Description: It’s been a source of dispute between Newfoundland and Quebec for many years. But the Supreme Court ruled this week that there is no need to reopen the 65 year agreement covering the Churchill Falls hydro development. The problem is that Hydro Quebec has earned about 27.5 billion dollars from the project because the price it pays Newfoundland actually decreases over time. Newfoundland has earned about $2 billion over the same time period.
Date: November 2, 2018
1) Had you ever heard of this Churchill Falls problem? After reading the linked article, where do you stand on this dispute?
2) What lessons can an accounting student learn from this dispute?
3) What are some of the significant challenges associated with planning massive capital projects like this?