MUSKRAT FALLS: REPORTERS HAVE TO DO BETTER

The announcement by
Ed Martin, interjected on day two of a “Show N’ Tell” on the Muskrat Falls construction
site, is another in a long series of re-runs in which public information is
treated as a game, and reporters as dolts.

The $600 million
overrun didn’t even warrant the Premier’s presence, confirming who is in charge.
The best Davis could muster, later, is a comment that he still “believes” in
the project; as if dumb “belief” cancels the worst effects of a “sinkhole”.

The Nalcor CEO Ed
Martin is a seriously failed senior bureaucrat; yet, he has unfettered
authority to deal with the public, and to persist with ‘spin’ as the basis of cost
overruns.

The surprising part
is that he hasn’t been fired; but, that is only because democracy will suffer
even lesser men who can’t show him the door.


It is one thing to
listening to Ed Martin ‘snow’ reporters; but nausea inducing, too, is listening
to reporters’ questions of Martin. It is a profession that rarely leaves high
school. Other than the occasional bit of sanity (the Telegram’s James McLeod’s piece
and the editorial on October 1, 2015 were stellar) most reporters are so ill-equipped
to conduct an intelligent interview with Martin on Muskrat, the public gets to
hear only nonsense. 

This Piece should
be about Nalcor, but there is a risk lame media might actually be
encouraging Ed Martin to stick around.

Reporters can argue
they do not have time to prepare, that the announcement was sprung on them in
the way Telegram reporter, McLeod detailed in the Wednesday, October 1st
edition of the Paper. But, truth be known, while McLeod went public with Nalcor’s
media control tactics, every media outlet concerned about the integrity of news,
ought to have done likewise.

They may not be
able to do anything about it, but they can bring the problem to the public’s
attention. Indeed, the very fact Nalcor treats them as dolts is the best proof of
Martin’s  derision for them, and his abhorrence
of the idea of transparency.

Whether anyone
cares is uncertain, but reporters’ lack of knowledge of this complex project is
really what inspires Nalcor’s trickery.  Even Nalcor’s costs estimates are quoted with biblical adherence, when reporters must know the lower figure, the one without interest during construction (IDC) is the one the Company wants announced. No one cares that interest during construction, on a financial level, is as important as the cement that glues the project together. And Martin didn’t add the IDC to the cost overrun either. 

Nalcor is
acutely aware reporters are unprepared; Martin counts on it. His PR people plan
around it. It is disrespectful. It is denigrating. The media suffers, as an
important institution.

Not just the
institution, the public loses, too.

It is not an easy
gig to follow Muskrat. It takes time, dedication, and a serious commitment to
the practice of journalism.

But reporters are
content to report ‘in the moment’.  They
fail to square Ed Martin’s glib justifications for the overruns with assurances
elicited from him, at an earlier time. 


The
Telegram reported June 27, 2014, when Ed Martin announced an $800 million increase in project costs: “At this point, Martin said 90
per cent of the project contracts have been awarded, and 98 per cent of the
engineering on the project has been done.”

Now, changes in engineering design are blamed
for a significant part of the higher figure.
Martin said then, too, the contracts signed are unit-cost
contracts or fixed rate agreements, so they won’t suffer overruns.
While the Telegram editorial on October 1, 2015 noted Martin’s comment, it bears
repeating.  He said: “I believe that we
have narrowed down the risk of additional cost increases very, very, very
significantly”.
These assurances suited Martin then, and helped him through a
rough patch. But his new rationale is all the proof needed to confirm he will
say anything to the uninformed.  He knows
few reporters will remember, or even bother with the research.
This was an occasion to inquire as Martin’s own competence. He chose
the project team poorly. He is the one that set in motion a trail of bad
decisions and outcomes that are now practically unstoppable; the Premier
unwilling to act.
Ed Martin chose Astaldi. He flew to Italy to beg the Company to
bid.
Still, Martin is never challenged on his own suitability as CEO.
It wasn’t just the engineering or the two dam contracts, awarded
recently, which exceed budgeted estimates. Overruns are occurring even on the
transmission line contract, the single area where Nalcor can claim expertise.
No one even questioned the assertion that the project is 50%
complete or sought a “real” independent assessment of the project’s
completeness.
Ed Martin’s word will do. Reporters will swallow it, even if he
treats them like shit, especially if it fills the need for a sound bite.
 
What better time to talk to Martin about resignation than when
his project is a mess? Or, does someone think $600 million is not a catastrophe?  Does even one reporter think he won’t be back
to the ‘well’ for a few billion more?
And, oh yes, the CBC interview with Danny Williams. Cochrane: the
word ‘supine’ to mind. Williams tells Cochrane the $600 million is just “mouse
droppings”.

Danny tells him Nalcor has the best management team in the world.
Cochrane
still can’t figure out that Muskrat emanated from Williams’ ego; he put his own
loyalists in charge. Failed as they are, he must defend them.
Williams raises Muskrat analysis to the quality of a fart. 
Yet, he has access to the public broadcaster when other
citizens, with something to say, like David Vardy or Cabot Martin don’t even get
asked even when the accuracy of long held positions are borne out each
time Ed Martin looks for another cheque.
Reporters are not responsible for the fiasco unfolding at
Muskrat. But, they sure as heck don’t offer the public much help in figuring
out just how bad things are, and holding the political leadership to account.

They need to do better.
Des Sullivan
Des Sullivan
St. John's, Newfoundland and Labrador, Canada Uncle Gnarley is hosted by Des Sullivan, of St. John's. He is a businessman engaged over three decades in real estate management and development companies and in retail. He is currently a Director of Dorset Investments Limited and Donovan Holdings Limited. During his early career he served as Executive Assistant to Premier's Frank D. Moores (1975-1979) and Brian Peckford (1979-1985). He also served as a Part-Time Board Member on the Canada-Newfoundland Labrador Offshore Petroleum Board (C-NLOPB). Uncle Gnarley appears on the masthead representing serious and unambiguous positions on NL politics and public policy. Uncle Gnarley is a fiscal conservative possessing distinctly liberal values and a non-partisan persusasion. Those values and opinions underlie this writer's views on NL's politics, economy and society. Uncle Gnarley publishes Monday mornings and more often when events warrant.

REMEMBERING BILL MARSHALL

Bill left public life shortly after the signing of the Atlantic Accord and became a member of the Court of Appeal until his retirement in 2003. During his time on the court he was involved in a number of successful appeals which overturned wrongful convictions, for which he was recognized by Innocence Canada. Bill had a special place in his heart for the underdog.

Churchill Falls Explainer (Coles Notes version)

If CFLCo is required to maximize its profit, then CFLCo should sell its electricity to the highest bidder(s) on the most advantageous terms available.

END OF THE UPPER CHURCHILL POWER CONTRACT: IMPROVING OUR BARGAINING POWER

This is the most important set of negotiations we have engaged in since the Atlantic Accord and Hibernia. Despite being a small jurisdiction we proved to be smart and nimble enough to negotiate good deals on both. They have stood the test of time and have resulted in billions of dollars in royalties and created an industry which represents over a quarter of our economy. Will we prove to be smart and nimble enough to do the same with the Upper Churchill?

13 COMMENTS

  1. Des… I actually think this is perhaps too hard an attack on the media. It is a complex project, with complex issues. Nalcor manage the message very well to the point of deception. Martin is very good with his words, and putting a positive spin. But in the reality Nalcor are not transparent. They know about these over-runs months ago when they said there was no material changes. This is not the fault of the media… this is the fault of Nalcor. Right now this project is off the rails from a cost, schedule and safety performance. It needs an independent review.

    There is a fault in our system when we must depend soley on the media to voice reasoned critique.

  2. Des is right to criticize the media. Figuring out the fatal flaws with Muskrat Madness — whether the unstable geology, or Nalcor's storage rights contract gap, or the uneconomic character of the whole plan — that was the hard part. But that work was done and published well by others. All the media types, or anyone else, needs to do is to fiddle with Google for a couple of minutes to recover that history. Vardy, Penney, Hollett, JM, Cabot Martin, and others have spelled out the fatal flaws in detail, long in advance. There is no excuse for surprise that Muskrat Madness is being revealed as a nightmare. It was explained long ago.

  3. It is amazing how quick people dismiss Cabot's concerns on the North Spur when he has been shown to be right on the issue of shale gas, cost over-runs, and the other issues. Nalcor, aided by the provincial government, undertook character assassination of the nay-sayers. It will be Ed Martin's reputation that will be in ruin when this project is finally completed.

  4. Its not just the local media that act like this. The "media party" is alive and well right across the country from CTV, Global to our tax funded crown Corp., CBC. It's the main reason why I've given up on traditional media as my source of communication for all things "news".

  5. The cement has been pored, what is there is good for 100 years, now is the time to put the project on pause. There is no longer a finish date, and Ed Martin when asked what would they do to meet the commitment to Emera said they could bring recall power from the Upper Churchill. Why can't the Government in power mushroom the project, at least until the water management case is settled.

    • Use the recall power from UC for Emera's share? This makes it sound as if UC recall power wasn't even considered without being bundled with the MF project. 1700 GWh was quoted last week available from UC recall and now closed industry in Labrador, that is over half of Holyrood Thermal's annual generation. HQ has never been approached for a PPA by Nalcor and natural gas was sidestepped – for the most studied project ever its due diligence in near non-existent.
      Among the most fanatical pro-MF their argument is that HQ would either not want to sign a PPA or would charge an arm and a leg. No one is suggesting HQ would sign a PPA for 3-5 c kWh to NL but considering the cost of service for MF is 30c kWh there exists a large gap for negotiations.

  6. The Telegram tried hard particularly Wangersky, Jones and McLeod. Note today's column by Brian Jones. The CBC was poor and the others non-existent. However, the most negligent has been the business community followed by the opposition parties. The Board of Trade endorsed with hardly a look as did the Consumer Advocate and has since been shagging with stuff like the salaries and other issues that are not even a rounding error on Muskrat to make it look like he is not just an appointed shill.
    None of the large business people publicly brought out their concerns. This thing had a Joey/Danny ring to it that brought a lot of fear to those who knew better and unwarranted comfort to the masses. Wait until they get their power bills in 2018
    Des mentions it is complicated but for the most part it simply a mortgage which has so far gone over 80% in capital which means about a 70% extra charge to the captive customer. The other uncomplicated issue being the water rights meaning that Quebec may have ultimate control on when Muskrat operates depending on the outcome of the court case.