Mixed messages on Lower Churchill loan guarantee

Newfoundland and Labrador's federal cabinet representative and its premier had different opinions Wednesday on how a possible federal election will affect the Lower Churchill hydroelectric project.

Peter MacKay — in town to announce federal funding for improvements to the St. John's International Airport — warned the election could cause a delay on a possible loan guarantee for the $6.2 billion Muskrat Falls project.

"There will be a pause. There will be little progress on this file in the midst of a federal election," he said.

However N.L. Progressive Conservative Premier Kathy Dunderdale said an election wouldn't affect the timeline that has been set out with the federal government. In fact, Dunderdale said she spoke with the Prime Minister's officials as recently as Wednesday morning about the loan guarantee and was assured an answer was coming. 

"I'm confident that in the near future, certainly sooner than the end of the federal election, we will have some indication on which way the federal government is going to proceed," she said.

Dunderdale wouldn't say what she expects Ottawa's answer to be, only that she would shocked if Ottawa didn't come on board.

Newfoundland and Labrador and Nova Scotia have asked Ottawa for a loan guarantee for the project that would see power generated in Labrador and routed through underwater cables to the Island of Newfoundland and Nova Scotia.