Gov’t disputes NDP claim of lost millions at Sask. CO2 capture plant

REGINA – The NDP says Saskatchewan lost millions on penalties, repairs and operations at a carbon capture facility, but SaskPower says that’s not the case. New Democrat Cathy Sproule says it was revealed in a legislative committee meeting Tuesday that SaskPower paid $17 million for repairs to the facility at the Boundary Dam power plant in Estevan.

There’s also $13 million in operating costs for 2015 and a $7 million penalty paid to an energy company that was supposed to get captured CO2 from the plant to use for enhanced oil recovery.

Sproule says it was also discovered that an overhaul and relaunch of the facility in November didn’t go as planned, and it had to be shut down again because of new problems in December.

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The NDP says SaskPower CEO Mike Marsh told the committee he expects outages every month with the plant.

“What we discovered Tuesday is that the project still isn’t working properly, and doesn’t have a working business case or financial model that will deliver a return for the people of Saskatchewan,” said Sproule.

“Those annual losses mean we’re not even coming close to paying for the $1.5 billion cost – plus interest – of building this thing.”

Marsh says his words are being are being taken out of context.

He says the repair costs will be recouped from the companies that did the original work, although the legal process could take “months, if not a couple years to totally resolve.”

Marsh says the operating costs, which includes salaries for workers, were as budgeted, and the penalty is offset by $9 million from the sale of CO2.

“I think those facts have been construed and are being twisted into something that is not just an expense, they’re calling it a loss and that’s totally incorrect,” said Marsh.

As for the outages, Marsh says it’s normal for any power generation unit to need maintenance.

SaskPower and the government have been facing criticism from the Opposition NDP for boasting that the plant is fully operational. Documents leaked to the NDP last year showed the facility had been working 45 per cent of the time.

The carbon capture facility opened with much fanfare in October 2014.

The goal is to reduce carbon-dioxide emissions by one million tonnes annually, but the facility removed just 400,000 tonnes last year.

Marsh says the overhaul went well and the plant is capturing more CO2.

“The plant is performing very, very well and we’ll continue to work the kinks out of it and move that unit up into a higher part of its operating range over the next few months,” he said.