“Those who cannot remember the past are condemned to repeat it.” – George Santayana, The Life of Reason, 1905.
Santanyana’s words are a caution worth remembering for three reasons as Nova Scotia businessman John Risley promotes a wind to hydrogen mega project for Stephenville and the Port aux Port Peninsula.
Reason #1. John Risley’s wind to hydrogen isn’t the first mega project that has been proposed for Stephenville. There was an earlier one in 1967 and it was driven by public funds. We don’t know what the financial ask will be for the Risley project, but the odds are there will be one.
The 1967 proposal was a fiscal disaster. If you aren’t old enough to remember it, you can find the story of the Stephenville linerboard mill at https://www.heritage.nf.ca. The deal was so bad, two young Smallwood cabinet ministers, John Crosbie and Clyde Wells, crossed the floor of the legislature in protest and joined the Progressive Conservative Party. Smallwood was eventually defeated by Frank Moores in 1972.
The linerboard mill opened shortly after Moores took office. The promoter behind the scenes was forced out and the venture became a Crown corporation. The losses were immediate. 1974/75 – $21 million. 1975/76 – $34 million. 1976/77 – $41 million. Big numbers for the 1970s.
In the 1977/78 Budget Speech, Finance Minister Bill Doody described the losses as “staggering” and the outlook for the company as “bleak.” Faced with projected losses of $54 million and $59 million for the following years, the government pulled the plug and abandoned the project.
Reason #2. None of what happened at Stephenville in the 1960’s and the 1970’s had anything to do with John Risley. What the successful Nova Scotia businessman should be remembered for occurred in 2001. The event was the hostile takeover of Fishery Products International (FPI).
FPI was created by the provincial government in 1984 out of the assets of 7 bankrupt fish companies. The cost to the province was $150 million. After operating profitably for three years, FPI was privatized. Under the leadership of its chief executive, Vic Young, FPI was faced with the collapse of the cod fishery. With the exception of the closure of its plant in Trepassey in the lead-up to the 1992 moratorium, FPI succeeded in keeping the doors open at the rest of its plants in rural communities.
In 1999 John Risely, who had built the very successful Clearwater Seafoods company in Nova Scotia, took an unsuccessful run at FPI. In 2001 Risley tried again. In March 2001, as part of the second takeover campaign the Risley group placed an ad in the Evening Telegram newspaper. The ad said there were, “no plans to cut jobs.”
A few weeks later a new FPI Board of Directors was elected. In reporting on the takeover, CBC quoted Risley as saying he wanted to communicate to employees that, “things are going to be fine.” In January 2002, the company announced that 580 jobs from a workforce of 1,300 at FPI’s three processing plants would be axed.
Reason #3. As the FPI take-over concluded, a reporter asked the outgoing FPI head, Vic Young, if he had any comment. My recollection is that Mr. Young replied, “God guard thee Newfoundland.” Four years later, the FPI plant in Fortune was closed. A year after that, FPI was broken-up and sold. Neither God nor anybody else showed up.