Thank you, Mr. Speaker. My questions are for the Minister of Industry, Tourism and Investment. My questions today are really wanting an update on where this government is at in terms of supporting the activities of a very exciting mining project that has a great potential and could positively impact the South Slave. Communities like Hay River did realize some benefits from the diamond mines, but we were really geographically kind of on the periphery of that. The Avalon rare earth minerals at Thor Lake is something that potentially has a processing or secondary processing opportunity in the South Slave. I understand that one of the challenges will be power supply. I’d like to ask the Minister of ITI what our government is doing to help our communities south of the lake and the GNWT economy realize maximum benefits from that particular mine.
The honourable Minister responsible for Industry, Tourism and Investment, Mr. Bob McLeod.
Thank you, Mr. Speaker. Our government has had some sessions with Avalon to discuss their project. Certainly, valued added is a priority for our government and also we want to work with them to facilitate that. So our first order of business is to determine what their requirements are.
As you know, the federal government is responsible for mining in the Northwest Territories and as such they collect royalties for all developments. So it makes it a little difficult for us to actually provide financial support. But, nevertheless, we are working very hard to identify areas that we can have value added. We’re working with the new Canadian North CanNor facility that has been set up by the federal government. We will be holding, in conjunction with them, a workshop in March to determine value-added opportunities.
With regard to power, we met with the principals of Avalon in Vancouver at the Cordilleran Roundup and they advised us what their requirements are. They need six megawatts of power for operations and an additional six megawatts for heating. They have advised that they are also looking at properties in Saskatchewan, Manitoba, and they are looking to see what we can offer. Thank you, Mr. Speaker.
I hope that in looking at what we can offer, we do not put too much emphasis on that federal responsibility and the royalties not accruing to the Government of the Northwest Territories, because we have the diamond mines as a very clear example of where this government went to extreme lengths -- and I applaud this, I’m not criticizing this -- with diamond secretariats and training programs through the college and a lot of financial support, loan guarantees for processing diamonds. There was a whole real spectrum of support for the diamond mines and we didn’t get any royalties from that either. So now this is something that has the potential of really benefiting the South Slave region. So I would like to ask the Minister who has jurisdiction over the excess power generated at the Taltson Dam at this time and what is the amount of that. How many megawatts of power is the surplus and who has jurisdiction over that at this time? Thank you.
They amount that Avalon is requesting, or has identified as requiring, is available through the current production at Taltson. But the way it works, the current timelines of the different projects would indicate that that power would go to the diamond mines when and if or when the Taltson Hydro expansion is completed and the transmission lines are done. We don’t have a process for reserving power. So it’s basically on a first-come, first-served basis. If that power is made available on an immediate basis it would be through the regulated side and it would have to go through and obtain PUB approval. Thank you.
I believe that the power purchase agreements that are contemplated for the diamond mines are outside of the regulated process because it is being sold to business, it’s not being distributed to consumers. The purpose of the PUB is really to protect the interests of consumers, usually considered on a broad scale. Why would the power purchase agreement framework or model that is contemplated for the diamond mines not be appropriate in the case of the purchasing power for a processing plant for Avalon Ventures at Pine Point? Thank you.
The legislation that was passed in the 15th Assembly with regard to the NWT Hydro Act specifically excluded the transmission lines to the diamond mines. The reason for doing that was because the power purchase agreements negotiated with the diamond mines would be negotiated and, obviously, the hydro proponents would be seeking the best rate in terms of making profits. With regard to the regulated side, the whole focus is to keep the rates as low as possible. As such, the legislation provides for preferential rates to be negotiated on the regulated side. Thank you.
Final supplementary, Mrs. Groenewegen.
Thank you, Mr. Speaker. Mr. Speaker, I understand that the Taltson is being expanded and I understand the potential demand of the diamond mines, if that happens. But, Mr. Speaker, we make the legislation. Sure, the act was put in place in the 15th Assembly, but why could there not be an exclusion made as well to supply power for this sizeable customer in the South Slave? Why couldn’t the same principles of business and making a profit apply to some kind of a negotiation for power supply for Avalon Ventures?
I think it’s very important that we have an opportunity before us here to keep this secondary processing industry in the Northwest Territories. I think we need to get creative. We made the rules in the first place, we made the laws. That’s what we do. What can we do to accommodate a viable offer to Avalon to try and keep this very important industry, processing aspect of this industry, in the North? Thank you.
Thank you, Mr. Speaker. With the will of the House I’m sure that anything’s possible. I just wanted to point out that on the regulated side, the cost of operating the power facilities has to be recovered. I believe that what Avalon is looking for are rates that are similar to what are being provided in Saskatchewan and Manitoba. In the Northwest Territories the commercial rate is 7.4 cents per kilowatt hour plus a one cent rider. That’s delivery. So that number is higher than what Saskatchewan Power charges Nico, for example. But certainly if we were to make an exception for Avalon, then we would have to change our legislation to find a way so that that doesn’t fall under the regulated power side. And, also, who would pay for the lower costs? I guess those are two main considerations that would have to be done if we’re going to change legislation. Thank you, Mr. Speaker.
The honourable Member for Tu Nedhe, Mr. Beaulieu.
