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PDA Review

PDA Review Archive

The PDA review was undertaken over a two year period starting in October 2009, and concluded in early 2011. It was prompted by several changes in the global economic and energy markets and other factors that were not foreseen when the PDA was signed. The review involved several rounds of consultations with NCN Citizens, and resulted in the PDA Supplementary Agreement which provided some additional investment options and clarification of the operational jobs provision of the original PDA. Below is an archive of information used throughout the review.


Community Skills Survey

December 2011 – The Wuskwatim Implementation Office conducted a community skills survey of NCN Citizens as part of implementing Phase 1 of the Operational Employment provisions of the recently concluded PDA Supplementary Agreement.

Shawna Linklater was the community employment coordinator for the project with Curtis Lobster, Donna Moore-Linklater, and Henry Wood working as employment advisors to visit households in Nelson House to conduct the surveys. Jeremiah Spence is conducting surveys in Winnipeg. About 400 surveys have been completed so far.

All NCN Citizens were asked to participate when surveyors come to your door.

“The results are important in helping us determine training programs that we need to put in place to make our Citizens more competitive in the job market.” Implementation Office Manager Norman Linklater said.

A key provision of the PDA Supplementary Agreement is to move forward with the Operational Employment provisions of the 2006 PDA that would increase NCN Citizens’ representation in Manitoba Hydro’s overall workforce. To do that first requires conducting this community skills inventory to determine what skills and aptitudes exist among NCN Citizens, and to identify training requirements for interested NCN Citizens to obtain skills needed for employment.


PDA-review Meet-and-greet Consultations Conclude

NCN held the third and final round of PDA-review meet-and-greet consultation meetings that were held for Members between Jan. 25 and Feb. 1, 2011 in Nelson House, Leaf Rapids, Thompson and Winnipeg. Close to 200 NCN Members attended. NCN’s advisors and Chief and Council provided an overview of the Project Development supplementary agreement recently negotiated between NCN and Manitoba Hydro to address economic and other changes that have occurred since the PDA was signed in 2006. The PDA itself was not reopened as part of the review process. No ratification vote on the supplementary agreement is required, and it will be signed in March 2011.

The supplementary agreement provides five options in addition to what is available in the original 2006 PDA. These include:

  • The option of borrowing six times NCN's cash investment instead of four times as provided by the PDA.
  • The option of receiving compensating income through an annual annuity if the projected rate of return on NCN's investment at final closing is lower than what was projected when the PDA was signed.
  • The option of an approximate 1.5 year extension to the deadline to complete payment of its cash investment for the full 33 percent ownership if it has paid for 27.5 percent of ownership by final closing.
  • The option of using its $5.7 million Taskinigahp Trust capital as part of its cash investment in Wuskwatim.
  • A low-risk preferred-unit option that would allow NCN to invest considerably less (with no loans) to own under 4 percent of the project, that would however also result in considerably less revenue over the long term.

Except for the preferred-unit option, NCN can use a combination of the other four options.

The Supplementary Agreement also includes finalized details of the Operational Employment program that will help make employment opportunities for NCN Members more available in Manitoba Hydro's regular operations across the province.

A PDA Supplementary Agreement Guidebook is being prepared for distribution to Members within the next few weeks.


Final Round of Meet and Greet Consultations

Set for Late January 2011

NCN will hold the third and final round of PDA-review meet-and-greet consultation meetings for all Members in four locations, starting the last week in January. Doors open for registration at 3:30 p.m. at all locations, with presentations staring at 4:00 p.m. outlining recommendations resulting form the PDA review process. Small group discussion meetings and supper will follow.  Meetings are expected to conclude about 8:00 p.m. Click to read poster.

Nelson House Tuesday, January 25

Duncan Wood Memorial Hall

Leaf Rapids Wednesday, January 26

Legion Centre

Thompson Thursday, January 27

Royal Canadian Legion

101 Elizabeth Dr.

Winnipeg Tuesday, February 1

Norwood Hotel

112 Marion St.


Special Small Group Meetings Arranged

for NCN Organizations

The third and final round of PDA review consultation meetings started with special small-group meetings, January 11 - 13 at ATEC in Nelson House for key NCN departments and organizations including: Construction Staff, Meetah Building Staff, NCN Youth, NCN Government Staff, Wellness Centre Staff, Resource Harvesters, Elders and Wuskwatim Staff.  Three meetings per day were held to accommodate all organizations.


Wuskwatim PDA-related Activity for 2011 Outlined

With the Wuskwatim project's first generator set to go on line in late 2011 or early 2012, considerable activity is still required leading up to NCN's final decision on whether to invest.  A complete schedule of PDA-related activity has been prepared through to Final Closing. Click to see complete schedule.


Second Round of Wuskwatim PDA Review Meetings Concluded March 29, 2010

The second round of Wuskwatim Project Development Agreement Review Meet and Greet meetings concluded Monday, March 29 at the Indian and Métis Friendship Centre in Winnipeg following four meetings the previous week in northern Manitoba: Nelson House, South Indian Lake, Leaf Rapids and Thompson. About 250 NCN Members attended the five meetings. 

Chief Jim Moore and Councillor Marcel Moody were the main presenters of Wuskwatim-related information.

Chief Moore provided:

  • A brief construction update
  • A rundown of actions Chief and Council have taken to address employment concerns raised at the first round of PDA review meetings
  • A brief assessment of NCN employment on the project including projections for future employment expectations
  • Highlights of the survey of Wuskwatim workers and families
  • An overview of socio-economic monitoring contract
  • An overview of the Taskinigahp Trust five year planning process.


Councillor Marcel Moody Explained Commercial Terms

and Operational Employment Considerations in PDA Review

Councillor Moody recapped the need for the PDA review including the primary areas of focus for the review – Commercial Terms and Operational employment. He reviewed factors that potentially affect NCN’s decision to invest, including the high value of the Canadian dollar, increased construction costs, the economic downturn that has considerably lowered Hydro’s export power sales.

On the commercial terms topic, Councillor Moody discussed options NCN might consider as an alternative to the common-share option provided in the PDA. One is a preferred-share option similar to that offered to First Nations partners in the Joint Keeyask Development Agreement that offers less risk but also considerably less revenue for NCN if the project does well. Another option allows NCN to borrow six times its equity investment instead of four times as provided in the PDA.

Marcel also reviewed progress with the operational employment topic of the review, which requires as a first step a broad assessment of education levels and skills in the community to determine what training and upgrading is needed to make NCN Members eligible for operational jobs with Manitoba Hydro.

As part of that assessment, Marcel provided highlights of the ATEC assessment that has been completed.

Members Ask Questions

Members who attended had the opportunity to ask questions, which will be answered at the final round of meetings in June.

NCN Citizens will be notified through invitations, newspaper advertisements and radio spots when the final round of meetings will be held, which is expected some time in June.

PDA Round 2 Information

Prior to the PDA Review Meetings, relevant information (available for download below) was distributed to NCN Citizens including:

Wuskwatim Update Newsletter (PDF 1.6MB)

PDA Review Round 1 Questions and Answers

(PDF 816 KB)

 

The Wuskwatim PDA Review – Round 1 Recap

The PDA Review is intended to ensure our agreement continues to offer maximum potential benefits to NCN considering the global economic changes and other factors that have occurred since the document was signed. A series of community meet and greets have been scheduled to inform NCN Citizens of the topics being reviewed.


The Review will Take Into Account…

• The increased cost of the project
• Changes to the economic environment such as fluctuations in the value of the Canadian dollar that could affect financial returns from Wuskwatim power exports
• Newer agreements with other First Nations that provide different arrangements
• Employment performance


NCN MEMBERS ATTEND FIRST ROUND OF PDA REVIEW MEETINGS
The first round of the PDA review meetings concluded Tuesday, October 20, 2009 with a final meeting in Winnipeg at Thunderbird House.

Other meetings were held in Nelson House, Leaf Rapids, South Indian Lake and Thompson the week before. Total NCN Citizen attendance at all meetings was modest at just under 300, with the largest attendance in Winnipeg, but attendees were engaged and interested.


Each meeting started with an overview from Chief Jim Moore,followed by Wuskwatim portfolio holder Marcel Moody providing the main presentation which included an update on the Wuskwatim project and benefits received so far and why the PDA review was necessary and what it would cover. NCN’s professional legal, business, economic and technical advisors were on hand and were available to respond to questions.


Question periods followed the presentations with most questions concerning jobs and employment issues related to Wuskwatim. Attendees also had an opportunity to complete a question and comment form, and the answers to all questions will be posted on the NCN website and provided at the next round of PDA review meetings set for winter 2010.

  • Councillor Moody’s presentation explained the reasons for the PDA review which included the changing circumstance surrounding the project:
  • The fluctuating value of the Canadian dollar vs the U.S. dollar and the volatility of the economy that independently or together can affect the profitability of Wuskwatim’s export power sales once the station starts operating in 2001;
  • The escalating construction cost for Wuskwatim that has doubled to $1.2 billion since negotiations first began;
  • The recent signing of the Joint Keeyask Development Agreement with other northern First Nations, which includes provisions that differ from those in the PDA that need to be reviewed to see if similar provisions could be adapted to benefit NCN’s agreement.

The other focus of the presentation covered the two main areas of the PDA that the review will examine. These include:

  • Commercial Terms which cover the business arrangements of the deal including such things as when NCN will have to provide its investment money, how much money NCN can borrow from Hydro, and different options for being a partner through common shares or preferred shares.
  • Operational jobs that cover broad employment opportunities within Manitoba Hydro, aside from Wuskwatim constructions jobs. Commitments to develop such opportunities are written into the PDA as well as the earlier Agreement in Principal.
    The review is not a reopening of the PDA, but could result in supplementary agreements to cover any changes or additions.

The next two rounds of meetings will be held in the winter and spring of 2010.

 

PDA Review to Ensure NCN Gets Maximum Benefits from Its Wuskwatim Investment

The Wuskwatim Implementation Office is coordinating a review of the Wuskwatim Project Development Agreement (PDA) to ensure its terms continue to meet the needs and expectations of NCN Citizens given changes in the global economy. This review is not intended to reopen the PDA but could possibly result in a supplementary agreement with additional options to the original PDA.

Read More in the PDA Review Newsletter (PDF 516 KB