Bill C-46 (Historical)

Pipeline Safety Act

An Act to amend the National Energy Board Act and the Canada Oil and Gas Operations Act

This enactment amends the National Energy Board Act and the Canada Oil and Gas Operations Act in order to strengthen the safety and security of pipelines regulated by those Acts.
More specifically, the enactment, among other things,
(a) reinforces the “polluter pays” principle;
(b) confirms that the liability of companies that operate pipelines is unlimited if an unintended or uncontrolled release of oil, gas or any other commodity from a pipeline that they operate is the result of their fault or negligence;
(c) establishes the limit of liability without proof of fault or negligence at no less than one billion dollars for companies that operate pipelines that have the capacity to transport at least 250,000 barrels of oil per day and at an amount prescribed by regulation for companies that operate any other pipelines;
(d) requires that companies that operate pipelines maintain the financial resources necessary to pay the amount of the limit of liability that applies to them;
(e) authorizes the National Energy Board to order any company that operates a pipeline from which an unintended or uncontrolled release of oil, gas or any other commodity occurs to reimburse any government institution the costs it incurred in taking any action or measure in relation to that release;
(f) requires that companies that operate pipelines remain responsible for their abandoned pipelines;
(g) authorizes the National Energy Board to order companies that operate pipelines to maintain funds to pay for the abandonment of their pipelines or for their abandoned pipelines;
(h) allows the Governor in Council to authorize the National Energy Board to take, in certain circumstances, any action or measure that the National Energy Board considers necessary in relation to an unintended or uncontrolled release of oil, gas or any other commodity from a pipeline;
(i) allows the Governor in Council to establish, in certain circumstances, a pipeline claims tribunal whose purpose is to examine and adjudicate the claims for compensation for compensable damage caused by an unintended or uncontrolled release of oil, gas or any other commodity from a pipeline;
(j) authorizes, in certain circumstances, that funds may be paid out of the Consolidated Revenue Fund to pay the costs of taking the actions or measures that the National Energy Board considers necessary in relation to an unintended or uncontrolled release of oil, gas or any other commodity from a pipeline, to pay the costs related to establishing a pipeline claims tribunal and to pay any amount of compensation that such a tribunal awards; and
(k) authorizes the National Energy Board to recover those funds from the company that operates the pipeline from which the release occurred and from companies that operate pipelines that transport a commodity of the same class as the one that was released.

[Geoff Regan, Liberal, Halifax West, NS]

Let me ask you about the risks to taxpayers in the case of a catastrophic spill. I ask because currently, of course, if pipeline company X were unable to pay the entire cost associated with the spill, some things could in fact go unpaid. Under Bill C-46, we would have a regime where the consolidated revenue fund comes over to the taxpayer. It would be called upon to cover unpaid awards.

The question is, I guess, whether it's fair to taxpayers to carry this risk, although there seems to be some mechanisms to allow the NEB to recover any compensation that might be paid out. Do you think this aspect of the bill should be amended, and if so, do you have any suggestions?

Mr. Olszynski, I'll start with you.

[Geoff Regan, Liberal, Halifax West, NS]

Thank you, Mr. Chair.

My thanks to the witnesses here with us today and the witness joining the meeting by videoconference.

One of the things that I want to ask about is funding for the NEB, because according to the 2015-16 main estimates, the NEB's funding for the regulation of pipelines, power lines, energy development, and so forth has actually decreased from $81.7 million in 2013-14 to $76.8 million in 2015-16. That's a reduction of some $4.9 million, or 6% thereabouts.

Given the fact that Bill C-46 is actually giving quite a bit more responsibility to the NEB, and more authority, do you think it's strange that its budget is shrinking instead of increasing? How do you think this will impact public confidence in the NEB's ability to make sure our pipelines are the safest in the world?

Mr. Donihee, do you want to start?

[Ian Miron]

I don't see a whole lot of consultation within this bill itself. I am aware that there are some extra efforts outside of the legislation that have been proposed by the government with respect to consultation with first nations. This bill isn't an environmental assessment bill. This is a liability bill. From my perspective, that's what this bill is about. It's about polluter pays. I don't see a whole lot of room for consultation within this bill.

[Joan Crockatt, Conservative, Calgary Centre, AB]

We have a responsibility here as a government to protect the public environment and also to protect public jobs. I think Mr. Blakely talked about that as well today. On those counts, how does Bill C-46 stack up in your view?

[Megan Leslie, NDP, Halifax, NS]

Thank you, Mr. Chair.

Mr. Miron, I have some questions for you. I appreciate the concept you put forward of “polluter might pay”. That resonated with me. You talked about the fact that once we're over a billion dollars, the cost falls to Canadians for cleanup and compensation.

For me, all of this is with the backdrop of a couple of different things.

The first backdrop for me is the environment commissioner's 2011 report. The environment commissioner looked at the transportation of dangerous goods via pipelines and found little evidence that the National Energy Board was making sure that companies actually followed through on correcting their deficiencies in the practices they had, and also, alarmingly, that the NEB wasn't monitoring companies as to whether or not they had prepared emergency procedures manuals. That makes me think, then, about Enbridge and Kalamazoo and how the U.S. regulators likened the response to the Kalamazoo spill to the the Keystone Kops.

I think about the two overlaid. If we don't actually have an emergency procedure manual, what the heck is going on and how do we deal with it? The longer we're struggling to have a response, the more environmental damage there is and the higher the cost for cleanup and potentially for compensation.

My questions to you are around Bill C-46 and drawing on the experience of spills that we know about. How much did they cost? How much did they cost to clean up? What kinds of damages were there? What was the proportion of what the companies were on the hook for versus citizens paying through government? How much compensation actually went unsatisfied and wasn't paid out? Can you help us situate Bill C-46 within the context of what we know about spills?

[Ian Miron]

Certainly.

If a pipeline spill got into waters containing fish and caused a deleterious effect on those fish, subsection 42(1) of the Fisheries Act could have come into play to make companies absolutely liable for an unlimited amount of spill response costs. Bill C-46 basically closes that option off. Those are no longer recoverable under Bill C-46.

[Jim Donihee]

Mr. Chair, thank you for providing me with this opportunity to share some remarks with you.

Mr. Chairman and members of the committee, thank you very much.

My name is Jim Donihee. I'm the chief operating officer and the acting chief executive officer for the Canadian Energy Pipeline Association. I thank you for the opportunity to present some remarks.

First I'll give you some background. CEPA operates 115,000 kilometres of transmission pipelines across Canada, much of which falls under the jurisdiction of the National Energy Board. Our members transport approximately 97% of all of the daily natural gas and onshore crude oil that is produced, and we have been bringing it to markets very safely for some 60 years. For example, in 2014 our members collectively transported over five trillion cubic feet of natural gas, and 1.2 billion barrels of liquid petroleum products. This represents approximately 23% of Canada's mercantile trade, and it makes an extremely significant contribution to the social fabric of our nation.

While our longstanding operational safety record of 99.9995% between 2002 and 2013 is truly exceptional, at the same time we recognize that it is not sufficient; it's not good enough. Our CEOs have publicly committed to zero incidents on pipelines, and we're very actively working to get there.

Bill C-46 as proposed certainly complements our industry's strong belief in the polluter pays principle, excellence in emergency response, pipeline safety, and environmental protection. For that reason, and to reassure Canadians that our industry is fully dedicated to a safe and socially responsible energy pipeline transmission industry, CEPA supports the proposed regulation.

Our members are focused first and foremost on pipeline safety and the prevention of all incidents throughout the entire life cycle of pipelines. This continuous focus on safety saw us invest over $1.4 billion in 2013 alone, in order to ensure the safety of these pipelines. We're working aggressively through our program entitled CEPA integrity first, a management systems approach that is addressing critical priorities in pipeline operations, commencing with pipeline integrity and control room management. The integrity first program, patterned after the responsible care initiative of the chemical industry, will drive significant performance throughout our industry based on our sincere desire to exceed regulatory compliance.

This year as well, CEPA will take a big step forward by committing to conducting a safety culture survey of its entire membership in order to ensure that we focus on the human dynamic that is also so absolutely critical to excellence in performance.

We are actively participating in the development of standards, and these standards, constructed largely by the Canadian Standards Association, apply to our operations throughout the design, construction, operation, and eventual retirement of the pipelines that we have the privilege of stewarding.

The best available technology is absolutely key to the way our industry functions. Through initiatives such as the Canadian Pipeline Technology Collaborative, which is a new initiative being formed, we seek to leverage new technologies through academic institutions and in collaboration with many government partners.

I think it's important to take a look at the commitments that our industry has made in recent times. First, for example, is the mutual emergency assistance agreement, the MEAA, that was first exercised in 2014 and that clearly recognizes in this day and age that any incident of a pipeline company is everybody's incident. This MEAA will seek to harness, and does harness, the resources of all of our members in order to respond in the most effective and immediate manner to any incident that might emerge.

Along with the MEAA, CEPA's members have adopted an incident command system common to all. It reflects interoperability and enhances interoperability among all of our members.

Transparency is absolutely key to earning and sustaining the trust of Canadians. To that end we've undertaken the formulation of a task force that is addressing the common template that will make available to all Canadians every bit of information that we can in order to earn their trust, while withholding only such information that is critical to privacy considerations and the security of critical infrastructure. That information is always made available to all emergency responders.

We've heard the comments by Mr. Blakely about the NEB and we believe strongly that the oversight that we receive from a competent regulator is vital to Canada's national interests. We are well served by having a strong regulator that is capable of providing timely, science-based, and fact-based consideration of our projects.

With that in mind, especially in consideration of the new powers and authorities that the NEB will be adopting through this bill, we believe that it's incredibly important for the NEB to receive the levels of funding and the flexibility of using those funds that are necessary to ensure that it can attract and retain expertise critical to being able to fulfill its mandate.

Our member companies have an exceptional track record with a very low frequency of incidents. They believe strongly in the polluter pays principle and have always ensured appropriate restoration of the environment without any financial consequence borne by the public, including considerations for loss of use. CEPA members are dedicated to the commitment of this obligation through preparedness and response. They will ensure that they fulfill their obligations as reflected in this bill.

Notwithstanding CEPA's strict adherence to the polluter pays principle, and our strong response capabilities, we are supportive of the proposed legislation that sets out liability and compensation requirements for companies operating crude oil pipelines.

As I seek to conclude, Mr. Chair, I would offer the following recommendations for this very positive step forward.

Regulatory requirements that originate from the bill should be risk-based and respond to the proven safety record that the transmission pipeline industry has demonstrated.

The federal government should continue to explore opportunities to support multi-sectoral initiatives, such as the CPTC, which will identify, develop, and implement advanced science and technology. The Canadian Standards Association remains an extremely effective body for the development of standards. We collaborate routinely and press the envelope forward to develop these standards.

We absolutely respect the role of the NEB and believe it to be vital to the good functioning of a highly responsible industry on behalf of Canadians. We believe that the NEB requires the funding that it needs and the flexibility of employing that funding to meet the obligations that you will offer to it through the approval of this bill.

With that, Mr. Chair, I'd like to conclude my comments and thank you for the opportunity to present some comments to you. The Canadian energy pipeline industry is an industry that has a proven, long-standing track record and one that Canadians should be proud of. We look forward to making a continued contribution to the success of our nation for many years to come.

Thank you.

[Ian Miron, Barrister and Solicitor, Ecojustice Canada]

Thank you, Mr. Chair, and thank you to all the members. I appreciate the opportunity to present today.

As you might know, I'm a lawyer here on behalf of Ecojustice, which is Canada's largest public interest environmental law organization. Ecojustice has worked extensively on pipeline issues across Canada as well as on statutory liability regimes, in the context of the energy sector more broadly. This will be the focus of my presentation today.

I think we can all agree that Bill C-46 is much needed and, quite frankly, long overdue. That being said, there are some significant shortcomings in the bill as currently drafted. I'm going to focus on three of those today.

First, the absolute liability limit is inappropriately low. Second, more guidance is needed around the assessment and calculation of damages for the loss of non-use value relating to a public resource, which I'm going to refer to as “environmental damages”. Third, although the bill provides some interesting new tools for seeking compensation and reimbursement in the event of a spill, the use of most of these tools is discretionary, not mandatory.

As currently drafted, the bill can best be described as “polluter might pay”. It offers modest improvements on the current regime, but it does not fully implement the polluter pays principle, and therefore continues to expose Canadians to an unacceptable portion of the financial risks of a pipeline spill.

Moving to the absolute liability limit, it's positive that the bill incorporates the polluter pays principle into the National Energy Board Act. The bill then restricts absolute liability to $1 billion for spills from large oil pipelines.

Imposing absolute liability up to that $1 billion limit is largely an improvement over the status quo. I say “largely” because it limits what was unlimited liability under the Fisheries Act for certain spill response costs. ln the case of a major spill, $1 billion isn't enough to cover the cleanup costs, let alone compensate victims for damages and all Canadians for environmental damages. We have seen Enbridge's line 6B rupture in Michigan. The cleanup costs have topped $1.2 billion so far. There's still oil in the river there, and there's more work to be done.

ln that light, limiting absolute liability to what seems to be an arbitrary figure of $1 billion inappropriately restricts the polluter pays principle and allows polluters to shift a portion of the financial risk of a pipeline spill back onto Canadians.

Moving quickly to environmental damages, I am pleased to see that the bill includes liability for the loss of non-use value. This measure is absolutely crucial to implement effectively, because a major oil spill can never be fully cleaned up and wildlife and the environment in the vicinity of a spill will often be killed or seriously harmed before cleanup efforts can begin.

Beyond recognizing that compensation for these environmental damages is available, the bill provides no details on how they will work in practice. This lack of guidance, I submit, makes it less likely that a government will try to recover compensation. At the very least, we need a regulation-making power so that some guidance can be provided, the holes can be filled in. I urge the government to consult publicly on such guidance.

Moving to the new recovery mechanisms, the bill does provide some new tools to respond to spills and to recover damages or expenses from polluters. The use of many of these tools is left to the discretion of the NEB. Many of the tools are also contingent on the polluting company being designated by cabinet. Designation is a discretionary decision that would allow the government to, for example, take over spill response or to appoint a specialized pipeline claims tribunal to decide claims for compensation.

Staying with that pipeline claims tribunal for a few seconds, it is worth noting that any awards the tribunal makes appear to be paid directly out of taxpayer money, presumably to ensure that victims are compensated in a timely manner.

Where taxpayer funds are used to compensate victims of the spill, the NEB has the option to try to get this money back from the polluter. If the polluter doesn't have enough money to pay, then they can also try to get it back from a broader subset of the pipeline industry through various fees and levies. Again, these tools are discretionary. The NEB doesn't have to use them, and this is concerning.

In keeping with the polluter pays principle, the NEB should be required to use any and all available tools to make sure that taxpayers aren't left footing the bill for the cost of a pipeline spill. This is particularly the case given that Bill C-46, in the context of this bill's claims tribunal, contemplates non-Canadians seeking compensation before it. Obviously, exposing Canadian taxpayers to that kind of financial risk is not acceptable.

To sum up, the bill does represent a move toward a polluter might pay model, but the shortcomings of the bill still leave Canadians exposed to an unacceptable portion of the financial risks of a pipeline spill.

Those are my remarks, subject to any questions. Thank you for the opportunity to speak today.

[Martin Olszynski, University of Calgary, Faculty of Law, As an Individual]

Thank you, Mr. Chair, and members of the committee.

My name is Martin Olszynski. I'm an assistant professor at the University of Calgary, Faculty of Law. The focus of my presentation today is on what are commonly referred to as the environmental damages provisions of Bill C-46.

I began thinking and writing about environmental damages roughly 10 years ago, when the Supreme Court of Canada first opened the door for governments to sue for such damages in a case called Canadian Forest Products v. British Columbia. I have since written several articles on this topic, including with one of Canada's leading resource economists, Professor Peter Boxall.

I will begin with a brief primer explaining this concept of environmental damages. I'll then describe their role and their treatment under Bill C-46. Finally, I will make two recommendations for improvement.

Most simply, environmental damages can be understood as the financial compensation awarded for the loss or impairment of some public environmental asset and the services it provides, for example, a forest, in the case of Canadian Forest Products, or a coastal area, such as was affected following the Exxon Valdez spill or the Gulf of Mexico following the Deepwater Horizon blowout.

Environmental and resource economists divide such harms into the loss of two kinds of values: use value and non-use value. Referring to an Environment Canada publication, the Library of Parliament's legislative summary of Bill C-46 defines these two values as follows:

Use values are associated with direct use of the environment such as fishing and swimming in a lake, hiking in a forest - or commercial uses such as logging and farming. Non-use values are related to the knowledge of the continued existence of the environment...or the need to leave environmental resources to future generations.

As committee members might imagine, environmental damages assessment can be a complex and difficult task. Various scientific disciplines—ecology, toxicology, hydrology—are applied to first determine the extent of harm done, while economics and the techniques of environmental valuation in particular are then used to convert this harm into monetary terms.

Under Bill C-46 there are actually two different roles for environmental damages. They play a role in sentencing and they play a role in civil liability. As to sentencing, where an operator commits an offence under the NEB Act, the proposed section 132—and this is clause 37, page 35—directs a sentencing judge to consider the “damage or risk of damage to the environment” as a result of the offence. That is further defined under subsection 4 as “the loss of use value and non-use value”. Through this amendment, the NEB Act joins the ranks of at least 10 other federal environmental laws with similar sentencing provisions. Although light on details, this wording is both simple and comprehensive.

The other environmental damages provisions, which are decidedly more opaque, are found in the context of civil liability. Under the proposed subsection 48.12(1)—and this is clause 16, pages 6 and 7 of bill—there's a reference to three heads of damages: “(a) all actual loss or damage incurred by any person...”; “(b) the costs and expenses” of cleanup; “(c) all loss of non-use value relating to a public resource that is affected” by the spill.

In other words, environmental damages are not actually referred to in this part of the bill; rather, their availability—at least partially—is implied by the reference in paragraph (c) to “all loss of non-use values relating to a public resource...”. Use values are not explicitly referred to, although as I will explain, some of these may be caught by paragraph (a).

There are two other relevant provisions I want to touch on just briefly. These are proposed subsections 48.12(9) and 48.13(5). The former states that only federal and provincial governments may sue for the loss of non-use values, while the latter states that the NEB is not required to consider the potential loss of non-use values when determining the financial resources that operators will be required to maintain for the purposes of absolute liability.

My first recommendation is that the third category of loss under the civil liability provisions be amended to refer simply to environmental damages. For instance, “all environmental damages resulting from the release...", and that this be coupled with an additional subsection defining environmental damages, as is the case in the sentencing provisions. Those are the simpler and more comprehensive provisions, and I suggest that the civil liability provisions be amended to reflect that simple and comprehensive structure. This would not only simplify this section, but it also seems necessary to correct what appears to be an omission in the current bill.

As the committee is probably aware, most of the wording here was brought over almost verbatim from Bill C-22, the Energy Safety and Security Act, which amended COGOA along similar lines. That legislation already had some spill-related provisions, and specifically a definition for “actual loss or damage”. I'll just read that definition quickly. It “...includes loss of income, including future income, and, with respect to any aboriginal peoples of Canada, includes loss of hunting, fishing and gathering opportunities.”

On my reading of this bill, this definition for “actual loss or damage”, which admittedly does capture some of the use values that I was referring to before, has not been brought over. Even if it were, I submit that there would still be a gap in the legislation. I can provide some examples of that gap after my presentation, if the committee is interested.

My second recommendation is that the Governor in Council should be required within a certain timeframe, or at least authorized, to make regulations setting out a process for environmental damages assessment. Reliance on this process should result in a rebuttable presumption of validity in any action for such damages, whether in court or before the pipelines claim tribunal. First, and as noted above, environmental damages assessment is a difficult and complex exercise; regulations would bring certainty to all parties and reduce needless litigation. It is for this reason that the equivalent American legislation, CERCLA and the Oil Pollution Act, contains such provisions, and that processes have been prescribed for the purpose of what is referred to there as “natural resources damage assessment”. I submit that such regulations represent the gold standard in this context.

My second reason tracks the preventative spirit of the bill. There are now roughly 10 federal environmental laws with some kind of environmental damages provisions, and it has been 10 years since the Supreme Court opened the door for governments to sue for these, and yet I am not aware of a single case where the federal crown has actually sought to do so. Perhaps this is something that future government witnesses could shed some light on. Whatever the case, this reality greatly undermines, in my view, the deterrent effect that statutory liability regimes like Bill C-46 are intended to create.

[The Vice-Chair, NDP, Guy Caron]

Good afternoon and welcome to the 53rd meeting of the Standing Committee on Natural Resources.

The topic on today's agenda is Bill C-46, An Act to amend the National Energy Board Act and the Canada Oil and Gas Operations Act.

In the next two hours, we will be hearing from four witnesses.

In the room we have Mr. Martin Olszynski from the faculty of law at the University of Calgary. As well, we have Mr. Ian Miron, who is a barrister and solicitor but is here to speak on behalf of Ecojustice Canada. Mr. Robert Blakely is the Canadian operating officer with Canada's Building Trade Unions.

Welcome, all of you.

By video conference from Calgary, we have Jim Donihee, acting chief executive officer for the Canadian Energy Pipeline Association.

Do you hear us well?

Canada Shipping Act

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

Mr. Speaker, I have been following this debate very closely, just as our government has been listening very carefully to what British Columbians, and indeed all Canadians, have been saying about economic development and environmental responsibility in this country.

I appreciate the opportunity to respond to the bill before us and to reiterate some of the points made so persuasively by some of my colleagues. I will also add that I find it ironic that this member is proposing such a bill after he and his party voted against our increased measures for pipeline safety. New Democrats voted against doubling the number of audits and increasing the number of inspections on pipelines. They voted against fining companies that break environmental regulations.

Our government is listening to Canadians, and the message we are hearing is very clear: Canadians want balance. They understand the importance of resource development, but not at any price. They understand that economic development and environmental protection go hand in hand, and so does our government.

Environmental protection is and always will be a priority for us. We have been clear that projects will only proceed if they are safe for Canadians and safe for the environment. That is precisely what our plan is, and that is what responsible resource development is all about. Grounded in sound science and world-class standards, that plan ensures that we can develop the energy of the structure we need in a way that protects the environment we all share.

As part of this effort, our government is strengthening marine, pipeline, and rail safety, resulting in stronger prevention, enhanced preparedness and response, as well as improved liability and compensation in the highly unlikely event of an incident.

The members opposite may not be aware, but oil has been safely transported along Canada's west coast since the 1930s, thanks to responsible players in the industry and effective preventive measures. In addition, 99.999% of oil transported on federally regulated pipelines between 2008 and 2013 was moved safely.

This outstanding track record should reassure Canadians, and especially British Columbians, that our energy resources can safety be exported overseas to create jobs and economic growth here at home. That said, even one incident is one too many. Our goal must always be zero major spills or accidents, and to achieve this our government has introduced stringent new safety standards for tankers, together with new navigational supports to better protect our coastal waters.

Put simply, Canada's approach to marine regulations seeks to balance the safety of shipping and the protection of the marine environment with the need to encourage maritime commerce. In fact, we have nine acts of Parliament governing marine safety. These laws complement international regulations established by the International Maritime Organization, and that is before we factor in the tough new regulatory oversight and enforcement capabilities provided under Bill C-3, Safeguarding Canada's Seas and Skies Act.

There is compulsory pilotage in British Columbia's coastal waters. This means that a vessel must have an on-board pilot who is a navigator, certified to a specialized knowledge of local waters. In addition, Transport Canada has more than 300 inspectors who work every day to verify that ships meet Canada's regulations and the international standards that Canada has adopted.

Within the international maritime community, Canada is highly respected as a country that provides a clear and consistent set of rules that promote safety and protect the environment. I would like to quote the British Columbia environment minister who spoke about our government's plan and said the following:

I have a high degree of confidence that [the government is] serious about achieving the goals that we have in front of us and serious about the safety of our coast and the transportation of tankers up and down our coastline.

Canadians want a balanced approach to economic development. They support growth and want good jobs and long-term prosperity for themselves, their families, and their country. What Canadians might be surprised to learn is how important natural resource development is to our quality of life. Over the last five years, the oil and gas sector has contributed an average of $25.1 billion in taxes, royalties, and fees to government. This money helps to support public pensions, provide health care, and build schools, hospitals, housing, and highways.

If we want to maintain our high standard of living and ensure governments have the funds to pay for a wide array of social programs, we need to seize the potential of new markets for our energy. That is something our government understands. It is something business understands, and it is something Canadians understand from coast to coast to coast.

Our focus then is on preventing incidents from happening, cleaning them up quickly in the unlikely event of their occurring, and protecting taxpayers from any cleanup or remediation costs. Under this government, it is polluters who will pay, not taxpayers.

We recently introduced the pipeline safety act, which would enshrine in law the principle of polluter pays. To ensure that pipeline companies can respond in the unlikely event of a major incident, they would be required to maintain the highest minimum financial resources in the world. For companies operating major oil pipelines, that amounts to $1 billion, as well as holding sufficient cash on hand to respond quickly to incidents.

The pipeline safety act would also give the National Energy Board even greater authority so that it could strengthen incident prevention, preparedness, and response as well as liability and compensation.

With all of these efforts, we are seeking to foster greater public confidence in our country's ability to develop its resources and to do so responsibly. We know that building public confidence in major resource projects requires a whole-of-government approach. Our approach to promoting responsible resource development is a balanced approach, and it is the right way to go.

Bill C-628 is not a balanced approach. A ban on oil tankers would have a lasting negative impact on Canada. The NDP's anti-trade, anti-development agenda is clear. This bill would limit further diversifying our energy exports to countries other than the United States, which would severely impact our economy, jobs, and everything. Moreover, such a ban would be looked upon negatively by other countries, which view these waters as open for navigation, and banning a legitimate class of vessel would be contrary to the system that has served Canadians so well for decades.

Canadians want a balanced approach, and that is the path that this government is going to follow.

[Geoff Regan, Liberal, Halifax West, NS]

We talked already today about social licence and the issue of public trust. Given new authorities that the NEB has under Bill C-46, obviously it seems to me that the public trust is even more important.

Some people are suggesting that the confidence in the NEB has been shaken lately in light of the fact that senior engineers are under investigation by their own professional association. It's been reported that the engineers in question have been looking into allegations of natural gas pipeline safety code violations. What, if anything, is the NEB doing to restore public confidence in light of this?

[Chris Charlton, NDP, Hamilton Mountain, ON]

So you can't comment on why the deputy would suggest that these things are not actually within the ambit of Bill C-46? It's not a fair question to you. I suppose you can't speak for the deputy minister.

[Jonathan Timlin]

Thank you very much for the question, Ms. Charlton.

As we of course said previously in a question that was raised by Mr. Regan, the board, as an expert regulatory tribunal, isn't in a position to offer opinions on whether anything should be added to the bill or not. What I can speak to is what was specifically requested by the minister. The minister, when he introduced Bill C-46, did at that time indicate that he would be seeking the advice of the National Energy Board, as is his prerogative in the act currently.

Currently in part II of the act, there is a section that allows the minister to seek advice from the board on specific matters. In this particular case, the minister indicated that he would seek advice from the board on the use of best available technologies in federally regulated pipelines. This includes materials, construction methods, and emergency response techniques. The board has indeed received a letter from the minister to that effect. We will be undertaking that study, as is required of us in the act, and we will be reporting back to the minister within the timeline the minister has established.

[Chris Charlton, NDP, Hamilton Mountain, ON]

I'll correct the record. Ms. Perkins called my comments “disgusting” at a time when she did not have the floor, and I would appreciate an apology for that. I had the floor.

But I'll continue my questioning so that we can just get on with the five minutes.

In the story by Reuters, the deputy minister said that none of these things that you are now being asked to study are covered by BillC-46. We have a bill before us in the House that is purportedly going to improve safety and prevention, and yet the deputy minister has acknowledged that this bill doesn't go nearly far enough, and has given you a new mandate to report back within one year and provide up-to-date guidelines.

I wonder if you can tell me what additional improvements you think there ought to be to Bill C-46, now that you have seen the new instructions from the minister.