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Friday, October 22, 2010 

Sask Premier Brad Wall Wanted Upfront $1.5 BILLION 'Baksheesh' Payment From BHP For His Support Of BHP Potash Takeover Bid

Progressive Bloggers

"TORONTO (miningweekly.com) - A former senior advisor to Canadian Prime Minster Stephen Harper, Tom Flanagan, said on Friday that Saskatchewan Premier Brad Wall's opposition to BHP Billiton's $39-billion bid for Potash Corp was "naked self interest in the most narrowest sense", and that Harper would likely approve the deal. [...] Flanagan went on to criticise the upfront levy of up to $1,5-billion that Wall wanted BHP Billiton to pay for potential future revenue losses.

"That strikes me as something that would happen in the third world," he decried. "I can't remember anything like that. This sends such a terrible message."
The Financial Times earlier said the levy sounded like "baksheesh" - or bribe - for regulatory approval. Also coming under fire from Flanagan was Wall's desire for the potash sales and marketing cartel, Canpotex, to continue.

Mining Weekly

"... there was still something a little gaudy about Wall wrapping himself in the Saskatchewan and Canadian flags just days after demonstrating a willingness to shake down BHP Billiton for a billion dollars upfront in exchange for the province's blessing for the takeover bid.

Really, if one was truly worried about a company taking over Saskatchewan's precious strategic resource, does a billion dollars upfront fix any problem beyond paying for a new football stadium?

And if BHP Billiton is willing to restructure its operation to the tune of a $3-billion benefit to the Saskatchewan government (albeit, down the road in deferred taxes) shouldn't the premier at least still be listening?

And how is squeezing a company for a billion dollars in cash consistent with an entrepreneurial, free-market Saskatchewan Party leader who in his 2004 "Promise of Saskatchewan" economic development paper railed about the "hammer of government" and the need to stop "the temptation, the tradition and the immediate political gratification of public sector intervention and politically motivated public investment"?

Can anyone imagine the outrage we'd be hearing if it were an NDP premier telling us that there's just no way we can trust a giant multi-national to keep its promises -- even if it gives that promise in writing?"

Regina Leader Post

L. Ian Macdonald has connected a couple of other dots, by the way:

"BHP has also offered to set up a $370 million infrastructure fund, which would be enough to build an enclosed stadium in Regina, home of the province's beloved Roughriders."

$370 million + $10 million (Hotels Assocation) + $70 million (KCI's estimate of private sector money)= 450 million.

Sounds like an episode of "Let's Make A Deal" for the big leagues! Thanks for the link!

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