Afghanistan Committee on Feb. 15th, 2011

[Robert Schafer]

I made that personal inquiry directly to several of them, and the words that came back to me were almost identical for each one. They said, if you deliver upon the things you say you're going to do, if we see strangers in our valley, they will not get close to you.

[Bob Dechert, Conservative, Mississauga—Erindale, ON]

Interesting.

[Robert Schafer]

Basically, they control their own populations, and they were going to keep away anybody who would deter benefits deriving to them.

[Bob Dechert, Conservative, Mississauga—Erindale, ON]

It sounds like they could be valuable business partners then, in many respects.

What is your view of the level of corporate social responsibility amongst Canadian resource companies, and how would you say Canadian companies could assist the people of Afghanistan in developing their resources in a responsible way?

[Robert Schafer]

Corporate social responsibility is a science and a social activity that is still developing, I'll say. In the past 25 years, this has become a true and budgetable component of not only a business such as mine, but any business going to any part of the world. We're all still learning from that. Having said that, through the interaction and coordination of the PDAC, we've put together guidebooks and guidelines to help companies going into these frontier areas so that they will not create faux pas and have problems; they'll know how to address issues that are related to corporate social responsibility, not just with indigenous people locally, but obviously it applies here in Canada as well.

[Bob Dechert, Conservative, Mississauga—Erindale, ON]

Would you rate them?

[Robert Schafer]

Yes. We're still learning, but it's something that's coming on very strongly, and I think Canada is leading the way.

[Bob Dechert, Conservative, Mississauga—Erindale, ON]

That's interesting.

How can the Canadian government support your company and companies like yours in helping the people of Afghanistan to develop their resources?

[Robert Schafer]

Really, stronger assurance of personal security is what is required at this point in time. At the time the copper project tender process was going on, the full extent of the conflict in Afghanistan was much lower than it is now.

There has been an order of magnitude increase in the level of violence in the country since I was there in 2006-07. As a result, now is not the time that companies are going to be entering into Afghanistan. I think a ceasefire of some sort has to be established in some fashion before companies are going to be willing to risk their personnel.

[Bob Dechert, Conservative, Mississauga—Erindale, ON]

Thank you.

Thank you, Mr. Chair.

[The Chair, Conservative, Garry Breitkreuz]

Thank you very much.

Last, but not least, we'll go over to the NDP, with Mr. Harris, please, for seven minutes.

[Jack Harris, NDP, St. John's East, NL]

Thank you, Chair.

Thank you, Mr. Schafer, for sharing your experience with us. Obviously, you've been on the ground in Afghanistan and can see the level of development.

There was something that struck me. In answer to one of Mr. Dion's questions, you talked about the wild west and the role of the cavalry when you were discussing the state of development in Afghanistan.

My question is, what is the role of the military in all of this? We've seen the estimated value of mineral resources reported as being potentially $222 trillion. This comes from some work by the Geological Survey in the United States, but, interestingly enough, it was actually released by the Department of Defense, and the Pentagon was very involved in providing this. General Petraeus, who is now in charge in Afghanistan, was part of that release.

I'm really wondering how all this ties in with what's going on in Afghanistan. You say the area is unstable, and you need to have protection to be able to do mineral development. What is the role of the military, and what state of play does there need to be for the kind of development you're talking about?

[Robert Schafer]

Again, I'll call on personal experience.

Over the past couple of years, I have been contacted not only by the Government of Canada, but also by the U.S. government on a periodic basis--both the State Department and the Department of Defense. Most recently, probably about six months ago, the Department of Defense sent three gentlemen to meet with me in Vancouver, who represented what the Department of Defense calls--and I'm not sure if I'll get the name correct--the economic development corporation, which is a part of the Department of Defense. It is trying to develop business within Afghanistan in areas it feels it has secured.

They were talking specifically about development of exploration mining with me through this economic development corporation.

[Jack Harris, NDP, St. John's East, NL]

Is that the Canadian or the U.S. defence department?

[Robert Schafer]

That was the U.S. Department of Defense.

[Jack Harris, NDP, St. John's East, NL]

It was the U.S. Department of Defense.

[Robert Schafer]

Yes. So they've essentially established a pseudo state corporation to assist private industry to develop natural resources, and perhaps other types of industries as well, such as cellular telephone distribution and other communications and that sort of thing.

My true belief is that the Department of Defense released this U.S. Geological Survey report in order to provide some good news against the background of the war in Afghanistan, to suggest that it's not just a place that is destitute of wealth but a place where opportunity will exist once the country realizes a peaceful environment at some point in time, and to suggest that the U.S. Department of Defense at least is willing to provide some level of security to help companies establish a base to do so.

[Jack Harris, NDP, St. John's East, NL]

It seems, however, Mr. Schafer, and you said this yourself just now, that this is not an immediate project. There are some long-term requirements. The World Bank identified the need for the Afghan government to develop effective revenue management and benefit-sharing policies. We've had the deputy minister or the ADM for the natural resources department here talking about requests for pretty basic assistance from the Canadian government in terms of analytic equipment, mining and exploration equipment, training, scholarship support. You yourself talked about an exchange program. Is that the level of activity that the Canadian government could promote in terms of assisting Afghanistan right now, by giving them some basic support in terms of helping the government to develop some of the skill levels?

I liked your idea of the exchange program. We talked about that a little while ago. It doesn't seem that we're at the level yet of developing mines without a proper regime in place. Would you support our urging the Government of Canada to give some assistance in developing expertise and equipment? Also, would you describe for me what you see as an exchange program that might be viable?

[Robert Schafer]

Thank you very much for asking that question.

I think that's precisely the level at which the Canadian government could be very supportive at this point in time, the reason being it's low risk from a human life perspective. Establishing a training program, as I had suggested, with the British Columbia Institute of Technology, in which they would train geological technicians, mechanics, as I said, pipefitters, welders, electricians, and all those sorts of things is a relatively low investment from an infrastructural cost perspective. All of those things become part of the infrastructure and then the fabric of the country. The cost of carrying out that sort of activity and creating an exchange program in which, then, the best and brightest are coming from the technical level of training to the academic level of training is the next step forward thereafter. So a program like that would be a low-risk, very high-reward type of activity that the Canadian government could certainly, I believe, participate in.

[Jack Harris, NDP, St. John's East, NL]

Thank you. I happen to agree with you that there's a lot of work to be done at the level of skills training that would give some expertise and put it in the hands of individuals. Perhaps your geologist friend would help us with some advice. Obviously, it was much help to you having had the experience in Afghanistan, and of course also being presumably very fluent in the local language.

I don't think there's much more time left. If I asked you a question, you'd be told to answer it in five seconds, so I think I'll leave it there.

I want to thank you for coming and joining us today with your hands-on, on-the-ground experience in Afghanistan and your experience in the industry to bring to our committee.

[Robert Schafer]

It was my honour to participate today.

[The Chair, Conservative, Garry Breitkreuz]

Yes, and as chair of the committee, I want to give you a special thank you for your expertise and for taking the time to share with us. This has been very, very helpful, and the information will be used in the report that we're going to make later on. Thank you.

[Robert Schafer]

Thank you very kindly for inviting me. I appreciate it.

[The Chair, Conservative, Garry Breitkreuz]

Okay. We're going to suspend now for a moment. We're going to go in camera, so we'll have to clear the room and deal with our report.

[Proceedings continue in camera]