The second day back into public hearings at the Muskrat Falls Inquiry proceeded with a careful, line-by-line, review of the roughly 175-page report from Grant Thornton.
Auditor Paul Shaffer has yet to take questions from lawyers apart from inquiry co-counsel Barry Learmonth. He will, as cross-examination gets underway Wednesday.
The auditor’s report didn’t comment on all the Muskrat Falls construction contracts. But a few, among the largest contract packages, were pulled out and covered in detail.
Presentation of the auditor’s findings ran into challenges given the redactions — blackouts of certain pieces of information deemed commercially sensitive — made before release to the public. In speaking about the construction of the north and south dams, for example, Shaffer was regularly forced to read aloud dollar figures, as being “blank” million or “x” million. While not public, the hidden numbers are available to Justice Richard LeBlanc for review.
In talking about two of the largest contract packages, a consultant for Grant Thornton — R.W. Block Consulting — said Nalcor Energy’s approach to performance securities in the selected contracts was consistent with what has been seen on other projects.
Similarly, asked about the contract with Valard, Shaffer testified it was sole-sourced, but not improperly structured. After a call for interested contractors, Valard was viewed as the only contractor capable of building the entire Labrador-Island Link.
Outside the hearing room, during the midday break, former Nalcor Energy president and CEO Ed Martin spoke to reporters about the auditor’s report. He referenced discussion in it of a separate SNC-Lavalin project risk report from 2013, saying he never did have a copy of that report or even know of its existence. The auditor found no evidence Martin had been given the report. The same was not found of other Nalcor Energy employees.
While identified risks started to prove out in construction early on, the auditor found Nalcor Energy did not try to put a dollar figure on changing project risks through a quantitative risk analysis (QRA) from 2012 to 2016. Westney Consulting had produced such reports for Nalcor Energy in 2008, 2010 and 2012; and did again after the gap period, in 2016 and 2017.
An updated hearing schedule for the inquiry has been posted online.
The public hearings continue in Happy Valley-Goose Bay. A webcast of the proceedings is available at the inquiry website, muskratfallsinquiry.ca.
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