07 December 2012

Selling Nalcor #nlpoli

New Democratic party leader Lorraine Michael raised a touchy question in the House of Assembly on Thursday.

It was about selling Nalcor.

Only problem for Lorraine was that she got it buggered up.

Here’s what she said at one point in the exchange:
I point out to the minister: I was not talking about Nalcor. Section 4.11 says very clearly there cannot be a change of control or sale of Nalcor, but it does say there can be a change of control or sale of the subsidiaries.
So, once again: Yes or no – does that mean those four subsidiaries can be sold to one of the other partners or control can go to one of the other partners?
Jerome eventually got ‘round to citing the exactly article Lorraine mentioned. 
There shall be no sale or change of control of any Borrower or subsidiaries, except as among the Parties, and no sale of any material Project assets. There
shall be no sale or change of control of Nalcor.
The English is pretty clear. 

None of the borrowers or their subsidiaries can have a change in their control, including through sale, other than back and forth among the parties.

The borrowers are the four companies created to run different aspects of the project.  That is spelled out in the loan guarantee agreement.

They are themselves subsidiaries of one or both of the partners, Emera and Nalcor.

The parties are the two provincial governments, the federal government, Emera and Nalcor.

Where Lorraine got the idea that somehow any of the parties could sell any of the subsidiaries is a mystery. 

There’s even a specific provision that stops the provincial government here from selling Nalcor.

And that’s important because it was provincial government policy at one point, no matter how many people tried to claim otherwise.

In April 2008, Premier Danny Williams plainly said:
This particular government wants to strengthen Hydro, wants to make it a very valuable corporation: a corporation that will ultimately pay significant dividends back to the people of this Province; a corporation that perhaps some day may have enough value in its assets overall as a result of the Hebron deal and the White Rose deal, possible Hibernia deal, possible deals on gas, possible deals on oil refineries and other exploration projects, where hopefully we might be able to sell it some day and pay off all the debt of this Province, and that would be a good thing. [Emphasis added]
So if eventually selling Nalcor is still secret government policy, someone included a clause in the loan guarantee agreement that stopped it.

Lorraine should be trying to find out who that is so she can thank him.