Canoe

Tuesday, November 21, 2000

N.S. writes off $750-million debt

HALIFAX (CP) -- Nova Scotia's cabinet has written off the more than $750-million debt of the province's oil and gas company.

The decision about Nova Scotia Resources Ltd. is contained in a cabinet order dated Nov. 17 and due to be released Wednesday.

The province is trying to sell the Crown company, and Liberal energy critic Manning MacDonald said Tuesday the debt writeoff means a deal must be imminent.

"If they're writing off the entire debt, it would appear to me that something is up -- they're close to a sale or are setting the stage for that sale," said MacDonald.

"They're preparing a company that will be debt-free and easier to sell and I expect that this deal has already been cut."

The elimination of red ink at the energy company will make it more attractive to any potential buyer, and provide some tax benefits.

The move will apparently not affect the province's $10.2-billion debt because the company's liabilities are already included.

Finance Minister Neil LeBlanc said last week that more than 10 companies are bidding on Nova Scotia Resources, but didn't elaborate.

MacDonald said taxpayers have a right to know what's going on and it's time the Tory government outlined who is involved.

"This a large, public corporation that's about to be placed in private hands and the preparation for that is obviously taking place with the writing off of $750 million," he said.

-- Rachel Gibson (rgibson@hotmail.com), November 22, 2000