Auditor hired to examine Muskrat Falls numbers for judicial inquiry
Grant Thornton hired to do the forensic audit under 'strict time limits'
The inquiry into Muskrat Falls has hired Grant Thornton to do an investigative and forensic audit into the hydro project, promising the work will be done before public hearings start in September.
According to a news release Monday, the company has been hired to focus on two areas. It will look at the options considered by Nalcor in deciding that Muskrat Falls would be the cheapest cost option to provide power to Newfoundland and Labrador.
That will include looking at financial analysis done for Muskrat Falls and for alternatives, such as just replacing the oil fired generator at Holyrood, or adding wind energy.
"It will be a multidisciplinary team," said Kate O'Brien, inquiry co-counsel.
O'Brien said team won't only include accountants. The company will decide what other experts to bring in, but will likely include people with engineering and construction expertise.
Grant Thornton will also investigate the escalation of costs. When it was sanctioned Muskrat Falls was expected to cost $7.2 billion but that had ballooned to $12.7 billion by June, 2017.
Nalcor blamed the escalation on changes to agreements with contractors such as Astaldi, the settlement of claims for past delays, and an unrealistic original estimate of what the project would cost.
The inquiry said in its news release that Grant Thornton was chosen through a competitive request for proposals, O'Brien said five firms were asked to compete for the work, and all had to make sure they hadn't worked for Nalcor in the past.
The commission is concerned about costs and will give updates on what it's spending, but right now won't say how much Grant Thornton is being paid, O'Brien said.
"We need to be careful about when we release information," she said.
"We want to make sure we don't put out any information that could affect the quality of the work that we get or impact how others might perceive that work."
The commission won't be directly involved in the audit but will use its legal powers to force Nalcor to hand over documents needed.
Critics of the Muskrat Falls project called on government to get a forensic audit done before the inquiry happened.
The province left that decision to commissioner Richard LeBlanc, saying he could hire any outside experts needed to assist with the inquiry. The release doesn't explain why LeBlanc decided the audit was needed.
The audit reports will be entered into evidence during the public hearings. O'Brien said what auditors conclude may or may not be accepted by the commissioner.
Those involved in the commission will have a chance to cross examine auditors about what they find.
"Ultimately the commissioner may accept all, some or none of what's in the report," she said.