NLFL proposal      

NLFL Proposal Objective

MUN's Study Report agrees with NLFL's claims that a Strait Of Belle Isle fixed link is technically feasible, capital cost is about $1.5 billion, and it will take 11 years to build. But that Report does not offer a financial plan that solves financial problems related to a fixed link.  In contrast, NLFL proposed, in April 2004, a financial plan that experience shows can resolve such problems.  With MUN Report's agreement on feasibility, cost, and completion time, combined with NLFL's financial plan, the Province now has a complete proposal ready for detailed studies, and the Provincial Government should, without delay, establish the Fixed Link Study Group proposed by NLFL.  With MUN Report's agreement on a tunnel's technical feasilbility, the Study Group's goal now should be to find the best fixed link construction system.

Newfoundland and Labrador's Major Problems

This Province's problems, related to need for a Strait of Belle Isle Fixed Link and new Northern TCH with estimates of costs and losses are:

-- Absence of direct Newfoundland road vehicle access to North America's mainland.
-- Newfoundland electricity deficits, no Labrador hydropower, and duplicate costs by Newfoundland and Labrador Hydro (NLH) and Newfoundland Power (NP).
-- Need for a North Shore TCH and Fixed Link to lower Newfoundland road travel costs and strengthen Newfoundland-Labrador unity as well as bonds with Canada.

A Two-Part Plan to Solve the Above Problems

To resolve the above problems, NLFL proposes two separate and concurrent steps:  

1 - Canada’s Federal, Quebec and Newfoundland and Labrador governments should jointly build a new North Shore TCH which will bring mainland road transportation to Quebec’s Lower North Shore, the Strait of Belle Isle, and Newfoundland.  This new TCH, with mostly federal funding, will include the now missing 350km of North Shore highway, a connection in Labrador to the Fixed Link, and upgrading of Newfoundland Highway 430 from the Fixed Link to the Deer Lake junction with the current TCH.

2 - Concurrently, the Newfoundland and Labrador Government will select by tender, a qualified investor group (IG) to be the sole authorized generator, distributor, and exporter (under Provincial regulation) of electric power in the entire Province.  In recognition of this benefit, the selected IG will also design, finance, build, and operate an all-weather, multi-use Fixed Link to carry electric power and all types of road vehicles across the Strait of Belle Isle.  Moreover, the new IG will be required to purchase from the Province's NLH (and continue to operate) the electric power plants and energy distribution assets at Churchill Falls, Bay d’Espoir and Holyrood.  To help the selected IG recover costs incurred in purchasing NLH assets and to build new hydropower facilities in Labrador and Newfoundland, the Province will contract with the selected IG for a suitable period (about 50 years).  The Province will retain owner-ship of all natural resources involved and lease to IG those needed in approved work.  The IG will pay the Province annual rent on leases, plus an income tax on profits.  The goal in creating new Labrador hydropower will be maximum long-term job creation in the Province, similar to British Columbia’s Kitamat-Kemano project.  IG's purchase of NLH assets should significantly lower the Provincial debt.

Even with the Trans-Labrador Highway still incomplete and difficult to travel, Quebec is now Labrador’s major supplier by road.  A fixed link is needed to preserve the traditions and culture of the Province of Newfoundland and Labrador and demand a high priority to assure an enduring future for this Province within Canada.

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Provincial Electricity Production and Distribution

EXISTING SYSTEM

PROPOSED NEW NLFL SYSTEM

  

Source:  Websites of Government of Newfoundland and Labrador,
Newfoundland and Labrador Hydro, and Newfoundland Power



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Bored or Immersed Rail Tunnel

Subject to detailed study, this initial Newfoundland-Labrador Fixed Link option evaluation suggests, that a bored or immersed, multi-use, single-track electric rail tunnel, able to carry all types of road vehicles and transmit high voltage electricity and piped materials, is challenging but not insurmountable.  A decision on the type of tunnel will clearly require far more detailed site data than is now available.

NLFL Proposal General Benefits

--Substantial reduction in this Province’s long-term debt--
--Fast, cost-effective direct road vehicle access to and from the Province--
--Fair and secure regulated income from Labrador hydropower resources--

-- New long-term jobs for all Newfoundlanders and Labradoreans. (Why export hydropower to create jobs elsewhere when new jobs are urgently needed here?)

--Reduced harmful emissions from fossil fuel power plants--
--Much improved Provincial, inter-provincial, and national unity--
--Enhanced tourism for all Atlantic Canada--
--No cost duplication by NLH and NP--
--Provincial regulatory control of all Newfoundland and Labrador natural resources--

Regional and Special Benefits

For Newfoundland - A North Shore highway and Newfoundland-Labrador fixed link will make all mainland roads accessible to over 500,000 Newfoundland residents, their visitors, and commercial vehicles.  Reduced time and lower tolls to access and leave the Island will attract tourists to this Province and all Atlantic Canada.  About 30% lower import-export shipping costs and Labrador hydropower access for the Island will create new jobs and economic opportunities within a united Province.

For Labrador - An all weather, multiuse fixed link will create new long-term hydro-power, forest and mining jobs. Power exports offer only short-term jobs. A fixed link will bring shared goals and pride in a joint heritage to a united Province.

Atlantic Canada - The fixed link will mean more circle tour options and many new long-term tourism jobs.

All Canada - The North Shore TCH and Strait of Belle Isle Fixed Link will enhance national unity, resource development, and continuous trans-Canada land travel.

Tourism Benefits

The proposed all-weather Strait Of Belle Isle Fixed Link and North Shore TCH will offer major benefits to passenger car, truck, and other road traffic between Newfoundland and North America's mainland.  Two new circle-tour venues will be provided when a Trans-Labrador Highway extends from Happy Valley-Goose Bay to Cartwright and then to the Fixed Link.  A shorter route will be via the proposed North Shore TCH and Fixed Link to Newfoundland. Road travel saved between St. John’s and Montreal via the latter route, over current Cabot Strait travel, is estimated at 230km plus time saving of, on average, a full travel day. All Atlantic provinces will also benefit , as many circle tour visitors will want to tour Nova Scotia, New Brunswick and Prince Edward Island.

CONSTRUCTION JOB BENEFITS

The Canadian Construction Association claims that every $1 million invested in non-residential construction, will create 15-20 direct and 45-60 indirect person-years of employment. Thus, a $1.5 billion capital cost fixed link could create for 3.5 years, 6450-8500 direct jobs for each of those years and 19300-25700 new indirect jobs.  It is not possible at this time to estimate new construction jobs for hydropower generation and transmission, road construction, and other associated work.  But it is reasonable to assume that the added new jobs will total many thousands.

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import-export Shipping benefits

Newfoundlanders now import most of the goods they use or consume. Total retail sales now average approximately $5.0 billion/year. If it is assumed that 80% of all retail goods are imported and a fixed link, when operating, will carry 50% of such imports, and resulting savings will be 3% of the total retail value, Newfoundlander’s annual fixed link savings on imported retail goods could be about $60 million. Annual savings of a fixed link carrying exports is assumed here to be $50 million/year.

Labrador Hydropower Benefits

With current data it is not possible to estimate all potential benefits from transmission of Labrador hydropower to Newfoundland via the fixed link. Newfoundland has only small amounts of undeveloped hydropower. With current oil prices, benefits could be very substantial. Moreover, bringing Labrador hydropower to the Island will use local resources to create jobs in this Province rather than exporting them elsewhere. Need in Newfoundland for new generating capacity in the next ten years is estimated at 400MW. Fuel cost alone at Holyrood's thermal generating station was $118 million in 2002, and capital cost to construct a single-use power transmission system across the Strait is estimated to be in excess of $500 million. For the fixed link's proposed 40 year amortization period this is estimated to increase to 1500MW. The transmission of this energy suggests n this early analysis that $40 million/year is a modest estimate of  annual payments to the proposed investor-group for tunnel transmission service.

Other Fixed Link Benefits

Physical unification of Newfoundland and Labrador will resolve most problems that now face this Province’s two major parts.  This web site's goal is to demonstrate the urgent need for a Federal-Provincial Fixed Link Study Group to conduct a detailed study on how to build the fixed link; not whether a link (that clearly should have been built twenty five years ago) should now be a major objective in this Province's future.   Both NLFL submissions and the MUN Report indicate that an electrically operated rail tunnel offers the best cost-benefit result.  A decision as to whether the tunnel should be an immersed tube tunnel (ITT) or the MUN Report's premature decision on a bored or blasted tunnel will require many more detailed site studies.  An electric rail tunnel will feature a single electric rail shuttle to transport all types of road vehicles.  It will contain separate compartments for electric power cables, piped fuel, other materials, and suitable emergency services.  Both an ITT and a bored tunnel can be designed to provide these services.  This website will not concentrate on determining the relative merits of either an ITT or a bored or blasted tunnel at this time.  Such information has already been outlined in the MUN Report and in previous websites by NLFL.  This website will focus on describing the NLFL proposal to reorganize this Province's electricity supply system to permit creation of a Strait of Belle Isle Fixed Link and new North Shore TCH.

However it should be noted that this Province's highest cost could be lost control of the development of its natural resources when Quebec builds a new North Shore TCH as a 2nd road to Labrador and the Strait of Belle Isle Fixed Link is deferred for too long.











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Preliminary Fixed Link Cost and Revenue Estimate

Estimated Capital Costs (Millions)
Tunnel Construction (Over 3.5 years) $750
Operating Equipment $75
Constructing Two Terminals $75
Management and Engineering $45
Total $945
Escalation (11.9%) $112.5
Contingency (3.9%) $37.5
Direct Construction Costs $1095
Interest During Construction (3.5 years @ 7%) $225
Administration, Overhead and Miscellaneous $135
Total Capital Costs - $1455 Million $1500 (rounded)

Average Annual Amortization and Operating Costs (Millions)

Payment on Principal $37.5
Payment on Interest $52.5
Operating & Maintenance Costs $15
Total Annual Payments & Costs $105

Preliminary Revenue Sources & Average Annual Receipts (Millions)

Vehicle Tolls (Initial Crossings 400/day; Max. 3000/day; Avg. 1500/day for 40 yrs @ $60/vehicle) $32.5
Ferry Subsidy Offset $10.0
Power Transmission Charges (Initial 400MW; Final 1500MW) $40.0  
Negotiated Portion of Tax Revenue from New Jobs $11.25
Negotiated Portion of Increased Tourism Revenue $11.25
Annual Value of Natural Resource Transfers to Fixed Link Builder $10.0
Average Annual Total Revenues $115

No-Fixed-Link Costs

Ferry tolls and time lost $60 million/year
Import shipping $60 million/year
Export shipping $50 Million/year
Costs of absent Labrador hydropower $60 Million/year
Lost tourism revenue $450 Million/year
Total Cost to Newfoundland residents $680 Million/year
Fixed link capital and operation costs $105 Million/year
Estimated net costs of missing fixed link $575 Million/Year








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Rail Tunnel/Fixed Link Terminals

MUN's Study Report recommends that the Strait of Belle Isle Fixed Link should be an all-weather rail tunnel.  If the proposed Study Group confirms that selection, and detailed site studies recommend either a bored, blasted or an immersed tube tunnel,  terminals to load and unload vehicles will be required at both ends of the tunnel.

The above illustration shows a terminal arrangement for an eventual two-rail tunnel. Low initial traffic may only require a single rail tunnel. In a single rail tunnel there would be three trains. The number of cars in each train would be selected to meet traffic needs. One locomotive system could serve three trains.  Normally one train will be in transit and the other two trains will load or unload at the two terminals.  For example, when Train A is at the South Terminal being loaded with vehicles, as shown on the left side of the roadway; at that time, the loaded Train B is on its way in the tunnel from the North Terminal and train C is unloaded at the North Terminal.  When train B arrives at the South terminal the locomotive system will pick up Train A for return travel through the tunnel to the North terminal.  With one locomotive system there is no possibility of train collision.  A train compartment for walk-on and bicycle passengers can be included.  The illustration’s upper left corner shows power lines as well as an area to load busses and trucks on suitable train cars for carrying these large vehicles through the rail tunnel.











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Proposed Continued Studies

Newfoundland and Labrador's current need for detailed studies of a Strait of Belle Isle Fixed Link is like that of England and France in 1957, when Europeans were restarting post war economies.  An international Channel Tunnel Study Group at that time began detailed studies of options for a fixed link across the English Channel.  The Group’s 1962 Report led to 1993’s completion of the “Chunnel”.  That Report indicates a model for the Strait of Belle Isle Fixed Link Study Group proposed here.  An organization chart for the Study Group is illustrated below.

Fixed Link Study Group Organization

The Canadian and Newfoundland and Labrador governments and other appropriate sources should be responsible for the Group's organization and study program, and engage competent individuals with leadership experience in legal affairs, design, engineering, and construction management.  Their work will involve studies on all options for a permanent, multiuse link to safely transfer all types of road vehicles, electric power, and other suitable commodities across the Strait of Belle Isle and assure social, economic and other benefits for the Province and all Canadians.  The Group will select a design that most effectively satisfies approved environmental, safety, and socio-economic criteria and report as required on progress.














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Schedule

A provisional fixed link engineering and construction schedule is outlined below. This assumes the identification of regional benefits, related infrastructure and other associated issues for all possible options over a three year period.  Within that time, specific route option and site investigation studies will be conducted, with detailed studies on a short list of the most attractive routes.  A final site selection based on engineering, environmental, cost, and all other factors, will take about one and a half years.  In this period, enabling legislation, reference design and property acquisition will be conducted, and fixed link implementation, engineering and construction work will begin.  Final detail design may take up to two and a half years.  Succeeding steps for an immersed tube tunnel (ITT) are shown below.  When final site studies are completed, construction contracts will be tendered and awarded.

The design and construction phase is expected to take six years.  Assuming an ITT placement from the north shore, landfall works on the Strait's Labrador side would start first.  Seasonal climatic constraints will require a ‘stop-start’ program of landfall construction.  In general, this work is not a critical activity.  Three steps in immersed tunnel unit construction are shown above.  Tunnel internal works, mechanical-electrical and tunnel track work will follow tunnel completion.  Allowing six months for testing, the total implementation period is eleven years.  For a bored tunnel, all-weather working may be feasible.  Allowing for a TBM procurement and mobilization period of eighteen months after award, and progress rate of 400m per month working from both landfalls, then tunnel boring could be complete in around three years – one year earlier than the immersed tunnel option.




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Concluding Summary

Newfoundland and Labrador's Major Problems

This Province's problems, related to need for a Strait of Belle Isle Fixed Link and new Northern TCH with estimates of costs and losses are:

-- Absence of direct Newfoundland road vehicle access to North America's mainland.
-- Newfoundland electricity deficits, no Labrador hydropower, and duplicate costs by Newfoundland and Labrador Hydro (NLH) and Newfoundland Power (NP).
-- Need for a North Shore TCH and Fixed Link to lower Newfoundland road travel costs and strengthen Newfoundland-Labrador unity as well as bonds with Canada.

A Two-Part Plan to Solve the Above Problems

To resolve the above problems, NLFL proposes two separate and concurrent steps:  

1 - Canada’s Federal, Quebec and Newfoundland and Labrador governments should jointly build a new North Shore TCH which will bring mainland road transportation to Quebec’s Lower North Shore, the Strait of Belle Isle, and Newfoundland.  This new TCH, with mostly federal funding, will include the now missing 350km of North Shore highway, a connection in Labrador to the Fixed Link, and upgrading of Newfoundland Highway 430 from the Fixed Link to the Deer Lake junction with the current TCH.

2 - Concurrently, the Newfoundland and Labrador Government will select by tender, a qualified investor group (IG) to be the sole authorized generator, distributor, and exporter (under Provincial regulation) of electric power in the entire Province.  In recognition of this benefit, the selected IG will also design, finance, build, and operate an all-weather, multi-use Fixed Link to carry electric power and all types of road vehicles across the Strait of Belle Isle.  Moreover, the new IG will be required to purchase from the Province's NLH (and continue to operate) the electric power plants and energy distribution assets at Churchill Falls, Bay d’Espoir and Holyrood.  To help the selected IG recover costs incurred in purchasing NLH assets and to build new hydropower facilities in Labrador and Newfoundland, the Province will contract with the selected IG for a suitable period (about 50 years).  The Province will retain owner-ship of all natural resources involved and lease to IG those needed in approved work.  The IG will pay the Province annual rent on leases, plus an income tax on profits.  The goal in creating new Labrador hydropower will be maximum long-term job creation in the Province, similar to British Columbia’s Kitamat-Kemano project.  IG's purchase of NLH assets should significantly lower the Provincial debt.

With MUN Report's agreement on technical feasibility and cost, and NLFL's financial plan, a sound base now exists on which to create the Study Group which is needed to determine how to build the fixed link that should have been built 25 years ago.

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