Emera had worries about Williams: WikiLeaks

Halifax-based Emera Inc. had been anxious about being used for political purposes by former Newfoundland and Labrador premier Danny Williams over a multi-billion energy deal, a diplomatic cable released Thursday by WikiLeaks shows.

The confidential January 2010 cable, sent by the U.S. consulate in Halifax to colleagues in Washington, Ottawa and elsewhere, concerned an interview with James Spurr, a senior executive with Emera.

Ten months later, Emera would reach a deal with Newfoundland and Labrador and its Crown-owned energy corporation, Nalcor, to launch the Lower Churchill hydroelectric megaproject in Labrador.

But at that time, the leaked cable shows, Emera was deeply concerned about Williams and his motives in finding a route to deliver energy to other markets while bypassing Quebec.

In a section subtitled, "Are we being used here?", the author wrote that Emera was worried about being manipulated by Williams.

"The unknown factor, as Spurr explained, is N-L Premier Danny Williams.Spurr explained that N-L had been the victim of bad resource deals in the past which have left Williams very cautious if not suspicious in his business negotiations," the cable says.

"Given that legacy, Spurr remarked that he and his senior colleagues are equally cautious in dealing with the premier, with knowledge it makes more financial sense for N-L to do a deal with Quebec than with them," the author wrote.

"In fact, Spurr indicated he wouldn't be surprised if William ended up doing just that, and leaving Spurr and colleagues to speculate that Williams might be using them to exert more pressure on Quebec to offer a better deal for N-L."

Emera eventually agreed to a complex deal that will see Nalcor generate 824 megawatts of power at Muskrat Falls on Labrador's Churchill River, far downstream from the existing Upper Churchill plant that has been the source of decades of friction between Newfoundland and Labrador and Quebec.

Under a 65-year deal that will not expire for another three decades, Quebec buys Upper Churchill power at a low price fixed years ago, and sells the energy in the U.S. at remarkable profit.

The memo said that Spurr indicated that the Lower Churchill proposal, as it would later be announced, would be difficult but feasible. "Money issues aside, there would be technological challenges to overcome in this scenario. However, Spurr emphasized that with Emera's experience in dealing with transmission systems, natural gas pipelines and its knowledge of regulatory processes, it would not be an impossible feat," the memo said.

The memo also includes comments on the aborted 2009 plan to sell N.B. Power to Hydro-Qubec, as well as concerns about how low prices for natural gas were affecting the Deep Panuke project, off Nova Scotia.

The memo noted that publicly-traded Emera, which has touted the Lower Churchill project as a way for it to expand its operations in New England and other markets, views projects differently from Crown-owned energy concerns in Atlantic Canada.

"After all, unlike its provincially-owned counterparts in the neighboring provinces, Emera's growth is not confined to its own province," the memo said. "Instead, the company plans to expand to areas that promise the best returns to its shareholders, not what might be best politically."

The memo is one of a series of Canadian-themed dispatches that WikiLeaks released on Thursday, including ones dealing with Canadian military views about the U.S.-led war in Iraq.