Orimulsion Issue
Unfortunately political instability in Venezuela in 2003 is believed to have contributed to PDVSA balking at formally signing a contract to implement an orimulsion deal with NB Power for Coleson Cove. By winter 2004 it was apparent that the fuel supply agreement with PDVSA had fallen through and NB Power launched a $2.2 billion lawsuit that was filed simultaneously with the United States District Court for the Southern District of New York in Manhattan and the Court of Queen's Bench of New Brunswick in Fredericton during the last week of February, naming both PDVSA and its United States subsidiary Bitumenes Orinoco S.A. (Bitor) as defendants and citing the companies' inability to negotiate and sign a contract to deliver orimulsion to Coleson Cove. On March 16, 2004 PDVSA announced that it was phasing out all orimulsion production; since NB Power's Dalhousie Generating Station's fuel supply agreement ends in 2010, it is assumed that that plant will be forced to switch to an alternative.
The failure to secure a fuel supply agreement with PDVSA for the massive Coleson Cove Generating Station overshadowed the final term of Premier Bernard Lord and is believed to have played a role in his government's subsequent electoral defeat since the publicly owned utility's write-down of the loss added substantially to the provincial long-term debt.
Read more about this topic: Coleson Cove Generating Station
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