Thank you, Mr. Chairman, and honourable members, for the opportunity to appear before you today and to support your review of part 3 of Bill C-38.
The National Energy Board's purpose is to regulate pipelines, energy development, and trade in the Canadian public interest. The board is accountable to Parliament and reports to Parliament through the Minister of Natural Resources. The board regulates the construction and operation of interprovincial and international oil and gas and commodity pipelines and international power lines. We also regulate oil and gas exploration and development on frontier lands and offshore areas not covered by provincial/federal co-management agreements. The NEB's regulatory oversight extends over 71,000 kilometres of pipeline that criss-crosses most of our country and approximately 1,400 kilometres of international power lines. The board does not regulate energy projects that are wholly contained within a province.
The NEB holds the companies it regulates accountable for the safety of their facilities and for the protection of the environment in which they operate. Our safety programs are designed to make sure companies are effective in managing safety and environmental protection throughout the entire life cycle of a pipeline, from design to construction, to operation, and through to abandonment.
As we audit and inspect for compliance, we look for evidence of management systems that provide a strong foundation for a pervasive culture of safety, forcefully affirmed by the organization’s leadership, rigorously documented in writing, known to all employees, and consistently implemented in the field.
The board has an advisory function under the NEB Act, and in this role it reviews and analyzes matters within its jurisdiction and provides information and advice on aspects of energy supply, transmission, and disposition in and outside Canada.
The board holds a public hearing for any application to build a pipeline over 40 kilometres long and for a variety of other energy regulatory matters. In assessing a project, the NEB considers all factors relevant to the public interest, including the environmental effects of the project.
We have significant experience in considering potential environmental effects when making our regulatory decisions, and we have been conducting environmental assessments under the Canadian Environmental Assessment Act since it came into force in 1995. In recent years the NEB has conducted about 30 screening-level environmental assessments per year. Many of these screening-level assessments were part of a public hearing. The board has conducted comprehensive studies and review panels under the CEAA, all in association with a public hearing under the NEB Act.
The National Energy Board has the mandate, processes, and capacity to conduct technically rigorous, publicly transparent, and inclusive environmental assessments for any facility we would regulate. The NEB has approximately 50 environment, socio-economic, lands, and stakeholder engagement specialists, and 40 safety and engineering specialists on staff. As a life cycle regulator, the NEB attaches environmental conditions to project approvals, which we monitor and enforce beyond the environmental assessment phase, from project approval, through construction, operation, and eventual abandonment.
Throughout the entire life span of a project, we monitor to ensure that the company is managing its project so that it is operated in a manner that is safe and secure and protects the environment. Our compliance and verification program includes such activities as audits, construction and safety inspections, compliance meetings, emergency exercise assessments, and investigations.
If we find that a company is not complying with its regulatory obligations, we use a range of tools to enforce our decisions, uphold safety, and protect the environment. These tools range from an oral request for immediate compliance to criminal prosecution. They also include orders to stop work or modify the operation of a facility.
Should proposed legislative changes be enacted, then the NEB would operate within that updated framework. The NEB would continue to conduct its independent, fair, and accessible environmental assessment and regulatory review process for major pipeline projects. We would recommend terms and conditions to make the project safe for people and the environment.
The legislative changes address the timelines for NEB regulatory assessment and provide the GIC, the Governor in Council, with the responsibility to make the go or no-go decision for issuing a pipeline certificate. The proposed timelines are consistent with the NEB’s historical performance, and tools are provided to deal with contingencies. Currently, the NEB makes a decision, but an order from Governor in Council is required before a certificate for a project can be issued. This would change so that GIC makes the decision and is not simply approving the NEB decision. Further, in situations where the NEB does not recommend approval, the analysis and recommended terms and conditions would be provided to GIC for the final decision.
Thank you for the opportunity to provide this overview of the National Energy Board's mandate and regulatory approach. I'd be pleased to answer any questions.