Tony Wakeham

Churchill Falls Memorandum of Understanding (MOU)

On December 12, 2024, Churchill Falls negotiations culminated in the signing of a historic Memorandum of Understanding by Newfoundland and Labrador Hydro, Hydro-Québec, and CFLCo. The agreement was publicly announced by Premier Andrew Furey and Québec Premier François Legault as a transformative new partnership intended to replace the 1969 contract seventeen years before its expiry. Following the announcement, a special session of the House of Assembly was held in January 2025 to examine the MOU in detail. On January 9, 2025, the House voted in favour of continuing negotiations toward definitive agreements with Hydro-Québec. The motion passed with support from Liberal, New Democratic Party, and Independent members, while Progressive Conservative members left the chamber before the vote, arguing that a more independent review was required before further commitments were made.^[18][19]

The direction of the project changed significantly following the 2025 provincial election, which brought Wakeham's PCs to power. The new government had campaigned on concerns regarding the MOU and promised a more rigorous assessment before approving any final agreements. On December 15, 2025, Wakeham established the Churchill River Independent Review Committee (IRC), chaired by Chris Huskilson and including Guy Holburn and Michael Wilson. The committee was tasked with determining whether the MOU was in the best long-term interests of Newfoundland and Labrador and was empowered to conduct a comprehensive examination of both the content of the agreement and the negotiation process that produced it.^[20]

The IRC delivered its final report on April 30, 2026, and its conclusions profoundly reshaped the public conversation. Although the committee recognized substantial financial and economic benefits associated with the MOU, it concluded that the agreement "in its current form is not in the public interest." The committee identified a number of concerns, including limited long-term access to Churchill Falls power for Newfoundland and Labrador after 2041, lack of guaranteed transmission access through Québec to reach external markets, problematic pricing structures, governance arrangements that continued to provide significant influence to Hydro-Québec, and risks associated with the proposed Gull Island ownership model. The committee estimated that the real net present value of the agreement was approximately $31 billion rather than the nominal $227 billion frequently highlighted by government communications. Nevertheless, the IRC acknowledged that the proposed agreement could generate meaningful benefits if significant improvements were made.^[21]

Following release of the report, Premier Wakeham stated that the province would not abandon development of Churchill Falls and Gull Island but would instead seek material improvements through renewed negotiations. A new negotiating team consisting of Barry Perry, Jerome Kennedy, and Jennifer Williams was appointed, and discussions resumed with Hydro-Québec during the summer of 2026. One of the most significant issues identified by the IRC was Newfoundland and Labrador's inability under the original MOU to secure guaranteed transmission rights through Hydro-Québec's network to external markets. During meetings between Premier Wakeham and Québec Premier Christine Fréchette, negotiators focused heavily on addressing this deficiency.^[22][23]

By August 2026, reports emerged that a revised agreement was close to completion. According to sources familiar with negotiations, the proposed replacement for the 2024 MOU would include guaranteed transmission access of approximately 985 MW through Hydro-Québec's network, enabling Newfoundland and Labrador to market electricity directly into other jurisdictions. Former deputy minister Ron Penney described the provision as a significant departure from the original MOU because the earlier agreement had not secured guaranteed access to Québec's transmission system. This development directly addressed one of the most important concerns raised by the Independent Review Committee and reflected the evolving effort to ensure that Newfoundland and Labrador could maximize the long-term value of Churchill River resources while avoiding some of the limitations that had characterized both the 1969 contract and aspects of the original 2024 MOU.^[24][25]