, nobody believes Williams would consider it. He's always been a leader, never a follower.

What about federal politics?

Never one to mince his words, when asked today if planned to run federally his response was uncharistically "political" in nature. Williams neither discounted the idea or said he would be interested. He simply said it was not the driving reason behind today's decision but that he has had many people approach him with the offer.

Interesting since there would clearly be no room for the life long Conservative inside any federal Conservative party run by Stephen Harper. That bridge was burnt long ago.

Only time will tell what the (almost) former Premier will do next. In the mean time reaction to the Premier’s resignation has been pouring in from across Newfoundland and Labrador, as well as the rest of Canada, ever since the unexpected announcement this morning.

Quebe's Shameful Power Play - National Post

From the National Post
The Bloc Quebecois are the W.C. Fields of politics -- they never vote for anything, they always vote against. Paule Bruelle, a Bloc MP from Trois Rivieres, provided the latest example of her party's ability to drain any room of positive energy by calling on the federal government to turn down Newfoundland and Labrador's application for $375-million in federal infrastructure funding -- not on the grounds that it may be a bad investment but because it would provide competition for Hydro-Quebec.

Newfoundland and Labrador, through its energy subsidiary Nalcor, and Nova Scotia's energy giant, Emera, have sought $375-milion in federal funding from the government's Private-Public Partnerships Canada infrastructure fund to help build a transmission link between a new generating plant at Lower Churchill in Labrador and Nova Scotia. The logical route would be through Quebec but Hydro-Quebec has already closed down that option by complaining it needs all its existing transmission capacity and the province's regulator has agreed.

Not only does the Bloc not want Newfoundland and Labrador's new green hydro power to go through Quebec, it wants to stop it going around Quebec too.

The worrying thing is that Jean Charest's Liberal government agrees with the separatists, claiming that federal funding would create an unfair trade advantage and result in a government subsidy for each kilowatt of electricity transported to Nova Scotia.

Only a Quebec government could make such a statement without feeling a sense of shame. The province likes to tout its green-energy credentials, but its environmental record is almost entirely dependent on the notoriously one-sided 72-year deal to buy Newfoundland and Labrador's hydro power, generated by the Upper Churchill Falls, for a fraction of its market price.

It seems hard to believe but the 1969 deal, which has seen Quebec make $20-billion to Newfoundland and Labrador's $1-billion, is about to get worse for residents of the Rock.

In round numbers, Quebec currently pays $2.50 per megawatt hour and then sells on the power at the market price of between $40-60 mw/h. Bad enough you might think, but that amount is set to fall to $2 per megawatt hour from 2016 for the remaining 23 years of the deal's duration. Wars have started over less.

This is the background to the screaming match that is brewing between Mr. Charest and Newfoundland and Labrador's Danny Williams. Mr. Williams is appealing the Upper Churchill deal on the grounds that there has been such a fundamental change in market conditions because of open access to the United States that there has been a breach of good faith.

The case is likely to be mired in the Quebec court system for years.

Undeterred, Nalcor has struck a deal with Emera that will see a new $2.9-billion generating plant at Muskrat Falls, linked by a new $2.1-billion transmission line to the Rock and then connected to Nova Scotia by the $1.2-billion subsea link. Newfoundland will keep 40% of the power generated, Nova Scotia will take 20%, leaving the remainder for sale to markets in the northern United States, a market where Hydro-Quebec is already strong. Muskrat Falls will leave Newfoundland and Labrador 100% emission free.

Ed Martin, Nalcor's chief executive, was in Ottawa Tuesday, trying to drum up support from the federal government. He said the deal will remove two to three megatonnes of carbon from Canada's total emissions and create about 6,500 jobs a year during the seven-year construction period. "It's a great investment opportunity for Canada and I don't want to leave them out," he said in an interview.

Whether or not the numbers add up is for the federal Finance department to decide. Ottawa's 8% stake in the Hibernia project that Nalcor has already bid upon adds the possibility of a side deal being added into the equation.

But what is clear is that the federal government should ignore bleating from the Bloc and the Quebec government about unfair trade practices, experts though they both may be on the subject.

The decision should be made on what is in the national interest -- something over which Mr. Charest, far less the Bloc, loses any sleep. If this federation is to flourish, Ottawa needs to speak for Canada.

By John Ivison