SASKATCHEWAN (CBC) - A clean-coal power project to which Ottawa is contributing $240 million is starting to look like a bad deal for Saskatchewan, the NDP says.

New Democrat MLA Frank Quennell said he wasn't impressed by Prime Minister's Stephen Harper comments in Saskatchewan on Tuesday indicating that the federal government would not pay for cost overruns on the $1.4-billion project.

What's proposed is a massive retrofit to the Boundary Dam coal-fired power station near Estevan so that the carbon dioxide it emits would be stored underground. The scheme would help Canada reduce greenhouse-gas emissions in order to fight climate change.

Harper said Ottawa's contribution to the plan is capped at $240 million, so the rest of the cost will have to come from the province and private investors.

The Saskatchewan government's power company, SaskPower, is on tap to pay $758 million - or more, if costs inflate and the province remains on the hook for the rest.

"We just simply can't afford to do that," Quennell said Wednesday. "And we can't start off with the precedent that we get a token sum from the federal government, we pay through our electricity or taxes or both for almost all the project, and our provincial government brags about it like it's some kind of accomplishment."

The Saskatchewan people deserve to see the details of any deal between the province and the federal government before proceeding, he said.

In recent days, the NDP has been grilling Premier Brad Wall about whether the Saskatchewan Party government will try to get a better equalization payment deal from Ottawa. It has maintained the federal Conservatives promised - but didn't deliver - a new deal that would pay the province an extra $800 million a year.

Wall has used the $240-million federal grant as an example of how Saskatchewan can benefit from a more constructive relationship with the federal government.

But that shortchanges Saskatchewan, Quennell said.

"What we've done, apparently, is traded $800 million a year in equalization money to which both Brad Wall and Stephen Harper said Saskatchewan people were entitled, at one point, for the opportunity for Saskatchewan people to pay disproportionately the lion's share of a national project to reduce greenhouse gases," he said.

Premier touts potential for spinoff benefits

However, Wall said Tuesday a Saskatchewan clean-coal plant could also have spinoff benefits that could pay off for many years to come.

Not only will the captured carbon dioxide not pollute the atmosphere, the gas and the technology can be sold to oil companies looking to squeeze extra production out of old wells.

"If we could increase that recovery rate by just five per cent, we would double oil production from Saskatchewan," Wall said. "Imagine if that were to be replicated in Alberta and Alaska and Colorado and Texas and all the oil-producing regions of North America."

Meanwhile, although Harper said the federal government "doesn't have plans to fund cost overruns," Wall suggested that it could perhaps be negotiated.

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