Bill C-69 (Historical)

An Act to enact the Impact Assessment Act and the Canadian Energy Regulator Act, to amend the Navigation Protection Act and to make consequential amendments to other Acts

Part 1 enacts the Impact Assessment Act and repeals the Canadian Environmental Assessment Act, 2012. Among other things, the Impact Assessment Act
(a) names the Impact Assessment Agency of Canada as the authority responsible for impact assessments;
(b) provides for a process for assessing the environmental, health, social and economic effects of designated projects with a view to preventing certain adverse effects and fostering sustainability;
(c) prohibits proponents, subject to certain conditions, from carrying out a designated project if the designated project is likely to cause certain environmental, health, social or economic effects, unless the Minister of the Environment or Governor in Council determines that those effects are in the public interest, taking into account the impacts on the rights of the Indigenous peoples of Canada, all effects that may be caused by the carrying out of the project, the extent to which the project contributes to sustainability and other factors;
(d) establishes a planning phase for a possible impact assessment of a designated project, which includes requirements to cooperate with and consult certain persons and entities and requirements with respect to public participation;
(e) authorizes the Minister to refer an impact assessment of a designated project to a review panel if he or she considers it in the public interest to do so, and requires that an impact assessment be referred to a review panel if the designated project includes physical activities that are regulated under the Nuclear Safety and Control Act, the Canadian Energy Regulator Act, the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act and the Canada–Newfoundland and Labrador Atlantic Accord Implementation Act;
(f) establishes time limits with respect to the planning phase, to impact assessments and to certain decisions, in order to ensure that impact assessments are conducted in a timely manner;
(g) provides for public participation and for funding to allow the public to participate in a meaningful manner;
(h) sets out the factors to be taken into account in conducting an impact assessment, including the impacts on the rights of the Indigenous peoples of Canada;
(i) provides for cooperation with certain jurisdictions, including Indigenous governing bodies, through the delegation of any part of an impact assessment, the joint establishment of a review panel or the substitution of another process for the impact assessment;
(j) provides for transparency in decision-making by requiring that the scientific and other information taken into account in an impact assessment, as well as the reasons for decisions, be made available to the public through a registry that is accessible via the Internet;
(k) provides that the Minister may set conditions, including with respect to mitigation measures, that must be implemented by the proponent of a designated project;
(l) provides for the assessment of cumulative effects of existing or future activities in a specific region through regional assessments and of federal policies, plans and programs, and of issues, that are relevant to the impact assessment of designated projects through strategic assessments; and
(m) sets out requirements for an assessment of environmental effects of non-designated projects that are on federal lands or that are to be carried out outside Canada.
Part 2 enacts the Canadian Energy Regulator Act, which establishes the Canadian Energy Regulator and sets out its composition, mandate and powers. The role of the Regulator is to regulate the exploitation, development and transportation of energy within Parliament’s jurisdiction.
The Canadian Energy Regulator Act, among other things,
(a) provides for the establishment of a Commission that is responsible for the adjudicative functions of the Regulator;
(b) ensures the safety and security of persons, energy facilities and abandoned facilities and the protection of property and the environment;
(c) provides for the regulation of pipelines, abandoned pipelines, and traffic, tolls and tariffs relating to the transmission of oil or gas through pipelines;
(d) provides for the regulation of international power lines and certain interprovincial power lines;
(e) provides for the regulation of renewable energy projects and power lines in Canada’s offshore;
(f) provides for the regulation of access to lands;
(g) provides for the regulation of the exportation of oil, gas and electricity and the interprovincial oil and gas trade; and
(h) sets out the process the Commission must follow before making, amending or revoking a declaration of a significant discovery or a commercial discovery under the Canada Oil and Gas Operations Act and the process for appealing a decision made by the Chief Conservation Officer or the Chief Safety Officer under that Act.
Part 2 also repeals the National Energy Board Act.
Part 3 amends the Navigation Protection Act to, among other things,
(a) rename it the Canadian Navigable Waters Act;
(b) provide a comprehensive definition of navigable water;
(c) require that, when making a decision under that Act, the Minister must consider any adverse effects that the decision may have on the rights of the Indigenous peoples of Canada;
(d) require that an owner apply for an approval for a major work in any navigable water if the work may interfere with navigation;
(e)  set out the factors that the Minister must consider when deciding whether to issue an approval;
(f) provide a process for addressing navigation-related concerns when an owner proposes to carry out a work in navigable waters that are not listed in the schedule;
(g) provide the Minister with powers to address obstructions in any navigable water;
(h) amend the criteria and process for adding a reference to a navigable water to the schedule;
(i) require that the Minister establish a registry; and
(j) provide for new measures for the administration and enforcement of the Act.
Part 4 makes consequential amendments to Acts of Parliament and regulations.

[Terry Abel]

As Chris said, CEAA 2012 wasn't perfect either. We didn't have a lot of projects moving through on the upstream side. It had some of the same elements that created uncertainty in the process. It did have timelines. We did see the governments and the agencies working closely to try to stick to those timelines. It had weaknesses in working with the life-cycle regulators and having those processes work more seamlessly.

Like anything, it's how it gets implemented. I don't know that all the provisions of CEAA 2012 were followed, at least in the way we understood the intent. We have engaged in this process because we felt improvements could be made, and Bill C-69 and the associated legislation would be an opportunity to address some of those challenges, most of which, in my mind, are focused on having a competitive regulatory regime that does those processes and reviews efficiently. They add value to the decisions that need to be made, and everybody comes through that process feeling there is certainty.

[Terry Abel]

Again, further to my comments to Ms. Duncan, we're not here to say that Bill C-69 is at the root of every problem. We acknowledge that. What I will say is that, overall, compared to other jurisdictions, Canada has a history. I think my colleague, Chris, highlighted the fact that there are a number of policies that all have a potential negative effect on the competitiveness of our industry. They are all collectively incrementally adding cost. You can take any one of them and say, “Well, it's 20¢ a barrel,” but you add up five or six of them and it adds up to a dollar a barrel or $1.50 a barrel. You compare that to margins that under the current commodity price environment are very tight. You see the effect that you have: companies that have assets in other jurisdictions look at where they can make a fair return for their investors. Right now, granted, we haven't gotten to the end of the review of Bill C-69, we haven't gotten clarity on a lot of the policies, but what we have is uncertainty and no clear signals that Canada is taking steps to address some of those additional costs.

I think one thing I've always been proud of—and most of my career was as a regulator—is that Canada did have very stringent environmental and social requirements, and our industry was very good at innovating to find ways to continue to be productive and economic with those policies. As a result of innovating them, you're able to move that technology into other jurisdictions, raise the bar in other places. But what we're seeing right now is increasing difficulty being able to bear all of those costs and continue to innovate.

Canada doesn't generate enough capital in and of itself to fund an industry like ours. You heard the numbers. In 2014: $80 billion. I'm sorry, Canada can't do that. It needs to come from foreign investment. When you're competing in a world now with many choices there are many places you can go with your investment. It's not 10 years ago where we had a limited supply of oil and gas throughout the world. I would argue a lot of that investment is going to jurisdictions that don't have the same environmental and social standards. We're not saying, relax those standards in Canada. In fact, we want to celebrate those standards. My opening comments were that we're clearly reflecting that. We think that's an advantage for Canada, but you have to take additional steps to make sure you implement policies in a way that minimizes those costs. Where costs are unavoidable, you have to look to the rest of the world and see what's going to make this industry competitive or not competitive, and then take other steps to address that.

It is unfortunate, but what you're describing are companies that have choices, and, as any good business that has shareholders—maybe even some of you—they're going to places where they can make an appropriate return on that investment.

[James Maloney, Liberal, Etobicoke—Lakeshore, ON]

Thank you, Madame Chair. Thanks, Mr. Bossio.

Ladies and gentlemen, thank you for your presentations.

I'm not a regular member of this committee, although I've met many of you before. I'm the chair of the natural resources committee, and it's that capacity that brings me here to talk to you.

Our committee has been working collectively—in fact, all of our members have been working and sort of pushing in the same direction—trying to find ways that we can help the resource sector. My conversation, notwithstanding some of the comments you've heard from around this table.... We don't hear those kinds of comments at our committee, which is quite a refreshing approach, frankly.

Mr. Bloomer, my question is for you.

I was quite surprised to hear your level of pessimism, in particular the comment that you don't see how another pipeline could ever be built. I think you were backing off from that a little when you were thinking about your mother, and I was glad to hear that your mother was more of an optimist.

My question is this. You're saying that Bill C-69 is what made you make that statement, but our government has approved three pipelines since we came to power two years ago. It's done so under the guise of the interim provisions that were implemented in January 2016, which formed the foundation of Bill C-69.

I'm wondering how you reconcile your position with those approvals, given that it's our government that approved and in fact championed those three pipeline approvals.

[Terry Abel]

I would agree with you that there are a number of factors affecting the competitiveness of our industry and the ability to attract investment. What I would say is that it's not true that investment isn't being made in other jurisdictions. It is, in fact, and I would argue that many of those jurisdictions—the U.S. is a good example, for the Permian Basin in Texas where there is no climate policy—that investment is going crazy. Look at Brazil offshore; they don't have strong commitments either. It's not the only factor and I'm not here to say that Bill C-69 is the only factor at all. We agree and we've taken strong positions on indigenous reconciliation. We are supportive of climate policy that sets practical objectives that are implemented in a practical way.

They're all important. I agree with you.

[Chris Bloomer]

Well, as we said in our statement, we don't see how Bill C-69 is going to lead to major new projects being proposed and developed in Canada.

[Eduard Wojczynski, President, Canadian Hydropower Association]

Thank you, Madam Chair.

I'm Ed Wojczynski, president of the Canadian Hydropower Association. With me are Genevieve Martin of BC Hydro, who is chair of our regulatory processes working group, and Pierre Lundahl, our chief consultant with the Canadian Hydropower Association.

The CHA is the national voice of the hydro power industry. It represents generators, manufacturers, engineering firms, and construction companies. Hydro power, as I think you probably already know, supplies over 60% of Canada's electricity. It is our largest generation source, and has made Canada's electricity system one of the cleanest, most renewable, and most reliable in the world.

Hydro power has virtually no greenhouse gas emissions, and it has a key role in achieving Canada's climate change targets. Studies indicate that to meet our 2030 and 2050 commitments, Canada needs to electrify the economy and further reduce the greenhouse gas emissions of the electricity sector, among other measures. This means doubling or even tripling electricity generation by 2050 through a major expansion of hydro power, in concert with wind, solar, maritime, and geothermal power.

Our industry is up to the challenge. Canada still has vast amounts of hydroelectric resources that can be developed. For this to happen, though, Canada needs a predictable and timely project review process that engages all stakeholders and indigenous peoples and has the confidence of the public. Bill C-69 will, in the view of CHA, bring us closer to that objective.

CHA generally supports the bill, but there are some important improvements that are still needed. We are pleased that a number of the suggestions we made in response to the government's 2017 discussion paper are in the bill.

The bill has many good elements, but today we will focus on further suggestions to improve the process. We will later provide the committee with a written submission commenting on several areas of the proposed legislation, and we will suggest specific amendment wording in that submission. We will also provide comments on revisions to the Navigation Protection Act, which we have some concerns with as well. This afternoon, we would like to highlight five recommendations on the impact assessment act.

First, focus the act on projects of national significance. Second, include guidance to the minister when she or he is thinking of applying the act to a non-designated project. Third, guide the ability to extend timelines. Fourth, set a time limit for the establishment of panels. Finally, provide the minister or the agency with a more explicit authority to issue a notice of commencement when a party is taking an unreasonable amount of time to respond, or refuses to respond or participate during the planning phase.

I would like to turn now to the first of these five items. The proposed impact assessment process, with its broader scope, two-phased approach, and large number of decision points, will be more challenging to manage and more complex than what we have today. It will call on specialists from many different areas. It will have to coordinate work from many departments and agencies. It will have to accommodate a large number and a broad variety of intervenors.

The complexity and overall effort required by governments, indigenous peoples, stakeholders, and the proponent argues strongly for focusing the act only on large projects of national significance. We suggest that this be added to the act's purpose statement, to assist in interpreting the bill. This would also guide development of the designated project list.

Large projects of national significance tend to be ones that have more impact than small projects. They involve more public concerns and expectations for a major review. Their proponents would be more likely to be able to manage the complexity and rigorous demands of the process. Projects of that scale already take time to develop and are managed by experienced teams with access to wide-ranging expertise.

If the regulations designating physical activities cast too wide a net, there are two risks. First, medium and small projects with significant benefits and minimal impacts might not be pursued. If the regulatory costs are unpredictable and potentially too large, and the review outcome is uncertain, then the financial viability of entire classes of projects could be undermined.

The other risk is that legislation leads the government to use its regulatory resources inefficiently. These smaller projects, with only minimal impacts, are likely already subject to provincial environmental assessment mechanisms. There are also federal statutes to protect various aspects of the environment such as the Migratory Birds Convention Act, the Species at Risk Act, the Navigation Protection Act, and the Fisheries Act, which is currently being made more stringent as we speak.

Turning to the second recommendation, the impact assessment act would also give the minister the discretion to assess a project that is not on the designated project list and thus would otherwise not qualify for review. Some sort of provision to this effect is necessary, and CHA supports that, but apart from the impact on indigenous rights, there are no criteria in the act to guide the minister's discretion.

As currently drafted, the minister may order an assessment on the basis of her opinion on adverse effects or on the basis of public concerns related to these effects—and that makes sense—but there's no explanation of the procedure or considerations that would help form that opinion. This is inconsistent with the goal of greater process transparency.

CHA recommends establishing criteria in the act to guide the minister's discretion. Our written submission will suggest specific criteria similar to those the government is already utilizing in development of the designated project list regulation. If it's good enough for the project list regulation, it's good enough to put in the act.

Geneviève Martin, my colleague from B.C. Hydro, will take over.

[Lisa McDonald, Interim Executive Director, Prospectors and Developers Association of Canada]

Thanks very much.

I'm Lisa McDonald, and I'm the interim executive director with the Prospectors and Developers Association of Canada. I'm joined here today by my colleague, Lesley Williams, who's our director of policy and programs.

I'd like to thank you for the opportunity to be here today to provide input on behalf of the mineral industry on Bill C-69. Our comments will focus mainly on the aspects related to impact assessments.

PDAC is the national voice of Canada's mineral exploration and development industry. We represent over 7,500 members from Canada and around the world. As the trusted representative of the sector, PDAC encourages leading practices in technical, operational, environmental, safety, and social performance.

Just briefly about the mineral exploration industry, it is a staged process of information-gathering with the hopes of discovering an economically viable mineral deposit, which is a little bit like looking for a needle in a haystack, quite frankly. Junior exploration companies do the bulk of this work in Canada. These companies are small. They have limited budgets and timelines. Most do not generate revenue and fund their activities by issuing shares. While some exploration companies may sell promising projects to mid-tier or major mining companies in order to take them through the assessment process and to be mined, a number of junior companies initiate the assessment process themselves.

Our remarks today will cover a brief overview of the mineral industry, two proposed amendments to Bill C-69, and comments on some of the key provisions in the act.

The value of Canada's mineral industry cannot be overstated. The mineral exploration and mining industry makes vast contributions to Canada. From remote and indigenous communities, rural areas, to large cities across Canada, it generates significant economic and social benefits for Canadians.

Our industry contributes more than 3% to the GDP. Valued at $89 billion in 2016, mineral exports accounted for 19% of Canada's total domestic exports. The industry employs nearly 600,000 workers across Canada, and it is also the largest private sector employer of indigenous people in Canada, and is a key partner of indigenous businesses.

That being said, the Canadian mineral industry faces fierce global competition for investment. In fact, Canada is starting to fall behind its competitors in a number of areas, indicating its decline in attractiveness as a destination for mineral investment. From 2012 to 2016, there was a prolonged downturn where investment in the sector severely declined around the world. Investment has started to return and has strengthened globally, however, in Canada mineral investment has stagnated and it is not recovering as substantially as in other jurisdictions.

A number of factors affect the decisions made by investors about where to invest, and by companies about where to explore and mine. Investment, both foreign and domestic, is particularly sensitive to legislative and policy changes. These generate uncertainty and unpredictability. An unpredictable, complex, and inefficient regulatory regime that is not well implemented will increase risk and deter investment and, consequently, exacerbate the waning of the Canadian mineral industry's competitiveness.

In order for the Canadian mineral sector to regain strength, we are proposing two amendments to the legislation that are critical to our industry.

We are proposing that the committee consider amendments regarding transition. Bill C-69 proposes that when the impact assessment act comes into force, projects that are being assessed under CEAA 2012 would have their assessment continued under the new act, unless they are in the final phase of the process. Industry recommends that the transition provisions be amended so that projects being assessed under CEAA 2012, or those that will enter the process before the coming into force of the new act, must be allowed to continue under CEAA 2012 unless the proponents specifically request the transition. This amendment to transition is critical. Otherwise, it would be extremely disruptive and cause uncertainty for industry, which will ultimately have a negative impact on investment.

Our second proposed amendment relates to the assessment of uranium mines and mills under the new act. We recommend that, similar to any other designated mining project, designated projects that are uranium mines and mills should undergo agency assessments with full access to provisions for co-operation with provinces and indigenous groups.

In its current form, Bill C-69 would preclude co-operation and agency assessment for all designated projects that are regulated by the CNSC.

With respect to the provisions, we understand that critical regulatory policy decisions remain to be developed with regard to the implementation of the new act, and these could materially influence the assessment process for project proponents.

We would like to briefly offer comments on some of the other key aspects proposed in Bill C-69. In general, we support Bill C-69 expanding the scope of factors and effects to be assessed, but there are potential implications to be considered. This expansion of scope will result in significant increases in the amount and type of information required and studied in project assessments. This could exacerbate the time and cost burden. Of particular concern are the ways that this will impact the ability for exploration companies to advance good projects.

Further, the collection, analysis, and weighting of impacts related to these diverse areas can also pose challenges. Views on whether an economic or social impact is positive or negative can be subjective and difficult to quantify. The weighting of various impacts is also not straightforward, particularly in the absence of any plan or guidance on how the various factors should be considered. The new process will require very clear, transparent guidance outlining the impacts that will be considered, the methodologies for the way these elements will be studied, and the weighting of impacts against each other.

With respect to cost recovery, PDAC urges careful consideration in terms of its implementation. Fees required should be transparent and predictable, and proponents should not bear undue burden of the costs for the assessment process. Some jurisdictions already have cost-recovery mechanisms for permitting and assessments. Imposing additional fees for the federal process would mean a duplicate cost for what is ideally intended to be one process, one assessment. This is particularly critical for junior exploration and development companies because, as mentioned before, they have very limited funds and generate no revenues.

Cost recovery, at a minimum, should have a clear, predictable, reasonable set fee per assessment; be linked to various guarantees, including timelines of process; and exclude out-of-scope costs such as policy development or regional assessments.

With respect to timelines, Bill C-69 proposes legislated timelines for project assessments, a provision that PDAC strongly supports. Clearly defined timelines are essential for the certainty that proponents and investors require, leading to a predictable, timely process. PDAC recommends that timelines should allow for alignment with the assessment process of other jurisdictions and enable co-operation, with the objective of one project, one assessment. We also recommend that the factors for suspension of timelines be clearly defined, and limited to specific circumstances to avoid endless delays and undermining predictability.

The mandatory early planning and engagement phase, if designed and implemented well, could provide more clarity for proponents and predictability for the process. That said, some important elements to consider are that officials must have the resources, both human and financial, to provide a proponent with a forward-looking permitting plan. Early planning could adversely impact proponents, particularly mineral exploration companies, as it could require various studies earlier on in the process than previously through CEAA 2012.

Proponents must have the ability to amend the project during the planning phase in response to indigenous and community feedback without having to restart the process from the beginning.

Bill C-69 outlines a more prominent, formalized role for indigenous peoples and traditional knowledge in the assessment process. PDAC supports meaningful participation by indigenous communities in project development and throughout the life cycle of a project. The mineral industry, as a leading practice, builds strong partnerships and seeks input on aspects related to their projects, and also guarantees economic opportunities for indigenous communities. As such, much of what is in Bill C-69 reflects the reality of current practice in the mineral exploration industry.

Furthermore, Bill C-69 proposes that the new agency would coordinate crown consultations and require, by statute, the consideration of potential impacts on indigenous rights. PDAC supports the crown or its delegated authority taking responsibility for fulfilling its duty.

We urge government to assess and outline its requirements for consultation and accommodation with indigenous peoples, to develop a transparent consultation plan that conforms to the tenets of consultation as articulated by the courts, and to assume its responsibility in the process, including for related costs.

[Chris Bloomer, President and Chief Executive Officer, Canadian Energy Pipeline Association]

Thank you very much for the opportunity to present to this committee.

This point in time represents the culmination of a long process of consultation, of input and so on, and a process that CEPA, the Canadian Energy Pipeline Association.... It also represents 97% of the volume moved from production in Canada into the U.S. We look forward to your comments.

I'm going to be fairly direct, fairly straightforward in my comments and look forward to your questions.

We remain fully engaged. We've submitted a submission already, and we will continue to follow up with further consultations. First I'd like to give you a brief “state of the union” for the energy sector. It's not good news.

In the two years leading up to this bill, you can pick your poison: policies, including a tanker moratorium off British Columbia's northern coastline; proposed methane emission regulation reductions; clean fuel standards; provincial GHG emission regulation; B.C.'s restrictions on transporting bitumen; a lack of clarity regarding the government's position on the implementation of UNDRIP and FPIC; and the fierce competition from energy-supportive policies in the United States, etc. The cumulative effect of these policies has significantly weakened investor confidence in Canada. It is seriously challenging the energy sector's ability to be competitive.

We are already in a time of profound uncertainty. New projects are grinding to a halt and we have major problems as a sector and as a country accessing new markets for our energy products to the world. The reality is that CEPA member companies, with material assets in other countries, are actively pursuing opportunities in those jurisdictions, and investment capital in the oil and gas industry is moving out of Canada. This is due in large part to the current regulatory policy uncertainty and the potential implications of any further seismic regulatory changes directly impacting the pipeline sector in Canada. The consequences are real, and the sector is suffocating because of it.

We believe that a majority of Canadians still appreciate the significant contribution the oil and gas sector makes to Canada's economy, and we hold firm to the belief that continued growth in the oil and gas sector is completely consistent with Canada's 2030 GHG emission targets. In the consultation process leading up to the tabling of this bill, CEPA took some comfort in assurances from the government that any new legislation will reflect shared values focused on a strong regulatory regime, relationship safety, environmental stewardship, public confidence, competitiveness, and the kind of certainty and clarity for a reasonable prospect of actually building a new major pipeline in Canada. In its current form, the bill cannot achieve that greater certainty, clarity, and predictability for projects that can extend hundreds if not thousands of kilometres across provinces, communities, and indigenous communities. In fact, it is difficult to imagine that a new major pipeline could be built in Canada under the impact assessment act, much less attract energy investment to Canada.

We are concerned that all this bill has done is frustrate regulatory reform in order to advance this government's climate change agenda and has baked too much broad policy subject matter into an otherwise very technical decision-making process.

With respect to the specifics of this bill, this process started with the Prime Minister's mandate letter to the Minister of Environment and Climate Change. The minister was asked to review environmental assessment processes to achieve three objectives: to restore public trust; to introduce new, fair processes; and to get our resources to market. With all due respect, CEPA does not believe the proposed impact assessment act would accomplish any of these objectives. Over the course of a year and a half of consultation, CEPA's 200-plus pages of submissions were meant to provide thoughtful and practical recommendations to address the government's three objectives. Our recommendations were premised on the underlying need to stem the erosion of Canada's competitive position in the natural resource sector. They were guided by key principles that we believe would have set the framework to meet all of these goals.

The first one is a process that ensures that broad public policy issues are addressed in more appropriate venues outside project reviews, a science and fact-based process that is coordinated and efficient, and provides clarity and certainty. The National Energy Board is the best placed regulator, with technical expertise and full-cycle responsibility for project reviews, operations, and maintenance. Regrettably, the impact assessment does not address these concerns. CEPA is disappointed that the proposed process appears to double-down on the very factors that created the toxic regulatory environment for major projects that this regulatory review process was intended to fix. The impact assessment does not address the pipeline sector's most fundamental concern: a process that is expensive, lengthy, polarizing, and ends with a discretionary political decision.

Bill C-69 has not addressed the need to find an appropriate venue to debate and resolve broader public policy issues. The bill is flavoured throughout with the government's commitment to meeting climate change objectives, gender-based analysis, indigenous reconciliation, and subjective and inherently unpredictable sustainability tests.

Despite CEPA's very strong recommendation to remove broader public policy from project-specific reviews, these issues are now explicitly included in the review process as factors to consider.

The impact assessment act will not achieve greater certainty, clarity, and predictability. Instead, it introduces a new regulatory agency and unique new processes and information requirements that have never been tested.

The public participation standing test has been removed. Science and fact-based assessments will now be obscured by the layering of other policy-based assessments that are ill-defined, fluid, and open to potential strategies of delay and obfuscation of the processes by groups opposed to any project. In short, we cannot see that timelines will improve; we expect them to be longer.

The National Energy Board, now the Canadian energy regulator, has effectively been sidelined with respect to major pipeline project reviews. CEPA consistently emphasized that the NEB was the best-placed regulator to oversee the full cycle of a pipeline from beginning to end. Instead, Bill C-69 carves out the review of major pipeline projects and places it with the new impact assessment agency. This new agency does not have the rich history of administrative decision-making and technical expertise of the NEB, now CER.

Instead, the new agency is mandated to perform a broadened role and assess a wider scope of issues, and is expected to implement the government's political agenda related to climate change, reconciliation, and gender objectives. It is not an independent, expert regulator. CEPA is not convinced that it will have the capacity to conduct these broadened political reviews, even with the announcement of $1 billion of new spending to support the implementation of the impact assessment.

Given these concerns, it is hard to imagine that any pipeline project proponent would be prepared to test this new process or have a reasonable expectation of a positive outcome at the end of it. With built-in climate change tests covering upstream and downstream emissions, it is preposterous to expect that a pipeline proponent would spend upwards of a billion dollars only to be denied approval at the end, because the project must account for emissions from production of the product to consumption in another part of the world.

If the goal is to curtail oil and gas production and to have no more pipelines built, this legislation may have hit the mark.

In conclusion, today CEPA has offered the views of member companies based on their direct experience in investing, building, and safely operating the energy infrastructure that supports the Canadian economy and the everyday lives of Canadians. Project proponents and their investors will continue to evaluate the feasibility of developing resource projects in Canada against other investment options.

The government's June 2017 discussion paper suggested a more balanced approach between the views of the more radical environmental elements and industry. This bill tilts the balance wholly in favour of the environmental perspective, some of whose goals are to keep fossil fuels in the ground and never see another pipeline built.

This bill will introduce even more risk and uncertainty. The net effect of the impact assessment is an impractical and unworkable process that will create unmanageable uncertainty and a decision-making framework that will insert broader policy issues squarely into a process that is not equipped to resolve them.

Finally, this bill does not provide a vision as to how it fits into Canada's achieving longer-term energy objectives; it does not reflect the reality of the importance that oil and gas will continue to play in the global energy mix for the next several decades; and therefore, it does not help Canada achieve full value of its resources in the world markets.

Thank you for hearing our comments. I look forward to questions.

[Terry Abel, Executive Vice-President, Canadian Association of Petroleum Producers]

I would be happy to. Thank you.

Good afternoon, honourable chair and members of the committee. My name is Terry Abel. I'm executive vice-president with the Canadian Association of Petroleum Producers. Joining me today are Mr. Paul Barnes, who is the director of our Atlantic Canada and Arctic offshore, and Patrick McDonald, who is director of climate and innovation.

We are very appreciative of the opportunity to address the committee today and provide some of our experience and thoughts that might help inform your review of Bill C-69.

Hopefully, many of you know that CAPP and its members are responsible for producing around 80% of all the natural gas, natural gas liquids, crude oil, and oil sands across Canada, including offshore resources. Our industry is the largest single private sector investor in Canada. In 2014, it invested at a peak of $81 billion and at more like $45 billion in 2017. Collectively, we employ well above 500,000 Canadians from coast to coast.

Our offshore oil and gas and natural gas projects, located generally quite a way offshore—200 to 500 kilometres offshore in Newfoundland and Nova Scotia—have brought tremendous benefits to Newfoundland and Nova Scotia over the years and will continue to do so for some time.

As you know, the International Energy Agency continues to project that energy demand will grow worldwide by more than 30% by the year 2040, and growth in that demand will happen in both oil and natural gas, with hydrocarbon resources continuing to make up the lion's share of energy demand across the country, although renewables are growing substantially.

CAPP believes that Canada is well positioned to become the supplier of choice for oil and natural gas resources, given our world-leading responsible development practices and the fact that we have some of the largest and highest-quality reserves of oil and gas in the world. It's therefore imperative that Canada remain competitive with other oil and gas-producing jurisdictions; otherwise, Canada loses not only the opportunity to generate economic value from this industry, but also the consequential global reductions in GHG emissions that flow from Canada's being a more responsible producer of those resources.

I am going to introduce my comments today focusing on the competitiveness of our industry and on some aspects of the bill that can create uncertainty and further erode the global competitiveness of the industry. I'll touch on such things as transitional provisions, timelines, early planning, review panels, and regional strategic assessments.

We understand that the government's stated objective is to restore public trust in its environmental and regulatory review processes, something we absolutely share as an objective. We also want to ensure, however, that any changes restore confidence in the investment community.

Our industry is very challenged these days. There is a highly competitive global competition for capital resources, and Canada needs to remain competitive, if we're going to bring capital into Canada. Unfortunately, today Canada is attracting more uncertainty, not more capital, and we will continue to lose investment and jobs if we do not have a system of clear rules and decisions that are final and can be relied upon.

I'd like to point out that a 2016 WorleyParsons study of environmental assessment practices worldwide observed that while Canada has an EA process that is one of the most thorough and comprehensive, it also currently has “one of the most expensive time, and resource consuming EA processes in the world”.

Unfortunately, CAPP and the investment community today see very little in Bill C-69 that will improve that status. A simple example of this growing uncertainty is found in the transitional provisions within the draft impact assessment act. Current provisions require that assessments initiated under CEAA 2012 but not yet complete would generally have to continue and be completed using new legislation and rules. Specifically, the language in the bill that might allow an assessment to be completed under the current legislation, CEAA 2012, is actually very subjective and does not provide clear certainty as to which process will apply. If the intent of those provisions was to have those started in 2012 continue, we would argue that you could make this far clearer and more certain within the current language.

Requiring a new proponent, if that is the intent, to follow the new regulatory process midstream would run the risk of essentially taking processes back to the starting line. For example, we would point to offshore exploration drilling programs. There are four currently in Newfoundland. We see substantial risk that all the work undertaken today could be deemed incomplete. Therefore, they may have to restart and follow an entirely different process, which would add more time and more uncertainty for our investment community.

We simply propose that the government confirm that all projects in flight within federal, provincial, or territorial processes not be revisited under the new legislation.

Madam Chair, CAPP supports maintaining legislated timelines that we see both in CEAA 2012 and within proposed Bill C-69. However, it's not evident that overall, the regulatory review timelines will be any shorter than the current process. With the addition of early planning and no clarity regarding the time frames for review and information requests, and a number of opportunities sprinkled throughout the legislation to extend those timelines, we and the investment community generally conclude that we only see an increase in timelines overall.

We fully support the concept of early planning. I would note that it is normal practice by CAPP's members and our industry in general to engage early with stakeholders that may be impacted by proposed developments. We support the government's involvement in a more formalized process of early engagement as it provides an opportunity to get an early understanding of issues and clarity for all. It also gives stakeholders an opportunity to address issues that we often find come up in our project reviews that actually have very little to do with the project. They're much broader in nature.

For early engagement to be effective, however, all parties must be committed to the process and held accountable to meaningfully engage and honour timelines and their respective roles. We believe that without setting clear expectations for the stakeholders, industry, and government, the commitment to, and the introduction of, an early engagement or early planning process is likely to continue indefinitely and do nothing to support timelines improvement.

CAPP believes that, should the proponent and the agency at the end of the process not be able to agree on the scope of an EA, there needs to be some mechanism to actually bring discipline and closure to that process and actually let an EIA continue.

I'd like to flag something very specific to our offshore in my final comments. The way it's currently written, all offshore-designated projects would require a panel review. With that panel review come timelines that are at least twice that of the review by the agency. We do not believe there's any justification for a process that would effectively double the timelines, which we would expect would be at least four years, particularly as the potential effects of offshore oil and gas projects are well understood.

We have had numerous environmental assessments completed and reviewed in Canada both by CEAA and the offshore boards and decades of environmental effects monitoring in Canada as well as internationally that can contribute to practices that are pretty much standard at this point and are adopted in all jurisdictions across the world.

It's our view that a review panel that combines the experience and expertise of both the impact assessment agency and a specialized regulator, such as the offshore petroleum boards, should actually be able to decrease the regulatory review time required, not double it, as would currently be interpreted with the way the legislation is written. CAPP recommends that the requirement for offshore operations to require a review by panels be removed.

Our industry is also very supportive and sees the benefits of regional impact assessments as are enabled under the draft legislation. We note that they can include such benefits as improved environmental effects assessment and cumulative effects assessment. They would probably help a lot with stakeholder fatigue by not having to do the same things over and over again, and should afford some regulatory consistency and efficiency.

This approach is something that's used internationally. We would point to jurisdictions, such as Norway, that have already used that.

We continue to support the idea of regional impact assessments, and we recommend that, if we're going to go that route, a list of the completed and accepted assessments should be maintained and should ultimately form part of exclusion criteria for the project list that's going to be developed as well.

We believe it can be a powerful tool provided Canada, the provinces, and the territories, work together to complete assessments. However, as currently written, in Bill C-69 we really see no mandated timelines, no confirmation of the inclusion of provinces or life-cycle regulators, and really no guarantee that the process will be successful or will actually be utilized within the assessment process that Bill C-69 talks about.

I will wrap up quickly here, Madam Chairman.

CAPP again thanks you for the opportunity today. We urge you to carefully consider some of our feedback today, and we recommend changes that will resolve investor confidence, help Canada fully realize the significant economic value of our industry, and ensure the resulting global environmental benefits that flow when Canada is the supplier of choice.

Thank you again.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

You're right about that. That's why we have this new act, because we are going to be addressing through Bill C-69, through the impact assessment act, the issues that you have brought up specifically today. The importance of indigenous rights, environmental effects, health effects, cumulative effects—all of those things—will be part of the considerations with respect to impact assessment.

I recommend that—

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Let me ask you a second question.

You spoke in your remarks about how highly you value impacts upon indigenous peoples. One of the greatest harms brought by the Harper changes was excluding the trigger of navigable waters for assessments of all the oil sands activities in northern Alberta, because of the interaction of all the streams, the marshes, and so forth.

The federal government also, in its wisdom—both the Conservatives and the Liberals—failed to look at the transboundary impact of the Site C dam upon the rights of indigenous peoples in northern Alberta to traverse.

There actually is a court case. Mr. Justice Hughes of the Federal Court of Canada found that any reasonable person would expect that the reduction of the number of protected waterways carries the potential risk of harm to the fishing and trapping rights of the Mikisew, thereby triggering the duty to consult. The area in which the indigenous people want to consult is the overall impact assessment, not a narrow process of simply looking at whether it is a minor or major impact.

One of the big issues is cumulative impact, and that's a significant issue that's been raised by a number of people. I wonder whether you can tell us how this new act, under Bill C-69, adequately addresses potential cumulative impacts, even of minor works upon minor waterways.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

Okay.

We did not remove the responsibility for an environmental assessment. It is covered in Bill C-69 through the impact assessment act.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

—of the first part of Bill C-69 is fisheries.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

As you know, the Navigation Protection Act, or now the Canadian navigable waters act, and before that the Navigable Waters Protection Act, is one of the oldest acts in the country.

I just want to make the point that, as you said, I have a great deal of power. I take that job extremely seriously because of the importance of the common right of Canadians to have access to navigation on our waterways.

As I said, we have added further dimensions to it. It was intended as an act to cover the issue of navigation when it was originally created.

Now, to address your point about an environmental trigger, there is, through Bill C-69 and through the impact assessment process, the possibility of triggering environmental—and not just environmental, but as well other—concerns that may be expressed, whether with respect to health, whether with respect to community—

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Mr. Minister, I know you're fully aware that you have a great power. You have the unilateral power over navigation. It's a unilateral federal power, so unless you make a decision to protect a navigable river, there is no other recourse.

Your government also committed to strengthening this act, as well as other environmental laws.

There are definitely a lot of concerns that have been raised about the changes made by the Conservatives to this act, but there are equally a lot of concerns about this bill. One is that this Bill C-69 in its entirety has 800 clauses. One of the concerns that is being raised is that the impact assessment law does not include potential impacts to navigable waters as a trigger.

Prior to the changes made by the Harper government, there were two major triggers for federal environmental assessment: one was potential impacts under the Fisheries Act, and the second was under navigable waters. The third, but always confusing, was impacts to the rights of indigenous peoples.

Why has a decision been made not to include in the proposed impact assessment act, under clause 7, a trigger of a potential impact to navigable waters? Why is there a completely separate impact assessment process for navigable waters?