Newfoundland to develop 2,824-MW Lower Churchill on its own

The government of Newfoundland and Labrador has chosen itself over three short-listed bidders to carry out development of the 2,824-MW Lower Churchill hydroelectric complex in Canada’s mainland Labrador region.

Premier Danny Williams said May 8 the province government, in partnership with its utility, Newfoundland and Labrador Hydro, will lead development of the project, which features two projects on the Lower Churchill River, 2,000-MW Gull Island and 824-MW Muskrat Falls.

“Previous development was always contemplated in the context of an external partner joining with the province,” Williams said. “This typically resulted in Newfoundland and Labrador being left with less than acceptable benefits and profits from the development of our own resource. Today marks a turning point in our history as we acknowledge that we as a province are capable of leading and having full control of this process.”

Sponsors of the three unsuccessful short-listed proposals were:
o Quebec utility Hydro-Quebec, Ontario government’s Ontario Energy Financing Co., and Montreal-based engineering company SNC-Lavalin Group;
o Alberta-based utility and developer TransCanada Corp.; and
o Tshiaskueshish Group, a consortium of: Macquarie North America Ltd., part of Australia-based Macquarie infrastructure development group; Innu Development Limited Partnership, representing Innu bands in Labrador; contractor Peter Kiewit Sons Co.; and Innu Kiewit Constructors, a partnership of IDLP and Kiewit.

Feasibility, environmental studies ahead

The province now must determine the project’s financial, technical, and environmental feasibility. Williams said all development options are being reviewed, including project configuration, transmission routes, and markets. In support of one option, Newfoundland has applied for permission from neighboring utility Hydro-Quebec to use its tranmission lines to carry Lower Churchill power to markets in Quebec, Ontario, the Maritime Provinces, and the northeastern United States.

Williams said the self-development decision is only one step in a long process before a final decision can be made whether to sanction construction of the project. While the government will take the time necessary to complete due diligence on project feasibility, Williams said, a planning schedule sees a project sanctioning decision by 2009 and first power generated by 2015.

The premier said preliminary activity is under way on several fronts, including negotiations with the Innu Nation of Labrador on an impact and benefits agreement. Groundwork also is being laid for a comprehensive environmental review leading to the filing of an environmental impact statement by the fall of 2007.

The government also announced it awarded four contracts totaling more than C$440,000 (US$396,000) for environmental studies needed to prepare the EIS. It made a C$205,000 (US$184,000) award to SGE Acres/Minaskuat Environmental Partnership to study ice dynamics of the Churchill River. Minaskuat Environmental Partnership also received a C$154,000 (US$138,000) contract to study water and sediment. Sikumiut Environmental Management received two contracts totaling C$82,000 (US$74,000) to study furbearers’ use of the river and to study seal abundance and distribution.

Information on potential tendering for project work may be obtained from Newfoundland and Labrador Hydro’s Internet site, www.nlh.nl.ca, under Vendors and Tender Information.

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