N.L. hopes Hydro-Qubec will reopen contract

The head of Newfoundland and Labrador's energy corporation, Nalcor, says he isn't discouraged by Quebec's public rejection of a request to reopen the Upper Churchill Falls hydroelectric powercontract.

Nalcor's leader said Wednesdaythe contract was made between the two power companies and he is waiting to hear officially from Hydro-Qubec.

"We made a good strong decision here. Obviously, we stand by it. We need to hear back from Hydro-Qubec and, when we do, we'll determine what the next steps are," said NalcorCEO Ed Martin.

Hesaid Nalcor is giving Hydro-Qubec until Jan. 15 to deliver an official response.

A Quebec law firm told Nalcorthere are grounds to mount a legal challenge of the Upper Churchill Falls contract.

On Tuesday, Quebec Natural Resources Minister Nathalie Normandeau told reporters in Quebec Cityshe saw no grounds to reopen the deal.

The 65-year Upper Churchill contract, signed in 1969, has been the subject of several failed court actions byNewfoundland and Labradorand continues to be at the heart ofa longstanding resentment toward Quebec.

On Monday, Newfoundland and Labrador Premier Danny Williams told the legislature that last year Hydro-Qubec earned about$1.7 billion from the contract, while the Churchill Falls (Labrador) Corp., known as CF(L)Co, received only $63 million.

The deal allows Hydro-Qubec to buy power at inexpensive rates from Newfoundland and Labrador, at a quarter of a cent per kilowatt hour, according to Williams, and then resell it for up to 36 times the price it paid.