ST. JOHN'S, N.L. — A new, 27-kilometre power line has been proposed, to feed power from Nalcor Energy’s Menihek Hydroelectric Station to a mining site on the Quebec-Labrador border.
The build will be a Nalcor Energy project.
The construction is estimated at $22 million (capital cost), with the federal government committing about $6.8 million, under the green infrastructure stream of the Investing in Canada infrastructure plan. The rest of the cost will recovered through a commercial agreement between Nalcor Energy and the mining company, Tata Steel Minerals Canada.
According to Nalcor Energy, the details of that commercial arrangement are still being finalized.
The project is not a project of Newfoundland and Labrador Hydro. And because Nalcor has said it will not affect Newfoundland and Labrador ratepayers (the costs to build and operate the line not being recovered from all power users, only the mining operation), the project will not go before the province’s Public Utilities Board for review.
The Telegram has asked for clarification on whether or not the province requires any further environmental review for the line at this point. Tata’s Howse Property iron Mine underwent a full assessment through the Canadian Environmental Assessment Agency, with a final report in April 2018. The project as proposed considered two options for power, with one being diesel generators and the other being a connection to the existing transmission system, linking to the Menihek station.
“The proponent stated it is currently in discussions with Nalcor, Natural Resources Canada, Environment and Climate Change Canada, and the Atlantic Canada Opportunities Agency regarding the potential to connect the direct shipping ore (DSO) site (including the Howse property) to the Menihek hydroelectric station, as part of the federal green infrastructure fund. However, at this time, no agreements have been reached,” stated the 2018 federal report, finding the project would not be expected to cause significant adverse environmental effects if it went ahead and mitigation measures were followed.
Tata Steel Mineral Canada’s project on the border is a joint venture involving Tata Steel of India, Ressources Québec and New Millennium Iron Corp. It involves iron ore deposits in Labrador and Quebec. The DSO project is now adding production of high-grade concentrate, involving the operation of a, by description of the Government of Newfoundland and Labrador, $700-million wet processing plant. Construction of that plant began in 2011 but was held due to low commodity prices at the time, according to The Economy 2019, a provincial publication.
Nalcor Energy and not Hydro operate the Menihek power plant, with a capacity of 19 MW (18.7 MW). The Crown corporation took over the plant from the Iron Ore Company of Canada in 2007 and has a 40-year power purchase agreement with Hydro-Québec to supply power to Hydro-Québec customers in the Schefferville area.
Nalcor has a contract with Kawawachikamach Energy Services to operate and maintain the plant and recovers operational costs from Hydro-Québec.
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