Minister releases documents detailing Lower Churchill project spending

Ed Byrne, Minister of Natural Resources, released the documents today detailing the $57 million which has been spent on the Labrador Hydro Project. In releasing the information, Minister Byrne reiterated that none of the $57 million was spent by the current government.

"There was not any direction provided by the current premier�s office nor my office as to the expenditure of this money," said Minister Byrne. "The vast majority of the money was spent by the previous Liberal government under several different premiers."

The information released today included details in several areas including:

• $16.6 million was spent on financing charges;
• $13.1 million was spent on environmental services;
• $8.9 million for engineering services;
• $4.2 million on legal services;
• $3.6 million on block funding - $2.9 million of which included support to the Innu Nation;
• $2.8 million on financial consultants;
• $1 million on communication consultations.

"Through the environmental and engineering work that has been completed to date, there is a significant amount of work and various studies done which do lay the groundwork for any government in going forward to see the development of the Lower Churchill Project," said Minister Byrne. "I have been able to determine that for this work, a Request for Proposals process was followed with input from the employees of the Labrador Hydro Project and Newfoundland and Labrador Hydro."

However, Minister Byrne indicated that such a process was not followed for the selection and awarding of contracts to several different law firms and to communications consultants. The bulk of the legal services was contracted to Patterson Palmer Hunt and Murphy at a cost of approximately $2.7 million, with a further $915,843 spent at Chalker Green and Rowe/McInnis Cooper. The communications costs included $461,000 to SNC-Lavelin and approximately $400,000 to Bristol Communications.

"The direction came directly from the premier�s office as to which law firms and communications companies were to be hired to carry out the required work," said Minister Byrne.

Minister Byrne also provided information as to the recent request of $1.8 million from the Labrador Hydro Project. This requirement for additional funds is the result of adjustments to the project�s current budget to cover off financing charges which total $3 million.

"Again, I want to be clear that there was not any direction from this government for the expenditure of this $1.8 million," said Minister Byrne. "This funding was required for the project to cover its operating expenses - the bulk of which was the financing charges associated with the millions that had been spent by previous governments."

  Download Labrador Hydro Project - Summary of Project Expenditures Document (PDF)

Media contact: Carmel Turpin, Communications (709) 729-5282 or (709) 685-4624

2004 10 19                       11:10 a.m.