December 6, 1996
The following statement was issued today by Premier Brian Tobin. It was also read in the House of Assembly:
I stand in this House on this day, December 6, to mark the 25th anniversary of a fateful event in our history as a province. On this day, in 1971, one of the most colossal and fantastic engineering feats ever realised, the Churchill Falls hydroelectric development, brought its first generating unit online and began feeding its power into the continent's energy grid.
Over these 25 years, the windfall profit Quebec has reaped from that power has plagued every Newfoundlander and Labradorian. We have come to view Churchill Falls as a symbol of great injustice. And we know that this injustice must be addressed - indeed, this government is steadfastly committed to it. But I stand in this House not to mark an inequitable arrangement and an unfair deal, but to celebrate the success of a project that stands as a monument to the tenacity, ingenuity, and extraordinary ability of the people of this province. On this day, we celebrate an engineering wonder constructed at the hands of 12,000 Newfoundlanders and Labradorians over five years; completed five months ahead of schedule. They came from all over the province to the Labrador bush and, just as the Minister of Municipal and Provincial Affairs did, lived and worked in the camps there until the job was done.
Today, I am reminded of the words of Pierre Elliot Trudeau, who often sought to match the endeavours of Canadians with the scope and grandeur of this great country. Churchill Falls, he said, was a "testimony of man's desire to see the remote, to explore the hidden, to achieve the difficult. The Churchill Falls project represents for every Canadian in every part of Canada one of those proud achievements in our history; it is a strong beat of the country's adventurous heart."
The challenge that faces us on this 25th anniversary is to address the injustice and inequity of the Churchill Falls contract, to ensure that Newfoundlanders and Labradorians receive their fair share of the benefits of this great development; to resoundingly commemorate the efforts of those 12,000 men and women with a new arrangement worthy of their achievement.
The gross inequity of the Churchill Falls power contract is known to every Newfoundlander and Labradorian. Today, Hydro Quebec pays just 2.7 mills, or just over a quarter of one cent for a kilowatt hour of power which it sells for 5-6 cents. When I spoke in Montreal, I said that it's like buying oil at $1.65 a barrel and re-selling it at the world price which is just over $30 dollars a barrel. Over the past 25 years, Hydro Quebec has received benefits averaging about $600 million a year. Newfoundland and Labrador has received benefits that averaged $23 million a year. Recently that has slipped to $16 million a year.
I believe this problem will not go away unless we turn our minds to solving it; unless we muster that same energy and determination that drove those men and women 25 years ago. Re-negotiation of the Churchill Falls agreement, a re-balance of the sharing of benefits in a fundamental way - not a minor way - is what is needed. Re-negotiation of the Churchill Falls agreement can also be the key to unlocking the further riches of the Churchill Falls river. Downstream from Churchill Falls there are two sites - Gull Island and Muskrat Falls. Together, these sites can produce a further 3,100 megawatts of power.
It has been estimated that the development of Gull Island and Muskrat Falls would cost $10 billion, and could create 12,000 person years of work in highly paid engineering and construction jobs. These developments could provide secure and stable power for Labrador and the island part of the province, and they would also yield significant amounts of power which could be sold throughout North America.
That is the choice that we face. We can remain locked in the rigidities of the current Churchill Falls agreement as it brings the project towards financial collapse, or we can seize this opportunity to address the new realities that have come to light in the past 25 years and work out an equitable arrangement for now and for the future.
Newfoundlanders and Labradorians have waited 25 years for the injustice of this contract to be addressed. But as we move forward, we must never lose sight of the significance of this project, and of the accomplishments of those men and women who built it. I ask all members of this House to stand with me in saluting them and to call upon that same fiery determination that marks us as people and drives us to do extraordinary things. On this anniversary, it is the memory of their labours that inspires us to do what we must.