Environment Committee on May 13th, 2009

[The Vice-Chair, Liberal, Francis Scarpaleggia]

Good morning to our witnesses. Thanks very much for being here today. We really look forward to what you have to tell us.

The first two days of our trip out west have been very informative, but our trip isn't over. We still have a lot to learn, so we're looking forward to what you have to say.

I'm told that you have a presentation plan worked out. Whoever wishes, then, please start.

[Don Thompson, President, Oil Sands Developers Group]

Good morning, Mr. Chair and panel.

I'd like to express our appreciation for your taking the time to listen to us, for inviting us here, and for the time you spent in Fort McMurray viewing our operations and the oil sands.

I'm Don Thompson, president of the Oil Sands Developers Group. I'd like to start by introducing our panel. Stuart Lunn is with Imperial Oil. Mr. Ian Mackenzie is with Golder Associates. Mr. Fred Kuzmic is with Shell Canada. Mr. Greg Stringham is with the Canadian Association of Petroleum Producers.

Water is clearly a critical aspect of the production process used for bitumen extraction and recovery, which we'll talk to in a bit. In reality, Canada’s oil sands use a very small percentage of available water, and the water used is highly regulated. For example, oil sands use is currently less than 1% of the mean annual flow of the Athabasca River, and there are procedures and processes in place that cap that withdrawal during low-flow periods

Regulations also do not permit the release of any untreated oil sands process-affected water, and ongoing aquatic monitoring has not shown impacts to the lower Athabasca River aquatic ecosystem associated with oil sands development.

Oil sands projects recycle a high percentage of the water they use, ranging from 80% in surface mining to over 95% in the in situ industry. In fact, the in situ side of the oil sands industry is shifting increasingly from the use of fresh water to the use of saline water, and of course none of that is from the Athabasca River.

The other reality is that pumping water, storing it, and treating it is a key cost of production. We have every incentive to minimize our water use, and that is important to the economics of oil sands production.

Recently there have been calls on both sides of the border to strike a balance between energy, environment, and economy. In my view, that balance is being struck today in the oil sands.

On the environment, local air quality is excellent and is being managed well. Greenhouse gas emissions are low and are a small percentage of Canadian and global totals. The use of water is being reduced through improved and increasing technology. As I've already mentioned, a high percentage of the water we use is recycled, and the in situ industry is moving increasingly to using non-drinkable water.

In terms of the land, minimization of impact has always been a watchword. Of the 530 square kilometres that have been disturbed over 40 years of surface mining, 65 square kilometres are currently under active reclamation. Advanced technology is being developed and innovation is being applied to all aspects of environmental management.

The reality is that the oil sands are a key strategic Canadian resource. They provide today, and will provide increasingly in the future, strong security of supply to Canada. They are a major component of this country's future energy mix.

On the economic side, oil sands economic impacts are felt across this country. Between 2000 and 2020, oil sands development has the potential to generate at least $885 billion in total economic impact, with $123 billion in royalty and tax revenues for Canada's federal and provincial governments. It's important to understand that for each permanent oil sands-related job, nine additional direct, indirect, and induced jobs are created in this country.

Yesterday I was in Drummondville, Quebec, where I met with the Quebec branch of the Canadian Manufacturers and Exporters and a number of steel metal fabricators, mining equipment providers, and the like that support this industry. In fact Suncor, which presented with me, demonstrated that they had 199 vendors in Quebec and almost $200 million of expenditures last year.

It's also important for people to realize that my members have workforces on their sites from coast to coast, from the far east to the west, and the oil sands represent people and industries coming together in Fort McMurray. The oil sands are a national endeavour.

On how oil sands fit into the future energy mix, you should know that global economic growth will require more energy of all kinds. In North America, energy use grows by about 1.5% a year, driven by population growth, lifestyle enhancements, and offset to a small degree by efficiency. Despite growth in the use of renewables and other forms of energy, oil remains an important long-term component of the global energy mix.

We will be needing all forms of energy because of growth in global population. But the reality is that oil sands resources are a vital part of the global petroleum supply. In Canada we are privileged to have the second-largest crude oil reserves in the world--second only to Saudi Arabia--at 178 billion barrels. But the reality is that 97% of those, or 173 billion barrels, are in the oil sands. Stated another way, in other countries and locations where crude oil is accessible, a full 87% of the world's known oil reserves are currently in state-owned or state-controlled locations held by countries such as members of OPEC, Russia, and the like. Only 13%, or one barrel in six, is openly accessible to international oil companies, and half of that is in Canada’s oil sands.

Our conventional production is declining by about 4.5% per year and will continue to do so. That gap has to be filled by oil sands and is being filled by oil sands. But the other reality is that the economic turmoil in recent times has flattened that line. You will see in the next forecast that the growth rate from 2008 to 2012 will flatten. So oil sands are critical to this country's future energy security. Oil sands exports will also be a key component of the balance of payments future of this country.

I know that on your tour you witnessed both kinds of oil sands production technologies, so I will not dwell on that. I'm sure you saw mining, trucking, and shovel operations; however, I draw your attention to the fact that 80% of the reserve base I spoke of must be produced by in-ground or in situ technology where there is no mine, no tailings ponds, and no water from the Athabasca River.

With that, I'll turn the floor over to Mr. Lunn, who will talk about water quantity issues.

[Stuart Lunn, Imperial Oil Limited]

I'd like to spend a little bit of time talking about the perspective of water availability in the province of Alberta, and then I'll talk specifically about water use in the oil sands industry, both in surface mining and in the in situ industry.

Each year in the province, approximately 130 billion cubic metres of water flow through the rivers of Alberta, and 85% of this water flows north. By far the largest rivers in the province are the Peace and the Athabasca rivers, joining to become the Slave River, leaving the province to the north. In contrast, in the province 88% of the water demand is in the agricultural areas and the major population centres in the south half of the province.

All the oil sands production is in the northern basins. The mining oil sands are all within the Athabasca River basin, and in situ oil projects are distributed among the Peace, the Athabasca, and the Beaver river basins.

Of the 130 billion cubic metres on average available in the rivers of Alberta each year, the Alberta government has licensed or allocated just under 10 billion cubic metres per year to all sectors within the province. The oil and gas industry accounts for about 7% of this provincial allocation--on here, the yellow portion of the bar--after the large sectors of agriculture, commercial, and municipal use.

Most of this allocation, unlike the other sector use, is allocated or licensed for oil sands mining in the Athabasca River basin, about 70% of that 7%. The rest of the oil and gas sector uses the remaining water, and comparatively small volumes are used for in situ oil sands production.

It's noteworthy that criticism of oil sands water use often fails to recognize that the use is in the northern basins, where the water supply is much more plentiful and water use is a small percentage of natural supply.

Focusing on that with a little more detail, oil and gas allocations represent 2.2% of the allocations of the natural flow of the Athabasca River, 0.04% of the natural average flow in the Peace River, and 3.7% of water availability in the Beaver River basin. It's worth noting that the actual water use is often less than the allocation, but concerns and water shortages in central and southern Alberta have led to misperceptions about water supply in the north for the oil sands.

If you take a quick look at the chart, there are three bars. The axis represents billions of cubic metres of water. The blue bar is the average natural supply in the river basin, the red bar represents the total amount of water allocated in that basin for use in all sectors, and the yellow bar represents the amount of water allocated for use in the oil and gas sector. What we can quickly see is that the allocations in the south half of the province, in the North Saskatchewan and South Saskatchewan River basins, represent a large percentage of natural supply, some 30% of the North Saskatchewan and nearly 60% of the South Saskatchewan.

In comparison, including forecast growth in the oil sands industry, the Athabasca, Peace, and Beaver river basins will remain among the least utilized basins in the province.

I'll now focus on the oil sands mining industry. Over the last several years, the Oil Sands Developers Group has been working on forecasting how much water might be required from the Athabasca River. Both lines on the chart represent aggressive growth cases, the purpose being to try to determine how much water might be required from the river if projects go forward as envisioned and if future projects go forward as envisioned.

The lower case represents 2.5 million barrels of oil per day, and the second case is 3.5 million barrels of oil per day, which is approximately four times current production rates. The left axis shows the absolute amounts of water being withdrawn from the Athabasca River, and the right axis shows the percentage that this withdrawal represents of the mean annual flow at Fort McMurray. We can see for those two growth cases that the industry use of water is expected to rise to between 10 and 15 cubic metres per second, which represents about 1.5% to 2.5% of the flow of the Athabasca River. We also see that it peaks, in the most aggressive case, at around 16 cubic metres per second, or just under 2.5% of the mean flow. And I'll be talking about that number again.

So why is there so much concern about water use from the Athabasca River, given the very low percentages of water that are allocated, and the low percentages of water that are being used now, and will be used in the future?

This is mostly because the Athabasca River is ice-covered for five to six months per year, and the winter flows are about 10 times lower than the open-water flows. Also, the Athabasca River's flows are not regulated by dams. The concerns very much focus on withdrawals during low winter flow weeks, and especially in dry periods during those low winter flow weeks.

It's worth mentioning that when the Athabasca River joins the Peace River beyond Lake Athabasca to become the Slave River, the low flows in that river system are not as much of a concern. This is because the Peace River has the W.A.C. Bennett Dam in British Columbia that takes some high summer flows and distributes them for hydro during the winter months, creating higher-than-natural flows in the Peace and Slave rivers—by about 700 cubic metres per second. If you compare that with the 16 cubic metres per second projected for the oil sands industry, we see that the low-flow concerns are really a concern only for the Athabasca River.

These low flows have been regulated by the federal and provincial governments, with water restrictions during these low-flow periods capping the cumulative amounts of water available to the oil sands industry. This is in the Water Management Framework: Instream Flow Needs and Water Management System for the Lower Athabasca River.

This framework was released in 2007, after seven years of multi-stakeholder research, resulting in a very protective and conservative framework. It applies to segments four and five of the lower Athabasca River, and these are the segments where we find the oil sands mining operations. It limits water withdrawals by the oil sands operators during low-flow winter periods to between eight and 15 cubic metres per second, depending on the river flow and the time of the year.

This process is being refined in a multi-stakeholder process, taking advantage of additional research on the river, with a phase two water management framework anticipated for implementation at the beginning of 2011.

So what does this mean? Given the projections of oil sands mining growth to a peak of 16 cubic metres per second, and given the protection provided by the lower Athabasca River water management framework, what does this mean for withdrawals and natural flows?

On this next slide, we've taken the driest period on record at the Fort McMurray gauge, as contained in the period of 1998 to 2004. The natural flows are the blue curve on the slide. You can see the low winter flows, and you can see the high summer flows and variability of the flows on the hydrograph. The other curve—which is difficult to make out—is the amount of water that will remain in the Athabasca River if that growth case of 16 cubic metres per second comes to pass.

With the protection provided by the water management framework, we see that the difference between that rate, even for a growth case during a very dry period, and the natural flow of the Athabasca River is almost imperceptible. However, we are concerned about those low winter flow periods, and research is ongoing in that area.

There have been some suggestions that the Athabasca River is drying up in the winter. This very much depends on the timeframes that we look at. If we take a look at the high-flow periods from 1970 to 2004 at the Fort McMurray gauge, we can see there's quite a steep declining trend. It's a little difficult to see on the chart, but if you take a look at the full record of flow history on the Athabasca River at Fort McMurray, you see that from 1957 to 2007, the trend—including a forecast for the future—is much less alarming.

The town of Athabasca, which is upstream of Fort McMurray, has a longer flow history, and the river flows track very similarly. Of course, it's a smaller river upstream, because of fewer tributaries entering into the river. At the town of Athabasca, we have a full century of monitoring data, and if we take a look at that full history, we can see there have been no trends in flows recorded over the last century on the Athabasca River. There are seasonal increases and decreases due to seasonal and longer-term fluctuations in the weather patterns.

However, that having been said, if the flows in the Athabasca River were to decrease because of climate change or for other reasons, the effect would be that the water management framework would be implemented more often, and that would restrict the oil sands withdrawals more often in order to ensure protection of the river.

In addition, industry would manage the reduced water availability through the use of various mitigation tools, including the use of additional off-stream storage, thus spilling storage in the wetter periods, the summer high-flow periods, and then using that water shortfall in those winter periods. In addition to that, we can expect ongoing water efficiency improvements. As well, we've heard about some new technologies that may be promising.

I'd like to spend a couple of minutes talking about the oil sands in situ industry, which is quite different from the mining industry.

Water is also critical for most in situ oil sands production, and as the industry grows, so does the requirement for source water. However, increases in fresh-source water demand have been offset by a number of initiatives, including the transition to the use of saline water--water that's too salty for potability or agriculture--and high recycle rates of water produced with the bitumen. These rates are greater than 90% and sometimes approach 100% in some years.

I'd first like to call your attention to the black line on the chart. It indicates the bitumen production or oil production from the in situ oil sands industry. We can see that over the last 20 years there has been a sixfold increase in production.

In contrast, the blue curve, which indicates fresh water, shows fluctuation over the years. We have seen a slight increase in recent years, but the volume of fresh water has been greatly offset by the volume of saline water used, especially since 2002. There has been quite a steep increase in the use of saline water over fresh water, and you can see for the first time in 2007 that the industry now uses more saline water than fresh water for recovery.

We would expect that trend to continue into the future, depending on the availability of saline water. Depending on this mixture, by 2020 the in situ oil sands industry's forecast is to use between 25 million and 45 million cubic metres of fresh water to produce more than 1.6 million barrels of oil per day, or 90 million cubic metres per year. This represents less than 0.5% of Alberta's current water allocation to produce almost 40% of Canada's total crude oil.

Continuous improvement is also an important aspect of the industry. The chart here shows the water use efficiency of Imperial Oil's Cold Lake operation. It's in terms of units of fresh water per unit of bitumen produced. We can see that over the last 30 years there has been a dramatic reduction in the amount of fresh water required to produce each incremental barrel of oil. It is this record of continuous improvement that gives me confidence that the oil sands industries, both the in situ industry and the mining industry, will continuously improve their water use efficiency.

In closing, I'll mention that some new projects in the in situ industry, such as Devon's Jackfish project, use only saline water for steam generation. They're not using any fresh water at all.

Thank you very much.

I'd like to now introduce Ian Mackenzie, who will talk about water quality.

[The Vice-Chair, Liberal, Francis Scarpaleggia]

Thank you for your presentation, Mr. Lunn.

Welcome, Mr. Mackenzie.

[Ian Mackenzie, Golder Associates]

Good morning. I'm going to talk about water quality as it relates to the environmental impact assessment process in the oil sands region in Alberta. My presentation is going to focus exclusively on surface mines.

I'd like to first introduce a slide showing the bitumen outcrops along the Athabasca River. I think it can be seen that water quality has to be influenced by hydrocarbons and polycyclic aromatic hydrocarbons, which I'm sure you've heard about. Then I think it's worthwhile to recognize that based on this water quality and bitumen association, the ecosystem in the Athabasca River has likely adapted over thousands of years or been influenced over thousands of years by these deposits.

I'll frame my presentation on the environmental impact assessment with a focus on water quality by five basic elements: characterization of existing water quality; assessment of project design; confirmation of appropriate mitigation measures; cumulative assessment of water quality in receiving streams; and resolution of residual issues.

There has been extensive monitoring of water quality, sediment quality, and benthic invertebrates and fish, not to mention hydrologic monitoring in the lower Athabasca River for quite some time by numerous agencies. The federal government, through Environment Canada and the Department of Fisheries and Oceans, was involved in the northern rivers basin study from the mid-1990s to the end of that decade. The Panel on Energy Research and Development has been funding dozens of studies since the early 1990s on the lower Athabasca River. The northern rivers ecosystem initiative carried on the recommendations and studies of the NRBS, starting at the beginning of this decade and finishing up in 2003 or 2004. Alberta Environment and its predecessor has been monitoring water quality monthly upstream of Fort McMurray, and downstream of the oil sands development at Old Fort for quite some time.

Alberta Environment has also been involved in the northern rivers basin study with the federal government. You'll hear more about the regional aquatics monitoring program that was initiated in 1997. I'd also like to mention a couple of other regional bodies that have been doing a lot of work in the oil sands area. The first one is the Canadian Oil Sands Network for Research and Development, or CONRAD, which has been funding studies since the early 1990s on many aspects of oil sands, including wetlands research into potential acidification, tainting, loading studies in the river, and many others. In addition, the Wood Buffalo Environmental Association, or WBEA, has been monitoring potential stream acidification for some time.

The Cumulative Environmental Effects Management Association, or CEEMA, which you'll hear more about this afternoon, has been developing several management frameworks on potential acidification of lakes, management of streams, reach-specific water quality objectives, pit lakes, and several other things.

Industry also has to carry out monitoring associated with its approvals, which can be quite extensive. Proponents that are undertaking the EIAs also have to undertake extensive baseline work associated with that assessment.

None of the agencies and programs I've just talked about have been able to detect any effects of oil sands operations on the lower Athabasca River. I have a number of testimonials, and they are just a subset of many more that exist. For example, the PERD study, as reported in the northern rivers ecosystem initiative report in 2003, indicated there was “no evidence to indicate that local industries are contributing significantly to measured hydrocarbon levels or biotic impacts”.

Alberta Environment, in their 2008 report entitled Alberta's Oil Sands: Opportunity. Balance., reported:

Stringent testing has consistently shown there has been no increase in concentrations of contaminants as oil sands development has progressed. In fact, contaminant levels in other rivers in the area with absolutely no industrial oil sands activity have been found to be higher than those adjacent to oil sands projects. The contaminant sources in the area are natural

RAMP, in their 2007 technical report, indicated:

Based on comparisons of water quality between upstream and downstream stations over time, no effects of local human activities were apparent on water quality in the Athabasca River in 2007.

Finally but not least, Evans, an Environment Canada researcher, and others stated in a published paper in 2002:

There is little or no evidence of temporal trends of increasing PAH concentrations in sediment cores collected in Lake Athabasca and the...delta lakes, suggesting no or minimum impact from oil sands operations.

The mitigation measures that are proposed and in place in existing oil sands operations--against which EIA practitioners gauge their effectiveness--include sedimentation ponds that trap particles associated with muskeg and overburdened drainage waters in advance of mining. These waters are released to receiving streams. There are closed-circuit operations of all process-affected waters and waters that may come into contact with exposed bitumen during mining operations.

Tailings are in back-filled cells, of which I have an accompanying diagram. You can see that the tailings are deposited in such a way that associated seepage is directed to reclamation features that are specifically engineered to remediate those waters. On the right side of the diagram you'll see a receiving stream. That is protected by the placement of low-permeability materials to prevent seepage from travelling in that way. Each site-specific circumstance is very unique; this is just a conceptual diagram.

The appropriate design of tailings ponds and tailings sand structures includes perimeter ditches to collect seepage and run-off from the structure. Many of the new tailings ponds that are being proposed include interception wells around the outside of these structures to collect water and put it in the closed-circuit system.

At reclamation of these structures, the hydrostatic head or water pressure is reduced from the top by removing that water and tailings, so the amount of seepage is very small and can be handled within the reclamation landscape. Sustainable reclamation landscapes are developed specifically to remediate seepage on the landscape through engineered wetlands, and then ultimately through pit lakes that have to meet regulatory standards before releasing to receiving streams.

After EIA practitioners confirm, using conservative modelling, that the proposed mitigation measures are adequate to protect local receiving streams, integrated modelling is conducted to ensure that all environmental pathways are considered cumulatively under several different conditions of flow and several timeframes, as well as under many conceivable development scenarios. These state-of-the-art models include integrated outputs from groundwater models, air quality models, and surface water models. The water quality models are then used to ensure that the predictions are robust and in compliance with regulatory benchmarks and thresholds.

Sometimes an iterative process has to take place when it's shown that important thresholds might not otherwise be achieved. Additional mitigation and refinement of modelling assumptions have to take place. That might form the basis of the application that is submitted to the regulators and stakeholders. These submitted EIAs are then reviewed in a transparent and open process that often includes independent expert reviews.

For example, the federal government, through DFO and Environment Canada, has funded international peer reviews of some of the water quality and quantity work. Industry has also funded international peer reviews. Stakeholders also contract independent expert reviews on a routine basis for their assessments.

Given this rather lengthy and comprehensive process, the EIAs in the region continue to predict that the effects on the lower Athabasca River will be negligible and will continue to be negligible into the future.

In the final analysis, regulatory authorities along with stakeholder experts have ample time to review these EIAs and integrated applications and ask clarifying questions of proponents, who respond through formal and informal processes. This clarification process often lasts a year or longer in the oil sands area.

Issues that may not be resolved through the process are carried on to joint federal-provincial hearings for resolution and discussion. At the end of the day, if the project has been ruled to be in the interest of the public, the joint panel makes recommendations that are put into conditions, approvals, and regional programs to validate that systems are operating effectively and ensure that actions taken into the future are protective.

Thank you.

I'd now like to introduce Fred Kuzmic, who represents RAMP.

[The Vice-Chair, Liberal, Francis Scarpaleggia]

Good morning, Mr. Kuzmic...[Technical difficulty--Editor]

[Fred Kuzmic, Regional Aquatics Monitoring Program]

I'd like to thank the committee for the opportunity to talk today a little bit about the regional aquatics monitoring program, RAMP. I'm past chair and technical chair of this group.

RAMP is really a joint monitoring environmental program that assesses the health of the rivers and lakes in the oil sands region. It's a science-based program that's funded by industry and has multi-stakeholder representation from a broad range of stakeholders in the region. The program was initiated in 1997 and has been ongoing ever since.

A number of industry members are involved in the program. Some of them aren't oil sands companies. A number of government agencies representing both the provincial and the federal governments, including Fisheries and Oceans Canada, Environment Canada, and Health Canada, are part of the RAMP technical group and helped design the program and the technical aspects of it.

Under Environmental Protection and Enhancement Act approvals, operators in the oil sands region are required to conduct aquatic effects monitoring. They can do that themselves, or they can do it through participation in RAMP, which most of them choose to do.

The intent of the RAMP program is really to monitor aquatic environments in the oil sands region and compare that information with the environmental impact assessment predictions. RAMP also has the task of collecting baseline information to characterize the natural range of variability in the area. Again we collect information to compare against EIA predictions to see if they are accurate. Finally, we collect some information to fulfill the particular EPEA approval requirements that operators have.

RAMP is a program that uses both stressor- and effects-based monitoring approaches and achieves a holistic understanding of the potential impacts on the aquatic environment. We try to recognize and incorporate traditional environmental knowledge from some of our first nation stakeholders into the program. We try to communicate with the communities, the regulators, and other interested parties to share information we have. In fact, we publish a technical report each year that summarizes the activities of the monitoring program.

One of the important aspects of RAMP that we're really proud of is the continuous improvement part of it. We really try to focus on reviewing the results and looking for ways to modify the program in reflection of changing science or additional monitoring mechanisms that become available to us.

RAMP is made up of five or six key components. There are some slides that follow, so I'll detail some of the aspects of those further on. But let's start with climate and hydrology.

The climate and hydrology component of RAMP is really there to monitor the changes in water level of selected lakes and the quantity of water flowing through rivers and lakes. That's accomplished through a series of snow course surveys, hydrometric stations on the Athabasca River, and hydrometric stations along a number of the tributaries, including the Muskeg River. There are, in fact, ten hydrometric stations on tributaries north of Fort McMurray, and three hydrometric stations on tributaries south of Fort McMurray. We've taken water levels at three lakes as well.

In terms of the fish populations component, these are biological indicators of ecosystem integrity, and they're a highly valued resource in the area. There's another slide that follows on that, and I'll get into the details of that a bit more.

In terms of benthic invertebrate communities, we look at the aspects in rivers, lakes, and in the Athabasca River delta, the Peace-Athabasca delta. These are biological indicators that contribute to fish habitat, so it's important for us to look at these as well.

The final component of our RAMP program is acid-sensitive lakes. Here, water quality is reviewed as an early indicator of potential effects of acid deposition. RAMP has identified 50 of the most highly susceptible acid-sensitive lakes. We monitor those on an annual basis, looking at trace metals, general water quality, phytoplankton, and zooplankton. The indications are that we have 50 acid-sensitive lakes in the monitoring program, as well as 11 or 12 tributaries that we deal with outside the Athabasca main stem.

There are a couple of regional initiatives that are under way where people can contribute to the RAMP program, and I note a few things that they've noticed.

The first one is the river response network. This provides emergency response to public reports of non-spill events such as fish kills, the presence of foam, or scum floating down the river. This is an effort we have in conjunction with Alberta's environment protection ministry. They have a 1-800 number where they report that information.

In terms of the fish tagging program, this is an opportunity where we encourage the public to report tagged fish. Part of the fish populations program is the capture, tagging, and release of fish. When these fish are caught by fishers downstream or somewhere else in the river, they can report that back with the numbers that are on the tags.

In fact, just in terms of some information, walleye tend to be very far-travelled. In some cases we've had tag recoveries about 715 kilometres from the initial tag sites—in Lesser Slave Lake in the middle of the province at one of the upstream edges of the Athabasca basin—and as far downstream as 403 kilometres along the Slave River. So these fish tend to be far-ranging.

The fish health program that we have promotes reporting of abnormal fish. So if a fisher catches something that looks strange or odd—if there are fish with lesions, growths, or physical abnormalities, such as curved spines or blindness or missing fins—they're encouraged to call the number that we have published and report the information to us so that we can take the fish and send it out for further analysis at the veterinary school.

If you take a look at the map, the RAMP study area is pretty big. It covers the entire regional municipality of Wood Buffalo. There are upstream monitoring sites from the oil sands operation, and downstream of Fort McMurray; and then there are some far downstream sites on the Athabasca River delta that look at the potential effects of development in the region.

The regional study area covers off the RMWB, as I said, but the focus study area looks at particular areas and watersheds where oil sands development is occurring, or is planned to occur in the future. So it's really keyed to those particular areas.

Take a quick look at some of the water quality information. As I mentioned before, water quality and sediment quality are two important components of our program. We look at all the regional tributaries of the rivers, and there are some lakes where the information is reviewed, and then out on the Athabasca and Peace River deltas as well.

The water and sediment quality reflect habitat quality, as well as potential exposure of fish and invertebrates. We have 45 sites that are sampled at a minimum annually, but there are some sites that are sampled monthly. There are 28 different sediment sites that we collect sediment samples from, and those are tied into the benthic invertebrate program as well.

We do toxicity testing. We analyze for polycyclic aromatic hydrocarbons. There are some potential fish-tainting compounds for which we analyze those particular materials as well, and there are some thermographs that we have to monitor for changes in water temperature.

The next few slides really just run through a couple of snapshots for the 10-year monitoring period between 1997 and 2007 on a few key components. The thing you'll notice is that each of them is below current guidelines—either CCME guidelines or other particular guidelines that apply—and there hasn't been a lot of change between the upstream and the downstream, or no change in most cases, between monitoring upstream and downstream of oil sands operations.

Maybe we could just flip through these slides. The first slide is of arsenic concentrations, the second of sulphate concentrations, and the next is of dissolved organic carbon concentrations. You can see that the purple represents the downstream sites and the green triangles represent the upstream sites.

The last slide on water quality that we have here is on PAH concentration, the polycyclic aromatic hydrocarbons. You can see there is a bit of fluctuation on some of those. The levels at upstream sites can be higher, depending on erosion that's occurring along the river, or seepage from some of the sites that Ian mentioned earlier. But the downstream sites tend to be fairly consistent over the period of record. So this is really showing no change across the region.

The benthic invertebrate samples are really biological indicators that reflect fish habitat and the quality of the sediment. There are 29 different locations on 23 river locations, three on the Athabasca River delta and three at the regional lakes. We measure both erosional and depositional habitat. There are 10 replicates collected at each of those sites, so there is some strong statistical power to the analysis that we do. And we collect the required physical measurements as well. None of the sediment samples are showing any changes in sediment quality. The benthic invertebrate community structure is similar and shows no change from previous data.

So one of the primary conclusions from the 2007 RAMP technical report—you can see the quote there—is that there have been no major effects on benthic invertebrate and sediment quality, as supported by the watershed and lake level analysis.

Talking about fish populations, the RAMP program each year does spring and fall inventories on the Athabasca and Clearwater rivers. In 2007 we collected just over 3,500 fish, and 2,500 of those were caught in the Athabasca River. A number of those fish will be tagged and released, but all of the fish are measured, weighed, and sexed so that we can come up with length and weight distributions and the age structure. There are 19 different species that we record in our inventories. These include walleye, northern pike, goldeye, and long nose sucker, to name a few. And we've seen no ecologically relevant level of change in any of the fish populations, which is really indicative of just natural variations.

We see that “sentinel (fish) species monitored in potentially influenced sites have not exhibited consistent differences in comparison to reference sites”.

This is a non-lethal monitoring program we've employed over the last few years to look at upstream-downstream young of the year, to analyze any changes that may be occurring to those populations and the growth expectations related to any development.

There are some other aspects of the fish population study. We do fish fences, as well as the electrofishing and the monitoring that goes on in conjunction with the sentinel species work.

We're the only agency right now that is collecting tissue samples and analyzing for mercury. That information is passed on to Alberta Health and Wellness, Environment Canada, and Health Canada for continuation of the fish consumption advisories.

With that, I would like to turn the floor over to Greg.

[The Vice-Chair, Liberal, Francis Scarpaleggia]

Thank you, Mr. Kuzmic.

Go ahead, Mr. Stringham.

[Greg Stringham, Vice-President, Markets and Fiscal Policy, Canadian Association of Petroleum Producers]

Thank you, Mr. Chair.

In the interest of time, I'll keep my comments relatively brief.

I want to talk about two main things. You've heard the regulatory story and what has been going on today, but I want to talk a little bit about the technology advances that are going on. We have a second panel that will come and talk about specific examples, but I thought it would be important for you to understand the research and development and the pilot projects that are going on in both the mining areas and what we call the in situ or the underground areas, to try to reduce the amount of water use, increase the amount of recycle, or in many cases, as you heard, shift from fresh water to saline water and other sources, even using solvents instead of that.

In the mining area, the chart outlines a couple of things that are going on. I know you had presenters from the University of Alberta yesterday. There is a centre there for oil sands innovation that is looking very intensely at water issues associated with that from a research and development perspective. In addition to that, as you've heard in regard to a number of other research activities that are going on, there's a very strong push right now to increase the recycle rates and reduce the amount of tailings. Some of those examples include such things as consolidated tailings—in other words, to get the water to separate out from the fine tailings much more quickly than it has in the past, in order to move it into a reclamation phase more quickly.

You'll hear in the next panel about CO₂ injection, where they will put CO₂ into the tailings to get it to thicken up, and about looking at things such as paste and dry tailings. In fact, there's an oil sands research tailing facility at the university that is looking at pushing the advancement of technology.

So while technology has already been demonstrated, as Stuart talked about, in projects that are in place to reduce the amount of water use, that technology thrust continues into the future to try to look at what would be possible and practical in the future.

The one that probably has the most work going on right now is the dry tailings technology. I think you probably heard about that, but really that is to get to what they call a trafficable--you can walk on it--type of reclamation much more quickly. Shell, Chevron, and Marathon have the $100-million pilot project at Muskeg River, the plant that you flew over on Monday.

As well, NRCan is directly involved, and you can see some of the pictures from the NRCan studies with Syncrude and Suncor that really have the pilots scaled towards these dry tailings. It has not been perfected yet. It's not completely there, but it is getting much, much closer, and the research continues to go on.

Today, that's about 20% of the resource in the mining area. The other 80% is in the in situ area. That's the future resource. Production today is about half and half: about half the oil comes from mining projects, and about half of it comes from in situ.

In the in situ projects, there are some very exciting technologies going forward that will reduce the total environmental impact, including in terms of water. The one that we've shown on the top is the in situ combustion. We have them presenting on the second panel, and they will talk about how they will use underground heat in order to avoid the use of water and still recover the bitumen coming forward. There's no steam that is required for that process at all, and it is up and running, as you'll hear from Petrobank in a few moments.

Other areas on the in situ side of things that are very promising advances, in addition to the shift to saline water, include using solvents, reducing the amount of water or steam that is required, and using things such as propane to be able to get that thick bitumen thin enough to be able to come up the well to the surface. This has really shown some good promise and is done in some pilot projects at this point in time. They're even looking at potentially using full solvent recovery, which would replace water completely, and being able to recover the bitumen that way as it moves forward. That has been done at the lab scale but hasn't yet moved out into the field.

So there are some technological advances that I think are really promising, that continue to push the technologies, as they have in the past. Technology has been a real key to unlocking this resource, but also is a key to the environmental protection.

I'll just quickly summarize. As you have already heard, the balance for us is really critical. We recognize that the water resources are very valuable and need to be managed appropriately, need to be balanced with economics and the environmental and social aspects of development.

To put it in context, in 2008, for example, the oil sands industry used a little more than a third of the amount of water used by the city of Toronto, and that produced about half the oil being produced in Canada. Even if we project into the future, as Don talked about, if we look at maybe 3.3 million barrels a day, and with the decline in conventional oil, about 80% of our oil in Canada would come from the oil sands. At that point in time, we also know that's going to be capped off at 2.5 percentage points of the annual flow of the Athabasca River, in addition to these new technologies on the in situ side of things. So we think we can achieve the balance and we know we need to continue to improve.

We talked about the regulation. The water use and the related impact such as quality are regulated by both federal and provincial authorities, and there's extensive monitoring in place that comes from the governments, as well as from government multi-stakeholder and industry associations that look at that quality on a regular basis and make that information and those reports available to the public.

I already mentioned the split between mineable and in situ, but I also want to come back and say that there has already been significant improvement in water use. We really are striving. There are economic as well as environmental reasons to reduce the amount of water and to increase the amount of water recycled. We can use the water over and over again after there is an initial draw-in. In many projects we're up to greater than 85%, and some of them are up to 95% recycled water. They draw on the water, but then they use it continuously throughout the life of the project.

Last, I want to emphasize the point on technology. Technology has already shown significant gains in helping us reduce the amount of water, finding technologies that don't need water, and pushing those technologies forward. It will still be a critical part of achieving environmental performance into the future.

I'll keep my comments short and turn the time back to you, Mr. Chairman.

Thank you.

[The Vice-Chair, Liberal, Francis Scarpaleggia]

Thank you, Mr. Stringham.

We will proceed to a seven-minute round of questioning, starting with Mr. Trudeau.

[Justin Trudeau, Liberal, Papineau, QC]

Thank you, Chair.

For the past few days we've been travelling and hearing from various groups and stakeholders. We've heard from industry, from native groups, and from scientists. We are not scientists, but we are trying to pull together the big picture. The fact that there has been such a wide variance of conclusions drawn by the different groups in terms of something as simple as whether the water downstream is being affected by the oil sands is something that I think we all are somewhat struggling with.

Mr. Kuzmic, you talk about the fact that RAMP detected no changes to downstream water quality in 2007, which comes, as far as I can tell, in direct contrast to the results from 2008 that Dr. Schindler has drawn on in terms of levels of aluminum, PAHs, and mercury concentrations.

How do you reconcile what RAMP has found, or not, and what Dr. Schindler has found, or not?

[Fred Kuzmic]

Thank you very much for the question.

I don't have the information from Dr. Schindler as to what his assumptions were in the information that he's provided. I know that RAMP is a scientifically credible monitoring program. We do have upstream and downstream samples. There is a 10- or 11-year monitoring record that is available for review. It's published in the RAMP annual technical report. That information is there and it's available.

[Justin Trudeau, Liberal, Papineau, QC]

The information is available; therefore, you're saying, all the science data that is drawn from industry, from RAMP, from all the different partners is published and available to analysts, researchers, and peer reviewers across the board? Every bit of data that is collected by industry is published?

[Fred Kuzmic]

A number of different monitoring programs are in place. The RAMP information is available to RAMP members and other selected individuals who sign the data-sharing agreement that RAMP has. That information has been provided to Dr. Timoney for review through the Mikisew Cree First Nation, as they are members. It's available to consultants or other interested parties who have an association with RAMP members.

[Justin Trudeau, Liberal, Papineau, QC]

Much has been made of the future of in situ mining with shifts to saline or non-drinkable water. This is all groundwater, obviously, not surface water.

What kinds of studies have been made into the extent of aquifers and groundwater in the region? What can you tell me about the replacement rate of those saline reservoirs?

[Don Thompson]

I'll let Mr. Lunn answer that.

[Stuart Lunn]

Thank you for the question, Mr. Trudeau.

I can speak in particular detail to the Cold Lake-Beaver River basin, where Imperial operates its in situ operation.

We use saline water in that operation. That's part of the Cold Lake-Beaver River water management plan, which has been published. The industry conducted a survey of the availability of saline water in the region over a fairly extensive geographical area and implemented an annual monitoring program to determine the sustainability of that water resource. The study showed that saline water is available in the region over a widespread area, although it can vary significantly in salinity, which can preclude its use as a source water supply; in fact, if it gets too fresh, it actually trips back into the freshwater category.

That water was found to be sustainable, and we'll continue to monitor those resources to ensure that it continues.

[Justin Trudeau, Liberal, Papineau, QC]

Sorry; is the water sustainable because the replacement rate of this groundwater is greater than the expected use of the groundwater?

[Stuart Lunn]

Typically when we talk about groundwater sustainability, we talk about it either being sustainable or being mined. Technically that means that if you're withdrawing at a rate where if you stop withdrawing water, the levels recover in time—typically taking about the same length of time you were pumping—it's considered sustainable. If you pump at a rate that exceeds that, it's mined. In other words, it's not being replenished.

[Justin Trudeau, Liberal, Papineau, QC]

And do you have studies for your basin demonstrating it is sustainable at the rate you're taking water out—

[Stuart Lunn]

To date, yes.

[Justin Trudeau, Liberal, Papineau, QC]

—and at the rate you expect? We're only at 50% of use in situ, and you guys said you were going up to 80%. Is it still going to be sustainable, and do you have studies to show that?

[Stuart Lunn]

That is a good question. One thing to recall about the in situ oil sands industry is that the resource is spread over quite a large geographical distance. We have operations up in the Peace River area, south of the Fort McMurray area, as well as in the Cold Lake-Beaver River basin. It's probably over a 500 kilometre distance.

In the Cold Lake-Beaver River basin, which is quite a mature in situ oil sands area, there are wells that are currently operating, as well as monitoring wells to track that sustainability. As industry expands into these areas, saline water is evaluated at each project for use within the project, and those sustainability questions are asked as part of the EIA process and expansion.

[Justin Trudeau, Liberal, Papineau, QC]

Looking at the scope of it, has there been a comprehensive study, or is there a comprehensive study in the works, of groundwater in all potential oil sands development areas?

Please give short answers, as I want to get to my next question

[Stuart Lunn]

Yes. In fact, Alberta Environment right now is pulling together the individual monitoring networks that each of the in situ operators have and are required to have. Some of those are quite extensive. Imperial, for example, has over 600 groundwater monitoring wells just for its own operation at Cold Lake. There are three different groundwater networks being pulled together currently: a regional groundwater monitoring network in the oil sands mining area, and one south of the Fort McMurray area—