Hibernia sale talks great news, Kathy Dunderdale says

A renewed interest from the federal government in selling its minority stake in the Hibernia offshore oilfield has delighted Newfoundland and Labrador Premier Kathy Dunderdale.

Federal finance minister opens door to new round of talks

Premier Kathy Dunderdale 'really happy' to learn of renewed interest in Ottawa, reports Peter Cowan 2:22

A renewed interest from the federal government in selling its minority stake in the Hibernia offshore oilfield has delighted Newfoundland and Labrador Premier Kathy Dunderdale. 

Federal Finance Minister Jim Flaherty said earlier this week that he is open to talking about selling Ottawa's 8.5 per cent stake in Hibernia, the first oilfield to be developed off Newfoundand's east coast. 

"It will be an expensive buy," Dunderdale told reporters in St. John's, responding to Flaherty's comments. 

Kathy Dunderdale acknowledges that it will not be cheap for Newfoundland and Labrador to buy Ottawa's minority stake in the Hibernia consortium. (CBC)

Former premier Danny Williams had advanced the issue of the province buying the federal government's minority stake in the Hibernia partnership, but talks fell apart over costs. 

"We just weren't able to bridge the gap so negotiations fell apart," Dunderdale said Wednesday. 

"This is the first indication we've had that they're willing to reopen the talks and we're really happy about that." 

Hibernia started producing oil in late 1997, and is the largest oilfield in the province. The development of the field was controversial, particularly when the federal government took on an equity stake in the field to ensure it was built. 

Feds reportedly wanted more than $1B 

The Newfoundland and Labrador government has never revealed what it is prepared to pay for Hibernia, which has turned over billions of dollars in royalties and other revenues for both levels of government. 

In the last round of talks, Ottawa was reportedly seeking more than $1 billion for its stake. 

Dunderdale said the province is still very interested in picking up the stake. 

"This would be a significant purchase for the province, but [one which] would bring great value," she said. 

Lorraine Michael, leader of Newfoundland and Labrador's NDP, insists the province should be able to buy the stake with a discount. 

"Whether it's a dream or not, I think it's the starting point," she said of the possible resumption of a negotiation. 

"I think we have to start there and work up from there. I really don't think it should be fair market value. I absolutely disagree with that." 

Flaherty's comments, made in Edmonton while answering questions about the federal governmment's fall economic update, was the first indication in three years of an interest in possibly selling the Hibernia stake. 


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