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.

Pipeline Safety Act

[Greg Rickford, Conservative, Kenora, ON]

moved that the bill be read the third time and passed.

[Kelly Block, Conservative, Parliamentary Secretary to the Minister of Natural Resources]

Mr. Speaker, it is an honour to rise today on behalf of our government to open debate on the pipeline safety act at third reading. Canadians can proudly look at this legislation as another significant step our government has taken in advancing responsible resource development. That is because we stand on the threshold of a generational opportunity to harness our vast energy wealth. We have a unique opportunity to cement Canada's place in the world as a secure, reliable, and responsible producer and supplier of energy. However, we can only take advantage of these opportunities if we choose to make them happen and if we are willing to think big and act accordingly. The stakes could not be higher.

Despite lower world oil and gas prices, we know that the long-term outlook for Canada's energy sector is bright. According to the International Energy Agency, global demand for energy will increase by one-third by 2040. Again, according to the IEA, 74% of this demand will still be met through fossil fuels. Countries such as China, India, and other emerging nations are fuelling this thirst for energy. Even developed countries, like those in the European Union, are eager to diversify both the types of energy they use and who supplies it to them.

Canada is perfectly positioned to seize this moment in time to create the quality jobs, the economic growth, and the long-term prosperity Canadians want for themselves and for their children. We have some of the largest known reserves of oil and gas in the world, the blue chip companies with the wherewithal to bring these reserves to market, the clean technologies and exciting new innovations to do so in ever more sustainable ways, and the world-class pipelines to transport our oil and gas safely and reliably. In fact, as I have proudly noted many times, between 2008 and 2013, 99.999% of the oil, gas, and other petroleum products transported through the federally regulated pipelines in Canada arrived safely. This is an extraordinary record, and most countries would be satisfied that it was enough. However, our government always strives to do even better. Our target is zero events. That is why our focus is on maintaining a world-class and even world-leading pipeline safety system.

As many members know, the National Energy Board was established back in 1959, with a very clear mandate to regulate international and interprovincial pipelines, power lines, and energy trade. Now, some 56 years later, the board is overseeing approximately 73,000 kilometres of pipelines that transport over $100 billion worth of natural gas, oil, and petroleum products every year.

It is important to note that the independent National Energy Board is responsible for the review of new pipeline proposals. The NEB's work is based on an exhaustive study of the science and on extensive public consultations to determine if a project is in the overall Canadian public interest. Furthermore, the board can impose enforceable conditions and has important powers to ensure that pipelines are built and operated in a safe manner. For example, it can issue administrative penalties to pipeline companies and reduce the amount of product allowed through its pipelines, or even shut them down entirely.

However, the board's role does not end with reviewing applications and setting conditions. It also oversees the entire life cycle of a pipeline, from concept to construction, from operation to eventual abandonment. To perform these duties and responsibilities, the NEB conducts ongoing audits, inspections, and emergency exercises. Some 300 such compliance actions were conducted in 2013 alone.

At the Standing Committee on Natural Resources, we heard from a variety of witnesses who support our legislation. For example, the members of Canada's Building Trades Unions take immense pride in their work to ensure construction of the safest pipelines ever built. Other experts, lawyers, and members of the National Energy Board also appeared before the committee and voiced their own support for our goals. There is widespread agreement that the pipeline safety act is an important step in our efforts to maintain the most rigorous pipeline safety regime in the world.

The result is a bill that would inspire even greater confidence in our existing national network of pipelines and that would ensure broader public assurance for new ones coming on stream.

All Canadians from coast to coast to coast should find comfort in this proposed bill. They can rest assured that the energy that fuels their cars, heats their homes, and goes into producing their home electronics and household products will continue to be delivered through the safest energy transportation system possible. Anything less would be unacceptable to Canadians and to our government, period.

This is why the pipeline safety act is built on three key pillars: incident prevention, preparedness and response, and liability and compensation.

Looking first at prevention, our government understands that responsible resource development demands that we take every measure and precaution we can to prevent incidents from ever occurring, and we do. That is why we have proposed amendments to the National Energy Board Act that would build on the steps we have already taken over the past two years. Our goal: to further improve the transparency and operation of the board under its enabling legislation.

We have already increased the number of inspections and audits the board conducts each year, and we have given the board the authority to levy administrative monetary penalties. Our new legislation would add to the current preventive measures.

In addition to clarifying the board's audit and inspection powers, the legislation would also provide greater clarity on when to seek the board's permission before disturbing the ground near a pipeline. This added clarity would help to prevent potentially life-threatening accidents and avoid damage to both property and the environment.

Prevention also depends heavily on the design and construction of our pipelines. That is why the minister has recently asked the National Energy Board to provide guidance on the use of the best available technology in pipeline projects. This includes materials, construction methods, and emergency response techniques.

Second, the pipeline safety act would ensure a robust response in the event of an incident. The legislation would require pipeline operators to have a minimum level of financial resources and to keep a portion of these resources readily accessible for rapid response.

The bill would also allow the Governor in Council to give authority and resources to the NEB to take control of an incident response or cleanup. The NEB would take control if, in exceptional circumstances, the company was unable or unwilling to do so. This means that the government would provide an initial financial backstop to ensure that the NEB had the resources it needed, when it needed them, to complete the cleanup.

In addition, and in the unlikely event that the NEB had to take control of an incident response, the government would also be able to establish a pipeline claims tribunal. Setting up this tribunal would streamline the claims process. In either case, the legislation would provide that all costs and expenses would be recovered from the industry should the board ever have to step in and take charge.

This leads me to the third pillar: enshrining the polluter pays principle in law. We fundamentally believe that polluters, and not Canadian taxpayers, should be held financially responsible for any costs associated with an incident, responsible whether the polluters are at fault or not. For companies operating major oil pipelines, this absolute, no-fault liability would be $1 billion. However, let us be clear. The liability would remain unlimited in instances where they were at fault. It is a new standard that would leave no doubt or wiggle room, no doubt for Canadian taxpayers and no wiggle room for pipeline operators.

The pipeline safety act would also allow the government to go after operators for damage to the environment over the entire lifecycle of a pipeline. This would include even after a pipeline had been abandoned.

The absolute or no-fault liability regime created under the bill would be one of the most robust and comprehensive in the world. In addition to actual losses, all types of damage to the environment resulting from oil spills would be covered by the enhanced regime.

Under Bill C-46, three broad categories of damage could be claimed. The first would cover claims for loss or damage incurred by any person as a result of a spill, including loss of income and future income. In the case of aboriginal peoples, for example, it would include the loss of hunting, fishing, and gathering opportunities.

The second category would cover the cost and expenses incurred by the federal government, a provincial government, aboriginal governing bodies, or any other person in taking action in response to a spill. This would include recouping the costs incurred in responding to or mitigating the damage from an oil spill.

The third category would cover claims by the federal or provincial governments for the loss of what is referred to as the non-use value relating to a public resource that is damaged by a spill. Non-use value means that the federal government or a provincial government could bring a claim for damage to environmental assets that are valuable to Canadians and future generations.

The concept of non-use value was first introduced for environmental offences by our government in 2009, and Bill C-46 is consistent with those measures. It is also consistent with the amendments we have introduced to Bill C-22, the energy safety and security act, for the offshore oil and gas regime, which also would allow governments to claim for the loss of the non-use value of public resources.

In many ways, these provisions mirror similar steps our government has already taken to strengthen marine, rail, and offshore safety. As part of our plan for responsible resource development, we have been strengthening environmental protection, enhancing aboriginal engagement, and modernizing our regulatory review of major resource projects. Our overriding goal has been to eliminate duplication and to provide investors with predictable beginning-to-end timelines for projects, all the while creating jobs and growing the economy.

This is an ongoing process. It demands constant attention and continued diligence, which is why our economic action plan 2015 contains new measures and investments to build on this momentum.

There are many items I could highlight from our balanced budget, but let me start by saying what is not in it. I know that what the opposition was hoping to see in our budget was a carbon tax. Both the Liberals and the NDP have been clear that they intend to put a tax on everything Canadians buy, from gas to groceries to electricity. We have been clear. We will not introduce a carbon tax.

We are very proud of the targeted investments proposed in economic action plan 2015 that are particularly noteworthy for today's debate. The first is $135 million over five years to support project approvals through the major projects management office initiative. We are proposing to make this investment because the development of our natural resources deserves both scrutiny and careful stewardship. Our processes and systems need to be modern and nimble, reflecting the views and needs of citizens and industry alike.

The second item is a commitment of $34 million over the same period of time to continue consultations with Canadians on projects assessed under the Canadian Environmental Assessment Act.

Third, we are proposing to provide $80 million over five years to the National Energy Board to support greater engagement with Canadians and enhanced safety and environmental protection.

Through these investments, we will continue to deliver the kind of responsible resource development Canadians have come to expect from their government, development that is critical to our government's economic plan to create jobs, growth, and long-term prosperity for all Canadians.

The fact is, Canada's natural resource sector represents 19% of our economy. It accounts for more than half of our merchandise exports and supports 1.8 million jobs directly and indirectly. Canada's natural resource sector is also one of the leading private employers of aboriginal people, and let us not forget that natural resource firms have contributed approximately $30 billion per year in revenue to governments, revenue that builds hospitals and highways, schools and subways.

In short, our resource industries are critical to the strength of our economy, the quality of our lives and our aspirations for the future.

As recent geopolitical events have shown, energy is also playing a critical role in national, continental and indeed global security. Our government recognizes that Canada is in a unique position to meet the world's energy needs, but just importantly we also have a responsibility to contribute to global energy security.

That is why, between 2005 and 2014, Canada's crude oil exports grew by 81%. That is almost 1.3 million barrels per day. Our exports expanded beyond North America to reach new markets around the world. Indeed, since 2013, Canada has been shipping oil into markets from Spain and Ireland to Chile and Hong Kong. In Italy, for example, our exports accounted for 3.4% of that country's total crude oil imports in 2014, as measured by volume.

With the European Parliament's fuel quality directive confirming that oil sands crude is as environmentally responsible as other sources, we expect exports to continue to grow. Canadian exports help nations diversify their sources of energy. They help reduce their dependence on unreliable suppliers and help bolster their energy security.

To continue to play that important role in global energy security, Canada must expand its ability to get its products to market. Pipelines are the safest, most secure and most reliable way of doing so.

As we expand our ability to export, this legislation will set the standard for pipeline safety, charting a new path to good-paying jobs and sustainable growth across the country for generations to come. I urge all members of this House to join our government in continuing to support this legislation.

[Ève Péclet, NDP, La Pointe-de-l'Île, QC]

Mr. Speaker, here is my question for my hon. colleague: Why do this bill's provisions cover only pipelines that transport at least 250,000 barrels of oil a day?

In the Lac-Mégantic tragedy, a smaller company unfortunately caused unimaginable damage. I do not see why this bill excludes pipelines that transport 150,000 or 200,000 barrels a day. If an accident or a spill happens, they could cause as much damage as a pipeline transporting 250,000 or 300,000 barrels a day.

Why does the government think that communities that would be affected by a spill from a smaller pipeline do not deserve the same protection as a community that would be affected by a spill from a pipeline transporting 250,000 barrels a day? I would like my hon. colleague to explain why that is not covered in the bill.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, as I stated earlier in my remarks, there is widespread agreement that Bill C-46 is an important step in our efforts to maintain the most rigorous regime in the world, the most safe regime, a regime that already has a safety record of 99.99%. Bill C-46 will bring even greater confidence to our network of pipelines and ensure public assurance for new pipelines being built. The provisions in Bill C-46 mirror steps our government has taken to strengthen marine, rail and offshore safety.

The provisions that the member has been asking for, in terms of pipelines that will see less than 250,000 barrels flowing through them, will be captured in regulations.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, the Liberal Party critic had the opportunity to speak on the legislation and expressed just how important it is that we get this job done right. At the end of the day, Canada's economy and environment are potentially of great benefit if, in fact, we get it right.

The question I have for the minister is this. If we look at the last number of years, the government has not been successful in building consensus, whether it is the social contract with Canadians dealing with the environment and pipelines, or dealing with the provincial governments, in particular, the Alberta and B.C. and other jurisdictions, to bring people together. The pipeline issue and the security of it is of critical importance, but it also seems that the government has not been effective in being able to pull it all together.

Can the member provide some feedback as to why she believes we have had to wait as long as we have to get this legislation and the impact that has had on discussions with the potential expansion of our pipelines?

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, again I will reiterate that there is widespread agreement that Bill C-46 is an important step in our efforts to maintain the most rigorous pipeline safety regime in the world.

The government has worked closely with provinces and territories, aboriginal communities, environmental groups, insurance companies and industry in the development of this legislation. I am very confident that this legislation appropriately addresses the concerns raised during these consultations.

[Lois Brown, Conservative, Parliamentary Secretary to the Minister of International Development]

Mr. Speaker, my colleague spoke a bit in her speech about the opportunities that this legislation would provide for the people of our aboriginal communities. I wonder if she would like to expand on that just a little more for the House.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, as I have said, our government's priority is to continue to create jobs, grow the economy and create long-term prosperity for all Canadians, which includes our first nations peoples. First nations have made and will continue to make important contributions as a full partner in the development of our natural resources. Our plan would provide training for aboriginal communities specifically, for example, when it comes to monitoring and response. As I mentioned, we asked to hear from aboriginal communities on this very important piece of legislation and there has been widespread support.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Mr. Speaker, I would like to point out to my distinguished colleague that one of the serious problems in Canada and the world is that the companies doing business in Canada are the same companies that are responsible for the Exxon Valdez spill and for destroying a river in the United States.

When people who have been consistently polluting other places say that they will be careful not to cause pollution in Canada, there is a credibility problem. It is all a matter of credibility and we do not trust those companies.

Moreover, safe transportation is all well and good, but there is also the matter of jobs. If I, Mr. Giguère, was told that 15,000 jobs were going to be created in my province's refineries, I would be on board with that. However, what we are being told is that we are going to have to assume 100% of the transportation risk, that there will be no contingency fund and that no jobs will be created. In Quebec, only 15 jobs were created to build the pipeline across the province. We are assuming all of the risks but seeing very little of the profit.

As a result, the government does not have any credibility. I am asking it to do something other than pass a law that imposes a 250,000-barrel limit on companies and simply requires them to be careful. That is not enough. A contingency fund must be created.

I am therefore asking my colleague to tell us something that will really assuage Canadians' fears.

[The Deputy Speaker, Joe Comartin]

Before I recognize the parliamentary secretary, I must inform the member that it is not appropriate to use proper names, as he just did, when addressing the House.

The hon. parliamentary secretary.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, perhaps the best way to answer that question is to go back and restate that the absolute or no-fault liability regime created under this bill would be one of the most robust and comprehensive in the world. All types of damage to the environment resulting from an oil spill would be covered in this legislation.

Three broad categories could be claimed. These are claims for loss or damage incurred by any person as a result of a spill; costs and expenses incurred by the federal government, provincial government, aboriginal governing body, or any other person taking action in response to a spill; and claims by the federal or provincial governments for the loss of what is referred to as the non-use value relating to a public resource that is damaged by a spill.

I did speak to what we mean by “non-use value”. This means that the federal government or provincial government can bring a claim for damage to environmental assets that are valuable to Canadians and future generations.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, in my capacity as the critic for natural resources, I am pleased to rise in the House at third reading to debate Bill C-46.

This bill moved to report stage very quickly, because clearly, the parties did not really have a chance to properly present their case, especially the independent members in the House.

At the Standing Committee on Natural Resources, the Conservatives imposed a motion similar to the ones it imposed on all committees, since it has a majority on all committees of the House of Commons, whereby, and I am paraphrasing, when the committee clerk receives an order of reference from the House in relation to a bill, the clerk must write to each member who is not a member of a caucus represented on the committee to invite the member to send a letter to the chair of the committee, in both official languages, stating any proposed amendments to the bill subject to the order of reference. During the clause-by-clause, the chair of the committee will allow a member who proposed an amendment to make brief comments in support of it, although the member cannot join in the debate or vote.

That is how the committees always operate, and the Standing Committee on Natural Resources is no exception.

We essentially believe that these manoeuvres violate the rights of independent parliamentarians or members who belong to a parliamentary group and who are nonetheless elected just like any other member.

The big book of procedure tells us that it is the House, and only the House, that designates members and associate members of these committees as well as the members that represent the House on joint committees.

The Chair has already established that that is a fundamental right of the House. As for the committees, they have no power in that regard, especially since the rules specifically state that an MP who is not a committee member may not vote or move motions.

Report stage was usually the opportunity for these members to have their amendments heard, to debate them and to participate in the vote. Instead, practically everything is now managed, debated and voted in committee, sometimes even in camera.

This is a very important change in the functioning of the House and it greatly affects the rights of members and their ability to properly carry out their duties of representing their constituents and holding the government to account.

However, despite everything, I must highlight the work done by my colleague, the member for Saanich—Gulf Islands, who had two amendments passed despite this unfair and undemocratic government tactic.

Bill C-46 establishes a liability regime for federally regulated pipelines in Canada, and although this regime leaves many questions unanswered, the existing legislation does not provide for much of a regime.

The NDP proposed some 20 amendments at report stage, many of which were virtually the same as those proposed by my colleague from Saanich—Gulf Islands. That is why I am pleased that these requests were heard. We must understand that she was not able to propose her amendments at report stage. She was asked to present her amendments in committee, which is what generally happens. She came to do so and she got just one minute for each of her amendments.

This is a systematic problem at committee stage. Committees should be a place for debate, so that we can identify the strengths and, especially, the flaws of each bill. However, this Conservative government's method is something completely new to Parliament, and it is undermining our ability to properly debate bills.

In the case of the amendments that passed, the government tried to make first nations members believe that the addition of a definition about them to the bill was a show of good faith and openness on its part.

Like other levels of government, aboriginal governing bodies will be able to sue companies connected to pipelines for recovery of reasonable costs incurred in managing a spill on their land.

I think this is a major collective victory. It shows not only that aboriginals are full-fledged nations, but also that there is a will to treat them as such. As I said, the parties were on the same wavelength and proposed many similar amendments that targeted the same flaws in Bill C-46.

In short, Bill C-46 is a first step toward integrating a real polluter-pays principle into federal pipeline regulations.

However, entrenching that in law is not the end of it. We also have to make sure that the provisions of the law respect its principles.

The NDP voted in favour of the principle underlying Bill C-46 because that step forward was better than the status quo.

I must nevertheless point out that at least one witness gave very engaging testimony during the committee's study of Bill C-46. Ian Miron of Ecojustice described this bill as a step forward, just as we have done. He also said that it was more of a “polluter might pay” principle than a polluter pays principle. The reason is that Bill C-46 is highly discretionary. It makes a number of tools available to the National Energy Board and the government, but they have complete discretion when it comes to using those tools. The lack of absolute regulations, if I can put it that way, means that this legislation does not fully respect the polluter pays principle. It means that the principle will apply if the National Energy Board and the government want it to.

These regulations and this liability regime will now be governed by the National Energy Board, which has an especially important role to play given that Canadians' trust and their sense of safety with respect to infrastructure and the regulations in place will depend on how well the board fulfills its mandate.

The report published in 2013 following a comprehensive study by the Standing Senate Committee on Energy, the Environment and Natural Resources clearly states that those two concepts go hand in hand:

If an accident occurs, there must be trust that the “polluter pays” principle, a principle applied to all modes of transport, is backed by concrete action. Social license is earned when citizens have trust in emergency and spill response capabilities, based on clear plans for well-organized recovery and rehabilitation of the environment, as well as a means for compensating for damages.

Even the president and CEO of the Canadian Energy Pipeline Association at the time, Brenda Kenny, suggested in the study that, “it is not enough in today’s climate to obtain a regulatory license or permit in order to proceed with energy projects”.

This illustrates how important it is for businesses and the industry to have public confidence. This was corroborated by the testimony in committee of a representative of Canada's Building Trades Unions, who said he agrees with the polluter pays principle, which indicates to us that the unions and workers truly understand that environmental protection and robust protection, prevention and accountability standards are ironically the things that are going to help them keep their jobs.

For a culture of safety to take hold, there needs to be interaction between common values and beliefs on one hand, and the structures and oversight mechanisms of an organization on the other hand, with the aim of producing standards of behaviour. Unfortunately, we are way off the mark. With its bills and regulations, the government has done nothing but cause the public to lose confidence not only in the industry, but also in the key regulators. If the oil companies want public approval for the pipelines, then Canadians need assurance that these projects are sustainable and that approval processes are open, rigorous and fair. That is clearly still not the case, and this bill will not change much, unfortunately.

In fact, only 27% of Canadians believe that the Government of Canada can respond effectively to an oil spill at sea, and only 32% share the same view for spills on land. The English Bay oil spill in Vancouver in early April should serve as an example of the government's readiness to respond. Civil society groups and environmentalists have been saying for years that Canada is not prepared for a major oil spill. The 2010 Kalamazoo spill in Michigan was a turning point for the oil sector. New standards were established and discoveries were made about how oil from the oil sands behaves, which requires new standards for research, prevention and response.

The problem is that instead of working with the utmost transparency, the board encourages corporations to be secretive. According to the 2013 Senate report:

By regulation, every pipeline company is required to submit Emergency Response Plans (ERPs) on a facility-by-facility basis and the ERPs must be approved by the NEB. These plans require companies to assess the risk of a spill and outline the details of a response. They must be up-to-date with corresponding emergency manuals and must be reviewed regularly. On June 26, 2013, the federal government announced that it would require ERPs to be more accessible to the...

[The Acting Speaker, Barry Devolin]

Order.

The member for Rimouski-Neigette—Témiscouata—Les Basques will have nine minutes when the House resumes consideration of this bill.

It being 5:30 p.m., the House will now proceed to the consideration of private members' business as listed on today's order paper.

The House resumed from April 30 consideration of the motion that Bill C-46, An Act to amend the National Energy Board Act and the Canada Oil and Gas Operations Act, be read the third time and passed.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Speaker, I am happy to have another chance to speak on the slightly amended version of Bill C-46, the pipeline safety act and of course, this is legislation that would amend the National Energy Board Act and the Canada Oil and Gas Operations Act, with the idea of strengthening the safety and security of federally regulated pipelines in Canada.

In fact, this legislation is long overdue and represents some progress. The Liberal Party recognizes that pipelines are a critical part of our energy infrastructure. We know that Canada must always strive to have the safest pipelines in the world. In fact, we have many thousands of kilometres of pipelines within Canada transporting both oil and gas and sometimes other products, but mainly those two, and they form an important part of our economy. People use those products every day in a variety of ways, so those pipelines play an important role and it is vitally important that they be safe.

However, we do not believe that we have to make a choice between protecting our environment and growing our economy. We have to do both. That is an important responsibility. Across this country, Liberals support projects that offer responsible and sustainable ways of getting our resources to market, while at the same time respecting indigenous rights, protecting our natural environment and earning the trust of local communities.

In fact, approximately 1.4 billion barrels of oil cross provincial and international borders every year. It is important that legislation like Bill C-46 clarifies the audit and inspection powers of the National Energy Board which regulates federal pipelines.

I should point out that many of the pipelines in Canada are not federally regulated because they are within the boundaries of a province, but they do not cross boundaries of a province or international boundaries between Canada and the U.S.

As we heard recently at the Standing Committee on Natural Resources, Bill C-46 implements a number of measures under the headings of prevention, preparedness and response, and also liability and compensation.

Prevention, of course, is critical as we must make every effort to ensure that a spill does not occur in the first place, obviously. The bill includes some sentencing provisions for environmental damages as well as additional audit and inspection powers for the National Energy Board. Of course, this raises the question of whether the NEB will do the job it is supposed to do. That would be a concern for members going forward as we watch whether the powers it is given in the bill are utilized properly.

Hopefully, the government will ensure the the NEB has the necessary resources to carry out these audits and inspections because a number of stakeholders said they were concerned about it. I am concerned about it after the recent budget. There is a question whether it has enough funding.

In fact, the NEB indicated that funding for several programs related to pipeline safety will be sunsetting in the next few years. It is up to the government to bring forward sufficient funds for the NEB to do the job of protecting Canadians and ensuring that these pipelines are operated in a safe manner. I think that needs to change.

In the event of a spill, Canadians need to have confidence that pipeline companies and the National Energy Board will respond in an appropriate manner. Bill C-46 would require companies operating pipelines to hold sufficient financial resources to cover any potential costs associated with a spill. Companies would also be required to hold a minimum level of accessible financial resources to ensure immediate response to a spill happening and that they have the financial capacity to do that. That is an important measure and I certainly support that.

Also, in exceptional circumstances, where a company is unable or unwilling to act, the NEB would have the authorization to take control of a spill response and it would have the authority to compel reimbursement of costs associated with a spill because if the NEB is incurring costs at the expense of the taxpayer, it should be reimbursed by whoever is responsible for the pipeline in general.

It is the company operating it that is going to be liable and that is why under this legislation absolute liability is provided for. In other words, whether or not negligence was provided, if a company is the owner-operator of that pipeline, it will be responsible for it. That is very important.

Finally, with respect to liability and compensation, the bill invokes the polluter pays principle with the goal of holding major pipeline companies liable for costs and any actual losses or environmental damages resulting from a spill. It includes a set of new measures which provide for no-fault or absolute liability set at a minimum of $1 billion for major oil companies, and the legislation contains the number of provisions relating to the abandonment of pipelines.

Bill C-46 seeks guidance from the National Energy Board on the application of the best available technologies for pipeline construction and operations. It also sets out how government will be required to work with aboriginal communities and industry to develop a strategy to better integrate aboriginal peoples into pipeline safety, including planning, monitoring, incident response and related employment and business opportunities.

While I noted earlier that Bill C-46 is a step in the right direction, that does not mean that no concerns were expressed about this particular bill. We have seen concerns raised over the potential impact of leaving many of the proposed changes in Bill C-46 to the discretion of cabinet and the National Energy Board. The Union des producteurs agricoles raised several points in a written submission, including their concern about the definition of “ground disturbance” in the legislation and how this will impact the cultivation of crops like alfalfa. They also expressed concern about whether the timeframe for claims should be tied to the time when a leak is discovered or the time when it occurred. Obviously, I believe that it should be tied to the time when the leak is discovered.

Ecojustice lawyer Ian Miron testified regarding the shortcomings in the legislation. He called for more guidance around the assessment and calculation of damages for the loss of non-use value in relation to public resources. Mr. Miron also suggested that, as drafted, the bill is best described as polluter might pay as opposed to polluter pays, as the government is suggesting.

Mr. Martin Olszynski of the law faculty at the University of Calgary offered suggestions to strengthen the wording of the bill with regard to environmental damages. Mr. Olszynski said that the federal cabinet should be required to make regulations setting out a process for environmental damages assessment within a prescribed timeframe.

Unfortunately, the Conservatives failed to put forward any amendments during the clause-by-clause consideration of Bill C-46 and they killed all but two of the amendments tabled by opposition members.

One of the amendments, which was adopted, will mean that an aboriginal governing body would be able to be reimbursed for expenses they may incur in responding to a spill. I think that is a good amendment.

Without that amendment, the category of entities that could get reimbursed for reasonably incurring expenses in relation to a spill, in other words for a cleanup, were limited to “Her Majesty in right of Canada, or a province or any other person”.

That would not include an aboriginal first nation and in my view it would also not include a municipality either. That is why there was, in fact, another amendment proposed to add the word “municipality” to that list, but I suppose the government side was not authorized. It did not have the green light, we might say, to say yes to that change, which would have been harmless and a good one.

The question of whether or not the province is authorized or the municipality, since municipalities are creations of provinces, is not clear at all. It might have been a very good clarification to have in the bill. Unfortunately, I am afraid the Conservatives did not support that.

The second amendment deals with a section of the bill which said that the NEB may recover funds to compensate those affected by a spill. In this case, the word “may” was changed to “shall”, another good change. At least there was some minimal accommodation and I suspect members opposite on the Conservative side would incorrectly and falsely claim that they were completely flexible on our amendments.

I know that the Minister of Natural Resources is fond of pointing out that between 2008 and 2013 more than 99.999% of oil transported in federally regulated pipelines was moved safely. That is a great record. Our pipeline companies deserve recognition for this achievement. However, we also need to look to the future. We need to take every step possible to continue to prevent spills, to put in place the proper measures to efficiently and effectively clean up spills, and to assign appropriate liability when spills do occur.

Canada must have the safest pipelines in the world. We need to ensure that this pipeline safety act is designed to achieve that goal.

The NEB has been given increased regulatory control over 73,000 kilometres of pipelines that transport more than $100-billion worth of oil, gas, and petroleum products across Canada annually. That is a lot of pipelines and a lot of value to our economy and also a lot of concern about the impact that would have on our environment if it was not dealt with properly.

Bill C-46 would build on previous moves, giving the NEB the authority to increase the number of pipeline inspections and doubling the number of yearly safety audits.

The NEB has also been asked to provide guidance on the best available technologies for pipeline construction and operations. Obviously, that is why we are hoping that the NEB will be given the resources to do that job and that it will do it properly. We will have to keep an eye on that. That is, I think, one of the important responsibilities of this chamber. It is to keep an eye on that and watch the statistics as time goes on.

We have seen measures that set out how the government is supposed to work with aboriginal communities and individuals to develop a strategy to better integrate aboriginal peoples and pipeline safety operations, including in planning, monitoring, incident response, and related employment and business opportunities.

Clearly, these and other measures in Bill C-46 signify a much-needed overhaul of the liability regime for federally regulated pipelines. The no-fault liability, the additional authorities given to the NEB, and the measures for abandoned pipelines are welcome, and the Liberal Party will therefore support the legislation.

[Joan Crockatt, Conservative, Calgary Centre, AB]

Mr. Speaker, I want to thank my hon. colleague for his support for the legislation.

One of the things he raised is funding for the National Energy Board. I am sure he is aware that in the budget, the National Energy Board would receive many millions of dollars, $80 million, in fact, in increased funding.

I wonder if he would talk about that funding and what the money would be used for.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Speaker, I spoke in my comments about the nature of the new responsibilities the NEB would have. We will have to wait and see, as time goes on, whether sufficient resources are there. I am not sure about that. We will have to wait and see.

Also, it is important to see how, in actuality, the NEB would enforce the rules and the powers it would be given. My hope is that it would exercise those controls in a responsible way, but as I said, it is important for this House to keep an eye on that.

[Chris Charlton, NDP, Hamilton Mountain, ON]

Mr. Speaker, I worked closely with the member from the Liberal Party on the bill as it was making its way through committee, so we heard many of the same witnesses, obviously, and perhaps drew some of the same conclusions.

I completely agree with him that a bill that purports to implement the polluter pay principle actually falls far short of doing that when so many of the provisions in the bill would actually be left up to the discretion of either the National Energy Board or cabinet.

I suspect that the solution to fixing the problem of the discretionary powers of the cabinet and the lack of confidence Canadians have in those powers we will need to resolve in the next election, and I look forward to the NDP forming the government after October 19.

However, I want to ask the member questions about the discretionary powers of the NEB. Canadians do not have very much confidence in the National Energy Board right now, either. I wonder if the member would talk about what amendments he thinks it is necessary to make to the National Energy Board, whether he believes it ought to be a complete overhaul of the NEB, and what specific amendments he would support when it comes to the future of the National Energy Board.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Speaker, it is nice to have hon. friends asking questions. They are members I sit with on the committee, and I enjoy working with them there.

My colleague talked about the issue of confidence, which I think is so important. In fact, one of the things I think we have seen eroded badly over the past decade under the Conservative government is the confidence Canadians have in environmental regulation generally.

The first thing that has to change is the attitude of government. I look forward to the election changing that, and of course, I heard my hon. colleague. My expectations are a little different from hers. I am looking forward to a Liberal victory in the election in the fall. We can leave that to the electors to decide. We all have faith in democracy and are obviously willing to accept its results. I hope we will see a new government, with the Liberal Party, of course, perhaps with support from other parties on measures like this, the kinds of measures that would create more confidence among Canadians about environmental regulation.

That is where it starts. We can certainly look at the question of what amendments are needed in terms of the power of the NEB and its discretionary powers. I think we should take some of those powers out of cabinet.

What we need is a National Energy Board that has the respect of Canadians and the confidence of Canadians, but again, that depends on the kinds of signals that are sent from government. We do not need government signals suggesting that people who are concerned about environmental matters are radicals or renegades, the kind of signals we unfortunately sometimes get from the government.

[Ted Hsu, Liberal, Kingston and the Islands, ON]

Mr. Speaker, I was wondering if I could ask my hon. colleague to perhaps look past several elections rather than to the next election. All too often we have the government passing legislation establishing a penalty for this or that and feeling that it has accomplished something and can forget about the problem for a while.

What kinds of things does my hon. colleague see five, 10, and 20 years down the line in terms of making resources available so that regulations are enforced and there are enough people to conduct inspections, for example, or look out for the unexpected things that may happen in the future?

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Speaker, it is not that uncommon that questions I get from my own side are sometimes, in some ways, more challenging.

That is a challenging question, because it asks me to go quite a distance ahead and to imagine the unexpected things that may happen in the future. That is challenging.

I think we will see a shift in our energy sector in Canada and in the way we use energy. Certainly we have seen a considerable effort to reduce energy use to be more efficient in the way we do things in our households and workplaces. That will continue.

I think we will see an increase in the use of renewable energy in a whole variety of ways. That is going to be an interesting process.

We saw the news last week about a new power wall that a major company in the U.S., of course, has introduced. It is a very large lithium battery for the home. If people have, for instance, photovoltaic solar panels on the roof, they can actually store the power that comes from those when the sun is shining and have it available when it is not. In some locations, power can actually be drawn down at night, for example, when power is cheap, and then used in the day.

We are going to see a variety of changes. I do not think most of us are probably all that worried about the safety impact, although it is something that has to be watched. For any new technology we have to examine the safety impact.

When we talk about pipelines, it is hard to project today how important they will be in our lives in 30 or 40 years. I think we are going to see them continue to be used for a few decades yet, but there may be new uses. There may be new infrastructure for which we need to have regulations to make sure that they are built and operated in a way that is safe for Canadians and safe for our environment.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I wonder if my colleague might expand on the importance of what we call a social contract when we look at the environment. How important is it that we consult and work with the many different stakeholders to develop a social contract that would allow us to look at pipelines and other important national grids that are on the horizon?

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Speaker, it is going to be interesting to see how we go forward, because there has been a change in the attitudes of Canadians and communities toward natural resource projects over the past decade or two. It means that the government has to do a much better job today, and so does industry, of reaching out to communities, consulting them, and understanding them and their differences. We know that different communities across the country, whether aboriginal communities or otherwise, have different issues, different challenges, and different capacities. Each of those things has to be considered in these consultations. However, the fact that there is so much concern out there is an indication of how important it is that the government change its attitude.

We have seen the Conservative government's attitude being one of wanting to shove things through in a hurry. We find, in fact, that this diminishes social licence. It actually makes it harder to get projects completed and built, and it increases resistance.

I think people want to see a government that is serious about the environment and that takes its responsibility to review projects and assess them environmentally in a serious manner. People will want to see that before they have confidence in the role of the NEB and the process of environmental assessment generally across this country so that those projects that should go forward will be able to do so.

[Joan Crockatt, Conservative, Calgary Centre, AB]

Mr. Speaker, I am going to be splitting my time today with my hon. colleague from Saskatoon—Humboldt, with whom I have the honour of sitting on the natural resources committee.

It is great to stand in the House and talk about this bill today. This bill, the pipeline safety act, is a really important bill for every Canadian who cares about the environment, and I think that is all of us. In fact, the pipeline safety act is really the embodiment of the kinds of things that I talk about with the people I represent in Calgary Centre all the time, which are the environment and energy.

Our government is firmly committed to making sure that as our energy industry is developed, so too are we caring for the environment at every single stage. This bill is really one of the poster children in our platform of how we care for our environment at the same time as we put things in place to continue to develop and enjoy the benefits of our energy industry in Canada.

All Canadians can be proud of and confident in this bill. What we have heard from the NDP today is a little hypocritical. They say that Canadians do not have confidence in our pipelines when we know they have a 99.999% safety record. We have gold standard legislation, like we are putting forward today. All Canadians need to be aware that we have among the best or the best systems in the world for regulating the environment, and this bill is a very key part of that.

At every turn, our government has demonstrated that it has a steadfast commitment to ensuring that Canada's national network of pipelines is world class, that our pipelines are the safest that they can possibly be, and that we maintain a very strong commitment, as I have said, to the environment at the same time as we seek to grow our industry. The pipelines can contribute safely to our economic growth and energy independence. The pipeline safety act that we are bringing forward would do all of these things. It is part of the comprehensive, responsible resource development plan that we have.

People in my riding of Calgary Centre know very well that we have a lot to celebrate when it comes to our natural wealth. We have the third largest proven oil reserves in the world, we are the fifth largest producer of natural gas, and we want to get those products to market. These resources will remain trapped in the ground if we cannot develop what are the safest, most reliable ways to transport them to their markets at home and abroad.

The pipeline safety act would give us a kind of gold standard. It sets out very clear parameters that help to ensure the safe operation of pipelines so that they can be some of Canada's national energy infrastructure projects for the 21st century, some of our most important. The importance of this legislation really cannot be overstated.

Bill C-46 is another way our government is strengthening our environmental protection while continuing to protect jobs, so important now, and opportunities for Canadians in all regions of the country. Last year, we did a study on the across-Canada benefits of the oil and gas industry and we heard from people in every single province about how this industry was creating economic well-being for all of them, from coast to coast to coast.

Equally important is that this legislation mirrors what we have done with marine, rail and offshore safety. It is based on some key pillars and one of them, in particular, I think British Columbians should be especially aware of. They had asked for world leading practices around spill prevention and response as one of the five conditions in British Columbia, and this bill would answer that. Number one of the pillars is incident prevention, number two is preparedness and response, and number three is a system for liability and compensation. Therefore, the entire umbrella is covered by this very important bill. We believe it is a really important and responsible approach to pipeline safety.

This bill would modernize our regulatory review of major resource projects by eliminating duplication and providing investors with the kind of predictable beginning-to-end timelines that they need. That is in our responsible resource development plan.

We have improved environmental protection and bolstered aboriginal engagement. Bill C-46 also clearly defines the roles and responsibilities of the key players in our energy industry, the National Energy Board and different levels of government so that pipeline operators are clear, everyone is clear.

Finally, the legislation reflects a responsible approach to consensus building. I agree, that is an important component here. It incorporates amendments from our all-party House Standing Committee on Natural Resources. We have heard from some of the members recently. I am privileged to sit on that committee.

Let us talk about the amendments, because there was a reference to amendments not being included. Nothing could be further from the truth. We actually made amendments and accepted amendments from the other side of the House. There were two important changes that were included in the bill for third reading. We agreed with those and have included them.

The first amendment is clause 48.12 (1). It adds aboriginal governing bodies to the groups that could recover costs and expenses in responding to a pipeline release. This is so that in the unusual event where there might be a pipeline release, our aboriginal governing bodies could feel free to move in and take action and know that they would be compensated.

The second amendment is a little further down in the bill. It is clause 48.17 (1). It would require the National Energy Board, subject to Treasury Board approval, to recover funds from industry that happened to be advanced by the government.

These are really solid recommendations that enhance what was already a very strong piece of legislation and a world-class regime for pipeline safety.

I want to talk a little more about committee testimony, because we heard some really interesting and strong support for the legislation in committee. We heard one expert witness describe the legislation as “...much needed and quite frankly, long overdue”. Who was it who said that? It was Ian Miron from Ecojustice Canada.

Another witness praised the legislation for its language on environmental damages. That was Martin Olszynski, from the University of Calgary. He said that the language on environmental damages is “simple and comprehensive”. That is great to know. In most instances we felt comfortable that the existing language had hit the mark, but in two places we agreed as a committee that these amendments were warranted. As we can see, there is co-operation in Ottawa.

The result is we now have an even better bill that would significantly improve pipeline safety. I want all Canadians to be confident and proud of that. That is what committee reviews provide. They provide this kind of oversight where we have expert witnesses we call in to come and provide testimony to legislation. We kind of put the legislation to the test. We poke holes in it. We have an opportunity to ask questions. We make sure it is airtight. If there are any issues, then we fix them. We do that on every single bill.

I also personally welcomed the opportunity to discuss a lot of the issues with some key leaders in the pipeline industry. One was Jim Donihee, acting chief officer for the Canadian Energy Pipeline Association. Another was Robert Blakely, the Canadian operating officer with Canada's Building Trades Union. They are passionate, well-informed people who actually do support pipelines and want to make sure we have a world-class safety regime that can give Canadians confidence in their operations.

I pressed both witnesses on the nuts and bolts of the bill. Their responses were both impressive and reassuring. When asked about the quality of the work and the care that was taken by the men and women who are working on these kinds of projects, Mr. Blakely said, “The truth is, we live here”. They want the best possible pipeline because this is their home. I live here too. All Canadians live here, and I think we all share that same goal.

Mr. Donihee echoed that kind of commitment on behalf of the Canadian Energy Pipeline Association. He said:

... the member companies, which I have the privilege of representing, share in the desire to ensure that we operate the safest possible pipeline transmission system that will benefit our nation.

They all live here too.

When asked about the additional responsibilities that would be placed on the pipeline industry in the legislation, he said their goal is a zero spill safety record. That is incredibly laudable. He said the industry does not just take what the government regulations are. It seeks to even better them. That is why we have world-class safety regulations here. However, we also have an industry that is firmly committed to meeting and exceeding those world-class standards. That is very worth remembering.

The bill would embody the polluter pay principle in law. It holds companies absolutely liable for any incidents, regardless of who is at fault, or regardless of negligence. It would ensure that companies have the financial resources to respond to incidents. It would give the National Energy Board the authority and resources to clean up spills and recover costs if the board has to step in on what would be exceptional circumstances.

In conclusion, this kind of inclusive approach, which also gives first nations a place here as very strong partners, is the kind of approach that residents in my riding of Calgary Centre want to see, and I think all Canadians want to see. It is these kinds of things that make Canada so great. With the right policies, the right investments and the right decisions, we can shape our nation's destiny.

[François Choquette, NDP, Drummond, QC]

Mr. Speaker, naturally, the NDP completely agrees with the polluter pays principle and with sustainable development. That is why we support the notion of liability for the pipelines.

This bill could have been even better. I would like to take this opportunity to commend the three NDP MPs who did an excellent job in committee: the member for Rimouski-Neigette—Témiscouata—Les Basques, the member for Hamilton Mountain, and the excellent member for Edmonton—Strathcona. We proposed some 20 amendments in committee, but unfortunately they were not well received.

Committees play a very important role in improving bills. The committee is not a place for partisan politics. Why did the Conservatives not consider these amendments, which had the support of most stakeholders?

[Joan Crockatt, Conservative, Calgary Centre, AB]

Mr. Speaker, I always love when we have an opportunity to hear from committee members who are committed to make our legislation better. We did listen to the amendments that were brought forward, very carefully. As I have suggested, we had witnesses who are being quoted on both sides of the House here today. I do welcome the NDP members and hope that they will support our energy industry going forward now that they know we have this amazing bill.

Last year, I was quite disappointed when we had the cross-Canada benefits of the oil and gas sector. The NDP members on that committee could not bring themselves to put forward one witness to speak on the cross-Canada benefits of the oil and gas sector.

I hope that their support for this bill might signal a change of heart.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, whether it is the leader of the Liberal Party or the Liberal Party as a whole, we have recognized the great value of our energy industry. There is always room for improvement, which is why we supported the bill in principle to go to second reading and so forth.

It would have been better had the government looked at ways in which we might have been able to incorporate some other amendments that would have made the industry a little more robust in its approach to the issue of safety. However, the idea of polluter pays has been supported, I suspect, by most if not all members of the House.

The question I have for the member regards pipelines in general.

In terms of the development of industry and looking at our environment, there has been a very strong lack of national leadership in such an important area in terms of working with the different stakeholders, particularly our provinces, first nations and so forth. Had the government been more proactive in dealing with this, we would have a better industry today.

My question to the member is: How would she respond to the criticism regarding the current government's inability to get the job done when it comes to the potential expansion of this industry through pipelines?

[Joan Crockatt, Conservative, Calgary Centre, AB]

Mr. Speaker, I think the member opposite has made a good observation. The environment has changed with regard to the public's need to be assured and have confidence that the infrastructure being put in place is the right infrastructure and that the public is protected, which is exactly why this bill is going forward.

This is a confidence bill. This bill is a poster child to show that Canada has the gold standard, the best standards in the world for pipeline liability. Therefore, Canadians will have confidence moving forward.

I want to highlight the aboriginal component as well, because the natural resources sector is the largest single employer of aboriginals in our country. They were consulted on this bill. This plan has been developed closely with them, and we are really hoping that our aboriginal communities will be a great beneficiary of it. They have shown a lot of desire to be involved, especially on the environmental monitoring side of this.

I think that all Canadians need to have confidence that they have an industry here they can support and make sure that Canada can continue to grow.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Mr. Speaker, I thank all members of the House who have been participating in this debate.

Anyone who is watching on TV and has seen some of the back and forth between some of the members on the committee will understand that the committee actually functions fairly well. One of my colleagues across the floor made the point that none of the NDP amendments were accepted in committee. That does not mean that other amendments from any other party were not accepted at committee. In fact, if my memory serves me correctly, Conservative members and all members backed two amendments from the leader of the Green Party at committee.

The committee has been fairly collegial and has worked well. As a member who has sat on the committee in one version or another for almost nine years in the House of Commons, I must say to those who say that these things do not work to come and watch us some time. I am very pleased to be part of the committee.

Before I get into the main body of my speech, I want to re-emphasize for Canadians and people who are watching what we are really talking about here. People who do not live in the Prairies or Newfoundland sometimes do not grasp just how strategic and important Canada's oil and gas industry is. When we begin to look at it in a world perspective, depending on whose numbers we are looking at, we are the fifth or sixth largest petroleum producer in the world. Essentially, the U.S., the Saudis and the Russians are the big three, and then we are with a group of other nations that are sort of jockeying from fourth to sixth or seventh spot.

What is amazing and incredible about what we have done is not just that we are such a big producer, but that we do it in a difficult environment. Canada is a cold country, a difficult country, a big country. The oil sands are not the easiest place in the world to produce oil. It is not like the joke that reservoir engineers tell about Saudi Arabia, that they can just put a straw in the ground, twirl it around and oil will start popping up. To be a successful oil man in Canada requires a considerable amount of skills, technological, financial, et cetera. Yet, with all of this, when we look at whatever we have applied, be it our pipelines, drilling industry, or fracking which has been in the news, our world safety standards, if they are not undisputedly number one, they are up there neck and neck, equal with other countries. That is an amazing thing.

We have created one of the most prosperous oil and gas industries. It is one of the most successful and it is private. We got rid of the mess that was known as Petro-Canada and the national energy program some years ago. It is private sector run and brings prosperity from one end of the country to the other, sometimes in the form of equalization and payments to government revenues, most often in jobs in engineering and manufacturing, and direct natural resource energy jobs.

One of the key components of this industry is pipelines. Because of where the majority of our oil is geographically positioned, although our offshore production on the east coast is somewhat different, almost all of our production needs to go into a pipe somewhere and be shipped away. With difficulties, backlogs and some issues that involve politics in different parts of our country and other places, we have been forced to use rail more and more. However, as the tragic incident in Quebec two years ago pointed out, rail has its downside. Rail is more costly in the majority of instances, and it is not as safe.

That is a context that people should consider whenever they look at any of this natural resource legislation that the federal and provincial governments put forward to increase safety. We do not take for granted what we are doing. That is why the government has put this legislation forward. That is the broader context. I do not know whether I will get through all of my other speaking notes, but I will work on it.

As I was saying, we work very well in the committee. We have had some very good discussions on issues in committee, such as aboriginal treaty rights, environmental damage, the polluter pays principle, something which all parties appear to agree on, pipeline standards, government regulations, and land ownership rights, which is a big one, but it is more provincial than federal.

Members of the committee listened carefully to witnesses who provided expert testimony. We read written submissions with great interest. I am confident that we have a very good piece of legislation. We have got Bill C-46 right in terms of its clarity, its focus, the delineation of roles and responsibilities, and of course, in terms of its effectiveness.

This bill is good policy-making that would strengthen the role of the National Energy Board and would enhance environmental performance of Canada's pipeline industry.

The pipeline safety act also clarifies responsibilities of different levels of government. As has been mentioned before by other members, many of the pipelines in Canada that do not cross provincial boundaries are not the responsibility of the federal government. However, we need to know about the responsibilities of the different levels. It leaves no doubt that the industry, not taxpayers, would be held accountable for any pipeline spill or incident. This is what Canadians demand, and the government expects no less. The industry, as has been noted in other speeches today, is of the same opinion. This again is a significant achievement, one that will lead to even greater confidence in our world-class safety regime for pipelines that deliver much-needed oil and petroleum products every day.

To summarize in a few words what this bill is all about, the pipeline safety act is a commitment by the government to protect both Canada's economy and its environment at the same time. The two go hand in hand. We recognize that economic growth cannot come at any price. We do not support the robber baron style of capitalism. As the Minister of Natural Resources has said many times, no project will proceed under our plan for responsible resource development unless it has been proven safe for Canadians and for the environment. It is that simple.

That is why economic action plan 2015 includes substantive investments and initiatives to maintain public engagement. Let me give a few examples.

The budget provides over $80 million more over five years for the National Energy Board. The funding begins in 2015-16 and is intended to support greater engagement with Canadians on enhanced safety and environmental protection. Also, there is a $135 million expenditure to support effective project approvals through major project management initiatives. This is important. This is not just applied to the pipeline industry, but to other industries such as mining, et cetera, that use the major projects management office to try to navigate the regulatory system in a way that is efficient both for environmental reasons and because it makes very good business sense. There is $30 million in funding for safety of marine transportation in the Arctic and to strengthen marine incident prevention, preparedness and response in the waters that are south of the 60th parallel.

These are concrete steps which the government is taking to ensure that Canadians have confidence in the system. Canadians need to be confident in the systems that are in place to protect Canadians and the environment. Indeed, the development of natural resources deserves both scrutiny and careful stewardship. The processes and systems need to be modern and nimble, reflecting the views and needs of industry and citizens alike.

I would also like to note that this does reflect and reinforce what the government said in the throne speech in 2013. It stated:

Our Government believes, and Canadians expect, that resource development must respect the environment. Our Government's plan for responsible resource development includes measures to protect against spills and other risks in the environment and local communities.

The pipeline safety act is one more example of a promise made, promise kept approach to governing.

There are a couple of other points I would like to take from the throne speech. The government said it will “enshrine the polluter-pay system into law”, something which has been mentioned today. It said it will “set higher safety standards for companies operating offshore as well as those operating pipelines”. We have done other legislation on that.

I would like to end with a quote from the member for Hamilton Mountain, which demonstrates again how well the committee works together and the positive way it approaches things. The member said, “I would be less than honest if I did not acknowledge that [the provisions] appear to be a step in the right direction”. We appreciate that support.

We look forward to working with all partners on this legislation, including industry, citizens whose lands are affected, and of course, members of Parliament across the House.

[Chris Charlton, NDP, Hamilton Mountain, ON]

Mr. Speaker, one of the things that all of us must strive to do in this place is to act in a way that is sustainable for future generations and I made that point when the Minister of Finance tabled his budget here in the House. At the time, I expressed my shock when he said that his tax cuts may not be sustainable, but he would leave that problem to the Prime Minister's granddaughter to resolve.

I have a granddaughter and I am completely objective. She is the most adorable granddaughter in the country. I want to make sure that Stella is not confronted with the legacy costs of decisions that we make here today. I am a little afraid that we are doing it again with the bill that is before us today.

The bill purports to implement the polluter pay principle, but there is a ton of discretion still left in the bill, both with respect to discretion for the cabinet and with respect to discretion for the National Energy Board.

If a true polluter pays principle is being implemented, it would require that polluters pay—that polluters pay; that part is critical—rather than leaving a debt on the backs of the next generation. That would respect the true meaning of the term “sustainable development”.

As the member has articulated in his speech and as he knows well from committee, the bill does purport to implement the polluter pay principle, but I wonder whether he would agree with me that in fact we could and perhaps should have strengthened those provisions when we had the chance both at committee and at report stage on the bill.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Mr. Speaker, I appreciate the hon. member's remarks about how cute her granddaughter is, but I have a six-week-old little girl of my own and it is an undeniable fact that she is the cutest little girl in Canada.

Getting to the hon. member's point, one of the concerns that people have when they look at this and say that the bill does not actually deal with the polluter pay concept, is that there is a limit of $1 billion on pollution. The point needs to be understood that that is if the company has not been negligent and caused the incident. This is a situation where someone from the outside causes it.

When a company through its own negligence causes a spill of oil, et cetera, whatever is going through its pipeline, the company itself is liable for over $1 billion. The company could end up being stuck with a considerably higher bill.

The record in Canada is that we do not have anything anywhere like that, so when we look at that provision, the $1 billion limit which is often referred to as something that gets away from the polluter pay principle, it actually only has an impact when it is someone else's fault that the pipeline is damaged and ends up spilling oil.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, there are literally hundreds and hundreds of kilometres of pipelines throughout the country. From what I understand, not all the pipelines are under federal jurisdiction. It begs the question in regard to the importance of the federal government providing strong leadership to work with other jurisdictions dealing with the complete stock of pipelines, especially when pipelines become decommissioned, as some will.

Perhaps the member could provide some thoughts in regard to that issue in terms of pipelines that the federal government as of now might not necessarily be responsible for and what should be taking place in that area.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Mr. Speaker, we would respect the jurisdiction of the provinces. I do not know of any single provincial government in this country which does not take the health and safety of its citizens seriously.

I was looking at my notes and I cannot find the exact number of spills annually in Canada with pipelines or any incidents, but it is incredibly small. The number is very low. It is just incredible how little is actually spilled, even with the incident off the west coast, which I know is not a pipeline, into the waters there. Within 36 hours, something like 85% to 90% of the oil was scooped up. That says to me it does not matter who is in charge, be it the federal or provincial government, Canadian governments are doing a good job at making sure this necessary product does not end up polluting the environment.

[The Acting Speaker, Bruce Stanton]

It is my duty pursuant to Standing Order 38 to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Thunder Bay—Superior North, Health; and the hon. member for Algoma—Manitoulin—Kapuskasing, Aboriginal Affairs.

Resuming debate, the hon. member for Northwest Territories.

[Dennis Bevington, NDP, Northwest Territories, NT]

Mr. Speaker, I am pleased speak to Bill C-46, an act to amend the National Energy Board Act and the Canada Oil and Gas Operations Act, a much-needed and long-overdue first step toward a true polluter pays regime for pipelines in Canada. The NDP takes this very seriously. We view the phrase “polluter pays” as being one of the fundamental aspects of our approach to environmental legislation when we are government later on this year. I believe November would be when we would take over.

I am pleased to see there has been co-operation and some degree of collegiality on the natural resources committee on this subject. That is an encouraging sign in a Parliament that has not had much collegiality over the five years of the Conservative majority mandate. It is good to see.

Bill C-46 would open up a liability regime, which is sorely needed. There is none for existing pipelines and that is amazing when we think of the volume, number and lengths of pipelines throughout Canada, many of them crossing provincial boundaries, which would be regulated by the federal government. That is certainly the case for the pipelines that exit my riding, the Northwest Territories.

The bill includes absolute liability for all National Energy Board regulated pipelines, which are those that cross provincial boundaries. I assume that includes all connections to those pipelines. There are web-like networks of pipeline throughout any pipeline system. Oil is collected from different locations in order to fill up a pipeline that might have a capacity of many hundreds of thousands of barrels a day.

Companies would be liable for costs and damages irrespective of fault. This liability could go up to $1 billion for major oil pipelines, pipelines that have the capacity to transport at least 250,000 barrels of oil per day, and up to an amount prescribed by regulation for smaller companies. That is an important proviso because many of the pipelines are not the size of 250,000 barrels a day. They come from smaller fields in isolated locations. I will speak to that in a bit.

Companies would continue to have unlimited liability when they were at fault or negligent. Accidental leakages, I guess, would mean that pipeline companies are not at fault or negligent, but what does “negligence” mean toward the maintenance and repair of existing pipelines? What does it mean with regard to engineering? If the engineering is inappropriate for the laying of a pipeline, is that considered fault or negligence upon the pipeline company? Some real decision will have to be made by government about what negligence or fault is part of the system, especially for smaller pipelines where perhaps there is less intensity in the environmental process when it comes to putting the pipelines in place.

Bill C-46 leaves considerable leeway for politically motivated decisions and backroom arrangements between operators and the National Energy Board. That is what we are talking about: how do we determine the responsibilities under this act? This also applies to many of the amendments to numerous environmental acts in recent budget implementation bills. We have changed the system considerably over the time of the Conservatives, mostly to weaken legislation that deals with environmental issues.

We have had several pipeline spills in recent history in my riding in the Northwest Territories. Those have come from an industry, mostly located in the Norman Wells area, that has been in place for a considerable length of time. That industry has been in the Northwest Territories since the early 1930s. We have seen that develop over time. We have a pipeline that has a capacity for 45,000 barrels a day that exits the Zama Lake in northern Alberta.

In early May of 2011, a hunter discovered oil leaking from the Enbridge Normal Wells pipeline near the Willowlake River about 50 kilometres south of the community of Wrigley. Enbridge estimated as much as 1,500 barrels of oil leaked from the pipeline. Of course the people in Wrigley were concerned about the impacts of that on the environment and on human health, as well as on the health of the animals and wildlife, which they sincerely use to a great extent for food. This was not a simple matter. It ended up resulting in many thousands of truckloads of material being hauled to the Swan Hills disposal site at a great cost. When we we talk about pipelines and 1,500 barrels people wonder what that is. However, when we have to deal with the dirt, the conditions and perform a complete cleanup, it gets very expensive. A lot of money was put into the cleanup that 1,500 barrels.

That is not the only incidence of spills we have had. The community of Norman Wells, where Imperial Oil has a refinery, ranks as the community with the most reported incidents of federally regulated pipelines in the country. Between 2006 and 2012, the National Energy Board recorded more than 70 incidents, including anything from spills and leaks to worker injuries and fires.

We are talking about pipelines that are not new and perhaps not built to the changing conditions of the northern climate. In that area near Norman Wells, scientists have reported losses of up to 40% of the permafrost over the period of a decade. Therefore, we have serious issues with changing conditions. With respect to the pipelines that were built before, the engineering was based on different circumstances. Those types of things lead to problems.

In 2012, the National Energy Board ordered Imperial Oil to come up with a comprehensive plan to deal with 77 buried pipelines at risk of failing.

Therefore, we do have some issues with pipelines in northern conditions. I cannot speak to all of the pipeline issues across the country. There is no question that many aging pipelines are used for the product around Canada. How many of them are provincially controlled and how many are federally controlled I am sure is of concern to everyone.

These 77 buried pipelines, some of which stretch for several kilometres, were installed during a boom in the oilfield expansion in the 1980s. A particular defect in engineering and construction allowed water to get between the pipe insulation and the bare steel leading to corrosion. Therefore, we have pipelines that are suspect and will likely cause problems in the future. As the corrosion gets worse the pipelines, under stress from changing soil conditions, may actually rupture. Corrosion can also cause pinhole leaks that without proper monitoring equipment on these pipelines can release a lot of oil before anybody even realizes what is going on.

Imperial Oil first identified the problem in 2011, after discovering oil seeping to the surface on Bear Island from one of its well sites in the middle of the Mackenzie River. We had leakage in one of our major pristine rivers in the north. Of course there is concern about that. Over the next year and a half, the company found a total of six leaks. Cleanup involved the excavation of thousands of cubic metres of contaminated soil. That soil had to be moved a very long distance in order to deal with it.

In 2004, a curious black bear caused an oil spill near Fort Simpson. About 12,000 litres of oil leaked out after the animal accidentally opened a valve at an Enbridge pipeline site. Is there culpability in that type of leak? Is somebody responsible for ensuring that pipeline valves are protected from the ability of black bears to manipulate them? Of course. The pipeline company's responsibility is to build pipelines that are safe and can live up to any kind of expectation. If a black bear could release a valve, so could people. We had a problem with the type of thing.

These NWT leaks are small in comparison to the roughly 28,000 barrels of crude oil spilled from a plains midstream Canada pipeline near Little Buffalo, Alberta in May 2011, or the massive 9.5 million litre leak near Zama, Alberta in June 2013 from Apache Canada's pipeline. That leak contaminated 42 hectares of boreal forest in northern Alberta.

We need stronger legislation and a stronger approach to pipeline issues in Canada. We cannot simply say that we have the very best, because the very best might have been that way 30 or 40 years ago when the pipeline was first put in place, but these things do not last forever. We can see that in the oil industry throughout the world. Pipeline degradation leads to leaks.

Whether the amount of oil is big or small, the damage to the environment is considerable, and we have to recognize that. Costs will be encountered. This legislation has loopholes within it that do not define precisely what polluters must pay. That it where our concerns are. We are still happy that we are getting something in place, but it is not the full thing I think we would look for from important legislation like this because of the nature and age of the industry in Canada, the need to fully monitor pipelines in an effective fashion so when leaks occur, they are caught as soon as they possibly can be. We are all concerned about those things.

In February 2013, an Enbridge excavation crew encountered contaminated soil in the immediate vicinity of Enbridge Line 21, which is the main Norman Wells pipeline, in two locations. The location in the first dig was kilometre post 457 on a line approximately 60 kilometres west of Fort Simpson. The second was at kilometre post 391. These two small leaks contaminated 100 cubic metres of soil.

As pipelines age, these sorts of issues start to become more and more, so it is very important that industry, dealing with aging equipment, provides the best possible care and attention to that equipment to ensure these leaks are found early and dealt with.

How does fault and negligence apply to existing operating systems for the pipelines that were approved many years ago by the National Energy Board? How do we ensure that the operating systems for these pipelines are brought up to a level that matches to the extent that the pipelines could have these problems?

While Bill C-46 makes some important improvements to Canada's pipeline liability regime, it does not unequivocally require polluters to pay. This undermines improvements and leaves uncertainty whether taxpayers will still be on the hook, in many cases for cleanup costs greater than the $1 billion where negligence or fault cannot be proved.

Basically, what we are saying here is that the very small problems are going to be covered. Larger problems, with this whole question of fault and negligence, are going to be at the discretion, I would assume, of the National Energy Board to come up with decisions. Just imagine the pressure and the lobbying efforts that could be made by various senators and other people for pipeline companies in this regime. As well as the National Energy Board being involved in these decisions, I understand the cabinet is or can be involved as well.

Ensuring that those who are responsible for making a mess clean it up is an important principle. We just went through an exercise with the nuclear industry, where we have limited their liability even after we have seen the complete disaster that took place at Fukushima, which cost exponentially more than what our limits are for the nuclear industry in Canada.

Why do we do this? It is because these industries simply cannot make the types of insurance arrangements for the kind of liability that they might incur. That is one of the problems we have in this industrial age, understanding how we can ensure that companies can carry the proper liability insurance or have the proper bond in place so that when things do go bad, the government is not left on the hook.

One of the greater examples of this is the Yellowknife Giant Mine where 237,000 tons of arsenic is going to be stored underground by the government in perpetuity at costs well in excess of $1 billion.

Things happen in many industries that we need to be very careful about, on prevention, ensuring that regulation and oversight is robust, and that the environmental assessment process leading to projects is also robust, so that we can be assured that when we are planning for the development of new pipelines, care and attention is put to every detail. I think of the Mackenzie gas pipeline and its environmental assessment process that everyone complained took so long, so many years. There were still no answers about what was going on with the pipeline, for the changing and the nature of the permafrost in northern Canada. It still did not get to that, and all the questions were not answered.

Environmental assessment is very important. Unfortunately, the record of the government is weakening environment protections. What this means is that by failing to do a rigorous environmental assessment before a project starts, there is a greater likelihood of problems later on. That is the result.

In the Northwest Territories, first nations are in court fighting against the Conservatives' gutting of the environmental regulatory system contrary to their constitutionally protected land claims and self-government agreements. The first nations are not happy that in the Sahtu region, where the pipelines are in the Northwest Territories, they are losing their regional boards, which could give them significant input into decisions that are made about pipelines to ensure that they understand the process is working best for them. Yukon first nations are preparing for a similar court fight if Bill S-6 ever becomes law.

Progressive companies, on the other hand, have found that high environmental standards actually work to their benefit, if they are selling product in the world. We heard the premier-elect of Alberta talking about that last night, talking about the need to raise the standards of Alberta so that its products can be better accepted around the world. That job is important, to ensure that what we are doing in Canada meets every rigorous requirement. Through that process, we can achieve better results.

[Kelly Block, Conservative, Parliamentary Secretary to the Minister of Natural Resources]

Mr. Speaker, through this legislation, our government is demonstrating its commitment to protecting the safety of Canadians and the environment. Contrary to what the member has said, Bill C-46 would introduce concrete measures to enhance pipeline safety under the pillars of prevention, preparedness and response, and liability and compensation. It would also build upon previously announced and implemented measures that would enhance pipeline safety and further establish Canada's system as world class.

My question for the member is, are the member and his party actually opposed to legislation that would build on a 99.999% safety record, or will they be supporting Bill C-46?

[Dennis Bevington, NDP, Northwest Territories, NT]

Mr. Speaker, I think I made it clear at the beginning of my speech that we were supporting Bill C-46. It is a step in the right direction.

However, in terms of how I see the industry, in totality, acting, I think we do need more efforts put into the legislation that could provide the safeguards that we need. That is simple enough.

We will go ahead and support the legislation going forward.

I thank the parliamentary secretary for her question, but I certainly did refer to it in my speech.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I would like to pick up on the member's comments when he said they would like to take a look at the broader picture, the totality of the industry.

There has been some concern expressed about the lack of support from the NDP toward pipelines in Canada, and I think it is worth getting some further comment from the New Democrats on the issue. It would appear, on the surface, that there is no current proposed pipeline that the NDP would support in one way or another. If I am wrong, I would ask him to correct me and maybe give an indication as to which pipeline.

Also, I am very interested in knowing what his thoughts are, because when we talk about safety issues, Canada, especially compared with the world, has a pretty good record. There is always room for improvement, but there is a pretty good record.

Some New Democrats have made the suggestion that we should be looking at rail, that it does not just have to be pipelines. I wonder if he would also provide comment on that issue.

[Dennis Bevington, NDP, Northwest Territories, NT]

Mr. Speaker, I think when it comes to the question of pipelines or rail, it is not simply either-or. Take the case of the shale oil developments that are very common now throughout western Canada and the United States, in particular, the Bakken field. These drilling sites may provide oil at a certain rate for 18 months or two years. They drop off very quickly. Many companies will not make the investment in a pipeline for a resource that may not last that long. They may have to move to other sites. In that case, there are companies that will want to use rail because that is the only way they can really justify the expense of doing the project.

We could argue and we could talk about what is the proper development but, in some cases, we have to look at what is going on in the industry.

In the case of pipelines, of course, we are committed to looking at pipelines, but through a rigorous environmental process that can give us answers. When we see what has happened in British Columbia, with the northern gateway pipeline, that one quite obviously has a high risk, perhaps not just with the pipeline itself but with where it delivers the oil and the process of the oil going across the ocean afterwards.

[Dany Morin, NDP, Chicoutimi—Le Fjord, QC]

Mr. Speaker, although the NDP supports the bill, I do have some concerns. I would like to ask my colleague for some guidance.

There is uncertainty about far too many provisions, because their implementation is left up to the discretion of the National Energy Board or the Conservative cabinet. Canadians do not have faith in either of them.

Could my NDP colleague tell me what he thinks?

[Dennis Bevington, NDP, Northwest Territories, NT]

Mr. Speaker, I want to thank my colleague for the question, and I think that is where the New Democratic Party wanted to strengthen the bill.

Perhaps we did not get all the amendments we wanted in committee or at report stage. The fact that two amendments were struck, out of some 41 that were put forward by the parties, I do not think indicates a real appetite for making sure that the bill was brought up to the level that we think it should be.

The bill was pretty well kept to where the Conservative government has designed it to be, where an opportunity existed for letting somebody off the hook. Companies that have one type of influence or other over the proceedings of the National Energy Board or through cabinet have some opportunity to be let off the hook. This is part of the problem when we deal with legislation like this: we open up those loopholes. It is certainly not the policy of the NDP to do that. Of course, that is why we brought forward the motions that we did.

[Chris Charlton, NDP, Hamilton Mountain, ON]

Mr. Speaker, I listened closely when the parliamentary secretary was questioning my colleague on the NDP side of the House. She was suggesting that the bill is so perfect, why would everybody not be supporting it?

Of course, we are supporting it. We are supporting it because it is a step in the right direction. However, it is far from a perfect bill when there are discretionary sections in the bill that would allow the cabinet, which is Conservative members for the moment, to decide whether and how much companies must assume liability. That should give Canadians some concern. The Conservative government's record on environmental issues is not exactly the best. I think about amendments to the Species at Risk Act, to the Canadian Environmental Assessment Act, to the Fisheries Act, to the Navigable Waters Protection Act. We have seen consistent gutting of environmental protections from the government, and now the Conservatives want us to believe that they are the best stewards of the Canadian environment. I find that hard to believe. I suspect my colleague finds it hard to believe.

I wonder whether my colleague would want to elaborate on what we need to do to truly get back to robust environmental protection in this country.

[Dennis Bevington, NDP, Northwest Territories, NT]

Mr. Speaker, that is a pretty broad question to deal with in one minute and 45 seconds, but I will give it a shot.

In terms of what has happened here with the bill, when we separate large pipelines, which are generally held by large corporations with fairly deep pockets, from smaller pipelines that may not have that same degree of protection in terms of fiscal ability to cover the cost of cleanups, then within that range of smaller pipelines, cabinet would have the discretion to set the stage as it sees fit. This means that these companies might well be given much more leniency when it comes to spills. However, a smaller pipeline, as I spoke about in my presentation, can cause a lot of problems as well. They can cause a lot of issues and expense in cleanup.

Therefore, I would think that we need a much stricter interpretation of some of these rules. We should not leave it entirely in the hands of either the appointed National Energy Board or the cabinet.

[Pat Perkins, Conservative, Whitby—Oshawa, ON]

Mr. Speaker, I will be sharing my time with the member for Yukon.

I appreciate this opportunity to speak to legislation that demonstrates our government's commitment to the things that matter most to Canadians: economic growth, energy security, and environmental protection. The pipeline safety act would deliver on all three. It would help to ensure Canada's continued prosperity while demanding that our vital energy infrastructure is environmentally responsible.

Driving all of this is our determination to have Canadians continue to benefit from pipelines while taxpayers are protected from the potential cost of a pipeline incident. That is why we already have one of the most rigorous pipeline safety regimes in the world. We have measures in place to ensure that Canada's pipelines are safe and modern. We have a national regulator with the teeth to enforce compliance with today's high standards, and we have the results to prove that it is working.

As we have heard many times, between 2008 and 2013, 99.999% of petroleum products transported through federally regulated pipelines in Canada have arrived safely. Our government wants to build on that record of achievement. We are aiming for zero incidents. The pipeline safety act could help us get there.

As members know, the pipeline safety act is another key element in our government's comprehensive plan for responsible resource development. Through this plan, we are ensuring that Canada's abundant natural resources are developed in ways that promote jobs, growth, and long-term prosperity. We are doing this while strengthening environmental protection and ensuring that aboriginal Canadians are engaged in every aspect of resource development.

It is a balanced plan. It is a plan that reduces duplication and makes the regulatory review process more predictable and timely for major resource projects. This plan does so while ensuring that no project is permitted to proceed until it is proven safe for Canadians and safe for the environment.

I would like to pause on that point for just a moment. We have a world-class, and in some cases world-leading, regulatory system overseeing this sector. Our government has already introduced comprehensive measures for tankers and offshore safety to ensure world-class standards. We are also taking action on rail.

Our regulatory system would be further strengthened by this legislation. It would assure Canadians and our international customers that pipeline safety is paramount in Canada. Add such things as technological innovations in the energy sector, our commitment to the meaningful inclusion of aboriginal peoples, and our profound belief in environmental protection and we have all the elements we need to make Canada a global leader in responsible energy development.

The pipeline safety act is an important element in all of this. The act also recognizes that Canada's oil and gas sector is literally helping to fuel our country's economy. In 2013, for example, Canada produced approximately 3.5 million barrels of oil and approximately 13.7 billion cubic feet of natural gas each day. The overwhelming majority of it, some $100 billion worth, was shipped by pipeline.

As well, in 2013 the oil and gas industry employed about 360,000 Canadians directly and indirectly. That is 360,000 well-paying jobs to support Canadians and their families in every part of our country.

Furthermore, Canada's sale of $128 billion in energy products in 2013 represented more than a quarter of our country's merchandise exports. This impact is incredible. The oil and gas industry alone generated almost 8% of our gross domestic product. Over the last five years it generated an average of $23.3 billion annually in government revenue to help pay for social programs such as health care, education, and infrastructure.

Despite recent declines in oil and gas prices, the sheer size of these numbers underscores why our government is doing everything it can to harness the opportunities and benefits of our energy sector for Canadians. Safe, secure, and modern pipelines are essential to these efforts. In fact, the pipeline industry itself is a major employer in Canada, supporting thousands of jobs throughout the country.

The Standing Committee on Natural Resources, which I have the pleasure to be a part of, heard from a representative of Canada's Building Trades Unions, who described the type of job creation at stake with the construction of new pipelines. He said:

If it is an oil pipeline, it means we will have thousands of people in a variety of trades, including plumbers, boilermakers, millwrights, iron workers, sheet metalworkers, insulators, labourers, scaffolders, carpenters, and the occasional elevator constructor.... About 60 trades are involved.

That is just the construction of the pipeline. It is just one element of the economic value derived from creating a modern, safe network of pipelines.

The pipeline safety act would strengthen this world-class effort. Specifically, Bill C-46 would offer additional measures and protections in three key areas. The first is incident prevention, the second is preparedness and response, and the third is liability and compensation.

Liability and compensation is particularly important, because it sends a clear signal of our government's intent to hold pipeline operators accountable for any harm, loss, or damage they might cause.

Canadians should make no mistake about our government's determination in this regard. As the Minister of Natural Resources has said on many occasions, the pipeline safety act would build on companies' unlimited liability when they are at fault or are negligent. This legislation would do so by implementing no-fault or absolute liability for all companies operating pipelines. For major oil pipelines, the absolute liability would be $1 billion. This means that pipeline companies would be responsible for damages, regardless of what happens or who is at fault. It is a standard that would leave nothing to chance.

The pipeline safety act would specifically provide governments with the ability to pursue pipeline operators for the cost of environmental damages. In addition, the legislation would give the National Energy Board the authority to order the reimbursement of spill cleanup costs incurred by governments, aboriginal governing bodies, or individuals.

The bottom line is that taxpayers would not be left on the hook. The full cost of cleanup and compensation would be borne by the pipeline operators, as it should be. This would even extend to pipelines that have been abandoned. Operators would cover any costs and damages related to their pipelines when they were no longer in use. In other words, it is a liability that would continue in perpetuity, or at least until the pipeline was removed from the ground.

I could go on about the merits of Bill C-46, but let me close by simply inviting members to consider this legislation carefully. If they do, I am confident that they will support it as a way of ensuring the safety of our pipelines, the strength of our energy sector, and the prosperity of Canadians.

[Jamie Nicholls, NDP, Vaudreuil—Soulanges, QC]

Mr. Speaker, there is a federally regulated pipeline in my riding that my constituents are very concerned about. In fact, the 23 municipalities of Vaudreuil—Soulanges have asked, through resolutions, for hydrostatic testing on this 40-year-old Enbridge pipeline. Whitby—Oshawa is also one of the regions this pipeline goes through.

It is true that pipeline standards for newly built pipelines are world-class, but what about grandfathered ones, such as this Enbridge line? Why has there been so much discretionary authority given to the NEB in cases such as this? To gain social licence in my region, there is a lot more work to do. How does the member intend to address these issues?

[Pat Perkins, Conservative, Whitby—Oshawa, ON]

Mr. Speaker, we addressed those matters at our committee. I am fortunate to be able to speak first hand to that, because we had the National Energy Board members there. We also had the pipeline folks there. We asked those questions.

Basically, they have some new technology. They will replace anything they need to replace. Although that is a 40-year-old pipeline, they have new technology, and they are testing throughout the pipeline to find out where there may be problems.

We have to remember, the liability lies with the carriers. They are not about to not fix something that is going to cost them a lot of money. They are going through that process now.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, Canadians have an expectation that the government will pass legislation that will protect our environment and hold companies accountable for polluting. Their responsibility for cleaning up that mess is a principle we have believed in for many years. It is good to see that we are moving forward on that issue. In that sense, the legislation in good. However, the member spent a great deal of time talking about the economics of the oil and gas industry. This is an issue I would like to ask her a question about.

One of the most significant projects is the Keystone pipeline. The Government of Canada has failed to demonstrate strong leadership on it. It is one of the reasons so many from within the industry are looking to Ottawa and asking what is happening and why Ottawa has not responded to the needs. It seems to me that the Government of Canada, in not doing that, has not only dropped the ball but has really hurt Canada's economy, and therefore the middle class and so forth.

I wonder if she would like to provide some comment on the importance of expanding the industry while protecting our environment. She seems to have forgotten about that issue.

[Pat Perkins, Conservative, Whitby—Oshawa, ON]

Mr. Speaker, certainly the Keystone issue is not a forgotten issue. As we know, there are many parties involved, and negotiations are required. Negotiations are under way and are ongoing, and I am sure we will be hearing an update on that matter.

[Wladyslaw Lizon, Conservative, Mississauga East—Cooksville, ON]

Mr. Speaker, I have a specific question about regulating pipelines that transport less than 250,000 barrels per day. Could she tell the House how those pipelines would be regulated?

[Pat Perkins, Conservative, Whitby—Oshawa, ON]

Mr. Speaker, all the regulated pipelines would be impacted by the proposed liability regime in the bill. The absolute liability for the operators of a major oil pipeline would be set out explicitly at $1 billion. The other classes are to be defined in the regulations, which would follow. We will not have the regulation-making authority to establish the other classes until the bill passes.

However, the government has begun its work to look at the regulatory aspect of how to establish the other classes. That is a normal process. It is anticipated that the classes would include oil pipelines transporting less than 250,000 barrels a day and those transporting natural gas and non-energy pipelines.

We are looking forward to seeing that come forward.

[Ryan Leef, Conservative, Yukon, YT]

Mr. Speaker, it is a pleasure to join the debate on Bill C-46. I would like to thank my hon. colleague, who spoke just before me, for being so generous in splitting her time with me today.

I am obviously pleased to be here because this speaks directly to our government's priorities: energy, security, economic growth and environmental protection. The pipeline safety act would deliver all three. It recognizes the importance of pipelines to transport the energy we need and use every single day in this vast country. Whether it is to fuel our cars, power our businesses or factories, or heat our homes, like the homes in Yukon, my home riding, pipelines play an essential role in moving our necessary energy around this country. It supports a significant role the oil and gas sectors play in our national economy.

We have heard the numbers many times in the House, but they are worth repeating. The energy sector, led by our abundant oil and gas resources, directly contributed almost 10% of Canada's economy in 2013. It also generated an average of $25 billion a year in federal and provincial revenues between 2008 and 2012. When we think about those numbers and the programs and services that the federal and provincial governments are able to deliver to their respective jurisdictions, be they social support, education, health, environmental initiatives or economic priorities, those numbers contribute greatly to allow each provincial and federal government to deliver for the priorities of Canadians.

Finally, the pipeline safety act reflects the importance we have placed on making pipelines safer. Under our government, energy security and economic growth will never come at the expense of environmental safety. That is why our comprehensive plan for responsible resource development makes clear that no resource development will be permitted unless projects are deemed to be safe, safe for Canadians and safe for the environment. Indeed, our government has proven that time and time again.

The pipeline safety act is a key component of this plan for responsibly developing our natural resources. As we know, Bill C-46 is based on three key pillars: incident prevention, preparedness and response, and liability and compensation.

There is widespread agreement that this legislation hits the mark on all three pieces. Indeed, a cross-section of witnesses offered expert testimony on the bill to the Standing Committee on Natural Resources, of which I am a member. There was general consensus that the legislation is needed and, indeed, a positive step.

After taking a closer look at some of the key provisions in the legislation, I hope Canadians will have a better understanding of how Bill C-46 would contribute to achieving all three priorities. We will continue to create and protect jobs and opportunities for Canadians from coast to coast to coast by encouraging our country's energy independence.

We will do so while maintaining and strengthening one of the most stringent and effective pipeline safety regimes in the world. In fact, each and every day Canadians drive, sleep and work over top of hundreds of thousands of kilometres of pipelines in our country.

As we heard in other debates and interventions from members in the House, Canada's pipeline safety record is tremendous, a 99.99% safety record. That is something we can certainly boast about. It is something that Canadians should have a great deal of pride in and it certainly warrants the measure of Canada having a world-class safety regime. What does that mean in respect of how other countries operate in the world, in terms of their safety and our legislative competence with this? Let me touch on a couple of those pieces.

The spill rate in Canada in comparison to other countries was 57% lower than in Europe and 60% lower than in the United States over an 11-year period. That is a pretty exceptional record. While the United States and the United Kingdom have similar legislation in place, the $1 billion minimum financial capacity, an absolute limited liability, is unique to this Canadian legislation.

Canada will also be unique in having a cost recovered financial backstop model that provides complete coverage for cleanup and damages.

I think everyone in the House would agree that prevention of any kind of accident or any kind of spill is the most important piece of our environmental protection regime. If something were to occur, with the $1 billion limited liability backstop and with penalties under the act, Canadians could be assured that breaches of any provision in this legislation would be taken seriously and that taxpayers would not be on the hook for the cleanup.

Exactly what kind of penalties would pipeline companies be subject to if they were to break the law? If we exceeded our ambition and our goals of prevention being the first and most important step and an accident were to occur, pipeline operators would be subject to the same laws that govern all industry activities in Canada, which means they would be liable without limit for incidents when they are at fault or negligent.

Second, under the National Energy Board, companies are subject to fines and imprisonment depending on the severity of the offence. Third, responsible resource development gave the NEB additional powers to implement administrative monetary penalties which enable the NEB to fine companies for contraventions of any regulations and orders. This is a new tool that would ensure smaller offences are punished.

The measures proposed today would enhance and further clarify all of these provisions. What are companies going to do to update any of the old pipelines? I know this question was posed to the previous speaker, but there are three principles that need to be recalled when this is taken under consideration.

We want to define our world-class safety systems. Prevention, of course, is integral to that piece of the plan. The legislation requires the use of best available technologies as well as the integration of aboriginal communities and businesses in pipeline safety, pipeline monitoring and operations.

All federally regulated pipelines would be impacted by these proposed measures regardless of whether they are operating, planned or under construction. Old, new or proposed plans would be subject to this new pipeline regime.

We have some questions that will mostly come around on what we are wanting to do to ensure why we are not requiring companies to create a pooled fund in advance of a spill. We are concerned about the worst case scenario. There is that old adage, hope for the best, prepare for the worst.

With our safety record in place of 99.99%, we still do have to be realistic in terms of what we can expect to see and reflect back on some past incidents to guide us in that direction. At the same time we must ensure that while we are balancing out the necessary protection for the environment and the communities in which these pipelines operate, we are realistic about allowing these companies to move ahead with moving Canada's much needed energy around this country.

From that point we can assure Canadians that any backstop, if it is assessed, will be fully recovered from industry to ensure that the taxpayers are protected. That is a fundamental piece. While Canadians expect, want and demand the strictest and safest pipeline regime, they also want to know that if there are any accidents, they as taxpayers are not responsible for cleaning it up.

We hold that firm and we have in many other pieces of legislation that we put forward. This is no exception. The polluter pay principle stands. The polluter pay principle is something Canadians want. The polluter pay principle is something Canadians expect and the polluter pay principle is something that this government is going to deliver as we move forward with our responsible resource development regime.

[Dany Morin, NDP, Chicoutimi—Le Fjord, QC]

Mr. Speaker, as I mentioned, the NDP will support this bill. However, I have a comment and a question for my Conservative colleague.

Social licence, or public approval of the development of our natural resources, is just as important as authorization by a regulatory body. Why are the Conservatives refusing to do what it takes to obtain public support for pipeline projects in Canada? I think that this question will be asked across the country.

[Ryan Leef, Conservative, Yukon, YT]

Mr. Speaker, I do not disagree that social licence is an important part of what we do in our responsible resource development regime.

It is important to understand that part of this legislation imbeds some of those very fundamental pieces. The polluter pays principle is very much based on what the public has told us they want, expect and demand, as I said in my intervention.

We have also imbedded in this legislation the requirements and the commitment to work with aboriginal and first nations communities, not only in proposed projects but also in terms of developing and utilizing best technologies as we move forward to ensure the continued integrity of a world-class safety regime.

That, of course, comes not just from subject-matter experts that deal with this but from community subject-matter experts who live, work and play in regions where pipelines operate safely every single day in this country.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

Mr. Speaker, when the government amended the Navigable Waters Protection Act, it weakened the legislation and it also transferred responsibility for environmental assessments of energy projects to the National Energy Board.

We learned last week that the board considers that it does not have the expertise required to assess the risks associated with a pipeline accident that could pollute water. At the time, we were assured that the National Energy Board had this expertise. However, we now realize that the board must conduct public consultations and request further information from companies about their plans in the event of an accident.

I would like the member to elaborate on the transfer of this responsibility to the board, which cannot fully discharge it.

[Ryan Leef, Conservative, Yukon, YT]

Mr. Speaker, I guess I am bit perplexed about why the member opposite would assume that the Navigable Waters Protection Act did anything but deal with navigation on waters, and where anybody assessing that piece of legislation, or who is tasked with the inspection, enforcement and regulation of the Navigable Waters Protection Act, would be in a position to deal with pipelines.

There is no more suitable board in this country than the National Energy Board to deal with national energy issues. It seems to be the case, though, every time, that the opposition, when we make streamlined, efficient and effective decisions around people who are designed and should be governing particular things, looks to other pieces of legislation to find excuses as to where, how and why these changes should not be made.

I imagine the member opposite would probably propose that if we made changes to the stuffed animals and toys protection act that that somehow would jeopardize the environment.

This does not. It only strengthens the environmental regime. We will continue on that track and Canadians know that.

[Kelly Block, Conservative, Parliamentary Secretary to the Minister of Natural Resources]

Mr. Speaker, I want to thank my hon. colleague for the work that he does on the natural resources committee. He is a very active member. I appreciate what he brings to the table coming from Yukon.

This legislation builds on a safety record of 99.999%. How does this legislation relate to ensuring public confidence in pipelines?

[Ryan Leef, Conservative, Yukon, YT]

Mr. Speaker, as we maintain public confidence in this through the polluter pay principle, which is clearly important to all Canadian citizens, we are also introducing concrete measures to enhance pipeline safety under the pillars of prevention, preparedness and response, and liability and compensation.

Canadians can be assured that with those pillars in place in this legislation, our government will commit to doing everything we can to achieve those strong pillars in order to ensure we adhere to everything we have set out in responsible resource development.

[The Acting Speaker, Bruce Stanton]

Is the House ready for the question?

[Some hon. members]

Question.

[The Acting Speaker, Bruce Stanton]

The question is on the motion. Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

[The Acting Speaker, Bruce Stanton]

(Motion agreed to, bill read the third time and passed)