Evidence of meeting #24 for Natural Resources in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was energy.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

  • Christopher Smillie  Senior Advisor, Government Relations, Building and Construction Trades Department, AFL-CIO, Canadian Office
  • Larry Hughes  Electrical and Computer Engineering, Dalhousie University, As an Individual
  • Jack Mintz  Palmer Chair in Public Policy, School of Public Policy, University of Calgary, As an Individual
  • Michal Moore  School of Public Policy and ISEE Core Faculty, University of Calgary, As an Individual
  • Brenda Kenny  President and Chief Executive Officer, Canadian Energy Pipeline Association

10:10 a.m.

NDP

Anne-Marie Day Charlesbourg—Haute-Saint-Charles, QC

Good morning, ladies and gentlemen. Thank you for joining us today.

My first question is for Mr. Hughes.

You say that 80% of the crude oil refined in Atlantic Canada is imported. What kind of risks are associated with this dependence on foreign oil, whether we are talking about our families or about the economy and the imbalance between imports and exports?

10:10 a.m.

Prof. Larry Hughes

The risk is not so much affordability, which of course I did mention before, but it can be an availability issue when we're talking about energy security.

Specifically, we have eight major suppliers to eastern Canada. The U.K. and Norway, as I mentioned earlier, both peaked; Saudi Arabia has effectively entered a plateau; Russia has peaked; Venezuela has peaked; and Nigeria is in a plateau. So with respect to production, some of our major suppliers are having difficulty maintaining supply.

The other side of the coin is what type of domestic and political security risk do they have? Although some of our major suppliers, like Angola and Saudi Arabia, haven't necessarily peaked, they are in regions of the world where they may be politically unstable, and of course it's the same thing with Iraq, which eastern Canada relies upon.

10:15 a.m.

NDP

Anne-Marie Day Charlesbourg—Haute-Saint-Charles, QC

You partially answered my second question. You talked about certain realities our families are faced with, such as energy poverty. You also talked about how much of the family or household budget is used to cover energy costs.

My question is about the potential recommendations to policy-makers. You talked about the possibility of opting for other energy sources, such as hydroelectricity, or shipping western Canadian crude oil from Sarnia to Montreal and Enbridge.

We import crude oil, and we have more than we need. In addition, a refinery was recently closed in Montreal. Could you tell me what the logic is behind importing more crude oil right now?

10:15 a.m.

Prof. Larry Hughes

I'm willing to be corrected on this, but it's primarily historical. The dividing line was developed in the 1960s, so that everything west of the Ontario-Quebec boundary was to be supplied by western Canada and the area east of the Ottawa River was to be supplied from overseas. During times of little or no political volatility, when the energy was available and affordable, it made sense.

On what has happened over time, as has been pointed out, with the OPEC crisis, line 9 was installed with the intention of overcoming this reliance on countries outside of Canada. Since then, line 9 has been reversed. One of the underlying assumptions is that we don't need to reverse it again, but we do need to reverse it now to meet not necessarily our energy security, but the energy security of other countries. From my understanding, it was a historical decision to take that path and supply eastern Canada with overseas crude.

10:15 a.m.

NDP

Anne-Marie Day Charlesbourg—Haute-Saint-Charles, QC

Thank you.

Mr. Smillie, at a committee meeting, the minister told us that the Keystone project would create 140,000 jobs. If the project moves forward, how many of those jobs would be in Canada and how many in the United States?

10:15 a.m.

Senior Advisor, Government Relations, Building and Construction Trades Department, AFL-CIO, Canadian Office

Christopher Smillie

There are two stages of jobs. Let's talk first about direct jobs, and then related jobs.

If Keystone were to go ahead today, there would be about 3,000 to 3,500 construction jobs in Canada in this section from Hardisty to the U.S. border for three seasons. The direct construction in the United States for Keystone would involve about 20,000 jobs. It makes a lot of sense, because the majority of the pipeline is in the U.S. But the jobs afterwards in the extraction, upgrading, and construction industry down the road would make a big difference.

Producers in Alberta would build and grow their facilities in order to fill that pipeline with product. That's where the jobs for Canada would come from. The jobs for Canada wouldn't really come in large numbers from the construction of the pipeline. It's the 50-year jobs that come afterwards. It's all the tertiary effects of the oil sands employment afterwards. It's in the hundreds of thousands that's calculated after a project like Keystone is completed. It's billions of dollars to Canada's GDP.

10:15 a.m.

Conservative

The Chair Leon Benoit

Merci, Ms. Day.

We will now go to Mr. Daniel for up to five minutes.

Go ahead, please.

February 7th, 2012 / 10:15 a.m.

Conservative

Joe Daniel Don Valley East, ON

Thank you, Mr. Chairman.

Thank you, witnesses.

I'm going to focus on what the government is focusing on, which is the job side of things. I think my questions are going to be primarily to you, Mr. Smillie.

You talked about there being 25,000 apprentices in training at the moment. How many of them graduate each year? Is there a gap in the demand for these folks, positive or negative, in each of the trades?

10:20 a.m.

Senior Advisor, Government Relations, Building and Construction Trades Department, AFL-CIO, Canadian Office

Christopher Smillie

Canada's apprenticeship system writ large has approximately 250,000 people currently registered. That includes construction, hairstylists, bakers, anything that's considered a registered Red Seal trade. There are about a quarter of a million folks, and each year Statistics Canada says there are 25,000 to 30,000 people who graduate from the apprentice program.

Apprentice programs differ in their length. For a specialty welder, it's four years, and for a carpenter, it's three. For a heavy machinery operator, it may be two or three years. In Canada's apprentice system, of which construction is a part, there are 20,000-odd folks graduating from their field of study, so to speak.

Basically, 10% of the entire apprenticeship system is in construction, and it's in Alberta. If you talk to some of the industrial unions or manufacturing trades, they haven't been able to hire apprentices in a long, long time because there's been a contraction in those sectors. The construction trades and companies, by opposite logic, have been able to hire tons of apprentices; it's usually three or four apprentices per journeyperson in the workplace.

10:20 a.m.

Conservative

Joe Daniel Don Valley East, ON

Are you able to keep up with the demand? Is there a gap between the number of people required versus the number of people who have been trained, or is there a surplus?

10:20 a.m.

Senior Advisor, Government Relations, Building and Construction Trades Department, AFL-CIO, Canadian Office

Christopher Smillie

Right now the labour supply is tight. We need to train as many Canadians as we possibly can. We need to get them into apprentice programs to address workforce shortages. Between now and 2017, the Construction Sector Council estimates there will be something like 320,000 construction workers who will be required to meet demand due to demographics and economics.

You have these two divergent forces. You have a tightening of labour supply and an expansion of economic investment in a key economy. It takes four years for most construction trades. Canada's employers and the construction unions have an opportunity. It's a real opportunity to add value to the system. If we don't, the labour supply will be even tighter.

I mean, they don't let me near the tools; I don't want to give you that impression. But if you take a look around a work site, most of the folks on that site are on their way out of the workforce. The average age of a construction worker in Canada is mid-forties, but the majority of them are past 50.

What are we going to do between now and 2017 to make sure we are replacing that workforce? It's demographics colliding with the economics of this massive investment. We're at a point where we're grabbing people from all parts of Canada to work in Alberta and beyond on energy projects.

10:20 a.m.

Conservative

Joe Daniel Don Valley East, ON

Okay. Could you expand on your comment that the oil sands are a global classroom for the young Canadian workforce? I didn't quite understand what you meant by that.

10:20 a.m.

Senior Advisor, Government Relations, Building and Construction Trades Department, AFL-CIO, Canadian Office

Christopher Smillie

Sure. We don't have any other areas in Canada where you can look around and there are 25,000 people learning a trade. I view Alberta as a global classroom for Canadians to learn an apprenticeship trade. It's also a place where foreign workers come to work. When the Canadian labour force can't meet demands, people from other countries come to Canada.

You have the experienced folks working in the oil sands teaching young apprentices what to do. In our view, it's an experience.

10:20 a.m.

Conservative

The Chair Leon Benoit

Thank you, Mr. Daniel.

We will go now to Mr. Stewart for up to five minutes.

Go ahead, please.

10:20 a.m.

NDP

Kennedy Stewart Burnaby—Douglas, BC

Great. Thank you.

Mr. Smillie, since about 1980 we've lost about one refinery per year in Canada, as well as significant domestic refining capacity. I'm wondering how these types of closures affect your members, such as boilermakers, for example.