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Justice
Environment and Conservation
December 7, 2012

Provincial Government Disappointed with Supreme Court Decision; Remains Confident
that Expropriation Allowed Return of Resources to the People

The Honourable Thomas Marshall, Attorney General, today expressed his disappointment in the Supreme Court of Canada decision with respect to Abitibi-Consolidated Inc. and responsibility for environmental clean-up and reiterated that the Provincial Government made the correct decision in expropriating the assets of Abitibi and returning valuable resources back to the people of the province.

The Supreme Court of Canada ruled today that the environmental protection orders issued to Abitibi-Consolidated Inc. by the province to clean up contaminated sites cannot be enforced as regulatory orders. In a 7-2 split decision, the majority found that the anticipated financial liability to clean up the sites can only be dealt with in the Companies’ Creditors Arrangement Act (CCAA) process.

“The Supreme Court of Canada has ruled in favour of ensuring the survival of the company over the environment, and that is disappointing,” said Minister Marshall. “However, our government is confident that the decision to expropriate Abitibi’s assets was the right decision on behalf of the people of Newfoundland and Labrador. If we had not expropriated, it is likely that Abitibi would still have gone into creditor protection, the outcome would be the same and we would not have the assets we have today on behalf of the residents of our province.”

As part of the expropriation, the Provincial Government obtained valuable timber, water and land resources and ensured that these valuable natural resources were returned to their rightful owners – the people of Newfoundland and Labrador. The Provincial Government also took control of the power plants of Abitibi and this hydro power is now being managed by Nalcor Energy.

“It has been suggested that the expropriation of the Grand Fall-Windsor mill somehow has resulted in increased liability on behalf of government,” said Minister Marshall. “This is simply not the case. Regardless of the ownership, our Environmental Protection Act states that the person responsible at the time the contaminant is released into the environment is responsible for the clean up of the site. The province issued orders for cleanup against all sites, including the mill. However, because the company went into creditor protection, it has shielded itself from enforcement of those orders, as the Supreme Court of Canada ruled today.”

The Provincial Government continues to address the immediate human health and safety issues associated with the Abitibi properties and the process will be completed in 2013 when the final phase of the Buchans remediation project is complete.

“The Department of Environment and Conservation will continue to work closely with the Departments of Natural Resources and Transportation and Works to assess the requirements for remediation on the remaining Abitibi sites,” said the Honourable Tom Hedderson, Minister of Environment and Conservation. “We will continue our ongoing commitment to environmental remediation throughout the province.”

The Provincial Government committed to not waiting for the legal battle to get resolved before taking action to address the concerns directly related to public health and safety, and has spent approximately $12 million to date to address public health and safety concerns from the former Abitibi-owned mine site in Buchans – the two main issues being the potential failure of the tailings dams, as well as lead tailings impacted soil in the residential area.

“It was the position of the Province of Newfoundland and Labrador that Abitibi operated in this province and left behind contaminated sites and that, as the polluter, the company was responsible for cleaning them up,” said Minister Marshall. “We were supported in our arguments by the provinces of Ontario, Alberta, BC and by the environmental group, Friends of the Earth. It is unfortunate that the court did not support our position.”

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Media contacts:

Tansy Mundon
Director of Communications
Department of Justice
709-729-6985, 693-1865
tansymundon@gov.nl.ca
Melony O’Neill
Director of Communications
Department of Environment and Conservation
709-729-2575
moneill@gov.nl.ca

2012 12 07                             5:15 p.m.

 
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