Hydro-Québec power linesJACQUES BOISSINOT
The cancellation of Hydro-Québec's proposed $3.2-billion acquisition of the bulk of New Brunswick Power Corp.'s generating assets should not be interpreted as a setback for the giant provincial utility, says its chief executive officer.
The deal - which proved to be a politically impossible sell for New Brunswick Premier Shawn Graham - fell apart last month after Hydro-Québec determined that two major facilities in the package could entail considerably higher costs in the future than initially believed.
Quebec Premier Jean Charest had touted the proposed deal as a major step in Hydro-Québec's efforts to become a dominant force in eastern North American power markets, with improved access to the New England states and New York, not to mention Prince Edward Island and Nova Scotia.
But in an interview coinciding with the unveiling of the utility's year-end results, Hydro-Québec president and chief executive officer Thierry Vandal played down the strategic role of the New Brunswick Power purchase.
The proposed acquisition was "an opportunity that appeared" last year when Hydro-Québec had already mapped out its strategy for clinching new markets in its 2009-13 strategic plan, said Mr. Vandal.
He added parenthetically that it was New Brunswick that approached Quebec and not the other way around.
The New Brunswick Power deal did not go through, but Hydro-Québec remains on track with a strategy to build its presence in U.S. markets, where it is already a significant exporter, he said.
He pointed to discussions now taking place aimed at striking an agreement to build a major new transmission line to New Hampshire.
"There are major transactions in the energy sector - in the U.S. for example - that are announced and that ultimately don't end up going ahead. It's normal," he said.
Commenting on the utility's results for the year, Mr. Vandal said he's proud of the performance, given the difficult economic context.
For 2009, Hydro-Québec reported a profit of $3-billion, compared with $3.1-billion in the previous year.
Revenue slipped to $12.3-billion from $12.7-billion a year earlier.