Chapter 18

Construction and protest at Muskrat Falls

In November 2016, the initial flooding of the reservoir at Muskrat Falls took place. It was delayed by protests, a hunger strike and sit-ins within the site perimeter. Despite the Newfoundland Labrador government’s assertion that ‘extensive pre-feasibility work, such as progression of the environmental assessment process’1 had been undertaken, serious problems have emerged in the capture of such a vast area of water.

The North Spur

The North Spur is the site of the Muskrat Falls reservoir. The North Spur had potential as a natural dam and has been strengthened by substantial engineering works. Nevertheless, experts have declared it unsafe because the spur contains quick clay, a substance which is likely to collapse when the reservoir is flooded to a depth of five metres. Jim Gordon, a hydropower consultant who worked on dams in Newfoundland Labrador up until 2005, wrote as follows for the newspaper The Telegram:

The North Spur is a natural hill 1,000 metres long connecting Spirit Mountain [a significant spiritual site for the Innu] to the north shore at Muskrat Falls, which includes three layers of sand and two of marine clay, all resting on a foundation of marine clay. When the Muskrat reservoir is filled, this hill will form part of the dam containing the reservoir.

Marine clay is a type of clay found in coastal regions around the world. In the northern, deglaciated regions, it can sometimes be quick clay, which is notorious in being involved in landslides. Construction in marine clays thus presents a geotechnical engineering challenge.

Marine clay is present around the southern half of James Bay. This persuaded Hydro-Québec to by-pass development on the Nottaway River, moving instead 300 kilometres north to the La Grande, at considerable added expense for access and transmission.

In his article, Gordon refers to research carried out by Dr Stig Bernander, an expert in quick clay landslides. Bernander examined the North Spur and concluded that, if the dam were flooded to a depth of five metres, the safety of the dam would be severely reduced. On the basis of Bernander’s examination, Gordon observes that:

If the North Shore dam fails, there is the likelihood of loss of life in Goose Bay and Happy Valley and the river will divert to flow through the breach in the Spur.

If the North Spur fails, Muskrat Falls will disappear and be left high and dry. The Muskrat Hydro facility would become a stranded asset, with (if feasible) a repair cost well over several billion dollars. Power would be interrupted for at least several years.2

Nevertheless, the Muskrat Falls flooding is scheduled to proceed to a depth of six metres on the grounds that, if it does not, the dam will be damaged by the winter ice.

Methyl mercury

Indigenous peoples and the settler community of Newfoundland and Labrador and beyond staged their most significant protest over concerns about increased levels of methyl mercury in the captured waters at Muskrat Falls. This came in the wake of a report from Professor Elsie Sunderland of Harvard University to the effect that mercury levels would double in the bodies of people living downstream from the plant. As with the James Bay project, she explained that when the soil underwater is cut off from oxygen, bacteria that convert mercury into methyl mercury flourish and this compound is concentrated in the bodies of fish and anything eating fish, including human beings, rather than being excreted.3 Her report concluded that the dam waters would contain methyl mercury levels ‘to the point that they exceed regulatory thresholds for exposure’ and, although the majority of build-up would occur three years after the flooding of the reservoir, the effects would last for decades. This echoes the findings of the Lake Melville scientific report, which predicted that there would be a sharp increase in methyl mercury levels immediately after flooding and that levels could spike by 380 per cent. Methyl mercury is toxic to the human central nervous system.4 Lake Melville is the large body of water from which the Innu and Inuit take the fish which provide a significant part of their diet.

The protesters (who could also be described as land protectors), a group made up of Innu, Inuit, Metis and settler Canadians, demanded that no flooding should take place until the dam was cleared, not only of vegetation but also of topsoil. This was a step which Nalcor was not prepared to take, even though the Newfoundland and Labrador Environment Minister acknowledged that this was the root of the problem.5

While Nalcor downplayed Professor Sunderland’s findings and ended the study,6 the provincial government responded by announcing that she would carry out another survey for them, a claim which was speedily refuted by Harvard University on her behalf.7 However the province did order Nalcor to ‘clear as much forest cover as possible’ but this did not extend to clearing topsoil. In the meantime, Nalcor was bringing in workers by helicopter in order to circumvent the blockade.8

The protest was led, not by Innu who lived close by, but by the Nunatsiavut government. The Innu Nation’s hands were tied because there was a clause in the Impacts and Benefits Agreement they signed with Nalcor providing that they would support Nalcor in the event of any protest against its activities.9 Nevertheless, many Innu as individuals took part in the protest. Nine people were arrested from a blockade on the Trans-Labrador Highway outside the gates to Muskrat Falls and court injunctions were granted against the protesters, who nevertheless refused to give up until the charges were dropped and the vegetation was cut.10 On 22 October, tactical units of the Royal Canadian Mounted Police were called in to evict the protesters, who were involved in only a peaceful protest and were instructed not to fight back. Later that evening the Newfoundland Labrador Premier, Dwight Ball, agreed to meet the leaders of the protest, and to postpone the flooding until he had spoken to the land protectors.11

At the meeting, Premier Ball announced the formation of an advisory committee made up of provincial, municipal, federal and indigenous leaders to monitor the project. The Nunatsiavut representatives claimed this as a victory and urged the land protectors to go home. Ball assured them that, ‘Going forward, decisions will be made using science-based research,’ and promised to order further clearing of the dam site.12 The protesters were released without charge provided they agreed to stay clear of the Muskrat Falls site, and Nalcor began to raise the water levels.13 Work at the site returned to normal.

One protester summed up the frustration of the land protectors at Muskrat Falls:

I wonder what we will eat? A way of life gone.

It just really hurts the heart that it has got to this point. I so hoped it would have been stopped by now, but if feels like we are not getting anywhere. But I still think that, with the cost of this project, and all the destruction, hopefully someone higher up than me will see the destruction and what’s happening and they will just shut down the project.  

Another said:

We’ve had relocation and compensation. We’ve had residential schools and compensation. And now we’re looking at methyl mercury and then compensation. Money doesn’t pay for any of it. In the midst of all of it, we have lives that are devastated. We have social issues, and we’re just contributing more to them. I think it’s time that we just need to put our foot down and say enough is enough and stand up to some of the colonisation.14

Under the Impacts and Benefits Agreements (IBAs) accompanying the New Dawn Agreement in Principle (AIP), further compensation for methyl mercury poisoning is specifically excluded. Such compensation is covered in the sums paid on signing of the IBAs. Some commentators have linked the failure to address the concerns of the land protectors to the sincerity of Canada’s promise of reconciliation and its lack of commitment to the adoption of the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP). Hans Rollmann observed:

The manner in which Nalcor and the provincial government have responded to the Muskrat Falls crisis is simply not how things are done in 2016. They reflect the archaic and outdated approaches of previous decades and the backward-looking inability of those in office to adapt to the present.

The old heavy-handed approach simply doesn’t work in an age of social media and international acknowledgement of Canada’s need to change its relationship with indigenous peoples. But it’s not surprising that the people in charge are stuck in the ways of the past.

Times have changed. But has the RCMP? Has the Government of Newfoundland and Labrador? The current events in Labrador are a true test of whether the country and its institutions have indeed changed.

…

In 2016, the year that Truth and Reconciliation is supposed to be an active principle in Canada’s relations with Indigenous peoples, the Newfoundland and Labrador government is playing the centuries-old role of racist cowboy villain. It’s an embarrassment to the province, and an embarrassment to the country.15

Playing into this stereotype, Nalcor’s response to the impending ecological disaster is to promise to put up notices advising people not to eat the fish and to propose a scheme of compensation. By contrast, Pamela Palmater, a Micmac lawyer and indigenous rights activist, describes the comparable Lower Churchill Falls project in far stronger language: as ‘a modern-day form of genocide’. She continues:

Look at every single court case that’s dealt with Aboriginal treaty rights. [They take] anywhere between 20 and 25 years to get to Supreme Court of Canada. What do you think is going to happen during those intervening 25 years? The dam will be built, the poison will be done, people will be sick, and then we’re talking about compensation. It’s in part political strategy. Governments are able to delay dealing with any of these issues simply by making it go to court. Even getting a criminal charge could find its way all the way to the Supreme Court of Canada. But 25 years later? The trees are gone, the minerals are gone, the water is poisoned and the people are sick.16

Palmater also describes industrial projects such as Muskrat Falls as ‘environmental racism’.

Financial concerns

In order to pay for the project, it is estimated that Newfoundland and Labrador and Nova Scotia will not see the benefits of cheap electricity until 2067 because, in the meantime, the electricity produced will have to be sold in the United States to pay off the seriously mounting debts which are being incurred.17 Further, decisions on the need for power are politicised by the need to provide jobs in the maritime provinces. In the short term, there are ample jobs in the construction of the Muskrat Falls dam and the transmission lines of the 1,500-kilometre Maritime Link taking the electricity to the United States.

The initial budget for the Muskrat Falls project was C$6.2 billion. The viability of the project rested on high oil prices when oil was commanding US$100 per barrel. Elsewhere it is claimed that the projected oil price on which the project was recommended was US$150 per barrel.18 By April 2016, the oil price had fallen dramatically while the cost of the project had risen to C$11.4 billion (including interest)19 – and now requires a loan guarantee from the federal government of C$5 billion. By 2020, when the Muskrat Falls Report was published, this had risen to C$13.1 billion.20 It is hardly surprising that, in a province of just half a million people, questions are beginning to be raised. At the same time, an audit by Ernst & Young exposed ‘a tangled web of inadequate governance and out-of-control management ineffectiveness’.21 Yet the provincial government and Nalcor appear to be safe in the knowledge that the project is too big to cancel although, at the same time, public trust in the provincial government is failing. Settler Canadians are joining the protests and, on two private visits to St. John’s and Corner Brook in 2015 and 2016, the author noticed a marked change in the attitude of the settler communities there. In 2015, the locals were keen to impress on all who would listen the importance of the jobs the scheme would provide. In 2016, there was complete silence on the matter.

The incoming CEO of Nalcor, Stan Marshall, told CBC News on 24 June 2016: ‘The original capital cost analysis, estimates and schedule was very aggressive and overly optimistic and just didn’t account for many of the risks that were known, or should’ve been known, at the time. And the analysis, finally, relied on high energy prices which were projected to continue with the rise.’

He pointed to the lack of experience of Nalcor and its contractors of working in the cold, northern climate, but he too said that stopping the project was not a practical option.

Writing on the Uncle Gnarley blog – one of the outlets for Newfoundlanders’ frustrations with the project – commentator David Vardy discussed the Ernst & Young report which claimed that Nalcor’s costs had been significantly underestimated and that the schedule for completion could not be met. At this point, Vardy suggests, the government could have suspended the project and called for a full cost/benefit analysis. He said that the public had never been given the evidence base for continuing with the project. Vardy also claimed that Nalcor was awarding contracts outside the provisions of the Public Tender Act and without independent regulatory oversight to protect the interests of ratepayers.22 Furthermore, he claimed that the entire Muskrat Falls project had been removed from the scrutiny of the Public Utilities Board.23 On 9 February 2017, a guest contributor to the blog again proposed that, following warnings from the Joint Provincial/Federal Review Panel and the Public Utilities Board, there should be a full Royal Commission of Inquiry into why the project was sanctioned in the first place, the causes of its escalating costs and, perhaps most importantly, whether the initial cost estimates were falsified.

Local Labradorian activist Cabot Martin24 points to another failure in the assessment of the viability of the overall Lower Churchill Falls project. Why, he asks, did Newfoundland and Labrador not consider the availability of wind power (a question also raised by the Innu negotiator in Matimekush), or a combination of wind power and the natural gas available under the Newfoundland Grand Banks? He also mentions shale gas technology – which in the years since the project was first mooted has made the Lower Churchill project redundant. While the gas alternatives add to Canada’s greenhouse gases total, wind power is cleaner than hydro and does not present the problems posed by methyl mercury or the quick clay in the North Spur. Martin’s claim is that these alternatives were never properly studied. He reports on a meeting at which Nalcor Vice President Gil Bennett claimed: ‘The capital cost on Muskrat Falls first is driven by favourable construction characteristics at the site. So, we look at the physical characteristics of Muskrat Falls, the geotechnical conditions are favourable. We are on competent bedrock.’25

Martin claims that Nalcor failed to carry out ‘even the most basic geotechnical investigations prior to Project Sanction’.26 He has asked the minister to make available the Dam Safety Review and Emergency Preparedness Plan on which Project Sanction was based, but to no avail.27

Research by the UK’s University of Oxford in 2014, which investigated 245 large dam projects, concluded that they are a risky investment, leading to soaring budgets which drown emerging economies in debt, fail to deliver the promised benefits and are not economically viable. Further, the leader of the study, Professor Bent Flyvbjerg, said that dams ‘are not carbon-neutral, and they’re not greenhouse-neutral’ – because the vast quantities of concrete required in their construction leave an enormous carbon footprint, and flooded vegetation under the reservoirs produces methane, a greenhouse gas 20 times more potent than carbon dioxide.28

While the people of Newfoundland and Labrador are by now all too aware of the threats posed by the continuation of the Muskrat Falls project, Nalcor and the provincial government press on regardless. It is to be hoped that they never have to quantify the costs of proceeding until the project results in financial ruin and human catastrophe against the stated will of the people to end the project immediately.

Very late in the day, after irreparable damage has been done to the environment, a Public Inquiry began in Goose Bay with Judge Richard LeBlanc sitting as its Commissioner.29 The inquiry considered how the project came to be sanctioned, its increasing costs and whether the provincial government was justified in excluding the project from scrutiny by the Public Utilities Board. The questions of methyl mercury poisoning and the stability of the North Spur were beyond the scope of the inquiry, as were questions of democratic deficit and process. The Innu Nation, Nunatsiavut government and the Conseil des Innus d’Ekuanshit were all given limited standing to attest to levels of consultation and the physical construction of the project.30 Professor Flyvbjerg was one of those called to give evidence. The Inquiry examined 2.5 million documents and the Final Report was published on 5 March 202031 in six volumes and 1,000 pages.

The Commissioner found that the project was backed by a Conservative government who were determined to proceed through a lens of political bias and unrealistic optimism. He concluded that top bureaucrats failed to provide oversight of Nalcor’s activities, exposing the citizens of Newfoundland Labrador to billions of dollars’ worth of debt, and that Nalcor’s CEO and his deputy took ‘unprecedented steps to secure sanction of the project’. Commissioner LeBlanc held the removal of the NL Public Utilities Board ‘unjustified and unreasonable’. The Report was handed to the police because of the possibility of criminal charges. NL Premier Dwight Ball said that the project ‘became a runaway train that could not be stopped’.32