Natural Resources
December 14, 2010

Amendments to Abitibi-Consolidated Rights and Assets Act
Removes Obligation for Compensation

Bill 47, An Act to Amend the Abitibi-Consolidated Rights and Assets Act, which removes the compensation obligations of the Provincial Government to pay Abitibi-Consolidated for any rights or assets they once possessed in Newfoundland and Labrador, received Second Reading in the House of Assembly today.

"When the Government of Canada provided $130 million to Abitibi-Consolidated it effectively eliminated the need for our province to pay any compensation to the company," said the Honourable Shawn Skinner, Minister of Natural Resources. "The action we are taking through these amendments will ensure that Abitibi-Consolidated will receive no compensation from the Government of Newfoundland and Labrador. Now that the issue of compensation to that company is settled, we can move quickly to address compensation to the companies which were bystanders to the action we undertook."

The legislation will now recognize that compensation is outstanding to the electricity companies CHI Hydroelectric, a subsidiary of Enel, and Fortis Properties. Both held interests in the Star Lake and Exploits River hydro projects which were expropriated through the Abitibi-Consolidated Rights and Assets Act. The Provincial Government is still in negotiations regarding fair compensation with these companies and is also discussing compensation with a consortium of lenders who were involved in these two hydroelectric projects.

"For 100 years Abitibi-Consolidated had access to land, timber and water rights in our province, along with a highly-skilled and dedicated workforce," said Minister Skinner. "Our government acted quickly to ensure the natural resources of our province were protected before this company abandoned its obligations to the people of Newfoundland and Labrador."

The amendments to the Abitibi-Consolidated Rights and Assets Act clarify that the parties identified in the legislation will be paid compensation as determined by the Government of Newfoundland and Labrador.

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Media contact:

Ken Morrissey
Director of Communications
Department of Natural Resources
709-729-5282, 685-6612

2010 12 14                                                      4:00 p.m.


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