An economic driver for three Naut’sa mawt Tribal Council nations reported some good, bad and indifferent news in March.

• Plutonic Power Corp. ran the first tests on the transmission line from the East Toba River and Montrose Creek run-of-river hydroelectric project. The generating stations are in Klahoose territory and the line runs through Tla’Amin territory before connecting to BC Hydro’s new Saltery Bay substation.
• When BC Hydro announced its round of energy purchase agreements for independent power projects, Plutonic was awarded a contract for a scaled-down version of its proposed Upper Toba run-of-river plans in Klahoose territory. It will now have generating stations at Upper Toba and Jimmie Creek and not a third at Dalgleish Creek.
• Plutonic announced that it was putting its massive Bute Inlet project on hold for a year or two until “further work” was done. The $4-billion project through Xwemalhkwu (Homalco) territory has been on the drawing board for more than two years.

Toba/Montrose work almost complete

Construction on the project is over 90 per cent complete. Main components that remain to be completed include the Montrose Creek penstock and powerhouse.

After the transmission line is energized (using power from BC Hydro), the East Toba generating units will be synchronized to Hydro’s system and Plutonic will start to use its own energy to complete testing. East Toba is expected to start commercial operations in July and Montrose in November.

“Energizing the transmission line is a very exciting step in realizing operations for the Toba Montrose project,” said Donald McInnes, Plutonic’s vice-chair and chief executive officer.

Tla’Amin signed an impact benefit agreement with Plutonic in 2007 that spelled out annual payments for the life of the project as well as employment and training opportunities for Tla’Amin members and Tla’Amin-owned companies during construction and operation of the project.

Meanwhile, Klahoose celebrated a similar agreement three years ago that guaranteed employment, training and contracting opportunities as well as cash payments during construction and for 35 years after completion as well as an annual royalty on revenue after that period. That agreement allowed Plutonic access to the project site through Klahoose IR#1 and its traditional territory.

Upper Toba scaled back

Plutonic and its partner GE Energy Financial Services said it had scaled back the number of generating stations from three to two in order to win the Hydro contract.

The company said that, during negotiations with BC Hydro, it learned that there were potential constraints on the transmission line from Saltery Bay. It determined that one of the projects had to be dropped, but said that if the constraints can be removed, the Dalgleish Creek could be developed.

More talks on big Bute project

“Negotiations with BC Hydro for an energy purchase agreement for the Bute Inlet project will not proceed at this time, in order to allow further data collection, studies and due diligence,” stated the joint release from the companies issued on Wednesday, March 10.

Those words from a Plutonic/GE press release in March were part of the explanation why the massive 1,027-megawatt Bute Inlet project was on hold.

Negotiations had started with Xwemalhkwu almost two years ago for the biggest project of its kind in BC. It included:

• 17 run-of-river hydroelectric facilities on three river systems;
• A substation near the mouth of Southgate River;
• 216 kms of a 230-kilovolt transmission line and 227 kms of a 500-kilovolt transmission line from the proposed substation to the Malaspina substation.

“We strongly believe that the Bute Inlet project is an exceptional opportunity that will be developed in due course, however we will not move ahead at this time,” said Donald McInnes, Plutonic’s vice-chair and CEO.

“We have learned a great deal and proven our ability to bring all stakeholders together on our three other projects in BC. Given the size of the Bute Inlet project and the level of interest expressed by First Nations, regulators and the public, we now realize that further work is needed. During the next 12 to 18 months, we will advance our studies and permitting processes as well as build on our strong relationship with the local communities, stakeholders and our First Nations partners.”