Nalcor says no talks with Astaldi; contractor wants more cash for Muskrat Falls work - Action News
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Nalcor says no talks with Astaldi; contractor wants more cash for Muskrat Falls work

The CEO of Nalcor Energy is refuting claims by the main contractor of the hydro megaproject that discussions are underway.

Italian company says 'cost growth' was due to other contractors on the Labrador hydro project

Astaldi has the contract to construct the Muskrat Falls generation facility on the Churchill River in Labrador. This includes the spillway, which is pictured in a spring 2018 file photo. (Eddy Kennedy/CBC)

NalcorEnergy is denying claims by the main contractor at the Muskrat Falls site that discussions are underway over extra costs incurred there, as Astaldihas confirmed it wants more money from the provincially-owned Crown corporation.

"In response to recent media statements made by Astaldi on Oct. 4, 2018, regarding its work at Muskrat Falls, Nalcor advises that no discussions are being held with Astaldi in relation to extra cost incurred by Astaldi at Muskrat Falls," NalcorCEO Stan Marshall said in an emailed statement.

Marshall said Nalcor is making payments to Astaldi"in accordance with its contracts."

He added: "Amounts owing by Astaldi to its subcontractors and suppliers are Astaldi's responsibility."

No discussions are being held withAstaldiin relation to extra cost incurred byAstaldiat Muskrat Falls.- NalcorEnergy CEO Stan Marshall

Marshall's comments come in the wake of statements Astaldi made to CBC News on Thursday.

Astaldi media contact Giuliana Paoletti said in an email that the company is "in talks with our client to reach an agreement on extra cost recently incurred during the performance of our works."

Astaldiwants more cash from Nalcor

Asked to respond to Marshall's comments, Astaldiconfirmed that it wants more cash, and has made submissions saying that to the Muskrat Falls Corporation (MFC), the Nalcor subsidiary overseeing the project.

"Much time related cost growth was due to MFC's other contractors, for whom MFC alone is responsible,"Alfredo Melesaid in a statement on behalf of the Italian company.

"Astaldi's entitlements were acknowledged in meetings with MFC but have not led to any conclusive discussions as of yet."

Astaldisays it has started an arbitration procedure to recover its costs, and "continues to engage with MFC to find a commercial solution for the benefit of the project and all involved."

The statement added: "Astaldi would like a reasonable commercial solution to the important issues raised in the arbitration, but will follow all necessary procedures required to obtain compensation in the event that a reasonable solution cannot be reached."

Nalcor declined to respond to those comments, or say anything about the arbitration procedure referenced by Astaldi.

Financial issues locally and internationally

A week ago, Astaldi's parent company in Italy filed for a type of creditor protection that allows it to carry on operations.

But there is also financial trouble facing the Canadian subsidiary operating in Labrador.

Suppliers and unions have filed liens totalling $34 million, claiming that AstaldiCanada has not paid its bills for Muskrat Falls-related work.

On Friday, Astaldi reiterated "its intent to complete this project and to honour all payment commitments to its subcontractors and suppliers."

Muskrat Falls Corporation is the subsidiary of Nalcor, which oversees the hydro megaproject. (CBC)

Nalcorhas stressed that it has performance securities in place for example, letters of credit and bonds that provide financial protections in situations where Astaldi doesn't meet its obligations under the contract.

According to Nalcor, Astaldi's work at the site is more than 95 per cent complete.

Two years ago, Nalcor and Astaldireached a deal to boost the value of the company's Muskrat Falls contract to $1.83 billion.