Equity not critical to Hebron deal, Reid says

A Liberal government in Newfoundland and Labrador would attempt to expedite a deal on the stalled Hebron megaproject, party leader Gerry Reid says.

Reid said the Liberals would not have followed Progressive Conservative Premier Danny Williams's lead by walking away from negotiations with owners of the Hebron offshore oilfield.

Williams was roundly criticized by businesses working in the oilpatch for his stand on Hebron, which is poised to become the province's fourth field to move into production. Businesses say the delay has meant an exodus of skilled labour and engineering talent.

Reid, who rallied party supporters at a weekend convention in Gander, said Williams made a strategic mistake by insisting on an ownership stake in Hebron.

"The question I would like to ask the premier is, give me a financial analysis where an equity position is better than a royalty regime," Reid told CBC News.

"He can't do that because such an analysis doesn't exist and he hasn't done one."

Talks between Newfoundland and Labrador and the Hebron partners— led by Chevron Resources Canada, and including ExxonMobil— broke off more than a year ago, after Williams insisted on an equity stake of 4.9 per cent.

Williams had also been demanding a better royalty stake than the partners had offered. In return, Hebron's owners had been seeking a more favourable tax regime.

Reid said Williams erred by demanding an equity stake.

"You've got to weigh that with a royalty regime or an enhanced royalty regime than would benefit you more than an equity position."

During the party's annual convention, Reid also committed the party to eliminating the provincial portion of harmonized sales tax on home-heating costs. Reid said such a move would save most consumers about $200 per year.

Underdog status may help: candidates

The Liberals are heading into October's general election as the underdog. The party currently has 12 of the 48 seats in the house of assembly, and only half of Reid's caucus is expected to run again.

As well, the party has been trailing far behind the PCs in consecutive opinion polls.

Former premier Roger Grimes, whom Williams defeated in 2003, said he is under no illusions about who will win in the fall. However, he predicted voters wouldn't give Williams a landslide victory.

"Unless there's some kind of a miracle or somebody gets struck by lightning… the Williams government will likely get another term in office," Grimes said.

"But that doesn't mean the Liberals can't run a really good, strong campaign," said Grimes, who believes the Liberals will at least hold their ground and may even pick up a seat or two.

""[The] good place to be is with the underdog, because you have nowhere to go but up," said George Joyce, a former assistant deputy minister of labour who is preparing to run in St. John's West.

Linda Goodyear, a dentist who will challenge cabinet minister Diane Whalen in Conception Bay East & Bell Island, acknowledged that the PCs have electoral momentum.

"Everyone wants to join the winners," she said.

"But the way I looked at it is [that] if you join the losers, you get a bigger voice. I found that they welcomed me, and I feel like I'm a bigger part of the policy decisions."

Reid, meanwhile, is far from ready to concede anything to Williams.

"Our focus is on forming a government and we think we can have that," he said.

"We have 12 seats in the house of assembly right now and all we need is 25 and we have a government, and I think that's within our grasp."