Brian Gallant is floating the idea in a letter to Premier David Alward, saying he should consider it because it would reduce the borrowing costs of covering the $2.4 billion bill of the work at Point Lepreau.
"Perhaps the prime minister would be open to consideration of the provision of a $2.4 billion loan guarantee representing the full cost of the Point Lepreau refurbishment in order to provide New Brunswick with similar savings for its priority energy project," Gallant says in the letter.
In a later interview, Gallant said his position is not an admission that the federal government should be off the hook for the $1 billion in cost overruns at Point Lepreau.
"We still have the position that we have to ask the federal government for full compensation," he said.
"In the interim ... this is a way to keep the amount of interest that accrues lower."
New Brunswick Energy Minister Craig Leonard said Gallant's suggestion doesn't make sense and he questioned whether Gallant knows how loan guarantees work.
"A loan guarantee simply reduces the interest costs on borrowing," Leonard said. "And frankly, the difference between the Government of New Brunswick rate and the Government of Canada rate is so minuscule that it really wouldn't provide any benefit whatsoever on amounts that are already borrowed."
The New Brunswick government has promised to use every means possible to recover the cost overruns, including threats of a possible lawsuit against the federal government.
They say the province shouldn't have to pay for delays and excessive costs incurred by Atomic Energy of Canada Ltd.
Prime Minister Stephen Harper has not budged, saying his government will only abide by the terms of the contract for the federal Crown corporation to refurbish the reactor.
Last week, Harper signed an agreement that would guarantee up to $6.3 billion in debt for the financing of Muskrat Falls, which is estimated to cost at least $7.5 billion.