Statement from Ed Martin, CEO, Nalcor Energy

April 20th, 2016

Over the past week, there has been considerable public discussion about Nalcor Energy, the Muskrat Falls project and my tenure as CEO. Today I’m taking the opportunity to address some of those issues.

Before coming to work at Nalcor, I worked in the oil and gas industry in the Nova Scotia offshore and Calgary before finally settling back to Newfoundland when I came back to work on the Hibernia project. For years I followed the success of Statoil in Norway and always hoped that someday our province would have a similar model. So when Nalcor was created, I knew it was the best thing for our province. We, as Newfoundlanders and Labradorians, absolutely needed to take full control of our natural resources! And I was honoured to lead that charge and every day since I have come to work with one goal in mind – to do what is in the best interests of this province. That has never waivered.

Nalcor is dramatically different today than it was ten years ago. We have grown from a single utility – with Newfoundland and Labrador Hydro – to an energy company with six lines business with equity stakes in three oil and gas projects, selling electricity to North American markets, developing one of the largest hydroelectric projects in Canada at Muskrat Falls, running the Churchill Falls plant, and managing the Bull Arm Fabrication site which is today leased to Exxon Mobil for the construction and fabrication of Hebron.

There is no doubt that there has been much public debate about Muskrat Falls. Throughout that debate, some fundamental information has gotten lost which I would like to remind everyone of.

• First, we need the power. Over the past ten years, the demand for power has grown substantially and steadily, and that growth trend continues, especially on the Avalon Peninsula. At the same time, our electricity assets are aging and are beyond their useful life. Holyrood is over 45 years old and is a constant state of maintenance. We could not continue without a new source of power.

• Second, Muskrat Falls is clean power, meaning our province will produce 98% clean, renewable energy and will displace the oil burning Holyrood facility.

• Third, we are buying versus renting. Today, when you pay your electricity bill, a large portion of that money goes towards fuel costs and gets paid to global oil and gas companies outside the province. When Muskrat Falls comes on-stream, we will pay ourselves. We pay back our investment and remaining dividends go back to the province. These dividends can be used to help offset electricity bills, they can be used for other key infrastructure investments – the key is, in just a few short years, the investment in Muskrat Falls combined with oil and gas and other lines of business is projected to return $400-$500 million in dividends each year for decades to come. Over the next 50 years, Muskrat Falls development will provide our province with savings and revenue of $60 billion. Muskrat Falls is lifetime project for many generations.

• Today, Muskrat Falls is a critical economic contributor. At peak during this past year, over 5,300 people were working on the project, 85% were Newfoundlanders and Labradorians. Each week $9 million is injected into the local economy as a result of the project. These project benefits are a key driver in today’s economy.

Let’s not forget about the oil and gas business. Since 2011 Nalcor has been the driving force behind one of the most comprehensive offshore oil and gas geoscience programs globally – essentially we’ve been studying what lies beneath our waters and then we share that information with global oil and gas companies to minimize risk and attract more investment to our offshore. This past fall, we received record bids of $1.2 billion for parcels of land in our offshore. And a recent assessment of our offshore potential has shown that in just 2% of our offshore, we have potential for several more Hibernia sized developments. We are being approached by oil companies around the world who have taken notice of the data that tells them our offshore may well represent one of the most exciting new regions for development in the world today. It is clear there is much more oil and gas to be developed in offshore Newfoundland and Labrador.

None of these accomplishments would be possible without the people of Nalcor. Today, there are over 1,400 people working with Nalcor. When I look around, I see many faces that have been around since the beginning, since the early days of Newfoundland and Labrador Hydro, who are the foundation for everything we do. I also see many more young faces and I couldn’t be more pleased. Some of the best and brightest in our province work for Nalcor, and some of them have come back home from places all over the world in order to work here – to be home… in the province they love so much. They are your friends, your neighbours, maybe even your family… and your support is important to them.

For the past ten years, I’ve had the unwavering support and commitment of ‘my’ family – my wife Mary Lou – my high school sweetheart – my four sons and my dad. Many times this job has come with significant public scrutiny. I recognize that that comes with the territory; however, I have to say, it’s quite difficult on my family. And I find that troubling.

Just a few weeks ago, we celebrated my grandson Alexander’s second birthday. We’re also anxiously awaiting the arrival of our second grandchild. I have to say, having grandchildren is one of the true blessings in life. Like many people, our grandson and soon-to-be granddaughter live away. We travel to see them quite often but each time we return, we simply can’t wait for the next visit. And since becoming a grandparent, I have also thought more and more about the passing of time.

For over 10 years, I have dedicated myself to the work of Nalcor. Each day I have come to work with one focus – to do what is the best interest of the province. I’ve thought about the work that has been done, and when would be the natural time for me to move on to the next stage of my life. Today, I have come to that time and I will be stepping down as President and CEO of Nalcor Energy.

I am extremely proud of the accomplishments that we have achieved as a company. None of them would be possible without the employees and the support of the Board members over the years. I whole heartedly believe in the work Nalcor is doing and the great things it will mean for our future. Nalcor is our province’s heritage fund and we should be proud of it.

Thank you.
Ed Martin