Evidence of meeting #66 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 innovation.
A recording is available from Parliament.
5:25 p.m.
President and Chief Executive Officer, Canadian Energy Research Institute
Yes. Actually, if you count the molecules, it's probably not.... The Marcellus molecule doesn't make it to Quebec, but by displacement you could say that in fact within a couple of years Marcellus gas will be occupying that demand space.
5:25 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
Just like transmission lines and electrons; it's the same kind of thing. I find that interesting.
If that's the case, and presumably if the same thing happens in New Brunswick, for example, two jurisdictions.... I'm hopeful we won't put a moratorium on that in New Brunswick, but you never know. With that in mind, have you done any numbers with respect to what the economic development would be and the cost to the economy if Canada were not pursuing that, as opposed to taking Marcellus shale?
5:25 p.m.
President and Chief Executive Officer, Canadian Energy Research Institute
I would have to say we haven't looked at it in that context, although we do have a report out there that looks at the economic impact of shale gas development within Quebec. Basically this report says that we fully recognize that there's a moratorium in place, but if that moratorium was lifted, there's this level of activity, this level of GDP growth, employment, and all that kind of stuff, that goes along with hydrocarbon development within the province of Quebec.
You could make the same statement in New Brunswick, if shale gas development took place there. We haven't worked on those numbers, but in Quebec we have.
February 12th, 2013 / 5:25 p.m.
Vice-President, Canadian Division, Regulatory and Government Relations, Encana Corporation
Yes, thank you. I'd appreciate adding to it because we've been working on the LNG side.
The market works, and United States gas is closer to the eastern Canadian market and is displacing western Canadian gas. So the market works, and the market is what it is.
At this point, United States imports into Canada are some three or so billion cubic feet a day. We've been considering the impact of LNG. When we lose those markets, it's critical that we access the Asian markets offshore with LNG. This is really where the growth is going to come, and that potential. And as I mentioned, we have that proposal through CAPP to get some three to four bcf a day, roughly equivalent to what has been displaced in the east. That would provide some $500 billion of GDP, and the jobs you're looking at, ongoing jobs, are in the range of 100,000. This would be Canadian jobs across the breadth of Canada, direct, indirect, and induced. LNG is critical.
5:25 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
Like oil, is there a price differential issue between the two countries on natural gas?
5:25 p.m.
Vice-President, Canadian Division, Regulatory and Government Relations, Encana Corporation
It's not to the same extent. There is somewhat of a differential. Gas is probably selling for, let's say, around the $3 to $3.50 per 1,000 cubic feet—mcf. At this point there would probably be a differential of 25¢, principally due to transportation distance from western Canada, and that's part of the advantage that the Marcellus gas would have in eastern Canada. They avoid that transportation differential.
5:25 p.m.
Conservative
Mike Allen Conservative Tobique—Mactaquac, NB
The short answer, then, is that if you think you're not getting shale gas and you make that decision, well, it's too bad, you probably are.
Thank you.
5:25 p.m.
Conservative
5:25 p.m.
Conservative
5:25 p.m.
Conservative
The Chair Conservative Leon Benoit
Yes, there actually is a little over a minute.
Go ahead, Mr. Anderson.
5:25 p.m.
Conservative
David Anderson Conservative Cypress Hills—Grasslands, SK
Can I ask one question? I don't think we understood until today the importance of the access to the world markets. I wish more Canadians could hear this conversation, because they would understand the importance of it.
Have you done anything on how much R and D investment in new technology and innovation would be lost if we lose the opportunity we have? If we can't move ahead, and if we lose that 60% and we can't get our LNG offshore, do you have an idea of what will happen to R and D? We keep talking about research and development being important as well.
5:30 p.m.
Vice-President, Canadian Division, Regulatory and Government Relations, Encana Corporation
It's a good question. I'll take a quick stab at this.
For our company, each year we submit, I think, somewhere in the range of $50 million to $60 million worth of activity that would qualify for SR and ED, so it meets the stringent tests of the research and development. Absolutely, that's in the upstream side.
That's certainly development that's going to go away. I mentioned a number of different areas, and it definitely would lose that. To your point before, it would strand an incredible amount of resource unless we access that world market.
5:30 p.m.
Conservative
The Chair Conservative Leon Benoit
We are out of time.
Thank you very much. Thank you to all the witnesses today for the information you have given and for answering the questions. It's very much appreciated. It will help us with our report.
The meeting is adjourned.