The Premier is inconsistent with resource policy.
Let's look at the situation. We will begin with Voisey's Bay - and Williams insistence that the contract guarantee that ore would be processed in the province. We all agreed with that and the contract does provide. The idea is - if you want to use the resource you must establish secondary processing here. The basis of that demand from the previous Liberal government was the size and quality of the ore body. We knew the economics allowed such a facility to be built.
Moving on to Hebron and the Premier's demand that we achieve an equity position - once again the majority of people agreed and as a result - the Premier's polling remained high - while the Liberals stagnated.
Both INCO (at the time) and the Oil Consortium had other preferences. INCO would have preferred to utilize other processing facilities in Canada and the consortium did not want to give in on equity.
Moving now to the Lower Churchill - first let's be clear - the quality and size of that resource is comparable to that of the oil and nickel - and because it is renewable it is superior. If companies want to avail of the premium energy generated they must come to Labrador to use it. Instead the Premier has no such secondary thoughts here - just revenue.
We could have taken a super royalty or escalating revenues from nickel sales (the price has increased substantially) - we could have taken a super royalty from the oil (the price has increased substantially) - but we wanted more - as we should - they are our resources. The best potential of the three is the Lower Churchill but not a sign of such recognition from Williams.
The idea that recall will save us in the event we find some capability to attract industry - is flawed. The Upper Churchill had recall and yet through 35 years we have found no real need for it other than to sell it back to Hydro-Quebec. The reason for this is simple - once it's left the barn - the door will not open again. The major industry players would prefer to operate in Ontario and Quebec - where they already have infrastructure and presence. If they refuse to show interest in Labrador after the fact - there will be no such development based on power in Labrador. If however they truly believe the Government of Newfoundland and Labrador is not exporting the power - they will look at negotiating industrial development there.
As it sits now - heavy energy industry will sit back and wait for Newfoundland and Labrador to pump it out - preferably to Ontario or even New Brunswick or Nova Scotia - and then negotiate with those provinces for industrial development projects.
One Sue's Blog reader - rightly pointed out sometime ago that Iceland had to use the energy in-house because they were a northern Island with markets not readily available. Due to that physical impairment they gained three aluminum smelters - and arguably succeeded where we and our Upper Churchill power failed. We cannot assume that Iceland would not have chosen that path even if they were connected to markets - but one thing is for sure - they prospered from keeping their power home.
If the Premier is serious about his demands with big oil and mining companies - there is no way the man would be exporting renewable - reliable - industry preferred power. Especially at a time when the environment has surpassed health on the priority list of Canadians.
Premier - we do not have an obligation to save Canada from it's fossil fuel woes or big provinces from energy shortfalls. We do more that our fair share now from the Upper Churchill. Your job is to use our resources to build our economy. If you export the power - you seal the fate of this province and will have orchestrated the biggest giveaway in our history.
