Minister releases bulk water report:
Government to maintain ban on bulk water exports for now

Justice Minister Kelvin Parsons today released the report of the ministerial committee examining bulk water and announced that government will not introduce legislation to remove the ban on bulk water exports during the upcoming session of the legislature.

"In March, the premier asked me and my colleagues from the departments of Environment, Finance and Industry, Trade and Rural Development to undertake a thorough review of the current legal, trade, economic and environmental aspects of this issue," said the minister. "Yesterday, I delivered to the premier and my Cabinet colleagues a copy of this report and I am pleased today to deliver the results of our review to the people of the province."

The Report of the Ministerial Committee Examining the Export of Bulk Water includes the advice and analysis of senior government officials as well as expert legal and economic opinions from outside government.

"It is clear from our analysis that the province has legal jurisdiction over its water resources," said Minister Parsons. "In addition, two of three legal opinions indicate that while approval of a bulk water project in Newfoundland and Labrador could create trade consequences for this province, it would not render all water resources in Canada a �good� under NAFTA, and, therefore, would not create a precedent for the other provinces.

"The report also concludes that bulk water removal may or may not have any significant environmental impacts, depending on the proposed location for the project. To date, the only bulk water export project proposed for this province was at Gisbourne Lake. Government determined through its environmental assessment process that a water removal project at Gisbourne Lake would not have significant negative environmental impacts," said the minister.

"The committee also sought expert opinion on the economic feasibility of a bulk water export project," said Minister Parsons. "According to Memorial University economics professor James Feehan, bulk water export may not be economically viable for a proponent at this time. Also, potential government revenues from royalties are less than had been previously anticipated. Professor Feehan�s complete report to government on this matter is included in the committee�s report.

Government has weighed the facts and considered the opinions put forward in this report and has determined the following:

• there is no public policy reason not to proceed with bulk water export;
• there is no legal impediment to a bulk water removal project;
• there is no compelling environmental reason not to allow such a project to proceed;
• the economic viability of such a project is marginal, according to one assessment;
• and, with respect to impacts on other jurisdictions, there are differing legal opinions.

"Based on these facts, government has arrived at a number of conclusions," said Minister Parsons. "First, that the economic viability of any project would need to be determined on a case by case basis. Currently, no proponent has come forward with a proposal. Second, government has decided to explore methods of clarifying the legal issue with respect to impacts on other jurisdictions. And finally, government will not rescind or amend the province�s 1999 legislation banning the export of bulk water from the province at this time."

Download the Document
Report of the Ministerial Committee Examining the Export of Bulk Water - PDF

Media contact: Edwina Bateman, Communications, (709) 729-6985.

2001 10 18                             2:10 p.m.