New Brunswick Premier Shawn Graham confirmed in the legislature Wednesday morning that his government will no longer sell NB Power's generation assets to Hydro-Quebec. The New Brunswick government had planned to sell NB Power's generation assets to Hydro-Quebec for $3.2 billion.

"That is why it is with so much regret that I am announcing this morning that we are no longer proceeding with discussions to finalize the energy agreement with Hydro-Quebec," Graham told the legislature.

"I continue to believe that the agreement proposed in October and the amendments inspired by New Brunswickers that we brought forward in January were in the best interests of our province.

"However, over the past several weeks as we worked to take that agreement and turn it into a full legal document, Hydro-Quebec has asked for changes to the agreement that would have unacceptably taken away some of the value and increased some of the risks for New Brunswickers."

Graham said he believes the proposed agreement that was announced in October and revised in January was in the best interests of New Brunswickers.

He said he has no regrets in pushing the power deal. "There are no guarantees in life. You can't win every time you take the field," Graham said.

"But you can never succeed from the sidelines. I will not retreat to the sidelines just because this didn't work out."

Premiers meet

Graham met with Quebec Premier Jean Charest on Tuesday to discuss the changes that were being proposed to the energy deal.

The New Brunswick premier said Hydro-Quebec found out in its research that there were more risks than they were willing to take on.

"This change in their position meant that the terms of our agreement in principle could not be met. Our government could not accept that," he told the legislature.

Graham said the New Brunswick government will "take a moment to take a step back" and consider what should be done with the utility.

"We may have closed the door on an energy agreement with Hydro-Quebec. But I know that new doors of opportunity have opened before us," Graham said.

"We will not look back, we will keep moving forward because that is what we were elected to do and that is what we must do to grow our province."

Progressive Conservative Leader David Alward said the government's decision to quash the agreement is a victory for all of those people who fought the deal.

"This is a wonderful day for democracy in New Brunswick," Alward said.