PROVINCE OF NEWFOUNDLAND AND LABRADOR HOUSE OF ASSEMBLY Volume 1 Number 128 4th. Session 34th. General Assembly VERBATIM REPORT FRIDAY, JULY 24, 1970 SPEAKER: THE HONOURABLE GEORGE W. CLARKE

July 24 1970 Tape 1359 page 1. The House met at 10.30 a.m. Mr. Speaker in the Chair. Presenting Reports of Standing and Select Committees: HON.W.J.CALLABAN(Min,Mines, Agr.& Resources): 1 have pleasure Mr. Speaker in tabling Mineral Resources Report No. 3. which is a consolidation and updating of available information on petroleum exploration in Newfoundland and Labrador by J.M.Fleming of the Department of Mines, Agriculture and Resources. The foreword Mr. Speak~r, is by the Director of Mineral " . Resources Mr.

McKillop, who says; briefly, even though the history of petroleum exploration in Newfoundland dates back a little more than one hundred years,no one has ever before assembled all the available data on the subject and summarized it for publication.'' Not only is this mineral resources report a milestone,it also satisfies a long existing need when comes the time when Newfoundland and Labrador could be on the verge of significant happenings as far as its petroleum and natural gas potentia~ on-shore and off-shore, is concerned.

During the past century many data have no doubt been lost,and many were never recorded at all, but at least the record,as it exists,will be preserved in this publication,which should also be very useful to any one who is interested in current and future activity. I should say,Mr. Speaker, that this does .not deal with off-shore exploration It deals with terrestial petroleum explorati~n in Newfoundland and Labrado~over a period of about a hundred years. 1 have pleasure in tabling it and 1 believe 1 if reports or copies are not already in the Clerk's office they will be shortly.

ANSWERS TO QUESTIONS: HON.E.JONES(Min. Of Finance): Mr. Speaker, a few days ago the bon. member for St. John's West asked if any &pecial warrants had been issued since the closing of the House about a month ago? The ans~er is no. MR.CROSBIE: ORDhRS OF THE DAY: could ~tr. Speaker, .·. the minister of Labour informed the Rouse when the

July 24 1970 Tape 1359 page 2. Government intends to proclaim the Human Rights Code that was passed, the legislation was passed last year 1969, I believe. HON.W.J.KEOUGH(Min. of Labour): Mr. Speaker, I am afraid I am not in a position to do so, as the Government has not yet arrived at a decision in that regard. ORDERS OF THE DAY: Second Reading of a Bill, No. 95: MR.CROSBIE: Mr.

Speaker, I adjourned the debate yesterday evening on this Bill lhe effect of this Bill is to extend to a further year , December 31, 1972, time for Newfoundland Pulp and Chemical Company,Limited,to proceed to cnnstruct what is known as the third pulp and paper mill,at Come by Chance. Now in time it would be the foarth,it used to be known as the third mill. Since there is now one at Stephenville this is probably the fourth mill. Now, Mr. Speaker, before I could vote in favour of any extension,! would certainly want to have more information than was given us in the Premier's speech yesterday.

The original Act 1 which this amends,was passed in this House on July, was assented to on July 5, 1960. It was Act No. 72 of 1960. Pulp The Government Newfoundland/and Chemical Limited Authorization of Agreement Act 1960. And that Act had an agreement attached to it and in that agreement certain concessions are made to Newfoundland Pulp and Chemical Company to establish a pulp and paper mill in the province. Under

Section 3 of that Act of 1960,the company was to proceed with all due diligence to carry out a programme of exploration and engineering in the Province, designed to enable the company to determine whether a newsprint or chemical pulp mill or both can be economically constructed and operated in the Province,"iuch programme shall consist of all investigation and studies deemed necessary by the company for the purposes of such determination ." The next Clause of the Agreement, Clause 4,said that the company wil~ within the period of three years immediately following the date hereof, determine whether it desires to establish a newsprint or chemical pulp mill,having a minimum capacity of 200 tons a day.

Under subclause Z,Section 4,- so the 8306

July 24 1970 Tape 1359 page 3. company had three years to decide whether it wanted to go ahead with a mill. Then,under subclause 2,which we are now amending 1 if the company should notify the Government,in accordance with subclause 1 of this clause,that the company Lntends to Proceed with the construction of the first stage of the mill,the company will,subject to Clause 22,construct and commence to operate the first stage of the mill within three years from the date of such notification.

So in 1960 this House gave Newfoundland Pulp and Chemical Company, Limited,three years to decide whether they wanted to proceed with a mill at Come by Chance and then,if within the three years they notified the Government that they did,then they had another three years to construct and commence to operate the first stage of the mill. So that would bring you to 1966. Say, if at the end of three years they had notified the government they wished to proceed and a further three ¥ears after they notified the government,to complete and construct the mil~ it would have been done by 1966 at the latest.

An Act was ·passed in 1963. Act No. 67 of 19631 and in that amendment -that amendment is not relevant to the time limit -An Act was passed in 1967. Act No. 83 of 1967 • In that Act this House of Assembly extended the time for Newfoundland Pulp and Chemical Limited to construct,to finish constructing the first stage of the mill,extended the time to July 1. 1969, So there was a further extension to July 1. 1969. Then. last/IftaAct,No. 64 of 1969,there was a further extension of time,from July 1. 1969,so that the mill had to be completed or constructed by Dece~ber 31. 1971. Now. Mr.

Speaker. that was eleven years after the original Act was passed,and now the Government asks the House to approve,another extension of a further year,December 31. 1972. Well. Mr. Speaker. I am for economic development and industrial development if it is economic. I am not for developments that are not economic,that are uneconomic for this province .• I am not satisfied that this proposition is one that is economic for this Province,and there has been no information from the Govern~ent at all 1 given to us,to justify us in consider · ~t-.her there should be another one year's extension or not.

It is very impo •. ant~I

July 24 1970 Tape 1359 page 4. think,to notice that in the amendment passed in 1966-67. in the amendment that ~3S passed in Act Nos. 83 of 1966 -67,this House abdicated control in the following clause: Clause 2,subsection 2,of that Act said this;(the first

section refers to the agreement and_goes on in subsection z)•such qualification~ modifications and additions to and deletions from the provisions of the draft Agreement set forth in the

Schedule to this Act may be given effect to in an agreement executed and delivered pursuant to subsection (1), as the Lieutenant Governor in Council deems necessary or desirable to secure the establishment of a third mill in the province." In other words,this House in 1966-67,passed this section,which means that the Cabinet, the Government can qualify, modify or add to the agreement approved by the House,in any way it likes, if it deems it necessary or desirable, to secure the establishment of a third mill in the Province. Now, the question is,Mr.

Speaker, what modification, qualification or additions has the Government made to the Agreement passed in 1960.on its own hook?The Government does not have to tell this House or the people what changes are being agreed to,and the Government - MR.SMALLWOOD: Changes agreed to in what? MR.CR OSBIE: In the whole proposal for the third mill~in the Agreement MR.SMALLWOOD: No changes approved. MR.CROSBIE: Well, we will come to that.

Now, Speaker, so it is very important to notice that the Government has the power to change this agreement in any way it likes,if the Government thinks it is necessary or desirable to secure the establishment of this third mill.

In that same Act,Subsection 3 of section (2),it is stated that the Lieutenant Governor in Council,the Govern­ ment,can agree to make such payments to Newfoundland Pulp and Chemical Co., Limited,as may be prescribed to compensate that company for the cost of wood from Labrador manufactured in pulp facilities on the island,in excess of the cost of wood obtained in the island of Newfoundland and so manufactured, and such covenant may be given upon such terms and conditions and for such term as the Lieutenant-Governor in Council prescribes.

In other words, if the third mill,to be located at Come by Chance~annot obtain sufficient pulpwood ., ·,, 8308

July 24 1970 Tape 1359 page 5. for its purposes from the island of Newfoundland,the Government is being • empowered to say to Newfoundland Pulp and Chemical; alright, you have to have a certain amount of wood from Labrador each year to operate your mill, We will pay you the difference between the cost of wood brought to the mill from the island of Newfoundland and the cost of wood brought to the mill from the mainland of Labrador.~ And the Government has in fact 1 ~fr, Speaker, agreed with the third mill promoters that they will do this.

Now we are not told, we have not been told what the cost of that would be or how much wood is going to have to come from Labrador,to Newfoundland 1 to be used for the third mill. we have not been given that information. MR.SMALL~lOOD: It would be cheaper if it all came from Labrador, and none from the Island. MR.CROSBIE: The Premier says it would be cheaper.

I do not agree with the Premier that it would be cheaper.! would have to see it •tudied by reputable people,to show that it will be cheaper to bring wood from Labrador than it would be to get it in Newfoundland. ~ecause all experience is to the contrary from that. We are not told by the Governmen~ is it 100,000 curds of wood a year from Labrador, SO,OOO,if so. what will the cost be to the people of New- foundland?

In the same agreement 1 66-67,the Royalties,that Newfoundland Pulp and Chemical are going to pay on timbe~were reduced from one dollar to fifty cents for a cord of wood cut on the Island and from $2 to $1.50 per cord for wood cut and removed from the Province. There was another concession in 1966-67. Now the Guvernment comes to the House,Mr.

Speaker. and asks us to agree to a further year's extension,but no information whatsoever as to what the cost of from the third mill is now going to b~as to what the cost of moving,Labrador will be.as to what other arrangements have been agreed by the Government with the third mill people. Now.looking at the original agreement of 1960. several things to note. All of the timber on the Island of Newfoundland,Mr. Speaker. not already granted to Bowaters or Price or other people,is reserved for the Newfoundland 83G3

July 24 1970 Tape 1359 page 6. Pulp and Chemical Company. That timber has been locked up since 1960 0 Occasionally Newfoundland Pulp and Chemical is asked to agree to somebody cutting wood but basically the wood is lo~ked up for Newfoundland Pulp and Chemical and has been so locked up since 1960. Now, is it reasonable,Mr.

Speaker, for this House to agree to keep it locked up for another year from December 31, 1971. at the request of Newfoundland Pulp and Chemical who for ten years now have failed, have been unable to carry out their obligation of constructing this mill at Come by Chancel In addition to the wood th<!t is on the Island ,Newfoundland Pulp and Chemical has been given a tremendous concession of wood in Labrador, the Sandwich Bay,area down in the southern end of Labrador, a huge concession of wood in Labrador which they have a concession on. liR. SMALL\\OOD: Only if they build the mill.

MR.CROSBIE: If they build the mill. But in the meantime the wood is frozen and cannot be used by _anyone else -and it has been that way for ten years now. f.ffi. SMALLWOOD: Because the mill has not been built. MR.CROSBIE: Yes, but the wood has been locked up ten years,with the mill not being built. Year after year, after year, the mill not being built, this wood is still locked up. Another

section that I want to point to in the original, I think it is a very weak section,is this~ in the original agreement,

section 18, subsection 4, it says this: In connection with the disposal of affluent from its mill or mills and other facilities,the company<will conform to the general practises in the Province. MR.SHALLWOOD: They will also conform to the law of Canada. MR.CROSBIE: That is a

section that should be changed,Mr. Speaker,because the general practises in this Province,with respect to disposal of affluent from pulp and paper mills,is that the affluent just goes into a harbour or to a river and that is it. So if they conform to the general practises in the Province,from the pollution point of view it would be a very serious problem. MR • S~IAL LWOOD: that. The law of Canada will supercede that,The hon. gentleman knows 83::0

July 24 1970 Tape 1359 page 7. }ffi.CROSBIE: Well, the law of Canada may supercede it but I think that the MR.SMALLWOOD: Not"may',' "will." MR.CROSBIE: Well I think that the law of Newfoundland 1 that when we are entering into this agreement we should supercede it and assure that a much better anti-pollution clause is put in. It is my understanding that it is planned for the affluent from the third mill, is planned to be discharged into Placentia Bay.

Now we are a~.ready aware of what happened when the affluent from ERCO went into Placentia Bay,and it may be that engineers will say that you can put the affluent from this pulp and paper mill into Placentia Bay and it will make no difference. MR. SMALLWOOD: The engineers may say it but the Government of Canada and the law of Canada does not say it, MR.CROSBIE: I do not care about the Government of Canada,! am concerned with our responsibilities,the Government of Newfoundland. We are ente~ing into an agreement and we should say thete will be no affluent from this mill going into Placentia Bay.

We have been caught once,with the discharge of affluent into Placentia Bay, We will not be caught a second time. That is by-the-way­ so we are being asked,Mr. Speaker, to extend this another year. Now, it seems to be forgotten,Mr. Speaker, by a lot of people,that the Government have already advanced to Newfoundland Pulp and Chemical Company $2~ million,which is being spent either at Come by Chance or in connection with this third mill. Two years o~ three years ago the Government advanced $2~ million to the Newfoundland Pulp and Chemical Company to spend in connection with this project.

We have not been told in this House, the neople of Newfoundland have not been told,what the $2~ million is spent on.We have received no report, no audited report 1 where that money went, what it went towards. Was it all on the building down at the site or was it used to meet Mr. Shaheen's overhead or travelling expenses and the rest?-»ot a word. And when the Government comes before this House now,with .another proposal to extend it for another year,you would think that the Government would say~ "gentlemen we are very pleased with 8311

July 24 1970 Tape 1359 page 8. what has happened so far. This $2~ million waF- spent on thus and so." You would think the Government would explain the mill is going to cost such and such. The last estimate that I saw of the cost of the mill was $74 million, seventy-four million that was in 1967. What is the estimated cost of this mill today, 1970? MR.SMALLWOOD: About $80 milljon. MR.CROSBIE: The Premier now says about ~HU million. The Premier, introducing this Bill yesterday said practically nothing except we are supposed to sign - MR.SMALLWOOD: I said about $80 ~illion, of which we would guarantee $15 million.

That is what I said. MR.CROSBIE: · I am going to come to that. $74 million was the last accurate estimate - MR.SMALLWOOD: The last estimate_was yeaterday~about ~80 million. MR.CROSBIE: The Premier now says S80 million. ~m.SMALLWOOD: Yesterday,not today. MR.CROSBIE: Well perhaps he said yesterday,! am delighted if he did. MR.S~~LWOOD: Well I did. MR.CROSBIE: Whose estimate is it? MR.SMALLWOOD: Their estimate. MR.CROSBIE: Exactly. S80 million dollars,now we are going to guarantee $15 m11l~n~. MR. SMALLWOOD: I was talking on the telephone, las·t night, to Rust Engineering- it is their estimate.

MR.CROSBIE: I am hoping that the Premier ' is going to answer some of these I points when he replies Mr. Speaker. I prefer he wait until he replies. Then he will know what is involved. What questions have been asked? Fifteen million dolla~s is to be advanced by this Province and we are to get a second mortgage. A second mortgage not a first mortgagel Now naturally,Mr. Speaker, we would like to know , we are I suppose inquisitive, we would like to know what is the size of the first mortgage that is going to come ahead of our $15 million,and we would like to know what is Mr. Shaheen :f..nvesting himself 8312

July 24 2970 Tape 1359 page 9. · in this third mill? That might be a question that the people might want to know. What is Mr. Shaheen going to have at risk in connection with this third mill? The last figure I saw was $10 million,which ~as to be covered by subordinated debentures not going to go in as equity.It is going in as a loan,in subordinated debentures,which would mean that even if the project failed Mr. Shaheen would be a creditor of the project and would not lose his $10 million it would not be equity, Re would be a creditor.

If we had to take over the mill and get someone else to run it, that $10 million would be added to the first mortgage and the second mortgage,as an obligation that would have to be met by whoever took the mill over. So that point should be elaborated on. There is the question of take-or-pay contract. We are told,Mr. Speaker, that there is supposed to be take-or~pay contracts for the production of the mill. These are to be ten year or fifteen year contracts. Mr.

Shaheen has been endeavouring to 3et publishers to agree to these take~or-pay contracts,on the basis that they will be come shareholders in the mill and will receive the paper at ten dollars a ton less than the paper would be sold ordinarily on the pul~ and paper markets of the world 0 "ts that still the arrangement? .. 8313

July 24tH, 1970 Tape 1360 JM £ 1 MR. CROSBIE: is that still the arrangement and,if so,what effect is it going to have on the other Pulp and Paper Mills in this Province, how is it going to affect their marketing, this arrangement where certain publishers will get the pulp and paper productibn at $10.00 a ton less? It was suggested in the House a week or two weeks ago by the member for Humber East, a week ago, that the contracts were being negotiated at ridiculously low prices so that Mr. Shaheen can say he has take-and-pay contracts, Is this so? Who is checking it out? What are the figures?

These are some of the issues that need to be discussed. Now what worries me about this development, Mr. Speaker, is that we have almost no information on it at all and there are some serious questions that need to be answered. Now this Government paid half the cost of a study to be carried out by Forestall International Engineering, I think that is their name~ a subsidlaJY of the B.K. Sandwell Company of British Columbia,who are experts in this field.

The Goverment agreed to pay half the cost of a study to be done by Forestall,to see whether or not we had sufficient timber resources, uncommitted in this Province~to permit the third mill to operate. In , answer to a question that I tabled during this session of the House,the Government said that they had received an interim report from Forestall and,l think,that we have spent some $30,000. as our share of the cost of that report. There were two reports to be done, one by the B.K.

Sandwell Company for Newfoundland Pulp and Chemical,on the economic and technical feasibility of the whole project, technical and economic study, and another study by Forestall,for the Province and for the Company,on the wood situation. Now that was an interim report that was received around the end of December or early January 1968. 1he report was never seen by the Cabinet while I was in the Government,until May of 1968.and I do not know whether the Cabinet has·seen it since. The Premier has said that no final report has been received from the Forestall Company,which is most peculiar, Mr.

Speaker, 1f an interim report was finished by the end of December 1967. it is most peculiar that a final report has not been received from the Forestall Company when this point was made.by May or June 1970. Now the interim report, Forestall report,had some amazing disclosures in i~and this House needs te be told 8314

July 24th, 1970 MR. CROSBIE: Tape 1360 JM- 2 whether the disclosures are right or wrong. For exaaple: the interim report, (and Forestall must have gotten this information from Newfoundland Pulp and Chemical) stated throughout that the design, construction and maintenance of major woods roads - MR. SMALLWOOD: To a point of order, please. Mr. Speaker, I submit this point of order.

If we were now asking the House to consider a proposal for the establishment of the mill and we brought legislation before the House outlining the proposals and the terms and conditions of the proposed mill,then obviously it would be the right of the House and the duty as well to debate it. We have not done that. We have brought in an amendment to allow that the House adopt, and the amendment is to extend that Aet for one year.

My point of order is, and I submit this to Your Honour's consideration, that except for an occasional reference to the main Act, the debate must be strictly relevant to the amendment, not the whole terms or any substantial part of the terms and conditions of the original Act. That is the law of the land now. There is no amendment in to repeal that. There is an amendment to extend its existence by .one year, that is all.

My point of order is that the debate must be strictly germane, strictly relevant to that one simple amendment,"should it be extended, should it not be extended~ but not go into a discussion of the original terms and conditions of the Act that is now on the statute book. I submit that for Your Honour's consideration. MR. CROSBIE: Mr. Speaker, on that - MR.

SMALLWOOD: Now before I finish,may I say this that,if fhe House wants a complete debate 1 I am willing to do it,if it is in order, if it is lawful, if it is in accordance with the rules of Parliamentary practice and Parliamentary procedure and Parliamentary precedent. My point of order is that it is not and that therefore we cannot have that kind of a debate. We can argue that it should be extended, we can argue that it should not be extended but we cannot discuss the whole original project as set forth in the Act. The proposal to amend

an Act does not give the right to debate the Act: it gives the right to debate the amendment. Now it cannot be argued that you cannot discuss the rightness or 8315

July 24th, 1970 Tape 1360 JM - 3 MR. SMALLWOOD: wrongness of extending the Act without a complete discussion of the Act but that argument surely falls to the ground on all the precedents that have ever been establishing in Parliamentary procedure,otherwise the debate on

an Act can never stop. Any simple amendment to

an Act opens up the whole A6t and, of course, that is completely contrary to Parliamentary practice and Parliamentary precedent. My point of order is that the debate must be strictly relevant to the amendment,which is that it be extended for one year. MR. CROSBIE: Mr. Speaker, on that point of order. MR. SPEAKER: The bon. Leader of the Opposition has the floor. MR. MURPHY: Mr. Speaker, we have our own points on this amendment but I fee~ in all fairness, Mr. Speaker,that we must be in possession of certain facts.

To discuss the thing intelligently,we would like to know the original Act and anything in that Act that would warrant an extension for another year or otherwise. I feel,in that way, Sir, that we just cannot say yes or no, I think ago. we have to discuss matters that were relevant two year/ Are they still relevant today in this amendment in permiting it to pas~l So I see absolutely nothing wrong in discussing just what is contained in the Act. That is my point. MR. CROSBIE: On that point of order, Mr. Speaker, Vhat I am saying is quite relevant to the amendment before us.

The amendment before us is to extend,all the concessions given in the original legislation and amendments,for a further year. What I am discussing now is whether we should give this extension or not and,in order to decide whether or not we should give this extension, you have to decide whether or not this is a project that is for the benefit of this Province and you have to have certain information. Now I am addressinr, myself to the reasons why.

As far as I. am concerned,we should not give the extension and that is because this Province has entered into ~arious cornrnittments that financially means there are more costs than benefits to this Province, if it goes ahead on that basis. So we cannot discuss the principle of this amendment, whether or not time should be extended, unless we discuss these matters,and what I am saying is quite relevant to this amendment. 8316

July 24th, 1970 MR. CROSHIE: Tape 1360 JM -·4 As far as full debate is concerned, this is what we should be having, Mr. Speaker, a full debate on whether this present agreement should be extended and concessions extended for another year. What could be more important to this Province than an $80. million dollar pulp and paper mill? We want a full debate, not a little chicken-feed introduction of the Bill 1 and we are going to sit here blindly and agree to another year,without debating the merits of it. MR. SPEAKER: The bon. ~mber is still speaking to the point of orderl MR. SMALLWOOD: Mr.

Speaker, if the bon. gentleman~as finished his comment on my point of order may I add this? What the bon, gentleman has been doing is debating the Bill, whether the Bill should have been passed in the first place and whether it is a good Bill or a bad Bill, That is what he has been debating. He has argued this, argued that and argued all the matter contained in the Act, not the Bill the Act, the law of the land that was passed. He has been debating the desirability of it, the wood, the pollution, the various aspects, the financial side of it, what is it costing, what is Mr.

Shaheen putting into it, how much is the Government putting into it, all the elements and the aspects of the Act,and the only thing that is before the House is an amendment, one simple amendment to extend the term for one year, not a discussion of the Act itself and all the contents of th~ Act,but only that it be extended for one year.

Now the argu.ents could be the finances of the world, the financial state of the Province, the financial state of the Government, the financial state of Shaheen, for these or such reasons it should not be extended,but we are not privileged on this amendment, I submit, we are not privileged, we have no right to discuss the main Act, whether it ought to have been passed, whether it ought to be repealed, we have no right. It might be very desirable but under the rules we have no right. That is my submission, Sir. HR. HICKMAN: Mr. Speaker, on that point of order.

It has been my understanding that on a second reading debate (1) there is a great deal of latitude allowed by:the Chair, indeed, it is most desirable. But as the bon. Premier says, the issue that we are now debating in this Bill is the extension of the time in 8317

July 24th, 1970 Tape 1360 JM - 5 MR. HICKMAN: which Mr. Shaheen and his group, or his company, will be granted to establish the mill. Now surely it is most relevant,in deciding whether or not this extension should be granted,to decide on the terms and conditions that will be laid down in order to grant this extension. MR. S~~LWOOD: You are debating the Act, you are debating the Act all over again. MR. HICKMAN: Forget, Mr. Speaker, all about what is in the Act and all the terms and conditions that were laid down in the original Act.

This House is now being ask whether to grant the necessary extension and ~f so, surely it - is.w~thin the competence of this House and indeed an obligation on the part of members to give their views as to the terms and conditions and ~f these terms and conditions are in conflict with terms and conditions that were laid down three or four years ago under completely different circumstances, so be it! Mr.

Speaker, may I draw this House's attention to the fact that earlier ·in this session we were debating a Bill entitled, "An Act to change the name of the D~partment of Eduction from that to Education and Youth," that was the total Bill. We had a long, long dissertation by the hon. the Premier on drugs and youth generally and,when there was a point of order raised at that time,the hon. Premier said that on second reading you can debate anything at all that is at all germane to the Bill. MR. SMALLWOOD: It has to be relevant. You must, not you can~ you must, you have no choice, you have to. MR.

HICKMAN: It is a far more technical amendment,in that case,than the one we have now,and to say that we cannot debate this Bill and cannot debate terms and conditions or point out the fact that this extension is being granted without new terms and conditions 1 in the light of today'& facts, I suspect, would be a restricted on the rules, MR. SMALLWOOD: We do not debate the Bill, we debate the Actr MR. HICKMAN: -a restriction on the rules, Mr. Speaker, that there is no precedent for. MR. SPEAKER: If no other member wishes to comment on the point of order raised, 831B

July 24th, 1970 Tape 1360 JH - 6 MR. SPF~KF.R: I have to say this,that the rule of relevancy is possibly the most difficult question that comes before the Chair to decide at any particular time. I do agree completely that the debate must be relevant to the amending Bill which with is before the House. That is a fact, I think,/wh~ch nobody will disagree. I also have to say that the main Bill itself should not be, there should not be a general debate on the principles of the main Bill, of the main Bill which the amending legislation seeks to amend. The Act which is now under discussion seeks to amend

an Act which was passed some time ago. MR. SMALLWOOD: Your -Honour, the Bill now before the House seeks to amend

an Act. MR. SPEAKER: This is what I am saying. The Bill,before the House at the present time>is attempting to amend

an Act which was passed some time ago. We cannot have a complete debate on that particular Act but we cann~t avoid reference to it. If the reference is relevant, how can any hon. member debate whether the time is going to be extended without stating his reasons why? therefore he must make reference to the Act but,at the same time, in referring to the Act and in making reference to the Act which was passed some time ago and which this Bill seeks to amend, he should not, as far forth as his debating skill will permit him, open up a general discussion on the principles of the Bill, the principles of the Act itself.

But he has to make reference to it,obviously,and his references will be relevant. I would ask the hon. member who now has the floor, if he will, I think that possibly he was wandering a little far afield and getting into the principle of the Act but I would ask him now to continue his speech and to keep as far forth as is possible from discussing the principle of the Act itself eference to it,of course, is not denied him but to keep it within the laws of relevancy,without opening up a debate which was held on this same Act a year or two ago. MR. CROSBIE: Yes, Mr. Speaker. I am now discussing, Mr.

Speaker, my reasons for supporting or failing to support this extension. My present inclination, unless I get information from the Government,that persuades me to be opposite, is not to support the extension. One reason is that in the Forestall or Sandwell report it is stated that no allowance is made for cost for main 8319

July 24th, 1970 MR. CROSBIE: Tape 1360 JM ~ 7 arterial roads and bridges because these costs are based on the written assurance of the Government that substantially all arterial logging roads will be provided by the Province of Newfoundland,as part of its highway system.

In other words, it is not in the Act, it is not in any amendment, but in 1966-67 the Cabinet was given the power to make whatever changes they wanted to;and I say the Government has given Newfoundland Pulp and Chemical written assurance that all their arterial logging roads are to be paid for,one hundred per cent, by the Government of Newfoundland. I understand that the Government has agreed that they will build arterial logging roads,so that all the wood to be cut is always within two miles of an arterial logging road built by the Government.

This would mean road building 1up to forty miles a year,by the Government at a cost to the Government of some $125,000. to $150,000. a mile. possibly, involving an annual cost to this Province,for this road building alone, of some $5. to $6. million dollars, lhat is my understanding. It is not in the legislation and it is one of the reasons I want to know whether this is so. Has written or verbal assurance been given Newfoundland Pulp and Chemical that all logging roads will be built at the expense of our Government so that their wood is always within two miles of those roads?

Because if that is so, it is a treMendous cost to the people of this Province and on any ••• MR. SMALLWOOD: The Government do not build logging roads, it never did and I do not think ever will. MR. CROSBIE: Why did the Government give written assurance then? MR. SMALLWOOD: The Government gave the exact contrary, the exact and precise contrary. MR. CROSBIE: Well, why did the Forestall study report that the Government gave them written assurance~ MR. SMALLWOOD: The Government wrote Forestall and bawled them out for that stupid error. MR. ROBERTS: That is only a draft report. MR. CROSBIE: That is alright. Mr.

Speaker, I am raising these questions, if the.Government answers them satisfactorily,fine that will satisfy me. I am hoping against all hope that'this is wrong but this is what was reported. 83~0

July 24th, 1970 Tape 1360 JM - 8 MR. SMALLWOOD: That is not a report. MR. CROSBIE: That was one statement in that interim report of Forestall which, if it is correct, I certainly do"not propose to agree to a one year extension or any extension for this project to go ahead. It'was stated in this interim Forestall report, another point was made, the report concluded that there is not enough wood on the island for the mill,to be supplied from the Island of Newfoundland alone, Mr.

Speaker, that there would be required,from year one, to be brought to this Is~and for the third mill,some seventy thousand cords or cunits of wood1 from Labrador,and the reason for that is because of the age of the wood, · If we cut all the wood for the third mill on the Island now,after twenty-nine years the supply of mature wood would be exhausted on the Island and there would than be a period when you would not have enough wood on the Island.

So they recommended that right from the year one,when the mill starts production,that this plant will have to be supplied with 70,000 to 100,000 cords of wood a year from Labrador. Now the question arises, Mr. Speaker, what is the cost? Our Govern­ ment has agreed to underwrite the difference in cost between wood on the Island of Labrador to the mill and wood on the mainland of Labrador to the mill. Now common sense tells you that,unless there has been some miracle in the business of cutting and transporting wood from Labrado~ there is going to be a substantial cost involved there.

One estimate I have seen is that it would amount to $12.00 to $17.00 a cord more to bring wood from Labrador to the third mill than it would be to have the wood, the average cost of bringing it,on the Island. MR. SMALLWOOD: That, of course, is obviously a crazy estimate. MR. CROSBIE: That being the case,that subsidy would amount to around $1 million a year right from year one. Now if these estimates are wrong and the Government has good reports from competent people that the cost are not going to be anything like that, fine that will look after our worries, but at least we should get some information on that.

So that is another point that needs to be clarified. In addition,! would like to know;if wood has to come from Labrador, from what port in Labrador it is going to be shipped, who is going to be 83~1

July 24th, 1970 Tape 1360 JM - 9 MR. CROSBIE: responsible for the cost of building the shipping facilities in Labrador, where is the wood going to be landed in~Newfoundland,on the Isthmus, who is going to be responsible for the cost of the shipping-receiving facilities on the Isthmus of Avalon? Who is to meet those cost~ because the Forestall report seems to indicate that those capital costs would be for our Government also, not for Newfoundland Pulp and Chemical but for our Government also?

The additional capital investment,which would be required to facilitate handling of Labrador wood in log form,if installed during the construction period is estimated to be $2,020,000 This report, the Forestall Report, is based on the above cost being considered as a portion of a Labrador wood cost and,in accordance with Legislation 1 it would be borne by the Provincial Government. Is it correct that the $2. million odd dollars,capital cost of shipping facilities at Labrador and Newfoundland,is to be met by the Newfoundland Government?

Because that is also a factor,as far as I aa concerned, in voting for or against an extension of a one year period in this Act. I do not want this Act extended,. Mr';_ _speaker, if this project,under these conditions,is going to ._,. :- ~. . ..,~ cost more to the people in the Province of Newfoundland than the benefits it will bring.I would sooner have us let the concessions run out, to Mr. Shaheen, and endeavour to get someone else to develop them,who will develop them and take over more of the cost themselves. So that is another issue.

What about this capital expenditure of $2. million odd dollars for the Labrador wood? What about the annual cost of subsidizing wood from Labrador to Newfouna\and? If the Premier is correct that it is now cheaper to bring wood from Le~ador to Newfoundland than it is to cut it on the Island and bring it to the mill, this is a revolutionary development that has occurred in the last two years, because it was certainly not the case two years ago.

·: .. July 24th. 1970 Tape 1361 PK - 1 }ffi. CROSBIE: Then there is the water supply for the Third Mill down at Come-by-Chance. At one time it was estimated that the Hill would require 40 million ~allons of water per day. That may be reduced now. There was a problem at Come-by-Chance in rettin~ that quantity of water. Now it is su~gested in the Forestall Report, HR. S}TAJ.LWOQD: Hr. Speaker to a point of order. My point of order is that the hon. ~entleman is arguinf' now not as to "rhether there should be an extension hut; there should not he a Hill.

He is ar2uinJ!; that the ~ecision that this Rouse made is wrong. The House made the wronJ!; decision. He has no riJ!;ht to arpue that. He has the right only, and I have, and we all have the ri~ht only to arrue that it should or should not be extended for a year. But, the principles that were adopted by this House in the Act- that is on the statute books, the House has decided there shall be a Mill. The a2ruments for and against the Mill were then stated in the dehate, when the House considered that Rill and made it into

an Act, made it into a Law. All the agruments for and ar,ainst the Hill;.rere stated and ,having been heard,the vote was taken and the House decided to have a Mill. Now we are entitled, I submit, to debate whether or not that decision shall be extended for a year. This does not raise up the right to debate the whole thin~ over again, as though it had never been debated.

There could be an ocassion for such a debate, but the ocassion is not the present ocassion where tve are only amend in!! it in one respect, not with regard to wood, not with rep.ard to transportation, not with regard to wharves, not with regard to the a~ount of capital involved, not with rep.ard to pollution, not with re?,ard to anything, except one thing, shall we extend it for a yearZ If, if I am "rronp,, '~"our Honour, it means that any time in the House that any Bill is amended,the whole Act is arnended,with an AmendinP, Bill. Then in debating that Bill,the whole Act that was psssed,is open to debate.

There is nothin2 clearer in Parliamentary practice than this that only the Amendment, the proposed Amendment that is in a Bill,is debated. That is all. There can be references, allusions,to the Act. There can be allusions to it hut there cAnnot he a dehate on the Act. There can only hP a dPb<tte 8 3 ~ :l

July 24th. 1970 Tape 1361 Pk - 2 MR. SMALLHOOD: on the Bill. rtR. CROSBIE: Mr. Speaker, in connection with that point of order, it is the same as the one made earlier. Hhat I am debating is not whether there should be a Third Mill at Come-by-Chance or not, MR. SMALU!OOD: It is. It is. MR. CROSBIE: It is not. MR. St-fALLI~OOD : Exac t1 y • MR. CROSBIE: We are all for a Third Mill at Come-by~Chance. h~at I am debating is should this arran~ement,with these conditions. should that be continued for another year or not? l-lell, that is what I am debat:l.np.. MR. St-~LLWOOD: That is stated in the Act. MR.

CROSBIE: Are we just to accept a Government extension of one year without asking questions, as to whether or not it should be extended? This was passed, Mr. Speaker, in 1960. MR. SHALLWOOD: No, you should not do that; that is the hon. j!:entleman's ri~ht. MR. CROSBIE: Well I am ~iving my reasons now why we should not agree to this extension, unless these points are met. MR. SMALLWOOD: But he cannot debate the Act. MR. CROSBIE: The Premier is tryin~ to stop it,for some reason. He cannot answer the questions. MR. SM.ALT.WOOD: Oh! Come off of it. MR. CROSBIE: Mr.

Speaker, I am carryinr. out what the Speaker directed a fe'lo.• minutes ago, and I am addressinp, myself to whet·her this arranpenent should be extended a year further or not. MR. SPEAKER: (NOEL): It see111.s to me that the House has to accept the position that the principle,of whether or not there should have been this agreement in the first place,has already heen decided and that this present Bill is whether or not this arranp.ement would be extended for one year. Our attention should be directed,not to the merits of the arrangement hecause that has been decided already.

The thin~ is whether or not there is any justification for the further year ~eriod. I do not think that it is in order for the hon. 111ember to debate the principle, as to 'l':hether this '!fll Q~,...

.July 24th. 1970 Tape 1361 PK - 3 t-IR. SPEAKF.R: (NOEL): !:!hould have been ar,reed to in the first p~· ace. It is chanpes that came up since then, thin~s of that nature,! would think. But I think the hon. member is just about to r.et into the water s~pply system. Now,unless there is some change in that, I do not think that is relevant to whether it should be extended for a year. MR. CROSBIE: ~'r. Speaker, the Forestall Report; these conditions are not in the ori~inal Act. But, the 1966-67 Act permits the Government to agree to such conditions and changes as they wish.

I understand the Government has agreed to these conditions outlined in the Forestall Report in 1968. My point is that,if that is correct that this should not be. MR. S~fALLlVOOD: It is not correct. I have safd it is not correct. MR. CROSBIE: Extended! I am not discussing the ~riginal Act. I am discussing whether or not this particular agreement should be extended for another year. I will restrict myself to that. MR. SPF.AKER (NOEL): I think the bon. member should continue, and I will stop the hon. member if he is not right and to the point;"whether or not the aJ!;reement should be extended for a year." MF.

CROSBIE: All right! In considerin~, Mr. Speaker, whether or not this arrangement should it be extended for another year,,. is. relevant to ask-have the Government agreed to pay half of the cost for providing water to this ~ill at Come-by-Chance?. Who is going to bear the capital cost of putting the water supply system there? Or has the Government agreed,as has been stated in this Forestall R.eport for which the people of Newfoundland paid but, which they have never seenJ ls the Government obligated to pay $165,000 per annum for the water? HR. S''ALLTYOOD: No, we are not. MR. CRO~RIF.· Then, Mr.

Speaker, it is equally relevant to ask this 1 when we are considerinp.,should the extension be rnade2 Is the Forestall Report of 1968, for which we paid, correct, when it says , that the company has been promised hydro-electric power or electric power, to be delivered to the company at t,..ro and a-half mills per kilowatt houri' That provision is not in the 1960 arreement, ~r. ~~~~ker. It is not in any amendment ~ade since 1~60. 83~5

July 24th. 1970 Tape 1361 PK - 4 MR. SHALLtmon: And it is not so. MR. CROSBIE: The Forestall Report says that, ''the company has been assured of power at two and one-half mills and the estimated cost to the people of Newfoundland for that every year ._rould be around ~1 million per year.'' MR. S!fALUJOOD: Is the hon. r.entleman quotinr; from the Forestall Report? MR. CROSBIE: I am quoting, MR. SHALLWOOD: Or are you quotin~ from a draft? }m. CROSBIE: I am quotinr; from the Interim Report. t-IR, S~LLHOOD: A draft Interim Report? MR. CROSBIE: Well, I am quoting from the only thing that I have in my possession, MR.

SMALLl?OOD: Which is a draft, and I know who ~ave it to the hon. gentleman and it is not the Interim Report. It is a draft. MR. CROSBIE: The hon. the Premier ~ot after Forestall when he saw this draft. MR. SMALL'.JOOD: You bet, }m. CROSBIE: Got him to change the draft. MR. SMALUlOOD: You bet I did. It was full of errors. MR. CROSBIE: The Forestall Report says, "power would be supplied to the Mill by the Power Commission so on and so forth, at a Government subsidized rate of two point five mills per kilowatt hour." MR. SMALL1WOD: Now,may I say rip,ht now,it will not. MR.

CROSBIE: I am ~lad to hear the Premier say that. But, Mr. Speaker, when we are considerin~ thi~ extension and whether it is to be made or not, we should be told at what price are the Government a~reeing to provide power to this ~ill? MR. SM.ALLl-!OOD: A strai~ht comrnerical. A strai~ht comrnerical. MR. CROSBIE: A straipht com~erical. Is a straight cornmerical,after one of the Premier's cost•benefit study to show the cost to be four mills or so, or is it the real straight commerical rate?

July 211th. 1970 Tape 1361 HR. SMALLHOOD: A straip:ht c:ommerical. ~. CROSBIE: Of about six mills per kilowatt hour. HR, SMALU!OOD: A connnerical. MR. CROSBIE: A commerical. That question needs to be cleared up. MR. ~t-'AI.J.WOOD: I cleared it up. MR. CROSBIE: It has not been cleared up yet. PK - 5 So, Mr. Speaker, if the Lieutenant-Governor in Council, if the Cabinet have agreed to concessions with respects to roads that will cost us $5 million to $6 million a year, MR. St-'ALUTOOD: They have not. MR. CROSBIF.: Concessions with respect to Labrador wood that will cost us . $1 million a year or so, MR.

SMALU70ClD: It '1-Yill cost us nothing. MR. CROSBIE: Concessions with respect to water that will cost ~s $160,000 or so, MR. SMALLHOOD: It will cost us nothin~. MR, CROSBIE: ConceRsions ~11th respect to powerL that will cost us around $1 million a year. MR. St-fALUYOOD: It will cost us nothin!. MR. CROSBIE: All of which totals up to about $7 million a year~ HR. SMAI.Ll~OOD: It costs us nothing. MR. CROSBIE· Then I say, I would not a~ree to this extension because,on any cost-benefit analysis.this Province cannot afford to pay out $7 million a year from the Treasury: ~uarantee $15 million of bonds. 'HR.

SMALU!OOD: I ap:ree with that. MR. CROSBIE: Build houses. MR.~' SMALL HOOD: I agree with that. ~. CRO~BIF.: So on and so forth. MR. ~t-'ALLHC'IOD: I ap:ree completely.with every word of that. MR. CROSBIE: Because the cost would out-wei~h the benefits. 83~7

July 24th. 1970 Tape 1361 PK - 6 t-!R. CRO~RIF.: Now, if the Premier,when he replies,clears all that UPjthat will set my mind at rest and will be extremely helpful. In view of the fact, ~r. Speaker, in view of the fact that the 1966-67 Amendment to this lep.islation p:ave the Government the power to chanp.:e the Ap:reement that this Rouse passed in 1960, in any'Way the Government liked, surely, when the Government asked us for an extension, the House, the Government should tell us, have there been any qualifications, modifications or additbons to or deletions from the a~reement that is attached with the

Schedule to the Act? Because the Government have absolute carte blanche, they can make any chanJ!es they deem necessary or desirable,to secure the establishment of the Third Mill in the Province. It is not y.ood enough. It is not ~ood enough, ~r. Speaker, for the Government just to come to the House and say; "~entlemen,we want another extension for a year with respect to the Third !-fill at Come-by-Chance." It has now being going from 1960 to the end of 19Jl. The Government says not~j 1o1e want another year, to 1972. It does not p.ive the House any information. It does not tell us what the new editions are.

It does not tell us what the new costs are and how they are p.:oinp.: to be met. We know our second mortp.:a~e is $15 million. How is the rest to be met? It does not tell us how much equity, Mr. Shaheen is puttinp. in the project, 4r what the changes have been since. It does not tell us· whether or not 1o10od 'ITlUSt come from Labrador and what that will cost us? HR. S!-1ALLHOOD: In other t~ords we do not ar~ue for the Hill. We do not give the ar~uments for the 1-1"111. l~e only arp:ue for an extension. MR. CPOSBIF.: No one is ar~uing whether there should or should not be a ~fill. But •• MR.

S~'ALT.POOD: That is what the hon. p.:entleman is arp.uin~. r~. CRO~BIE: The conditions under which there should he or should not be a Ht 11. He have had enoup.h of that heifer dust in Newfoundland ,in the last twenty years, that anybody who questions what the Government is doing is 83~8

July 24th. 1970 Tare 1361 PK - 7 MR. CROSBIE: against the Hill or ap,ainst this or that. That is nonsense. The people of Newfoundland understand we are not questioning that. We are questioning what the terms and conditions are. ~fR. Sf·!ALLHOOD: \Vhat the hon. gentleman is questioning is whether there should be a paper mill,according to the terms and conditions adoptE!d by this House in the Act. He :f.s questioning that. And that is what is out of order. MR. CPOSBIE: And adopted by the Government since. MR. SHALLHOOD: And that is what is out of order. MR. CROSBIE: _Two and a-half mill power is not in the Act.

Labrador wood is in the last amendment, but how much wood has got to come from Labrador and the cost? That is not in the Act. The water system is not in the Act. These things are not in the Act. There are things the Government has had come up since, because this started in 1960, and it is not completed now and $2.5 million of our money, the people" of Newfoundland's money is spent do~m there. We do not know if there is any money of Mr. Shaheen's spent down there. Now we are asked to keep locked up all the timber supplies of Newfoundland limit,for another year,to the end of December 1972,for Hr.

Shaheen. \-i'ell, why? Why not invite other people to come in now? Why extend this? '•Thy not invite other people to come in? The Shaheen people have not met their obligation. Mr. Shaheen got interested in the Refinery in 1967 and spent his time on that since because there is a pile more money in the Refinery t'1an the Third '·till 1 which will be much more to the benefit of Nel.rfoundland. Far more employment for Newfoundlanders, based on our natural resources has been alloHed to rusticate 1by Mr. Shaheen, because there is more money for him in the Oil Refinery. That is not to the benefit of Newfoundland.

The Government should have had said to him; "forget that refinery, until you get that mill there." That is where the benefits are for Uewfoundland,in the r.1ill. Perhaps, 600 or ROO jobs and there are another ~00 lORRers in the rest of it. That is where the jobs for Newfoundlanders are. Put, Mr. Shaheen is being allowed to put that in 8329

July 24th. 1970 Tape 1361 PK - 8 MR. CROSBIE: a secondary place,for the last three years, while this Oil llefinery far more specious, far less advanta~eous to Newfoundland ~cnt ahead because that is where the money is. !.Jell, I would say,· that is not ~ood enoup,h. Mr. Shaheen has had eleven years, ten years,to ~et up the mill. Let us try someone else now. Let us free up our force. Let us try the two paper co~panies again or let us look around the world to see if anybody else, ~!R.

SNAT.L~-'OOD: They will take all the timber, we will not have to try. lve will just have to beat them off with cricket bats to keep them from ~rabbinp, the timher. We do not have to try to ~et them to take the timber. Price and Bowaters. lve t·Yould not have to beg and plead with them. They will take it. Every cord of it. MR. CROSBIE· I do not want to get into an ar~ument with the hon. the Pnmier, Hr. Speaker, we have ~otten along so well this week. I refuse to be baited by him. What was the point I was just going to make? MR. SY.'ALLPOOD: Ah! does it matter. ~- CROSBIE: The Premier is gettin~ me confused. MR.

SY.'ALLPOOD: noes it really matter? Y.!R. CROSBIE: I think it matters. MR; Sfo!.ALLPOOD: Is this trip necessary? tm. CFOSBIF.: I think it matters. Well, anyway I do not want to wait too much longer, but. I think there is something germane, I was ~oing to say. Oh! Yes, yes, 1-!r. Speaker, what I su~gest is this, somethin~ that has already been sup.~ested by the hon. member for Humber East,outside the House. He cannot be here today because of certain family reasons. It is this; Y.fr. Shaheen has asked for an extension of time.

Is it unreasonable for the ~:ewfoundland people and the Newfoundland Government to ask ~r. Shaheen now to put up a performance bond in an amount of say Sl million that, if he rets this extension of time to the end of December 1972, he bonds ~~self to perform to have that mill under construction before the end of 1972? 8330

July 24th. 1970 Tape 1361 PK - 9 ~R. CFOSRIE: "~Y should not Mr. Shaheen, when he asks us for another concession like this,be prepared to take some risk? Put.up at least $1 million bond but,on condition of the Government grantin~ them this extension a~ain, he hands himself to perform, to carry out his obli~ation by the end of December 1972. Then we will see, then we will see how much faith Mr. Shaheen has in this. Then we will know; is it an election dodp.e or not? r.'hen, Hr.

Shaheen demonstrates his faith, by puttinp. someth:ln~ at risk, $1 million bond, for example, and he is a man of lots of assets, the Premier has told us, when he does that,then we can with confidence say;"all ripht)another year's extensio-g, we can take a chance on that.'' Mr. Shaheen must be pretty confident, He is takin~ a chance now he has got $1 million at risk." But some condition like that surely should be ~iven. Here is something tha.t was started in 1960, suppose to be completed at the latest 1966, and ten or eleven years later is not completed.

There is another point to I would like for the Premier to expand on, and it is this; as I underRtand,all the lor:F:in~ for the Third Hill, Mr. Speaker, is p:oin2 to he done by lor:F:inr: contractors. It is not going to be done by the company. That means 1 most likel~ that logp.inP, cannot he mechanized. It is not p.oing to be modern methods of lop:p.inp., if you are going to use a lot of small loP-r:inp. contractors to do the work. If that is the case, they will not be able to use much mechanization. What is the advantap.e to the company?

The advantage is th~t they have pulp contractors who r:ot to deliver pulp at a certain price. Rut it appears to me that there is a very serious possibility that tJe low wages of non-unionized labour is really poinp. to he suhsidizinp: the cost of that wood to the plant.

Some small loP-ping contractor, he wants to get business, he wants to be in business, o he aprees to cut certain number of cords for the mill,at 11 certain price, and, to follm·r throur,h ,he has p.ot to employ labour at certain rates of war,es, which are not all that hip.h, lf there are F:Oinp. to be a whole series of lopginr: contractors,it will be most diffcult for them to be unionized. Is there a possibility of low wap.es,of non-unionized 83~1

July 24th. 1970 Tape 1361 PK - 10 MR. CROSBIF.: labour subsidizinp. that situation? And, if there is that possibility, what does the Government propose to do about it? MR. SMALLHOOD: Are there any non-unionized lor,gers in Newfoundland today? MR. CROSBIE: Yes, there are many of them. HR. Sl''.ALLtmon: Are there? MR. CROSBIE: Workin~ for a small lo~~in~ contractor. MR. SHALL HOOD: l..Torking for small sawmills. MR. CROSBIE: Yes. MR. SMALL~OOD: But, are there any pulp wood loggers in Newfoundland today not unionized? MR. CROSBIE: The hon. the Premier would know better than I would. MR.

SMALLlvOOD: Well, I do know there is not one. NOT ONE. Not one man, not one person in the entire Province. HR. CROSBIE: Hell, I hope, lo'R. S HA LLt~OOD:- cuttinp, pulp wood1who is not a union man. loffi. CROSBIE: We hope the Government will see then)that that continues to be the case. MR. Sl'~LHOOD: It is not up to us to see that . that is the case, it is up to the men in the unions. MR. CROSBIE: It is easy enough to say that it is up to the men in the unions. ~tR. SHALL WOOD: So it is. MR. CROSBIE: But, if you got many small employersJemployin~ people all over the place, it is very difficult for unions to - MR.

S}'ALLPOOD: You had that before 'r·ith Bowaters and Price1 small camps and operators and subcontractors all over the Province. Did that stop unionization of the men? MR. CROSBIE: Now another thinR we should be told, Mr. Speaker, in considerinp, this extension,what are the arrangements for housin~ and all the rest of it in that area? Is it at our Government's expense entirely that housinr and water and sewerap,e and the rest of it have to be provided or does the company 8 3 <"l•) ~ ...

July 24th. 1970 Tape 1361 PK- 11 MR. CROSBIE: make any contribution? In fact, what contribution does the company make? Is the town site ~oing co be Ciarenville or is it goin~ to be a new town in the area? MR. !'MALLWOOO: I have already ans,vered that. HR. CROSBIE: The answer was yes, was it not? }!R. S?-'.AU.lVOOD: I answered that. }fR. CROSBIF.: It would be. }fR. SHALLWOOD: The answer I thou~ht was, "no." }ffi. CROSBIE: No, it is not ~oin~ to be Clarenville. l-lR. SHALLWOOD: lolell, I did not say it was not p,Ciing to be Clarenville. I said, I thouRht there would not be a new town,necessartly.

That is what I said. l-lR. CRO~BIE: There is suppose to be a take.or-pay contracts, Mr. Speaker, who have we got acting for us to assure us that the prices in these take-or ~ay contracts are prices that will make the mill economically feasible! Somebody at this stage has to look at the whole thin~, revise all the costs. Say the capital cost is $80 million, the wood is from here, there and the other place,it will cost so much to produce, and Nr. Shaheen's take-or~ay contracts are therefore economic or they are not economic. Hho is doing that?

What effect will it have on the pulp and paper market, if this pulp and paper production is sold at $10. a ton or some other figure less than the market rates to these people? We are asked to extend this. In 1960,when this was passed, Mr. Speaker, our $15 million second mort~a~e and, I think, a $30 million or a $35 million first mortgaee was a total cost>just about. Now the total cost is $80 million. Well, surely,if we are asked to extend this, someone will expl~in, the Government will explain to us how the $80 million is nm~ going to be put up ~ And surely they will explain,to us, how much Hr.

Shaheen is puttin~ in, whether it is p,oing in as a loan, or whether it is going in as equity. 8333

July 24th. 1970 Tape 1361 PK - 12 MR. CROSBIF.: Seventy-four million was the last fi~ure that I have pot here,now it is $80 million. Newfoundland Government $15 million, first mortgage hands $38 million. Is there going to be a Canadian Government grant for the construction now of this Third }fill? In these fi~ures here, $3 million "'as shown as a grant from the Canadhm Government. Is that still the case or what is the grant going to be? These are all questions, Hr. Speaker, that are relevant 1.•hen ''e are considering whether we should extend this for another year or not.

Before this House decides to approve or disapprove this, these points should be answered. The answers should be ~iven. \<Jill the mill affluent be discharged into Placentia Bay? And the other question that I have read. ~fuat about this suggestion, on the surface I cannot see how the Government can refuse to accept the suggestion,that Mr. Shaheen be asked to put up a performance bond now 1after this ten years have gone, that he will,if granted by this House.perfonm or at the end of 1972 we would ~et the $1 million bond that he has put up.

That is the minimum. lf he would do that and demonstrate his faith in the project like that, tre \vould he protected and I for one would vote for it. But, before deciding, Mr. Speaker, to vote for or against this extension, I want some of these questions answered and I want to know whether Mr. Shaheen will demonstrate his faith by having something at risk himself? See, Mr. Speaker, it is not a question, when a matter like this comes before this House, it is not a question whether you are for or apain~t it the development of Newfoundland, and so often in the past"has heen l!ll'noeuvrerl to appear like that.

It is a question,what kind of a development do you want for Newfoundland? Do you want economic development that pays for itself, or do you want development that is non-economic that the people of this Province will have to pay for;that does not give them the heonefit th.1t th<'V should p.et; that is too cl'stlyl Those areo the issue~ involvf'rl. lt IR not whether you are for or against, Mr. Shaheen, it is whether ~~r. Shnhf:'rn l s properly doinp. What he should do, takin~ the obligations he shou]d tnkP, investing the money he should invest in these projects. 8 3 ·~ , •' 1

July 24th. 1970 Tape 1361 PK- 13 }ffi. CROSBIE: Now there is nothin~,so far in the ten year,demonstrates why tore should give this extension of another ye~r. He know thllt Mr. Shaheen put this aside,of far more value to Newfoundland, but he put it aside when he ~ot the idea of the Oil Refinery,of far less benefit to us. Now he comes to this House 1 after doing that, comes to this House and asked us for another year's extension,without any information. MR. SMALL HOOD: Come on give us another hour. God, he is ~ettinp, to be a wiz at it~ MR. CROSBIE: Since, we want to be relevant, Hr.

Speal~er, and the Premier now thinks I am beginning to get a wind-bag, I am so discouraged,! think I will cease by saying this! I have not got my mind finally made up. We have not got our minds finally made up, MR. S~ALLWOOD: I am ~lad to hear that. That is manly. MR. CROSBIE: As to whether we will vote for or against the extension,will depend on the information we receive from the Government, MR. SMALU100D: All right that is fair enough. Fair~ MR. CROSBIE: ,-and as to our suggestion about this performance bond or something like it. MR. SMALLWOOD: That is fair enough! It is fair enough! MR. EARLE: Mr.

Speaker, it is not my intention to delay the House for any length on this particular amendment. But, I think there are a few comments necessary.

Actually, in making any comment on a ~ill of this nature. there is a strong danr,er,which the Opposition always seem to run into, of beinp, labelled immediately as .beinp against everything, as we have been in the case of the Oil Refinery. that is the most dastardly falsehood that h~s bPr.n ever spread among the people of Newfoundland. l.Je are not,again we are &Fainst in this ~ase, as in the case of the Oil Refinery~of havinp, Newfoundland bled white by promoters who themselves may become extremely wealthv, and T am not even a,:!ainst that Pro!T'oters of these projects can becoll'e unhenrd of wealthy,if they wish to providinp, the benefits to Newfoundland, cornpensatP. the people for 'ihat they put into it.

This is the point

July 24, 1970, Tape 1362, Pa~e 1 -- apb HR. EARLE: ---- ----- Hhich I think the press should drive home, that we on this side of the House are not against an oil refinery, we are not against the extension of this mill, even more so than the oil refinery, because of the potential employment in a paper mill,we are all for it. We would like to see nothinr, better than the fourth mill. Fair enough, fair enough. !-!R. EARLE: -------- Absolutely. ~!R. SHALU'OOD : It is a fair statement. HR. EARLE: The only point '-'hich I would like to make Hr.

Speaker, is ,as the Premier said~ if there are any questions in this matter of a chanp.e in the situation in a ten year period over which this particular project has been in negotiation, the House should be informed. We do know that two and a half million dollars of the people's money have been invested there somehow. \\'e know that in the case of the oil refinery there was $5 million bridge financing. ~~at we have not got in either case, and I suspect that we will not r.et it in this case, is the auditable report as to how that money has been spent.

I would think that if the Shaheen people were sincere in coming to this House and asking for another year or tl..'O extension, they 1vould be prepared to place before this House full audited details of how the two and a half million dollarshavebeen spent, ~hat the present financial condition of the Newfoundland Pulp and Chemical Company is. What are their assets? Are they able to live up to any commitments which they may make'? Are they lvorthy of this Government givin~ them the concessions which they seek? Can they carry out?

Now with the lack of information, we can be forgiven if we feel that in this case and in the case of the refinery also that Ne~1foundland has been able to build up quite an organization for some people,to the extent of supplyin~ seven and a half million dollars on these two projects. Any member of this House,himself, if he has that kind of money to play around with.could keep a very, very good organization ~oing.

Arain I repeat, we do not mind keeping the orF"anfzation going providinp. we can be sho"•n conclusively, without question, tha the ultimate benefits from these particular pror.rams are ~oin~ to ~e for the people of Net-~foundland and not soley for the promoters involved. 83 ~" ~ 'J

July 25, 1970, Tape 1362, Pare 2 -- apb In order to give us so~e sensible comparisons and some scn~fblc reasons t-1hy t.re should extend this particular agreement, this House should be shown the present financial standing of this company, how the money has been spent and what their plans are for the immediate future, not one year's time, not two year's time or six year's time but now.

Starting as of now,if we extend are the agreement, l-7hat" the steps which they are p.oing to take ,as from the extension of the ap:reement fort~ard~ I think,if we had these facts to base our judgement on,then we would feel that we could or could not extend the a~reement. Incidentally Mr. Speaker, I do not intend to enlar~e on this any more because there is nothing more to be said on the extension of an aJ!reement other than to say, ,.

I am not goinr to vote af?ainst it because I feel that before this can be implemented, there will be a new Government and we will see to it that it is handled properly. ~ffi.. l!ICKMAN: ------- It might be much better to give it to Bay Street, in Toronto than Wall Street, in New York. Be that as it may,Mr. Speaker, the issue in this Bill is a very simple one, to extend it for one year. It must be obvious to every hon. member that this mill cannot be built in time to meet the deadline that is placed in the present legislation. HR. SMALLHOOD: Fair enouF:h. NR.

HICKHAN: Hopefully, it will be done in time to meet the new deadline. I would think that the representatives of the Shaheen organization,who are presently in the Speaker's Gallery at this time. have !?Otten some pretty clear messaf-eS. !-lay I point out to this hon. House, Mr. Speaker, that if there is no prop:ress made in the meantime and if by this time next year it becomes obvious to this House that no prorress has been made beyond the position 1.•e are noH in, this would be a clear case to repeal the Act forthwith;so that these facts should be conveved to the Shaheen or~anization.

Out of this debate today comes two or three very enlirhteninr facts and t"-'O or three firm commitments made by the Premier ,as Leader of the Government,and this House is entitled to accept and rely on them. 83:7 Number (1) there ~·~ill be no subsidy for po"·er. The power "~<•ill hl' r

July 23, 1970, Tape 1362, Pare 3 -- apb sold at the commercial rate. HR. S?!ALLI\'OOD: '\>1111 the hon. ~entleman allow me to confirm his

interpretation of what I said? I now confirm it. ~ffi. JIICKPAN: The hon. Premier confirms it. So that is out, the Shaheen people can take back no'"· I.Jhatever your feasibility studies are in the fvture ••••• ~. S~ 1 ALUJOOD: No, no, this is not ne'" to them. l-IR. HICKPJ\N: --- ~ --- -- ... ----· Whatever the feasibility studies are in the future, no subsidy Number (2) the Government of Newfoundland in no way will be responsible for the construction of shipping facilities either at Corne by Chance, Sunnyside or in Labrador. That is out of the way • .

Number (3) the Government of this Province will not in any way directly or indirectly be financially involved in the providing of adequate water supply for the mill or housing for the people who will be employed in the mill. These things are now all out of the way. Whether the feasibility studies that have been subsequent to this draft report of the Forristall Engineering, have already had this information,! do not know. The last one,,-Thich is of equal importance ,is that Government in no way will be responsible for the provision of woods roads to enable the company to operate.

These are all out of the way now, cleaned up, definitively stated for the first tirne,publicly ••••••• UR. HICJ(}UI.N: Yes definitively stated. If the Leader of the Government says that this is,and he has said it in reply to statements put by the hon. member for St. John's West, this Ilouse is entitled to accept it as being fact,and now we kno'"· ••....• MR. S!-11\LLHOOD: Not only entitled, must. · under Parliamentary rules the House must accept. NR. HICK':AN: !·~ust, all rip:ht. !·IR. S~ALU:OOD: Official stateMents made by a minister in his capacity.

Ri~ht, and we now know that never will there come before this 83:;g

July 24, 1~70 Tape 1362 l'age 4 KM House (because legislation is necessary to promote this)never will there be brought before the House a Bill to amend this Bill nor another Bill to confer on Government the right to subsidize power, pay for the water supply, pay for the housing, building the wharves. This will not happen, nor to build the woods roads. It \oTill not happen. This is cleared out of the "-'ay and our Horries have been allayed. Nr.

Speaker, under these terms and conditions the Government have the right to lay do"-'11 (and this is why these terms and conditions are relevant to this Bill) if there are any terms or condition that have been laid do"-'11 or agreed to, even tentatively, since the debate on the last amending Bill, then the Government, I am sure, ldll discharge its obliga - ~ons and tell the hon. members whether any such conditions have been made.

One of the disturbing features of this proposal and one of the thinP-s that crea2 an uncertainty as to whether or not this will ever come to fruition is the public suggestion and the public statement that has emanated certainly from the Shaheen Group and I believe, but this may be subject to correction, from Government, that the concept of the Come By Chance ~!ill differs from other mills that have been established in Canada, in that the price of the product is p.oing to be ten dollars a ton less and that the publishers, who are really the only customers for paper mills in North America, the publishers in the United States will be piven shares in return or in consideration for their arreeing to buy paper at a lower cost.

Why there is cause for concern, Mr. Speaker,. is that that type of deal is not unprecedented in the history of sellinr paper and creatin,:> paper mills in l~orth ~.merica. Indeed, I am told (an here, obviously I cannot confirm it because I was not around when it happened) that in the t~··enties this was the "'ay that you started a paper mill. You .,·ent to the publishers, you P-Ot take-or-pay contracts at prices that ~·ere mor'e than cor.1petitive and you gave the publishing companies in the L:nited States and the ne"·spapers an opportunity to acquire 83:J9

July 2q, 1970 Tape 1362 Pare 5 ownership in these paper mill. This went on until suddenly - and bear in mind. all we have heard, publicly, is that the market for l01 the product from the Shaheen !'ill,at Come By Chance, the bulk of it will go to the United States of America and so, consequently, the lat-$ of the United States are exceptionally relevant in this instance As the hon. the Premier is fully aware and I am sure hon. members of this !louse are fully aware, the F.E.C.

Regulations or \>.'hatever their combine (their countrepart is the Combines InvestijZation Act of Canada ) absolutely prohibits newspapers from becoming shareholders in the mill which supplies the product to them, if this means that the product is going to be supplied at something less than competitive prices. Now I realize that if you put this to ~r. Shaheen, he will say: ''No, no. That is going to be changed" or "That will be quite all right, l"ashinjZton will agree.,. But you cannot build a paper mill on what a promoter tells you; that Hashington is going to agree.

You have to build a paper mill based on what present day legislation provides in the United States of America. I suggest, Hr. Speaker, and submit that, \\'hen we are looking at the feasibility of granting this extension and decidin~ whether or not this is a meaningful piece of legislation, because if it is not meaningful, what difference does it make how you vote? If it means that in two years time this plant is still not going to be started, then what difference does it make?

The only handicap is, and it is not when you take it in the overall picture of what could come out of this, it is rather minimal,that some logy.ers, some small sawmill operators Hill still, for the next two years, be barred from entering on unused land in this Province and even then, if Government sees that nothing is going to happen, it has an absolute right and indeed an obliration to repeal the existin~Z lepislation.

But let us not forget, froa 1959, at least from 1959, the year before the original Act was passed, right up until today, the carrot of this new paper mill has been dangled under the nose of the people, particularly in the Trinity South - Placentia East and Trinity :;orth Area. Some people still are waiting and genuinely

July 24 , 1970 Tape 136.7 Pare 6 waiting in anticipation of this coming to pass. Well, ~r. Speaker, you cannot go on year after year after year coming up l-lith excuses that Hr. Shaheen has been too busy on something else' · that some other problem has arisen but that it is still going on, that we switched from Finland to the United States or we switched from U.K. financing to American financinr , and still expect these people to wait and wait in hopeful ant i cipation. It is a rather cruel way to develop industry in this Provjnce. The sod has been turned and r:ro~,·n over now.

It was turned in 1966, for sure, maybe before. I know it was turned in 1966. I am equally certain that you cannot find the place lvhere it "-'as turned now. Be that as it may, if this labour-intensive industry has a chance to get started within the next two years it would be silly not to give them this last chance, but it would be equally (and out of this debate has come the public revelation that the cornmittments that, for instance, worry the hon. member for StJohn's West have not been made and will not be made and will not be made).

This in itself certainly delays my fears and makes the proposed a~endment, for what it is worth, a rather innocuous one. }'r.

Speaker, let us not get the impression that this sort of extension can go on indefinitly, that next year some one can come back again, because where it really puts this Province in a rather unfortunate light is to have promoters beatinP around North America, with a piece of paper in their pockets, saying that ·the Government of Newfoundland have given me so many thousand square miles of timber land in Labrador and on the Island of Newfoundland, and all I need from you, l-rith this in my pocket, is an indication that you are going to buy paper from me.

Then I will go to the financiers and again show them this legislation,(they now have since 1960) and on the strength of this legislation try and raise the necessary funds. This does not, I repeat , does not ~ive the impression of responsible, sensib~e economic development in this Province, not by a long shot. Anyone knows that if we can get labour intensive industries in !\ewfoundland, based on our natural resources, 83:!1

July 24, 1970 Tape 1362 Page 7 KM that He should have them. To anyone it is not arguable that this Province, as is the case with the Atlantic Provinces and certain parts of Manitoba, that these under-developed provinces have to make concessions which the Province of Ontario or the State of New York or of Tennessee will not have to give to a paper mill. They too. I.ook up what New York does to attract industry, the concessions they make, look it up. I kno~r.

We will not have to give the generous concessions that these States of the Union have to give or the more heavily populated areas of Canada have to ~ive, for the very simple reason that in decidin~ there are many factors to be taken into account, Mr. Speaker, on the establishment of a new industry. One is the natural resource. Maybe that is the most important one but certainly following very, very close behind is the accessibility, the cheap accessibility to the market. It depends on the industry.

If it is a chemical industy it is a distinct advantage having that chemical industry dm,>n in the centre of heavily populate areas. If it is a newsprint industry, not to the same degree, but still the closer you can get to your markets the better it is - and the availability of all the infrastructure that is now being bandied around as to the townsite for this development, these are all considerations. Anyone would be a fool to arp.ue that Newfoundland is not at a disadvantage when it has to compete with Ontario or when it has to compete with Tennessee.

To suggest, for instance, that Bowaters are not in a more enviable position in the Southern United States than they are in Newfoundland would be quite unrealistic. Fortunately they are here. These concessions have to be given. ~'1'. S"ALL!-!OOD: They are here now but would they come here if they were not here no~1 ? I have some p,rave doubts whether they would. YR s~·'ALLh'OOD; So have I. I have the gravest doubts. But, t~r. Speaker, how far can we go?

How far can we go in giving these concessions, and for how long must we continue to tie up what is obviously the rrentest attraction and the ~reatest asset we have in so far as t he ne•.:sprint industry is concerned, our natural resource, the wood? 8 3 i~!

July ?-'1, 1970 Tape 1362 Pace 8 As I understand it, that an even r,reater attraction, as far as ~~ood is concerned, is Labrador wood. The fibre in the Labrador wood is of a much hirher quality than that ~>'hich can be found on the Island of Ne'ldoundland. Newsprint companies ,paper companies have been trying: no~• for n long,long time, at least t'>enty years, to solve the vexatious problem of economically harvesting and bringing to the site Labrador wood.

Everyone in Newfoundland recalls that Crown Zellerback ~,rere most anxious indeed to get their hands on the Labrador timber stands and to use that in the ~anufacture of paper in this Province. But that great organization, by a very slim majority, I am told, the board of directors came to the conclusion that Labrador \-Yood could not be economically harvested. Bowater's experience in Labrador has not been anything to scream about and has not attracted them to that area with any great involver.1ent. The same applies to Price. }!aybe }'r. Doyle has solved the problem for his liner-board mill but whether 1-'r.

Shaheen, who has had no experience ~vith the newsprint industry, can unravel this problem that has perplexed Ilm·raters, which is the greatest paper-making organization in the world, remains to be seen. Let us not in passing this Bill convey the impression to the people of Newfoundland; beyond any shadow of doubt, work is now going to start on a paper mill in Come By Chance.

Let us, on the other hand, be sufficiently frank and open to the people of Newfoundland, that we point out to them the very serious problems that face any promoter and particularly any promoter who is trying to start a ne\-YSpring: industry at this particular time in the history of the development of the newsprint industry in Canada. If we tell them that.

If we say that the odds are not good, that for ten years, off and on, sometimes with enthusiasm but quite often with lack of enthusiasm, avenues have been explored all the ._ray from Helsinki to l:ew York and so far all of them have been abysmal failures, hut we are going to ~ive it one more try. The obstacles are still there. We are still looking for a way to get around these obstacles. 83~3

July 24.1950 Tape 1362 Page 9 KM We are still trying to satisfy ourselves, or the promoters are, that beyond any doubt Labrador wood can be harvested and harvested economically. The hon. the Premier has indicated that the cost of harvesting, transporting to the site,of Labrador wood,will not cost this Province anything in the way of subsidy, so presumably now a method of harvestinr. has been discovered, whereby Labrador wood can be harvested in Labrador, can be transported to the Island of tlewfoundland at a price similar, because it has to be equal to the cost of harvesting Newfoundland wood. Again, MX.

Speaker, and I am sure the Government is alert to this, that in deciding whether or not there will be any subsidy paid on the cost of harvesting wood, one has to look very carefully that the promoter does not, in assessing the cost, charge back against Government the rentals that would be payable on any loading facilities, docking facilities that are paid by the Government of Canada, under its formula that the operator-users pay for it over a period of years. If, therefore, the Labrador wood can be harvested, obviously the labour rate in Labrador is going to be lm·Ter than in Newfoundland.

I'!R St-:ALLt-:'OOD: HR HICI.O'AN: Because the cost of transportin~, obviously the cost of transporting the wood from the Shaheen Holdings in Labrador to Sunnyside and then to Coree By Chance is going to be higher than transportin~ it from some of the holdings in the Bonavista Peninsula. 't'!R S}'ALU!OOD : Bonavista is not the only source on the Island. It can cost more to brin~ it from some parts of the Island to Come By Chance than it Hill cost to bring it frow Labrador to Come By Chance. That, Hr. Speaker, with deference to the hon. the Pre!T'ier, · is not the experience that has now been found in Nova Scotia.

In Nova Scotia now the Bowater -~Prsey Mill and the new mill at Point Tupper are going more and more to the cheapest method of transportation of t,.ood ~. S! 1~J..J..Y5'.0l'. : Bowater. in Corner Brook, can brin~ wood into this Province, from outside this Province, and land it at the mill in Corner Brook cheaper, at lm,cr cost than it is now costincr them rcttinr> it within this Province. 83iJ

July 24 , 1970 Tape 1362 KM 'MR lliCIQIAN: The hon. the Premier is overlookinr. one basic fact, Mr. Speaker, and that is this: The cost of transportin~ pulp wood, over land, is diminishing each year, and much more so in the Province of Newfoundland than in other provinces where you had modern lines of communications ten years ago. The fact now is that the cheapest way to transport pulp wood from the Glenwood area to Corner Brook is by these large trucks, simply because we now have the Trans Canada Highway, which l-ras not around ten years ago.

As our communication systems improve and continue to extend toward the Great Northern Peninsula, the Baie Vert Peninsula, the Bonavista North Peninsula, then obviously there is a diminishing cost. This is relevant in this sense.

As the cost of transporting and harvesting island wood goes down,the liklihood of a subsidy being payable by the P~Ovittce incteases,unless the Shaheen Group have now satisfied the~selves that you can harvest in Labrador cheaper, bring it to the Labrador Coast, load it on to a barge or ship, transport it to Sunnyside and then the short transportation over the neck of the Isthmus into the papermill which is on the Bay of Placentia. 83~5

July 24 1970 Tape 1363 page 1. if you can do all that and keep it do~ at least equal to the Newfoundland production cost then there will be no subsidy . But I think that any bon. member will agree that ~bat has been a problem that has perplexed two paper mills on the island of Newfoundland for a long long time, perplexed Crown Zellerbach 1 and that our enthusiasm has to be somewhat restrained when we hear that the man.who has had no involvement in the pulp and paper industry now7has solved a problem that the giants could not solve themselves.

But so far as the Bill is concerned, particularly in '"iew of the firm commitments that have been given by Government to eliminate any possibility of cost on the part of government, . it seems to me the only sensible thing, any is Opposition member or indeed any bon. member of this House can do/to give them a year's extension and to expect the bon.

Premier to be man enough to come out and tell the people,of Newfoundland,and particularly the people of the Come By Chance area,that no way is this a firm,irrevocable commitment that the mill is going to be built and that they can forget sod-turning,the next time they see any official function out there it will be the actual opening of the mill. MR.MARSl~L: Mr.

Speaker, if I may,! will not take too much time but I do waut to point out~ith respect to this amendment this request for an extension to the mill,that it would appear to be that this project, this mill project has gone on fur too long with too little information being given. The reason for this extension, the request of this extension,is that we are told that Mr. Shaheen has been occupied with the refinery and in effect has not been able to turn his attention to the pulp and paper mill. Now this particular reasoning is unacceptable. It would appear that Mr.

Shaheen is setting the priorities not only in Come by Chance but in all of this Province. The pulp and paper ~111 is a much more labour-intensive industry . and any sane rational government operating properly would have demanded of the promoter that he use his best endeavour to bring about the industry which is going to cause the most employment and bring about the most jobs first. 83 . ~6

July 24 1970 Ta?e 1363 page 2. There are a few questions that must need be answered and I would trust that the Government will ~ive the answers in due course. Questions arise when you ask for an extension - what pressures have been brought upon the Shaheen interest to bring about the pulp and paper mill at this particular time? lfuat pressures will be brought upon them in the future? What qualifications if any, has the Government made to the Agreement,as they were allowed to under the amending Act of 1966-67?

With respect to the additional cost we are now told that it is going to be $80 millions, This goes up from $57 million, and one wonders whether the White Welding Company is still agreeable to put up its $27 million. MR.SMALLWOOD: No, they went out of the picture years ago. MR.MARSnALL: Well if they went out of the picture this is a clipping in 1966 MR.SMALLWOOD: The companies now is going to be British not American. MR.MARSHALL: Well the details that we would like the Government to supply to the House is where exactly the money is coming from? MR.SMALLWOOD: The hon. member wants us now to justify the Act passed.

MR.MARSHALL: No not to justify the Act but assure that there had· ·been negotiations going about, to make this extension realistic when the time comes. There is just one or two other points that I want to make. In view of the fact that this has been going on for ten years,! would trust that even though the extension, we may vote for the extension of the Agreemens that the Government will be making efforts to have another concern take over the projects if Hr. Shaheen drops it,so that we may not be caught in a year and a half's time with no paper mill and no prospects in sight.

Finally, I would ask , I would request, observe,with respect to this extension,~to come out and tell the whole facts about the pulp and paper mill,loud and clear to the people. Let us not be cruel. ~et us not be cruel like we were before the 1966 election when the paper mill was annonnced, when the sod-turning ceremonies were performed, when people from Sunnys~de and Trinity Bay came up looking for jobs,and there is still no paper mill.in existence. 83.~ 7

July 24 1970 Tape 13b~ page 3. MR.STRICKLAND: 1be people of Sunnyside got a lot of jobs on that project MR.?-IARSI!ALL~' There wrre a lot of people supposed to get ~ MR.STRICKLAND: They got a lot of jobs. MR.MURPHY: All selling newspapers-in Sunnyside. MR.MARSHALL: Who were supposed to get jbbs that have not got jobs. AN.HON.HEMBER: How many working there now? MR.STRICKLAND: I am not saying about now. I said they got jobs there. Do not distort it all.

MR.MARSHALL: Let us not play politics with the aspirations and the hopes of the numbers of Newfoundlanders who are -- unemployed and who are overladen with the lack of effective industrial and economic development in this country. Let us come out with all the facts, let us tell the people the situation as it is. Okay!

Maybe we will go along with this partioular extension because it is all we can do in the circumstances, but let not it be forgotten an obligation and an announcement was made by this Government that a third mill was going to come into existence sometime ago and let us tell the people,loud and clear.what the present situation is, before we consider this particular amendment. MR.MURPHY: Mr.

Speaker, I would just like to take a few moments and perhaps in the same vein as the hon. member for Burin and St.John's East like to compliment very sincerely the hon. member for Burin - MR.SMALLlolOOD: And the member for Fortune Bay - I would MR.MURPHY: And the member for Fortune also and the member for St. John's West and also the hon. Premier and also anybody else who has spoken, I do not want to make anybody feel that - But I think the hon. member for Burin Mr.

Speaker, really summed up what the fears were in our minds,although in the 1966-67 Act great latitude is given to this famous body that is running the Province and running everythi~g in this country at the present time, the Cabinet,who have all powers to make any agreements they wish, but with this matter I certainly hope and I think the hon. member for Fortune Bay pointed out that 1972 is the date set for the erection of this mill 1but within one year's time it is mandatory 83~3

July 24 1970 Tape 1363 page 4. that there must be an election called. And I am sure that whatever happens in that election and on whatever side this party is sitting ) and it looks now like we will be on the other side)that we can take the necessary action to guarantee to our people,Mr. Speaker, the benefits that should come to them . and possibly, not like what has happened the past few days here where I can hear John Shaheen and his associates say: "Well done thou good and faithful servants." We have seen happen in this House,}lr.

Speaker, when responsible people , elected members,representing many numbers, many thousands of Newfoundlanders (I am not getting into another debate) have been refused absolutely the right to put their ideas in a part of a Bill because Mr. Shaheen may not agree. Now Mr. ipeaker, on this matter and I am looking now at a statement made by a former predecessor here, former leader of the Opposition here ,in September 1966,where he quoted much of what we all feel is very vital today,where this third mill has been mooted for some years,it has been held as a carrot.

The people of this Province,in pretty well every election since that time,where the sod was turned, where $15 millions of our money is being guaranteed MR.SMALLWOOD: It has not been guaranteed, not $lj million, nothing like it. There is no guarantee yet. MR.MURPHY: No guarantee yet, How much money has been raised and spent by the proposed owners and operators or are we going to have the same deal that we had with the other,where we have just a group - MR.SMALLWOOD: Authotity is there to guarantee it, if we give the extension, but we have not guaranteed it. MR.MURPHY: What, just what progress has been made?

We accept at face value the Premier!s statement that Mr. Shaheen has been so busy with the oil refinery that he has not had time to give his great promoting talenb to this third mill. We have an oil refinery, we will have one, that will be not nearly as important to our Province Mr. Speaker, as the third mill will be,where we use our own products, our own natural resource~more labour-intensive. So Mr. Speaker,

July 24 1970 Tape 1363 page 5. we will, I am sure, we have agreed to support this amendment for the year's extension 7 because we feel that within the next year history will be made in the Province, it can be made next week or twenty-one days time. tf any of the members want to sneer over there,we will ask them to put their great talents and great development ideas on the line 0 This is wide open,we cannot do it Mr. S~eaker,.

It was said in this House before that our great Liberal Government has always accepted any challenge,at the drop of a hat to go to the people;the love of this Government is still in the hearts of the people - MR.SHALLWOOD: We do not want the Opposition to decide, we always decide. MR.MURPHY: We know that. Do not even let the people decide. You will not even let the peop~e decide,not talk about the Oppositio~ I say now again that the people of this Province are looking for their right to speak. MR. SMALLimoo: We will see.

MR.MURPHY: Oh, the ~temier can say that we will see we will decide, we have done this and we have done that, That is absolute baloney. MR. SMALLWOOD: We always saw. We always saw, MR.MURPHY: Absolute baloney. And there is only one way to prove it, let the people decide not the members on this side or the members on that side, let the people decide. MR.SMALLWOOD: They will decide. They will decide. They will. MR.MURPHY: They will decide.! would like to see them decide twenty-one days time. MR. SMALL'-'000: They always did decide. MR.HURPHfi: They always did,is right.

But things change MR.NEARY: The millionaire leader does not seem to care.tte is still in Otta\ora. MR.MURPHY: Mr. Minister, do not be so darn stupid talking about millionaires. We are creating millionaires here in this House every day of the week. ~lillionaires_ now we will get back to Come by Chance MR.SPEAKEll: I presume that every hon. member is of the opinion that he is now in order. 83~0

July 24 1970 Tape 1363 page 6. MR.MURPHY: That is my right Mr. Speaker, and I ask that right,to be heard in silence.! think that is one of the Standing Orders. Wind it up so the great Premier can get up againpThe only one in the House that the Premier likes to listen to is himself, knows it all, divinely inspired.He will tell us all about this great development. God Help Us,if anything should happen to this Premier, how will we manage to survive? How will we manage? MR. SNA.LLWOOD: I thank the hon. gentleman - the unexpected compliment,! am deeply grateful.

MR.MURPHY: YOu should - because,in the opinion of the Premier,he is the only one in this Province that knows anything, that can decide anything, every one else is a nitwit or a halfwit or semi-retarded. I cease, for that reason I carry on. It has been requested that MR.SMALLWOOD: to wind it up. Nobody wishes the hon. gentleman to cease just wishes him MR.MURPHY: Yes, Mr. Speaker, this is a very serious piece of legislation,but as I say,and I repeat it again,that the Government now,who are the Government, will not,Thank God,have the final word to decide on the terms of this third mill.

I say that now, I can be laughed at 1 I can be abused for it but the answer lies with that again before December 31, 1971~ This can be decided. ~~e have issued, the Leader of our Party has issued the invitation to challenge, but for the first time since 1949 this great all.powerful government has declined to accept the invitation. Mr. Spea~er, as I said earlier,we will support this, Now I could go on,Mr. Speaker, for ten minutes with quotes for t~e bon. minister for Social Services,that are not quite so complimentary to the great gentleman that he reveres, adores.

MR.SMA.LLWOOD: I did not think he revered and adored me. I did not think that. MR.MURPHY: That he now adores and reveres. He is waiting for the few words to drop from his lips. MR. SMALLWOOD: I have not been canonized yet, not yet. I am not canonized. Not yet. 83:J1

July 24 1970 Tape 1363 page 7. MR.MURPIIY: Not yet, we certainly hope,when the time comes,to canonize or immortalize,whatever will be done with our hon. Premier, criticized or ostracized or whatever else. You know, it is a great feeling to be able to stand here and sort of make the other side feel;"look will you kindly sit down because we want to listen to our Premier. Wij want to listen to him,He is the only one we want in this House we would sit forty-eight hours straight off without a break and listen to the Premier tell the world how great it is.

It is wonderful to sit here now and see the hon. member for Bonavista South. 1 could listen to him for weeks, tremendous man,He is one of my constituents. It is nice Mr. Speaker to be able just to stand here for a few moments, and the word is gone out,the Premier is about to speak again. Mr. Speaker,when the vote is put we will vote for it,we will not vote against it. Mr.

Speaker, we certainly hope that,not because this amendment carries today,that anybody concerned can sit back and fold their arms and say:'~ell, we must take it easy now we have so much of our Province tied up:I do not think there has been any great demands for paper mills. we have some sawmills 1of course ,that are perhaps anxious to get at some of this wood and within the next five, six, seven, eight months,! hope within the next twenty-one days,the opportunity will be given for all our people of the Province to decide,in their wisdom, just what kind of a deal this will'be for the province.tve certainly hope it will go through.

God Knows we need jobs, jobs for our own people, to provide them with the necessary to look after their families. If this Summer is any indication of what the Fall and \Unter is going to be, we are going to need something. The hon. minister of Social Services,! guess,has got more employees on his,, or recipients on his - MR.NEARY: The biggest payroll in the Province. MR.MURPHY: Yes, and quite proud of it, this is the tragic part of it. This is a great tragedy Mr.

Speaker, 5o 1 as I say,we will not vote against this amendment but will reserve the right at any time that this House is open to bring in amendments that wa feel are necessary to safeguard the interest of our people and not to make another great ~iveaway programme,for people outside 83~2

July 24 1970 Tape 1363 page 8. the Province who have received all the benefits and none of the liabilities. MR.SMALLWOOD: Mr. Speaker, I heard a question asked by some bon. member, I think the bon. member for Burin. The question asked,is this an election dodge, this paper mill, this extension, this Bill here today 1 is all this just an election dodge? Uell all of them over there on that side of the House. Mr. Speaker, seem to be quite convinced that there will be a general election this Fall.

Early fall or late Fall.they seem to be convinced of this and this I think has coloured every word that they have delivered in this House of Assembly thus far in the year 1970. I believe that all their talk and argument and debate and tactics and strategy have all been or vitrually all been coloured by their belief that there is to be a general election this year. And I believe they probably look upon the answer to the question asked,is this an election dodge,as yes. They~think this is an election dodge becaus~ they think there is going to be an election this year. Mr.

Speaker, I have,! think petected a strong anti-Shaheen attitude in this Chamber, from the Opposition, I believe I am right. I believe that the Opposition have expressed 1 on countless occasions and in a large variety of ways,strong biased against John .M. Shaheen, the anti-Shaheens and they have coined a new word ._ which I think will become a proud word in our Newfoundland history, the word Shaheenery. All this is Shaheenery. That will become a proud word,in my opinion,but you know,Mr.

Speaker, nothing that they have said against John Shaheen is in a class not even to be mentioned in the same breath with what they have said about John C. Doyle. Not ~at they are saying now but what they used to say about John C. Doyle. There was virtually nothing too rotten to say about John C. Doyle ·' •• and none so poor as to do him reverence:'ao one,but 6o one,had a decent word to say for John C. Doyle. Now that is the past. But you know history does repeat itself. There was a time when the hated name in Newfoundland was the name Alfred Harmswortu.

Alfred Harmsworth was a successful young Englishman who came up from poverty and became a great and famous man,ending up as the great Lord Northcliffe, 83c;3

July 24 1970 Tape 1363 page 9. and Alfred Hartnsworth 7 before he was Lord Northcliffe,came to Newfoundland an ·engag .ed in negotiations with the Government of that day to establish something new iQ Newfoundland,something that did not exist,that had, well it had existed in a very primitive and rudimentary form up at Piper's Hole,in Placentia Bay, where Harvey & Co, had established a crude little plant 1 just before Hannsworth came to Newfoundland to establish a great paper mill at Grand Falls.

The name Harmsworth was despised, it was spat on 1 He was condemned, he was c:alumn1ate4 he was slandered even more than John Doyle was slandered and even more than John Shaheen has been slandered and continues to be slandered. You see, Mr. Spea~er, John Doyle and :John Shaheen both have had the misfortune to be associated with me, just as Alfred Rarmsworth.had the misfortune ~o be associated with Sir Robert Bond, just as

July 24th., 1970 Tape no. 1364 Page 1 Mr. Smallwood. as others had the misfortune. MR. CROSBIE: The Premier interrupted me twice today on a Point of Order 1 that I was not discussing the extension of one year and that I was trying to discuss the original Bill. Now I submit that the Premier,in talking about John Shaheen and John C. Doyle this has nothing to do at all with what the House is supposed to be discussing. I submit to your Honour that you should keep the Premier relevant, if that is at all possible~ to the subject under debate. MR. SMALLWOOD: Mr.

Speaker, to that Point of Order, I have only to reply that I am replying to what has been said on the other side here today. I think in doing that I ought to be very well within order. Now having said that, I want to reply specifically and particularly to a number of points that have been made by speakers on the other side. One, is the question of locking up, locking up the timber, locking it up on the Island of Newfoundland and the territory of Labrador. Mr. Speaker, some of it is locked up. Some of it is not, because one permit after the other bas been given, with the consent of the Shaheen people.

One permit after the other has been given to local contractors, to local businessmen, to go in upon the timber land reserved for this third mill and to cut and sell and export it. So, really, the timber is not locked up, Some of it is and so far as the Island of Newfoundland is concerned that is the case and so far as Labrador is concerned. There is so much wood in Labrador that in God's mercy it ought 83~5

July 24th., 1970 Tape no 1364 Page 2 Mr. Smallwood. to be cut, if someone would cut it. You cannot get anyone to cut it. You cannotseize a man by the throat and kick the stuffings out of him and make him go in and cut wood in Labrado~ and any human being,in human form,who wishes to cut wood in Labrador, we do not let them escape. We do not let them out of our clutches. We do not let him out of our sight for fear he might change his mind.

The picture is not a picture of a lot of good God-fearing,decent people who want to cut wood in Labrador and a heartless Government protecting a heartless concessionair and preventing them from doing it. That is not the picture. Now another point that was made is with regard to the cost of the wood, the cost of Labrador wood, the cost of a subsidy that the Newfoundland Government would have to pay to bring 70,000 cords of Labrador wood to Come-by-Chance, because the Island of Newfoundland will not sustain wood cut to support that mill.

Therefore, 70,000 cords would have to be brought in and that the Government would have to pay the difference between the average cost of the Labrador wood,landed in Come-by-Cbance,compared with the average cost of Newfounliland Island wood landed in the same place. Mr. Speaker, let me give this House this assurance that if all of the wood for the mill in Come-by-Chance were to be harvested in Labrador and brought to Come-by-Chance, they would al.ost, surely, saVe money in the cost of the wood.

What has been demonstrated recently is the fact that the most economical wood is Labrador wood but this is a very late and recent fact to emerge and it is a .est encouraging fact. It is a fact that makes the Province of Newfoundland wor·th hundreds of millions of dollars more - worth more. Our value as a Province has gone up, because of the 83~u

July 24th., 1970 Tape no. 1364 Page 3 Hr. Smallwood practicality of havesting :rood in Labrador. The untold millions · of cords of timber growing in Labrador have all of a sudden come to be worth incompar~bly more than we use to think, because of the emergence of this fact that you can harvest the wood in Labrador; You can harvest it, You can ship it. You can deliver it to a market. You can deliver it to a consumer at a price, at a cost much below what used to be believed to be the case. So, do not worry. The hon. gentleman from St.

John's West can cease worrying now,as of this moment,about the possible subsidy on the cost of Labrador wood coming to Come-by-Chance. You forget it. MR. CROSBIE: What study ' showed that? Bow does the Premier know this1 How does the Premier know? MR. SMALLWOOD: Not studies have shown it. Practical operation has shown it. MR. CROSBIE: Where. MR. SMALLWOOD: In Lake Melville. MR. HICKMAN: That is pulp wood for export. MR. SMALLWOOD: That is pulp wood for export an~whether you export it to France or export to Come-by-Chance, it is the same wood, aboard the same boats and handled in the same way. MR..

HICKMAN: The bon. Premier is overlooking •• MR.. SMALLWOOD: I know what I am talking about. It is always proper for a man to know what he is talking about. "Thrice armed ·1111 lw who hath his quarrel just." In other words, "who knows what he is talking about, when he has the facts, when he knows the truth." He is 83~'7

July 24th., 1970 Tape no 1364 Page 4 Mr. Smallwood. then in a pretty good position to state a case. Now the third point •• MR. CROSBIE: What about the shipping facilities? Who pays fo11 them? MR. S~~LWOOD: I am coming to that. I have all these points noted here. I listen with rapt attention, fascinated and rapt attention to the oratory and wisdom of the hon. gentleman. I made notes) insofar as I could tear myself away from listening. I forced myself to make these notes,with a pen on a piece of paper, and it so happens I am fortunate that I have the piece of paper. MR. CROSBIE: No one could ask for more. MR.

SMALLWOOD: Now with regard to the surveys. I do not know very many industrial projects in this Province or before we were a Province to be more thoroughly surveyed and engineered than the paper mill in Come-by-Chance. If there is one that has been more engineered, it must surely be the oil refinery. We have had ~neral Kennedy 1 who was Canada's greatest authority in forestry. General Kennedy was Chairman of a Royal Commission. He investigated the forest resources of this Island home of ours. employed by the Newfoundland Government to do so. I 1 personally, engaged General Kennedy.

I was very proud to get him to be Chairman. He is the one who said - MR. COL1INS: What about Goodyear? MR. SMALLWOOD: Well Roland Goodyear was one of that commission. There were three,and General Kennedy was the head of it. I selected Roland Goodyear, too. a great per•onal friend of mine,for whom I have always had immense respect and considerable regard as well, as I have for the whole Goodyear family. They are staunch supporters of mine, loyal 83~8

July 24th., 1970 Mr. Smallwod Tape no 1364 Page 5 Liberals, staunch and unshaken, amunshakeable loyal Liberals, which is another thing I rather like about the Goodyear family. However, General Kennedy,as head of that Royal Commission, surveyed the matter. Sandwell surveyed the matter. Forestall surveyed the matter. Rust Engineering surveyed the matter. Now they did not all, the four of them, survey identically the same things and make identically the same surveys. One surveyed the wood. The other surveyed the engineering, the other surveyed the economics and the other surveyed the shipping and so on and so on.

MR. HICKMAN: Would the bon. Premier permit a question? Is it still the intention · that Rust Engineering Company will have a turnkey contract? MR. SMALLWOOD: It is still the intention of Rust Engineering to do precisely - I was talking to them last night, a long chat on the phone between here and New York,and Ru~t Engineering are the outfit that did the big job at Grand Falls,for Price. They have done big jobs for Bowaters. They have done big jobs for paper mills all over this continent. I had a long and delightful chat with them last night. They are rearing to go.

They are eager to get the thing going and happy tohear that this legislation is before the House, happy to hear my prophecy and that is all I could do, make a prophecy that it would probably become the law of the land this very day. I told them that. They were happy to know. The arrangement that has been made wll stand with Rust Engineering. Now let me go on to another point and this is the point of pollution. I am taking them as they were uttered. The bon. gentleman from St. John's West,who is one of the braiaest men we have in the House here, I would not say the brainest, probably the second brainiest.

The brainiest member is over on this side of the House. He is sitting now,from me now about eighteen feet. But the bon. gentleman 83S9

July 24th., 1970 Tape no 1364 Page 6 Mr. Smallwood But the bon. gentleman who is sitting about twenty-two feet is the second brainiest • The bon. and brainy gentleman from St. John's Weat must be aware of the fact that the Parliament of Canada, at the instigation of the Government of Canada, had done something quite extraordina~ on this question of pollution. They have overridden possible provincial objections and they have made the control and prevention of pollution a Federal matter. So that if a province works with them,that is just fine and,if they do not, well~it is too bad for the province.

But the Parliament of Canada has said that pollution has become a matter of nation-wide concern. "We are going to control pollution" - good for them. In addition to that, the company itself ., the paper mill people themselves are starting a brand new paper mill. Remember, if you are starting a new paper mill, it becomes a lot easier and cheaper to prevent pollution than it does in a paper mill that is already built. We heard a statement from the head of Price, who use to be the manager •• MR. CROSBIE: Moore. -MR. SMALLWOOD: Mr Ross Moore. We heard Mr.

Roes Moore make a statement in Grand Falls the other day,to the effect that to install the necessary equipment now, to stop putting the affluent down into the Exploits, to do that now would cost over a period (what did he say?) of $40 million. But a paper mill starting from scratch can prevent it1 incomparably cheaper and incomparably easier than to stop it after it has started. 83GO

July 24th., 1970 Tape no 1364 Page 7 Mr. Smallwood. Then finally, I think, I told the House here the other day that in connection with the oil refinery -if I did not, I certainly intended to do i.t. If I did not, I will do it now. The Government have invited Professor Laird_of the University to investigate for us and recommend and report to us on the question of pollution in the paper mill at Stephenville, in the oil refinery at Come-by-Chance and in this proposed paper mill in Come-by-Chance. Now Professor Laird has won a world-wide reputation. He is one of the world!s great authorities now on pollution.

I am proud that he has accepted the Government's invitation to look into this matter for us. Logging-roads- let me say categorically, that there is not a chance. I must say; the word I am going to use, Mr. Speaker, I use with regret because, frankly, I was shocked when I read that the Prime Minister of Canada, a man for whom I have ·absolutely, boundless respect, he shocked me when he said; ''well, who the heli' or uwhat the hell'' or something in the House of Commons.

Now, perhaps that is so commonly used in ordinary private conversation that it is a little bit mid-Victorian of me to be shocked by hearing a man use it in the House. But I am going to say this much that there is not a chance in hell that the Newfoundland Government will build logging roads for Bowaters, for Price, for Melville Pulp and Paper at Stephenville or in Labrador or Newfoundland Pulp and Chemical Paper Mill in Come-by-Chance or any other paper mill. We are not crazy in the head. We have never built logging roads for any paper mill,a nd we have no intention of doing it.

What we are doing and will continue to do is what every government have done in

July 24th., 1970 Tape no 1364 Page 8 our history, we build roads, public roads. We allow paper mills to use the public roads over which to haul pulp wood. Why not? Every province does it. Now in other provinces, they, in New Brunswick, i.e., the government of that province builds logging roads for the paper mills and the pulp mills of that province. But, sir, the difference between New Brunswick and Newfoundland in that respect is this: in New Brunswick they collect large volumes of taxation and large rates of taxation from the pulp and paper mills;

whereas in Newfoundland we do not. So, in New Brunswick they give back to the paper mills something of what they collect from them. They give it back in the form of logging roads. -we do not do any such thing. We do not propose to do it. a The sixth item I find here is~reference to wharves. There will have to be two wharves.

There will have to be three. (l):In Sandwich Bay,where the pulp wood will be harvested and shipped from Labrador. (2). one at Sunnyside which will receive the wood from Labrador and from other points on the Island of Newfoundland as well and (3), a wharf in Come-by-Chance from which they will ship their finished products - 600 tons of paper a day rising, I have no doubt, after a very few years, and rising to 900 or 1,000 tons a day. Because a paper mill grows or it dies. An oil refinery grows or it dies. Anything grows or it dies. Nothing can stagnate.

They have to have a wharf in Come-by-Chance by means of which they will ship their paper abroad. The wharf in Come-by-Chance will have a

section attached to it, the one of which we spoke here in an earlier debate yesterday . 1hat wharf will have a

section auached to it,built on to it to take ordinary shipping, such · as, pulp and paper, such as, petro-chemicals, such as anything 83 ~9 v~

July 24th., 1970 Tape no. 1364 Page 9 Mr. Smallwood. else tht may be manufactured. That takes care of that wharf. The wharf in Labrador and the wharf in Sunnyside are not the care of the Newfoundland Government, not financially speaking. It is our care. We are concerned. We want to see them built. We are going to do our best to see that they are built, but they are not our concern,so far as the cost of them is involved. I Then, someone said, I think, it was the bon. aember for Burin. He said that,or somebody said, it was put hypothetically or maybe it was the brainy hon. gentleman from St. John's West.

Maybe it was he vho laid it; that ffShaheen cannot do it, let someone ese have itt Who was it said that? Somebody said that. MR. CROSBIE: I did. MR. SMALLWOOD: Yes, if Shaheen cannot do it, let someone else have it. Right! Right! So right! But who is someone else~ Please tell me. Natural!~ with this - this is the last extention that I would ask the House to give to this agreement, not out of anypique not out of any feeling against Shaheen, but with the feeling that with another year's extension, that we propose now to give him, he will have had enough time to produce. If he fails, then let somebody else try.

But who is the someone else? We gave the same concessions exactly to Crown Zellerback and Crown Zellerback are the world's second largest pulp and paper company on the earth - Crown Zellerback. We all had great hope, you remember,and long before their option expired, long before the date arrived for the expiration of the option, they came to us and said; "look, we do not want it. Thank~.take it backJ We do not wa~t it." That is Crown Zellerback. 83G3

July 24th., 1970 Tape no 1364 Page 10 Mr. SDtallwood. We offered it- God knows how many companies w