Evidence of meeting #32 for Natural Resources in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was program.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

Serge Dupont  Deputy Minister, Department of Natural Resources

9:35 a.m.

NDP

Christine Moore NDP Abitibi—Témiscamingue, QC

You mentioned $90.4 million for the Investments in Forest Industry Transformation initiative.

If we compare that amount to what was put towards the program in the past, there's actually a decrease of $37.5 million. You just stated that this is a significant investment, but in the end, the funding for this program has been reduced. I have a difficult time understanding why you would say that.

Because of the competition in rail transport, particularly with the oil and gas industry, people cannot send their forest products to their consumers. What is in fact happening is that products are not selling because people cannot send them adequately to the right places. What are your thoughts on this?

9:35 a.m.

Conservative

The Chair Conservative Leon Benoit

Minister, you have about 30 seconds for an answer.

9:35 a.m.

Conservative

Greg Rickford Conservative Kenora, ON

Thank you, Mr. Chair.

My colleague here will be able to give you more details on the investments which are made from year to year.

As I said earlier, in the short term, the government puts the emphasis on infrastructure investments so that forestry sector producers can have access to dynamic markets. This sector's needs in terms of technology and innovation must also be taken into account, a sector that could be more competitive in the future.

As I have only 30 seconds to respond, my answer is limited, but I could continue after if you wish.

9:40 a.m.

Conservative

The Chair Conservative Leon Benoit

Thank you very much, Mr. Minister.

We do have to get on to our final question for today.

Ms. Crockatt, up to five minutes.

9:40 a.m.

Conservative

Joan Crockatt Conservative Calgary Centre, AB

Thank you very much, and thank you, Mr. Minister, for being here.

I too am very excited to see you in this portfolio, with the energy and drive that you're bringing to it as well as your background in innovative technologies.

You spoke a little earlier about the need to understand how our energy industry can get to tidewater, so that we can access other markets. I want to ask you about a market that's a little bit closer to home.

Here in Canada, many Canadians do not know that crude oil is actually Quebec's top imported product and that the largest single source of oil to Quebec is Algeria. About 28.1% of their oil comes from Algeria, according to the Montreal Economic Institute.

I'm wondering if you might address, Mr. Minister, what measures and developments are under way to help Quebec get off its dependence on Algerian oil and to provide jobs in central and eastern Canada.

9:40 a.m.

Conservative

Greg Rickford Conservative Kenora, ON

This is a great question, not just for Canada in general but obviously for the province of Quebec also.

We supported the decision by the National Energy Board, in particular, to approve the reversal of line 9B. It is a safe way to transport energy products. It's environmentally responsible and will create jobs and long-term prosperity.

I spoke at a forum in Montreal. Since we're using metaphors, as a former nurse, maybe I should say mine. We've had drilling, and energy and drive. There was a palpable enthusiasm. If I were to take the pulse of our industry stakeholders in Montreal to ensure that Quebec was participating in the opportunities related to your question, line 9 will transport western Canadian oil east to refineries in Montreal and Lévis. This pleases the industry. They'd like to get back into that business more substantially.

Of course, it goes without saying that every barrel of oil from western Canada displaces a barrel of oil coming from a foreign source, which will assist Quebec obviously in ending its dependence on, as you particularly pointed out, Algerian oil.

Line 9 is a made in Canada solution. It's the reversal here.

We'll have the benefit of protecting jobs in Quebec and across Canada. I believe this will create an opportunity to further develop the confidence and understanding that Canadians in communities across this great country will have in our efforts to ensure that we have world-class, world-leading pipeline safety.

It's designed not just to address international markets but, as your particular question points out, to address demand and capacity, particularly in Quebec, for our energy products. To that extent, it's a win-win for us all.

9:40 a.m.

Conservative

Joan Crockatt Conservative Calgary Centre, AB

Excellent.

You also mentioned that one of your tasks as minister is to create more confidence and help people to understand, in Canada, what's going on with resource development. I presume that extends, and I know that it does, to the opportunities that exist for Canadians.

On the topic of transporting western Canadian oil to eastern Canada, one of the highlights of the recently completed study at this committee—I know that you're aware of it—is the cross-Canada benefits of developing the oil and gas industry. It was the testimony that we heard from New Brunswick.

The study isn't out yet, as you know. I believe it's in translation right now. The testimony certainly has been public. People from New Brunswick testified, most specifically the Mayor of Saint John, that they had a very strong desire to be a have province, especially in terms of energy development. We're looking to provinces like Saskatchewan. I believe one of the quotes from New Brunswick was, “We want to be Saskatchewan”. Kelly is all in favour of that.

Can you please tell us, what do proposed projects like Energy East offer to these communities?

9:45 a.m.

Conservative

Greg Rickford Conservative Kenora, ON

Thank you, Mr. Chair, for the question.

Well, as I said before, we believe that, like western Canadian refineries, refineries in eastern Canada should have the opportunity to source competitively priced Canadian oil. I think it would be counterintuitive to think about it any other way. So we welcome, in principle, the prospect of shipping western Canadian oil to eastern Canada, and to new markets abroad, and as I alluded to in my previous answer, for domestic demand, because we understand the importance of diversifying our markets in order to benefit from the incredible opportunity of energy development provided within natural resources.

This particular project will have to undergo a scientific environmental review by the National Energy Board, and we'll wait for the science and the facts before we conduct our own review and determinations. What I can tell you, for my part, in my capacity as the Minister of Natural Resources, is that what we're focused on here is ensuring that the foundational pieces like pipeline safety and the measures we will take will lead to greater confidence and understanding for communities from coast to coast to coast—that they are in fact world-class, and that elements of it are world-leading. We've already gone through this exercise in meeting the five stringent conditions from British Columbia, or at least four of them, since one of the conditions was between Alberta and British Columbia.

We want to ensure that our prevention, our preparedness in response, and, in particular, our liability regime give Canadians the confidence. To that extent, we have an absolute liability regime in place. It's the only one of its kind in the world, of up to a billion dollars, in the remote case that there is a spill. It doesn't matter whose fault it is; the pipeline companies have to start their activities immediately. The “fault and negligent” regime remains in place and it's unlimited.

Obviously, what we've proposed in a recent announcement I made—and I hope it will garner the support of our colleagues from across the floor—is new powers for the National Energy Board to enforce activities, and not make taxpayers pay, but rather focus on polluters paying, in the event that, as rare as it might be, a spill should occur.

So these are the important pieces that I think help build confidence through engagement and consultation with our communities across the country—that what is being proposed here and what is already in place is working. We're proud of our 99.999% safety record for the more than 73,000 kilometres of pipeline we already have in Canada; and we want to build on that success, as statistically impressive as that might seem.

9:45 a.m.

Conservative

The Chair Conservative Leon Benoit

Thank you very much, Mr. Minister, and Ms. Crockatt.

That completes our time with the minister. We'll continue the discussion with departmental officials after we reconvene the meeting.

I want to start, Minister, by thanking you very much for an informative and very helpful meeting that has given us a good picture of where you intend to take this portfolio. I'm looking forward to that very much, and hope to have you back many times in the next year and beyond.

I'll suspend the meeting now, while the minister leaves the table and departmental officials seat themselves.

9:50 a.m.

Conservative

The Chair Conservative Leon Benoit

We reconvene the meeting now, and we'll just carry on with the order of questioners from those who asked questions of the minister.

I'd like to start by welcoming to the floor, Ms. Ramcharan, who is the assistant deputy minister and chief financial officer of the corporate management and services sector. Thank you very much. Also, Serge Dupont was with the minister and is back again. He is deputy minister of the Department of Natural Resources.

They will answer any questions the members might have.

So we'll carry on with the list we started before, and we'll start with Ms. Moore for up to five minutes. Go ahead, please, Ms. Moore.

May 29th, 2014 / 9:50 a.m.

NDP

Christine Moore NDP Abitibi—Témiscamingue, QC

Thank you, Mr. Chair.

I would like to come back to the question I asked of Minister Rickford concerning forestry.

In his speech, the minister talked about injecting $90.4 million over four years into the Investments in Forest Industry Transformation initiative. In fact, if we compare this amount with what was invested over the same period in the past, we are looking at a decrease of more than $30 million.

Why was the funding cut? How was the money used in the past? Was it fully utilized? How did it come about that this decision was made whereas investment in transformation seems to be a crucial element in successfully giving a helping hand to our forestry industry, which it needs to recover?

9:55 a.m.

Serge Dupont Deputy Minister, Department of Natural Resources

Mr. Chair, I am pleased to be able to complete de minister's answer, given that he had little time to respond to this excellent question.

The way in which information is presented to the committee sometimes may lead to confusion. Ms. Moore, you correctly mentioned that the amount had decreased by $37.5 million this year compared to last. This is because the program expired on March 31, 2014, but its renewal, while it was announced in the budget, does not appear in the main estimates. However, it will appear in the supplementary estimates, which will be presented to parliamentarians later on.

In the past, the Investments in Forest Industry Transformation initiative totalled $100 million over four years. For last year, the $37.5 million decrease is explained by the fact that certain funds would normally have been spent over the course of the first three years, but they were pushed back to the fourth year. The program was renewed with an amount of $90.4 million over four years. As I was saying earlier on, these amounts will appear in the next supplementary estimates.

You also asked about the number of projects. Fourteen projects were funded. The funding for the first cycle of the program was used. In the case of the 14 projects funded across Canada, we are talking about first generation technologies. We expect that the $90.4 million will allow us to support between 12 and 15 projects across the country.

9:55 a.m.

NDP

Christine Moore NDP Abitibi—Témiscamingue, QC

If we consider that the amount allocated to this project was $100 million and that it is now $90.4 million, and on top of that we take inflation into account, it is obvious that the financial support for this program has suffered a decrease.

Furthermore, I would like to know if, when the project selection occurs, care is taken to ensure that they are spread across the country.

Is it possible that they might be concentrated in one geographical area in particular and that that area would get practically all the funding?

9:55 a.m.

Deputy Minister, Department of Natural Resources

Serge Dupont

Mr. Chair, once again, that is an excellent question.

The purpose and the spirit of the program is to support the industry throughout the country. That said, there have been no established quotas nor is there a systematic distribution of funds per region. The funds are allocated basically on the merit of the projects.

However, what we observed during the first phase—and we expect this to also be the case in the second phase—is that because we used a merit system and because there is talent in this industry throughout the country, we ended up funding projects throughout the regions, whether that be in Quebec, British Columbia, or other regions with skills and assets in the forestry sector.

9:55 a.m.

NDP

Christine Moore NDP Abitibi—Témiscamingue, QC

Given the problems in the rail transportation sector, I would like to know if your department has planned on taking any measures to facilitate the transportation of forest products so that the forestry industry can sell them.

9:55 a.m.

Deputy Minister, Department of Natural Resources

Serge Dupont

Mr. Chair, railway transportation is a topical issue. It is important for the natural resources sector, including forestry, mines, and so on. Agricultural products would fall under the Department of Transport. We are trying to follow these issues and make our colleagues within the Transport Department aware of the needs of various industries. That said, I am not in a position to answer your question given that I do not know the details of this file.

9:55 a.m.

Conservative

The Chair Conservative Leon Benoit

Thank you, Ms. Moore.

We go now to Ms. Block, for up to five minutes.

Go ahead, please.

9:55 a.m.

Conservative

Kelly Block Conservative Saskatoon—Rosetown—Biggar, SK

Thank you very much, Mr. Chair.

I would like to welcome you, Mr. Dupont, to this meeting as well as recognize the very capable team that you have joining you today. I look forward to hearing your testimony in response to the questions that we have.

I'm sure you are aware that we've recently completed our cross-Canada benefits study on developing the oil and gas industry, and we heard a fair bit of testimony from witnesses about the importance of engaging aboriginal communities in resource development. Given the fact that this is one of the four pillars of our responsible resource development plan and given the announcements that were made earlier this week, could you provide us with any information on what the main estimates provide for aboriginal participation in the resource economy?

10 a.m.

Deputy Minister, Department of Natural Resources

Serge Dupont

Mr. Chair, the amounts that will be invested to foster further participation of aboriginal Canadians in the resource economy, and specifically in the energy sector, would not yet be reflected in the main estimates.

We have been doing some work in fostering greater conversations and dialogue with aboriginal Canadians from western Canada and other parts of Canada through our existing authorities, for example, through the authorities already funding the major project management office and other parts. As well, for a number of years we have provided support—though I don't have the numbers at my fingertips—through our forestry programs for aboriginal participation in the forestry sector, working with Aboriginal Affairs and Northern Development.

We also support development of resources in the north through a range of initiatives—again, going back to geomapping for energy and minerals where we also engage with communities. The polar continental shelf program is a science based facility where we also engage with aboriginal Canadians.

This dialogue with aboriginal Canadians cuts across virtually all of our programs and would not be found in one of the line items in the main estimates.

10 a.m.

Conservative

Kelly Block Conservative Saskatoon—Rosetown—Biggar, SK

Thank you very much for that.

I recognize that as you go through the main estimates the investments that we are making when it comes to aboriginal communities are embedded within some of the different lines.

I wonder, then, if you could provide any information on what the priorities are for your department, moving forward.

10 a.m.

Deputy Minister, Department of Natural Resources

Serge Dupont

Essentially we wish to continue to support, through a range of initiatives and programs, responsible resource development. That means working on innovation. These include, in particular, innovation in forestry; innovation in mining, for example, our green mining initiative; innovation in the energy sector to enhance the economic but also the environmental performance of energy technologies of our energy sector and therefore responsible resource development; as well as regulatory oversight through the MPMO, ensuring continued efficiency and effectiveness of the regulatory system. That's responsible resource development.

The minister has indicated that energy market diversification is a very clear priority for the government, and therefore for Natural Resources Canada, to try to ensure that there is the infrastructure that is reviewed, and that the government policy framework, including marine safety, pipeline safety, in engagement with aboriginal Canadians, is in furtherance of that objective.

We also have some very important fundamental functions in Natural Resources Canada related to the safety and security of Canadians. We received, in the last budget, some moneys to improve and upgrade our earthquake monitoring capabilities. We are experts in assessing, for example, the range of geo hazards. That is the kind of very basic activity that we conduct through the Geological Survey of Canada.

We try to be at the outer edge of the frontiers in the north, the frontiers of innovation, but also in some very basic functions of understanding our earth, understanding our land mass and the risks and the opportunities it provides.

10 a.m.

Conservative

The Chair Conservative Leon Benoit

Thank you, Ms. Block.

We go now to Ms. Duncan, for up to five minutes. Go ahead, please.

10 a.m.

NDP

Linda Duncan NDP Edmonton Strathcona, AB

Thank you very much.

Thanks for sticking around. I have lots of question for you and I'll try to get a few in.

Can you tell us if anywhere in the mains we can find a specific allocation for the Canada-U.S. clean energy dialogue, and in particular engagement of the public in those dialogues?

10:05 a.m.

Deputy Minister, Department of Natural Resources

Serge Dupont

You would not have a specific line item on the clean energy dialogue. The clean energy dialogue is one in which the government, Natural Resources Canada, participates. The ministerial lead for the clean energy dialogue is the Minister of the Environment.

There obviously has been bilateral contact between Minister Rickford and his counterpart, Secretary Moniz, and discussions between our department and the Department of Energy.

10:05 a.m.

NDP

Linda Duncan NDP Edmonton Strathcona, AB

I just want to know if money has been allocated.