Environment Committee on Oct. 30th, 2025

[Graeme Reed]

I would broadly say we've had long-standing mandates on positions related to carbon pricing. Rarely have they been in explicit support. By and large, they've been about reducing the disproportionate impacts on first nations as a result of the consumer carbon price in particular.

[Ellis Ross, Conservative, Skeena—Bulkley Valley, BC]

Thank you for that.

What about the Liberals keeping the industrial carbon tax? It has been argued those costs will actually be transferred to the consumer as well. Does the AFN have a position on the industrial carbon tax being kept by the Liberal government?

[Graeme Reed]

No, I would say our contributions were for the entirety of the federal backstop, which is to say that first nations need to be appropriately positioned as rights and title holders within the design, implementation and potential impacts of carbon pricing. We haven't yet gotten an updated mandate on the basis of what Prime Minister Carney is doing with industrial and consumer carbon pricing.

[Ellis Ross, Conservative, Skeena—Bulkley Valley, BC]

In reading some of the submissions, first nations are saying they're unfairly impacted because of the affordability of the carbon tax, especially in remote communities. Does the AFN support that position?

[Graeme Reed]

I would say that by and large, the bulk of our position is to ensure carbon pricing does not disproportionately impact first nations in any way. A lot of the contributions we've been trying to provide, including in submissions directly for the design of the Greenhouse Gas Pollution Pricing Act, have been to reduce the impacts that first nations are facing and to support the very specific concerns that first nations from across the country have been raising, such as first nations in Ontario.

[Ellis Ross, Conservative, Skeena—Bulkley Valley, BC]

Perfect. I won't cover the Ontario article, then.

The Major Projects Office wants to expedite and fast-track projects, specifically oil and gas pipelines, for instance. There is a concern that rights and title interests would be overridden by this new policy, with or without what Prime Minister Carney has been saying. The Ontario chiefs are basically experiencing this first-hand now. Their complaint is that negotiations for major projects were going fine until this announcement, and now they feel they're being ignored by proponents and being ignored by government.

Is that what the Assembly of First Nations is hearing currently?

[Graeme Reed]

In our national consultations on Bill C-5, we heard of the specific experiences of first nations in Ontario and B.C. because of provincial legislation that preceded Bill C-5. In Ontario, it's Bill 5. In B.C., it's Bill 14 and Bill 15, both of which are accelerating projects to the detriment of first nations' full and effective participation.

[Ellis Ross, Conservative, Skeena—Bulkley Valley, BC]

I've done environmental assessments and permitting for 20 years, and I could not figure out the substance of the national Building Canada Act. It's a very brief document. Bill C-5 itself was also very brief. We don't have the mechanics of how it is supposed to work to retain robust environmental standards and how it will address aboriginal rights and title. Has the government actually detailed this to you in either respect?

[Graeme Reed]

No, not yet. The only conversations we've had so far were with the Impact Assessment Agency and were about trying to adhere to the two-year timeline that was identified. It wasn't specifically identified in legislation, but in subsequent policy direction. I have not yet seen what the implications of it are.

[Ellis Ross, Conservative, Skeena—Bulkley Valley, BC]

To follow up on another question—you don't have to answer it here because of time—I understand the AFN doesn't support the carbon tax because of the affordability measures and the consultation measures. In that context, will the AFN support or oppose Canada's support of the International Maritime Organization imposing a carbon tax on shipping?

[Graeme Reed]

The very short response is that we would need to seek direction from the first nations in assembly to take that sort of position.

[The Chair, Liberal, Angelo Iacono]

Thank you, Mr. Ross. As you can see, I was generous. I've been generous with all the witnesses in letting them finish their sentences. On average, members have been getting an extra couple of seconds. I've noted that down. If ever I'm challenged, I can give you numbers. I like to be fair.

Next is Mr. Fanjoy.

The floor is yours for five minutes.

[Bruce Fanjoy, Liberal, Carleton, ON]

This is for the Assembly of First Nations.

One of the perspectives that first nations bring to this discussion is the concept of thinking seven generations into the future when we look at the actions we take today. Can you speak to that and how we contrast it with the short-term thinking that, unfortunately, affects much of our policy-making, particularly from Conservatives?

[Graeme Reed]

I'll start briefly.

The core of our national climate strategy is very much to identify the values and behaviours driving the system of short-term thinking and how we then move those values and behaviours into a system that has a relationship and reciprocity with the land.

In our submission, we talk about how we avoid thinking about net zero as an end point and rather as a process to a just, equitable and resilient future. That future for first nations is about the ability to continue to exercise their relationship with their lands, waters, air and territory to ensure they can fulfill their obligations and pass those obligations on to future generations.

The absence of taking up that longer-term thinking and being able to see longer term is going to continue to prevent first nations from exercising those abilities.

[Bruce Fanjoy, Liberal, Carleton, ON]

Mr. LaBobe, I understand you're from Prince Edward Island, a part of Canada that's dear to me. Hurricane Fiona damaged small craft harbours up and down the east coast. Repairing and rebuilding are ongoing. Is there any way to ensure that our infrastructure improvements are more climate-resilient?

[Wendell LaBobe]

Fiona did do significant damage on Prince Edward Island and throughout Atlantic Canada.... We lost a lot of our sand dunes to erosion, and we're still feeling the effects of it all right now. As I said, we need to work together to ensure that we come up with a good strategy to fight future Fionas—hurricanes like that.

By including first nations and by working with the government, I believe we can come up with a good plan to fight this in the future and come up with a good strategy to combat it. With today's technology and the advancement of everything going on, we have a world of opportunity to come up with a good plan to combat this.

[Bruce Fanjoy, Liberal, Carleton, ON]

Thank you.

Ms. Potvin, as you know, offshore wind and building out a clean east-west grid are central priorities of our government.

Can you describe in more detail the role that ports can play—perhaps, Ms. Nugent, you can pipe in on this as well—as connectors to a broader energy system and commercial transportation routes?

Perhaps I'll get you to address that first.

[Catherine Potvin]

It's well known that for freight transport, rail and aquatic transport are more efficient in terms of emissions. Ports play an important role in that, but it's important to also understand that there are other concerns.

For example, Ms. Nugent mentioned Contrecoeur. There are some other impacts there on biodiversity that I think need to be taken into account.

I'm not an expert on maritime transport. I think she's much better positioned than me to answer.

[Bruce Fanjoy, Liberal, Carleton, ON]

Go ahead, Ms. Nugent.

[Amy Nugent]

We would agree with Catherine on the role that ports can play to connect other modes of transportation.

I think it was Madame Potvin who talked about the transport sector having a quarter of the overall emissions across the Canadian economy. For example, when you see on the projects of national interest list not just Contrecoeur but also wind west, you can take up large energy developments—albeit in the context of other sustainability; I fully agree—and ensure that there's local offtake for them.

We often talk about, if we're going to double or triple the grid and the capacity—

[The Chair, Liberal, Angelo Iacono]

Thank you.

I've been generous, but this puts an end to our witnesses testimony today.

I'd like to thank all the witnesses for being present today and for allowing the study to continue. Thank you also to members.

The witnesses are now excused. The meeting will be suspended while we prepare witnesses for the next panel.

[The Chair, Liberal, Angelo Iacono]

Let us resume.

The committee is continuing its study of the effectiveness, potential improvements and capability of Canada's 2030 emissions reduction plan.

This afternoon, we are meeting with the following witnesses: Sophia Mathur, as an individual.

From the Oil and Gas Corporation of Newfoundland and Labrador, we have Mr. Jim Keating, chief executive officer, by video conference.

From the Resource Works Society, we have Margareta Dovgal, managing director.

Each of the witnesses will have five minutes for their opening remarks.

I will be putting up this sign indicating that you have one minute left in your remarks. I will turn it over when your time is up. This will also occur during the question period.

We will start with Ms. Sophia Mathur.

[Sophia Mathur, As an Individual]

Thank you so much for having me as a witness.

Thank you, Bruce Fanjoy, for inviting me.

Hello. My name is Sophia Mathur. I am 18 years old, a climate activist and a first-year university student at the University of Ottawa. Funnily enough, I have a math mid-term right after this.

When I was seven years old, I started lobbying for climate action, not in the way that adults around me did with thick briefing binders and a long list of evidence—that was their role—but in a way a child can, by sitting and listening. By showing up and by being present, it felt as though I was reminding everyone in the room that the decisions being made were shaping my future, because they were.

When you're seven, climate action isn't just policy; it's a promise, a promise that the world I grow up in will be safe, beautiful and alive. I've carried that belief with me ever since. While the devastation of climate change is real and frightening, with fires, floods and smoke-filled summers, I don't want my generation's story to be one of despair. I want it to be one of accountability and courage.

Over the years, I've met politicians and experts who have dedicated their lives to this fight. I've always admired that. It takes resilience to turn research into policy and policy into measurable change.

Now that I've started university and I'm beginning to study economics with a minor in public policy, I'm continuing to understand just how complex this world is, and I am nowhere near an expert. Efficiency, cost and timelines aren't just numbers; they represent people's lives, yet through my climate activism, I've also learned that this complexity can't be an excuse for inaction, because while climate policy takes time, climate change does not wait.

I ask myself, how long will climate policy be too hard to advertise in political campaigns? How long will this global crisis be rewritten as partisan? Do voters know that the cost of this discussion is the deadly impacts of climate change?

I brought with me today a book given to me by Citizens' Climate Lobby that summarizes the evidence from climate change experts on Canadian emissions strategies. The message from scientists and economists is consistent: Make polluters pay.

Fossil fuel companies, many of which make billions in profit each year, must bear responsibility for the pollution they create. One of the key findings is clear: Carbon capture and storage is costly, is largely inefficient as an emissions reductions tool and will continue to keep money in the pockets of these polluters.

Today, I want to offer not a critique but a reminder that young people like me, the people you represent, are watching, learning and hoping. We trust that our leaders will listen to the evidence, respect the experts and keep their promises, because for me, this isn't just about emissions targets; it's about integrity. It's about what it means to make a promise to the next generation and to keep it.

I may only be 18, and I have much to learn, but I know one thing for certain. Real leadership isn't measured by how many promises are made. It's measured by how many are kept.

Thank you.

[The Chair, Liberal, Angelo Iacono]

Thank you very much, Ms. Mathur.

Now the floor is yours for five minutes, Mr. Keating.

[Jim Keating, Chief Executive Officer, Oil and Gas Corporation of Newfoundland and Labrador]

Offshore oil and gas indeed should be central to Canada's energy future, as we cannot be an energy superpower without it. With over 85% of new discoveries by volume occurring in offshore fields worldwide, declining onshore output is being steadily replaced by global offshore growth.

Newfoundland and Labrador is indeed a global offshore player: 100% of Canada's offshore oil production is sold internationally, which means 90% of a barrel's emissions occur outside of Canada. The province reinvests oil and gas profits into renewable energy, and it does so directly. Over $1.1 billion from Crown corporation ownership in offshore oil and gas projects has been directly invested in our provincial hydro power portfolio. It is indeed the most elegant of energy transition strategies.

To enable this, we created an exploration strategy, investing over $160 million in geoscience and identifying hundreds of prospects, 20 of which have the potential for over a billion barrels of oil or six trillion cubic feet of natural gas each. What's at stake here is not only our known reserves of 10 billion barrels currently in production, but also an estimated 50 billion barrels of oil. For context, Hibernia's two-billion-barrel oil field has already contributed $15 billion to the provincial treasury and another $4 billion to the federal government.

Exploration wells cost about $100 million to drill and have only a 25% chance of success. Despite the costs and the risk of failure, between 2015 and 2020, over 14 companies bid $4.2 billion to explore in Canada's offshore. Seven submitted plans to drill dozens of wells. This momentum has come to a crashing halt. First it was due to the pandemic, and now it's due to the proposed emissions cap. Canada is undermining a strategic resource, leaving international investors confused and concerned.

There were no exploration wells drilled offshore for the first time in nearly 25 years, and there are no wells planned for next year. The last two licence rounds saw no bids, which is unprecedented. With a licence round closing just next week, I fear the same result.

Of the 14 exploration companies we had in 2020, only three remain. Those exiting have forfeited over $430 million in bid securities to the offshore regulator, and that figure is growing. Companies simply believe they will be unable to develop a discovered resource.

This is not the local effect of a global trend. Global exploration is trending upwards. This year, 80 high-impact wells were drilled, an 8% increase from the previous year, and 15 discoveries were made across 12 countries.

Spending is rising and expected to grow again in 2026. Newfoundland and Labrador and Canada are missing out. The proposed emissions cap regulations are often cited by investors as the reason they've decided to explore elsewhere. The economic damage is already happening.

With our provincial trade association, Energy NL, we engaged Wood Mackenzie consultants to assess the impact of the proposed emissions regulations. Their modelling shows that to meet post-exemption targets, operators may need to defer start-ups or scale down projects, weakening project economic viability. What's most concerning is that the modelling suggests the emissions cap could force curtailment of existing offshore production. Forecasts show emissions exceeding the cap by 12% in 2030 and remaining above limits through 2035, leaving absolutely no room for new developments.

Should our Bay du Nord project eventually start up after a three-year delay, it is expected to emit less than 10 kilograms of CO2 per barrel, which is half the global average. When the oil-climate index was first established in 2016, our Hibernia field ranked 12th lowest among 75 global oil and gas fields in terms of emissions. Why would we eliminate the possibility of low-emission projects that can displace higher-emitting projects elsewhere?

Our offshore projects have already implemented emissions reduction measures. The SeaRose FPSO and the Hibernia and Hebron platforms have already reduced emissions by almost 29% to 50%. The Terra Nova FPSO has undergone asset life extension upgrades that will lead to further reductions.

While the federal government aims to balance fiscal support with strong regulation, we urge abandoning the emissions cap framework. Instead, focus on practical policies and fiscal tools that enable the meaningful decarbonization of Canada's oil and gas sector.

Thank you.