First posted in 2007 by Sue's Blog - Every Time Dean speaks we should remind ourselves of the following:
I guess most of the readers are familiar with the various TV shows on flipping houses - where the buyer picks up a property - renovates and or adds an addition and flips it for a profit.
Newfoundland and Labrador has it's own new program now - called Flip this Utility. I cannot for the life of me figure out why CBC or NTV have not picked up the pilot and a couple of completed programs in the can. The least the Telegram or VOCM could do is give the reader and listener some highlights of the new series so we can encourage one of the TV networks to pick it up. I don't expect "Out of the Fog" would be interested.
The program is filled with energy as the hosts and flippers are interesting well known characters - that give it a kind of soap opera appeal - mixed with a tinge of a reality series.
The creator of the series is a well kept secret but I think it's fair to say that Brian Tobin might be the producer and the government of Newfoundland and Labrador acts as a partial financier of the renos.
Te pilot takes place in Newfoundland and Labrador when Tobin was the Premier. He decided after some encouragement by the local cable company that it was time to reno the government's communications contracts. So Tobin without an RFP or tender call picks Cable Atlantic for the investment.
Cable Atlantic picked up the government contract and away they went. Shortly after the owner of Cable Atlantic flipped the property for a tidy profit to Rogers - not a (local) company.
Dean MacDonald - Danny Williams - Ken Marshall - and Brian Tobin are featured predominantly in the pilot and the backdrop is priceless - as one of the flippers - apparently not believing that Tobin's government had done a good job became the leader of the other political party and went on to become Premier.
The second program starts off with one of the flippers of the first property picking up Persona - and while Danny is becoming Premier - Dean Macdonald leaves Rogers - the purchaser of the renovated Cable Atlantic - and starts to work on Persona. Not to be left out Brian leaves as the Premier and he ends up on the Board of the new property to be renovated and does work for the company that picked up the first flip.
The third show features all the same players - but this time the Premier who was a flipper on the first - decides government needs some reno work itself - and Persona who is ready to be the second property - just happen to come together with the same plan. So instead of going out to the market to find another property to invest in - government decides why not just deal with the same gang. No tender of RFP needed.It worked before. Same storyline - local company gets reno...
Now this episode gets real fun as the biggest communications (telephone) company Aliant experiences a real tragedy and has a fire in one of its buildings knocking out cell and telephone services far and wide. Danny - and Dean - recognizing this irony jump all over this to convince us that another reno is essential.
They send out a new character Trevor - to announce all the plans - and poor Trevor is all over the map as to exactly what it is they are doing for the reno and why. He fondly becomes known as the "duct tape man".
Then our Minister of Business Kevin O'Brien jumps in - to be honest witchu - and starts selling the audience on the real value in this property.
The audience is in for great laughs as everyone runs around trying to figure out if they want strands or a whole network or how many fibres they will need and whether or not they will light them. And if they are lit - who will do it.
The funniest part is when the neighborhood spokesperson won't reveal who is going to pay what for maintenance and the whole meeting goes up when one of the property owners asks for an administration fee to sort it out.Once again the appeal to us the audience is that another local property wants to reno and expand. Unfortunately - once again the audience is torn when the property is flipped to another company on the mainland.
Unlike the first flip where the profit details were available - the producer will keep us guessing as the real profit off this one will not be known.
The producer is not talking but the last episode might go something like this - Danny leaves as Premier - Dean takes that job - and Brian picks up a property to reno and appoints Danny to the Board. The new government under Dean will encourage reno's to that asset and will partially finance the upgrades - without a tender or RFP. I haven't heard yet if they will release the results of that flip and the profits which might accrue.
Utility Flip - coming soon - from your local cable provider.
8 comments:
Is government money that easy to capture so politicians can build empires for themselves when politicians become embedded in a government seat?
If it is, well then it does explain the reason for the state the province of Newfoundland and Labrador finds itself in financially?
From your post it appears its a malady that has spanned both political parties that have ruled Newfoundland and Labrador for 58 years. Neither of them is innocent.
Sue, you didn't give the benefits, if indeed there were any, to Newfoundland and Labrador of such redesigning of the technology/utility of which you wrote. Were there any?
If there were no benefits it is an awful waste of our money so that 10 or 12 people can prosper, when so many of us are awaiting the establishment of meaningful industry here so that we can acquire a job that will, at least, make it easy for us to pay our bills and put away a dollar for our retirement.
There are benefits in most technology and communications expansions - upgrades - etc.
It's whether we got the best deal to do it. That's why we have a Public Tendering Act and a system for calling Request for Proposals.
Each and every time a politician or politicians decide they will skip the process - they destroy openness and accountability - and they believe they are the best judge - so who needs rules or laws - or regulations.
We are in the middle of one such mess in the House of Assembly now - right?
Thanks Sue!
Openness and Accountability should be utmost in all dealings. If it is not practised in my opinion, the end result will not be an honest one.
If there is a loophole for these types of dealings to occur, without following the proper process, why doesn't somebody close the loophole immediately through which ever method is needed to do so?
As a participant in the Newfoundland and Labrador electorate, I do not want politicians doing government business in a way that it benefits the politicians and not the whole electorate of the province of Newfoundland and Labrador. It is absolutely wrong for politicians to do such things. If they have a business interest in whatever is coming down the chute in the province in development, well then put everything up on tender and let the politicians bid no differently than any other person with interest and let the best bid win.
I think that practice you described should end today.
I just listened to Opposition Leader,Gerry Reid on VOCM demanding that the contents of the MOU be revealed. I might add I do not often agree with him.
I, too, want the contents to be revealed, no differently than I sided with Premier Williams 5 days ago in wanting the contents of the Voisey's Bay MOU revealed .
We need to know what we are getting in that MOU and what we are giving away.
This self proclaimed "open and transparent" government has proven to be anything but. ITRD has stated that their estimates indicate a five year payback on the investment due to lowered communications costs. Show us the math! I would presume that the vast majority of government commnications requirements are for on-island traffic, with only a very small portion being sent off the island. Given that the project was to establish another off-island route, I can only assume that the savings will come from savings off that link. Is the provincial government really spending that much money on off-island communications? If the savings were 50% less, that would mean that the province pays $6 million per year for their current off island connection. I can't imagine that the province is paying anything near that kind of money for that service.
Sue,
you point out the obvious (once you explain and point it out it becomes obvious)... so as I did in a previous post, I ask, WHAT CAN WE DO? As your average Joe, what can we do to change all of this?
As noted in a previous post by you, when the members don't represent as they were elected to, or at least not AFTER they are elected, WHAT CAN WE DO? Screw the "toe the party line"... we should yank them out of government, and give a few of them a good GD fright. Maybe then the others would wise up a bit and grow their spines back.
WHAT CAN WE DO?
Keep it up!
What baffles me about politicians is that some days they are golfing with each other and some days they are growling at each other, so how are we to figure out what is going on within the brains? I have figured it out and I don't listen to it any more. It is just a ruse to throw us, the Newfoundland and Labrador electorate off course, and they should damn well stop the deceitfulness.
I have come to the conclusion in the past few months that we cannot listen to what comes out of politician's mouths, since they are following the principles of the etiquette books written for Canadian politicians.
They try to confuse you, or is it send up smoke screen? All the while they are in each others pockets.
Two of the politicians you mentioned in this post, one representing the Liberals and one the Conservatives, and both of them are toeing the party line that sees Ottawa getting to have the say on where the Lower Churchill Hydro power will be delivered. That route, of course, is to be through the energy corridors of Quebec destined for the Ontario market so as to maintain present industry and create more industry there and to provide Ontario with the much needed Green Energy/Kyoto points that will result when it shuts down a few coal fired plants? Are we as Newfoundlanders and Labradorians going to allow it to happen?
Sue, I'm sure you have read this column from the Globe and Mail, but it makes one wonder if a 4.9% equity share is enough.
Jerome
For oil companies, the good old (bad old) days are over
Eric Reguly
Friday, September 07, 2007
ROME — It used to be so easy. A North American or European energy company
eager to ramp up foreign production would traipse into a bankrupt, yet
oil-rich, country - anywhere in North or West Africa would do - make nice
with the local strongmen, promise jobs, technology and export sales, and
walk away with oil and gas concessions that made shareholders weep with joy.
Reserves and production went up, costs were relatively low, and
environmental regulations were the very palest shade of green.
Those were the good old days. Now look at what's happening. Economic
nationalism is on the rise. Poor countries that once begged foreign oil
companies to develop resources buried in deserts and jungles are now kicking
these same companies out. Development, revenue and tax laws are being
furiously rewritten to favour domestic interests.
It's happening everywhere and, if it keeps up, your favourite oil company
will have an increasingly tough time replacing waning reserves and
production.
Just a few days ago, Repsol, the Spanish oil giant that considers Algeria
its backyard, was given its marching orders by Sonatrach, the Algerian
national oil and gas company. It and Gas Natural, a company related to
Repsol, were booted out of a $6.8-billion (U.S.) gas production and
liquefied natural gas development in the eastern part of the country. Repsol
and Natural Gas said Sonatrach was "illegally appropriating" the project.
About the same time, Kazakhstan ordered development stopped at the monster
Kashagan oil field, where a consortium of Western companies led by Eni of
Italy held most of the ownership. Kazakhstan wants Eni and friends to cede
control of the project, and blamed epic cost overruns and delays for its bad
mood. (Canadian investors will remember that PetroKazakhstan, the former
Hurricane Hydrocarbons, complained of endless government interference and
ended its woes in 2005 by flogging itself to a Chinese oil company).
Last year, Russia's Gazprom, the world's biggest natural gas producer, which
is privatized yet state controlled and operates a private army, wrested back
control of Royal Dutch Shell's huge Sakhalin-2 gas project.
Resource nationalism didn't just hit last year. It's been coming, not
coincidentally, since oil prices began their relentless rise from about $25
a barrel early in the decade to three times that now. Resource-rich
countries, thanks to the commodities boom, are no longer in financial crisis
and are therefore less keen to court foreign investment.
Take Algeria, a basket case in the 1990s. Since then, surging oil and gas
production has allowed it to pay off almost all of its external debt and
build up foreign exchange reserves of $100-billion. Sonatrach last year
earned $54-billion from oil and gas exports. As energy prices rose, Algeria
decided its foreign investment rules were unduly generous to foreigners.
The new rules, now in place, give Sonatrach the right to take 51 per cent of
all new energy projects (the old rules gave it the option to take 20 to 30
per cent). In other words, Sonatrach no longer has to compete for contracts.
In addition, Sonatrach's oil and gas transportation monopoly was restored
and a windfall tax was slapped on outsized profits earned by foreign
companies. First Calgary Petroleums, a Toronto-listed energy company with
substantial reserves in Algeria, cannot be happy about this.
Algeria doesn't expect a backlash from the Spaniards for kicking Repsol out
of one of the country's biggest projects. The Algerians blame Repsol for
massively understating the project's development costs - the bill for the
first phase has almost doubled to $19-billion. Plus Spain relies on Algeria
for 30 per cent of its gas supplies. Algeria is a useful counterweight to
Russia, the other big gas supplier to Western Europe (Repsol says it will
take the case to international arbitration in an effort to recoup hundreds
of millions already sunk into the development).
With energy prices strong, and governments in Africa and Asia enjoying their
oil and gas spoils, there is no reason to believe the nationalization trend
will end any time soon. At the same time, shareholders of Western oil and
gas companies will put pressure on management to avoid plunking fortunes
into countries like Algeria because of the new risks. They will suggest that
exploration and development money be spent elsewhere.
But where? The biggest potential oil and gas projects reside,
inconveniently, in countries where you wouldn't want to spend your
vacations.
ereguly@globeandmail.com
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