Thank you, Mr. Speaker. Mr. Speaker, my questions are for the Minister responsible for the NWT Power Corporation. Mr. Speaker, we're all familiar, of course, with the saga of the missing generators, and so I would like to try to get some additional clarification today.
Mr. Speaker, in March of 2017 we were told that additional costs due to the absence of the generators was $500,000. Seven months later in the fall session of 2017, when asked, and still without any generators, the amount remained the same. I assumed that we still had to pay some rent for back-up generators for those seven months, as well. Now we have received three generators and are awaiting two more. I assume again that we have to pay some kind of costs for back-up generators while waiting for these two remaining generators. Can the Minister explain how the amount of $500,000 has remained the same since being asked a year ago what the overruns would cost? Thank you, Mr. Speaker.
Minister responsible for the NWT Power Corporation.
Thank you, Mr. Speaker. I'd like to give some background as to this matter. The original contract, or the contract that was entered into between Virdi Power and the Power Corporation, was in 2015. That original signed contract for was $3.4 million, and that's United States dollars. It was later increased to $3.6 million when a tie breaker module was added under a change order. Now, of course, we did not receive the generators on time. In fact, they were almost two years late. I did mention earlier in this House that had been a pre-payment, an initial progress payment to the corporation. That in American dollars was $962,500, which approximately is $1.2 million CAD. I mentioned the change order for the additional equipment. That was $176,500USD, which is approximately $238,000CAD.
Upon the delivery of the three units, there was a bill sent by Virdi Power to the Power Corporation of $1,468,000. From that was the deducted $943,000 USD. This money was deducted because of the delays which were caused by Virdi Power. There will be costs going forward. As Members likely know, we have entered into a new contract with a Canadian supplier to receive the last two generators. As to whether we can recover that money from Virdi Power, we are looking into that. It is a complex matter, including, if there is litigation, where litigation would be conducted, in the United States or in Canada. This has been a difficult project, but I believe we're back on track. Thank you, Mr. Speaker.
Thank you to the Minister for the detailed response and some additional background information. I'm still not sure, however, that I was clear on getting an answer with regard to the $500,000 that the Minister a year ago indicated were the overrun costs for not receiving the generators at that time. Seven months later, we still have incurred more costs. I find it difficult to see how the $500,000 amount remained the same.
Of course, the Minister has referred to additional costs that we have incurred since then. What is the total overrun cost that is on the line now that the Power Corporation is trying to recover in some form or another? It just can't be $500,000 anymore, Mr. Speaker. What is the new, revised number? Can the Minister share that with us, or at least share the detailed information with committee, breaking out these costs and how they intend to recover them?
As I mentioned earlier, there was a set-off, so money for the costs that were incurred by the late delivery of the first three generators was recovered. There are going to be ongoing costs. That is acknowledged. Our expectation, however, is that the overall original or the expected budget of $8 million will be exceeded by about $500,000. We are looking into whether we can recover additional funds from Virdi Power, but as I mentioned earlier, that is a complex issue. If there is litigation, we would have to look at the cost and time that that might take, and in fact which jurisdiction it would be held in.
I would appreciate it, though, if the Minister then could also make a commitment to share with us the break-down of the costs to date, and be able to show us their intention of how they intend to recover them. I appreciate that there may be a challenge to litigate this matter, so can the Minister maybe provide, so that we're clear, you know, is the government still intending to hold Virdi Power's feet to the fire, and if in fact, try to recover any additional costs due to these delays? Or is the Power Corporation ultimately going to be on the hook for these costs now?
Certainly, I would be prepared to meet with committee to discuss this. I know that the numbers involved are complex, partially because some of the contract was initially in United States dollars, so it was necessary to get some information as to what that approximated in Canadian dollars. Certainly, I would be willing to meet with committee. As I say, we are looking at the possibilities of taking legal action, but we have to look also at the time and complexity of such legal action and also which jurisdiction such legal action would be commenced in. Certainly, I would like to meet with committee. I realize I have thrown out a lot of numbers today. I have had the Power Corporation provide me with up-to-date numbers, which I certainly would be prepared to share with committee. Thank you.
Masi. Oral questions. Member for Yellowknife North.
Thank you, Mr. Speaker, and thank you to the Minister for that commitment. So, let's just say, then, if at the end of the day we are going to take the responsibility for this debt and that there will be no recovery from the contractor, can the Minister advise what the Power Corporation's plan is in order to cover off these costs if in fact we end up having to be the ones to cover it? Can the Minister offer assurance that NWT ratepayers are not going to be facing yet another increase as a result of having to cover this loss? Thank you, Mr. Speaker.
I wish I could give the assistance or the assurance requested by the Member opposite. As I say, we are expecting to be over the expected budget on this project, which frankly is not unusual in contractual situation, but ultimately I suppose it would be up to the Public Utilities Board to determine whether these additional costs would be passed on to ratepayers. Thank you.
Masi. Member for Kam Lake.
