MONTREAL, July 22, 2013 /CNW Telbec/ - Hydro-Québec is filing a motion
today with the Québec Superior Court to obtain a declaratory judgment.
The company is asking the Court to confirm that two recent positions
taken by CF(L)Co with respect to the Churchill Falls Contract (the
Contract) are ill-founded. The Québec Superior Court has exclusive
jurisdiction to rule on any dispute arising out of the Contract. It
should be noted that the Contract will be automatically renewed in
2016, for a 25-year period ending in 2041.
1 - Energy deliveries to which Hydro-Québec is entitled
Under the terms of the Contract which Hydro-Québec and CF(L)Co concluded
in 1969, Hydro-Québec has certain essential rights, including:
The exclusive right to purchase virtually all of the power and energy
produced by Churchill Falls Generating Station until August 31, 2041;
The right to benefit from operational flexibility.
According to the recent positions taken by CF(L)Co, Hydro-Québec would,
for the entire Contract renewal period (2016 to 2041), be entitled only
to fixed monthly blocks of energy. This position would deprive
Hydro-Québec of the operational flexibility to determine the quantities
of energy it can request from CF(L)Co. This operational flexibility
enables Hydro-Québec to coordinate the operation of Churchill Falls
with its entire generating fleet, and to do so both on a seasonal and a
In Hydro-Québec's opinion, CF(L)Co's position is incompatible with
several provisions of the Contract. Hydro-Québec wishes to have the
Court confirm that it will not be obliged to limit its requests for
energy deliveries to fixed monthly blocks from 2016 to 2041.
2 - Sale of quantities exceeding 300 MW by CF(L)Co
Under the Contract, until 2041, CF(L)Co has the right to recapture a
300-MW block of power and energy and sell it to a third party. However,
this right has limitations: CF(L)Co may not, under any circumstances,
sell quantities exceeding 300 MW to a third party, until expiry of the
Contract. Yet, since June of 2012, CF(L)Co has sold quantities of more
than 300 MW to Newfoundland and Labrador Hydro (NLH), a related
provincial Crown corporation, causing the interruption of deliveries
scheduled by Hydro-Québec under the Contract.
Hydro-Québec therefore wishes to confirm that, as long as the Contract
is in effect, namely until August 31, 2041, CF(L)Co may not sell
quantities of power and energy exceeding 300 MW to a third party,
For further information: