Fentie denies Yukon Energy-ATCO merger claims

Yukon Premier Dennis Fentie broke his silence Tuesday about secret discussions his government had with ATCO about the future of Yukon Energy Corp., but he still refused to answer reporters' questions.

After weeks of ignoring the media's calls for comment on the ATCO talks, Fentie held a news conference in Whitehorse to refute what he said are claims by the opposition Liberals that he was in talks to merge the public utility with ATCO, the Alberta-based corporation that owns the Yukon Electrical distribution company.

Fentie told reporters the Liberals' statements "are misleading and, indeed, false."

The Yukon government met with ATCO officials to discuss a possible merger between Yukon Energy and ATCO, forming a new entity to be known as OPCO, according to a draft joint position paper leaked to local media in June.

The seven-page position paper was leaked by Willard Phelps, who resigned as Yukon Energy's board chair earlier that month, citing government interference in the board's operations.

The confidential draft document called for ATCO and the territorial government to share 50/50 ownership of OPCO.

Preliminary discussions

On Tuesday, Fentie said ATCO approached him in October with a merger proposal. The company's unsolicited offer was probably very similar to one ATCO presented to the Northwest Territories government earlier this year, he added.

The secret talks were not negotiations, Fentie said, but simply preliminary discussions to analyze options for the government's consideration.

Fentie said his cabinet, and all Yukoners, would have been briefed if those talks had been more positive. The joint position paper was never finalized, he added.

To this day, Fentie said neither ATCO nor his cabinet has been briefed on the discussions.

"We expect to be briefed shortly and will determine next steps from that," he said.

"But I think it's fair to say you, the media, have somehow been given information that the two principals don't even have as yet."

Fentie then turned the news conference over to senior officials and refused to take questions from reporters. He has since declined requests by CBC News for an interview.

Sworn to secrecy, official said

Shirley Abercrombie, who was the government's representative at the ATCO talks, saiddiscussions were halted in June with no agreement reached.

Abercrombie, the Yukon's assistant deputy minister of energy, mines and resources, said government officials that were involved in the discussions were sworn to secrecy.

The draft position paper was reached following six meetings with ATCO in Calgary, starting in October 2008 ending in June, Abercrombie said. The talks were terminated when the document was made public in June, she confirmed.

"This is the fourth or fifth time this has been tried and it's never gone anywhere. So I think before we went out to the public on this, we wanted to see if we had anything," she told reporters.

"We have no document between us right now whatsoever. That was going to be our first document. We have no document."

Abercrombie added that Yukon Energy assets were never offeredup for sale during the ATCO talks.

"While an element of ATCO's proposal involved the sale of YEC assets, the government was clear at the outset that it was not agreeable to this idea, and we said no," she said.

'Yukoners can be the judge': Liberal leader

Liberal Opposition Leader Arthur Mitchell rejected the government's explanation for its talks with ATCO, saying Phelps and three other Yukon Energy directors quit the board in early June for good reason.

"Mr. Fentie is trying to say that reality is not as people see it to be but what he would like it to be," Mitchell told CBC News on Wednesday.

"Yukoners can be the judge of whether to believe Willard Phelps, Paul Hunter, Martin Allen, Greg Hakonson all long-time Yukoners that have contributed in many ways to our society or Dennis Fentie. There's two different versions; only one of them can be factual, and I think I know which side I'm on and which side I believe Yukoners are on."

NDP leader Todd Hardy said he's pleased to hear the government and ATCO have suspended their discussions.

Both Yukon Energy and ATCO's Yukon Electrical are preparing to appear before the territory's public utilities board. The board wants details from both companies about electricity costs.