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Natural Resources
March 30, 2010

The following statement was given today in the House of Assembly by the Honourable:
Kathy Dunderdale, Minister of Natural Resources:

Water Management Agreement Established for the Churchill River

I rise today to inform the House of a recent ruling by the Public Utilities Board that has resulted in the establishment of a water management agreement on the Churchill River between Nalcor Energy and the Churchill Falls (Labrador) Corporation. The conclusion of this agreement is another step toward sanction of the Lower Churchill Project.

Our government moved to regulate the coordination of water management on provincial rivers in 2007. This was accomplished through amendments to the Electrical Power Control Act to provide the Public Utilities Board, commonly referred to as the PUB, with the authority to regulate the coordination of water management agreements.

These amendments provide certainty over the coordination of water flow when two or more operators are on the same river. The Water Management Regulations that accompanied the amendments provide direction to the PUB for the review or establishment of water management agreements. 

With that action taken, Nalcor and CF(L)Co officials began discussions to reach a water management agreement on the Churchill River. However, the proposed agreement that was subsequently reached was rejected by the CF(L)Co Board of Directors. It is our understanding that none of the Hydro Quebec directors on the CF(L)Co board supported the agreement, which was a necessary requirement.

As a result, Nalcor Energy applied to the PUB to establish the terms of a water management agreement based on the proposed agreement rejected by the CF(L)Co Board of Directors. The process provided CF(L)Co with 30 days to make its submission to the PUB.

It is noteworthy that both CF(L)Co and Hydro Quebec, in separate submissions to the PUB, supported the version of the agreement filed by Nalcor Energy. Upon review, the PUB established this agreement as the water management agreement to be binding upon Nalcor and CF(L)Co.

I also want to note for the House another important part of the PUB ruling. Two Quebec Innu groups had filed objections to the water management agreement based on asserted Aboriginal rights. In its ruling, the PUB concluded that this agreement does not have an adverse impact on Aboriginal rights or title and that the project operating regime and Aboriginal consultation are already part of the ongoing environmental review process.

The conclusion of this agreement would not have occurred without the decisive action by this government to regulate the coordination of water management agreements in this province. The rivers in this province belong to the people and it is our responsibility to maintain control over our water resource and ensure it is regulated in a way that optimizes the benefits to the province.

2010 03 30                                                     1:50 p.m.

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