Nalcor has reached a new contract with Italian company Astaldi to complete the construction of the powerhouse for the Muskrat Falls project, pushing the total cost to $11.67 billion.
The new contract is valued at $1.83 billion, up from $1.15 billion. It sets a new date for the completion of the works that is in alignment with Nalcor’s current completion schedule.
Nalcor CEO Stan Marshall says the net increase to the cost of the project is $270 million because he had already factored in higher costs for Astaldi when he announced a price tag of $11.4 billion in June.
Astaldi has been blamed in part for the delays and cost overruns that plague the hydroelectric project in Labrador. First power is still expected in late 2019 with full power in 2020.
“This agreement will provide certainty for the completion of the construction of the powerhouse and intake civil works by Astaldi and will ensure the continued progress by Astaldi in fulfilling their full contract,” Nalcor CEO Stan Marshall said in a news release.
Filippo Stinellis, chief executive officer of the Astaldi Group, said: “The constructive dialogue built and developed with the client over the past years has allowed us to reach a full understanding over our contract’s objectives and timing. The challenging work and its environment have made the negotiation process complex and we are satisfied for having reached this agreement.”