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April 28, 1999
(Fisheries and Aquaculture)


The following statement was issued today by John Efford, Minister of Fisheries and Aquaculture. It was also read in the House of Assembly:

As Honorable Members know, government decided last year to assist the financially troubled S.C.B. Fisheries in Bay d'Espoir. S.C.B. has been involved in finfish aquaculture since the mid 80s and the focus prior to government's latest involvement was on research and development. However, all participants recognized the need to focus all future efforts on commercialization of the industry in Bay d'Espoir.

Recognizing that there was a fear that the operation would have probably gone out of business and a possible loss of 200 jobs in the area, government decided to make available a $6.4 million working capital loan guarantee in 1998 to help S.C.B. Fisheries deal with some of the problems they were facing in this new and challenging industry.

Government invested this money because Bay d'Espoir is a leader in the aquaculture industry in our province, and we have confidence in the growth of this new sector. There are many challenges in the ongoing development of the aquaculture industry, but we believe it has considerable potential and can offer economic diversification opportunities.

One of the problems at S.C.B. resulted from the types of strain of fish they were allowed to use that were not commercially competitive to the strains of fish being used in other parts of the world. The inferior strains of fish they were using, as a result of DFO regulations, was one of the major reasons for the poor financial performance of the aquaculture industry.

Meanwhile, Honorable Members, if you can recall, we have been lobbying very hard and pressuring the federal government to allow us to bring in a better strain of fish. We are happy to report and inform the Honorable Members that we have now been given permission to import all female diploid steelhead trout, which are more commercially viable. This recent decision by the federal government will now place S.C.B. Fisheries in a more competitive position. Our efforts paid off and this is good news for S.C.B. Fisheries and other aquaculture operations in Bay d'Espoir.

In 1998, when government assisted in the management of the facility and provided financial assistance to commercialize S.C.B., I made very clear to everyone involved that it would be the last of taxpayers money going into the operation. Government believed that this final investment would help the company better position itself for potential investment by the private sector. The S.C.B. operation is a major force behind the development of finfish aquaculture in the Bay d'Espoir area and we believe very strongly that it has a brighter future. Since our involvement we have achieved the following favorable results:

  • Plan worked out with Shur-Gain (feed supplier to SCB) whereby it received satisfactory conclusion to its $3.4 million outstanding feed credit to S.C.B;

  • Completion of an independent detailed operational review of the company;

  • Site operating costs reduced to address the seasonality of the business;

  • Plant processing facility organized and upgraded which resulted in increased productivity, improved quality, and lower production costs;

  • Refocused the hatchery operation to deal with quality and not quantity, and as a result we have larger, healthier fish going into grow-out cages which will equate to less mortalities and improved costs on the marine sites;

  • By lobbying D.F.O. we received approval to import diploid all female steelhead eggs. By using these improved strains we will see improved feed conversion ratios, which equates to lower costs to grow the fish. In summary, the aquaculture industry in Bay d'Espoir will be placed in a competitive position with other producers. In short, they now have a brighter future.

The time has come for government not to have any further financial involvement in the S.C.B. operation and this has been done effective March 15. We have ended all of our financial and managerial involvement in the operation. However, release of the province's security will be subject to S.C.B. Fisheries Limited first having in place a new general manager, a new investor, and submission of a viable business plan for the continued operations that is acceptable to government. We believe, as a result of our investment, we have put the company in a more favourable, stable position to move ahead and continue to play a major role in the future development of the aquaculture industry in Bay d'Espoir and in Newfoundland and Labrador.

I reiterate that government is committed to the aquaculture industry and will continue to provide research and development funding to support this sector. We will continue to work with the industry in this area with the objective of building a self-sustaining aquaculture industry.

1999 04 28                    2:30 p.m.


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