Newfoundland and Labrador and Quebec aim for a final agreement on Churchill Falls
Posted August 27, 2025 9:51 am.
Last Updated August 27, 2025 9:52 am.
The premiers of Quebec and Newfoundland and Labrador, along with the heads of their respective power companies, met Tuesday in Saint John, as the two provinces work to reach final agreements on a far-reaching energy partnership.
Newfoundland and Labrador Premier John Hogan indicated that officials remain committed to reaching final agreements by April 2026.
The Liberal premier warned that any interruption in negotiations, called for by his province’s Progressive Conservatives, could jeopardize the agreement as a whole.
He said this issue could be a central focus of the provincial election campaign he is expected to launch in the coming weeks.
“Not only is this an important election issue, it’s the election issue. This is what we need to talk about as a province,” Hogan told reporters after meeting with his Quebec counterpart, François Legault.
“Suspending a project of this magnitude, when Quebec wants to act now, effectively means stopping it and losing any ability to develop and benefit from Churchill Falls, not only now, but also for the next generation and the next 50 to 75 years.”
Hydro-Québec and Newfoundland and Labrador Hydro are negotiating a new agreement to end, 16 years earlier than planned, an existing contract that allows the Quebec government-owned utility to purchase most of the electricity from the Churchill Falls generating station in Labrador at rock-bottom prices.
Newfoundland and Labrador Hydro pays the same low prices—0.2 cents per kilowatt-hour—but can only purchase a fraction of the electricity. The agreement, signed in 1969, has long been a source of bitterness toward Quebec. The Atlantic province unsuccessfully challenged the agreement in court.
Under the new draft agreement, Hydro-Québec would pay approximately $33.8 billion for Churchill Falls’ electricity over the next 50 years and would partner with Newfoundland and Labrador Hydro on other energy projects. Newfoundland and Labrador would also receive more electricity from the massive Churchill River generating station.
Jennifer Williams, CEO of Newfoundland and Labrador Hydro, responded sharply Tuesday to critics of the new agreement, who claim that the planned $33.8 billion price tag is a fixed rate that is not tied to market value.
“We would not sign that contract,” she said, applauding every word. “It’s not a fixed value.”
Authorities are currently negotiating formulas that will tie rates to the energy market, as well as to the price Quebec would pay for the same energy from other sources, Williams explained.
“We’re linking this to new supply in Quebec,” she said. “The price will change, and if the market increases, we’re involved in that, but not only that.”
Hogan said the parties also discussed mining opportunities on the Quebec-Labrador border.
According to Progressive Conservative Leader Tony Wakeham, too many people in Newfoundland and Labrador feel they don’t understand the agreement in principle between the utilities, unveiled in December.
He added that if he wins the provincial election scheduled for October, he would have the memorandum of understanding reviewed by an independent third party, such as the province’s Public Utilities Board.
“This shouldn’t just be an election issue. It’s a generational issue,” he said in an interview.
“We’ve had a contract for over 50 years, and now they want to turn around and sign another one for another 50 years.”
Wakeham had called for a pause in negotiations, but he did not reiterate that call on Tuesday. However, when asked about the negotiators’ goal of concluding final agreements by April 2026, he replied that he “will not allow myself to be held hostage to any arbitrary deadline set by the province of Quebec.”
–This report by La Presse Canadienne was translated by CityNews
