Evidence of meeting #12 for Finance in the 43rd Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was federal.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Clerk of the Committee  Ms. Evelyn Lukyniuk
Mark Scholz  President and Chief Executive Officer, Canadian Association of Oilwell Drilling Contractors
Rebecca Alty  Mayor, City of Yellowknife
Daniel Breton  President and Chief Executive Officer, Electric Mobility Canada
Tristan Goodman  President, Explorers and Producers Association of Canada
Manuel Arango  Director, Policy and Advocacy, Heart and Stroke Foundation of Canada
Steven Nitah  Senior Advisor, Indigenous Leadership Initiative
Christopher Sheppard  President, National Association of Friendship Centres
Kaylie Tiessen  National Representative, Research Department, Unifor
Jocelyn Formsma  Executive Director, National Association of Friendship Centres

5:20 p.m.

Liberal

The Chair Liberal Wayne Easter

Peter, this is your last question.

5:20 p.m.

NDP

Peter Julian NDP New Westminster—Burnaby, BC

I would like to ask Mr. Breton a question.

Mr. Breton, I'm pleased to see you again.

Some countries have made a successful transition to electric vehicles. I am thinking of Norway in particular, where more than half of new cars purchased are electric.

What could Canada learn from other countries that have successfully transitioned?

5:25 p.m.

President and Chief Executive Officer, Electric Mobility Canada

Daniel Breton

Thank you for the question, Mr. Julian. I am also very pleased to see you again.

The world's leaders are countries that have ensured that the right parameters are in place to promote the development of electric vehicles. They have encouraged people to purchase electric vehicles in a variety of ways, such as offering rebates and deploying infrastructure for the vehicles, like charging stations, throughout the country.

They also have ways to discourage the acquisition of polluting vehicles, by using a bonus-malus mechanism, for instance. Norway is extremely strict in that respect. It imposes taxes of up to 150% of the purchase price on buyers of polluting vehicles. We will probably never get that far in North America, but we can certainly learn from zero emissions legislation passed elsewhere in the world, such as in California. The state government there enacted a zero emissions law 30 years ago, and California has become the North American leader in acquiring electric vehicles.

Regulation is important, but public awareness is also essential. We need to explain to people how electric vehicles work, because there is a lot of misinformation and a lot of preconceptions about them.

I live in the country, on an island, and I can tell you I have no problem getting to Toronto, Ottawa, the Gaspé or New York in an electric vehicle. It is doable today, and the technology is evolving extremely fast.

5:25 p.m.

Liberal

The Chair Liberal Wayne Easter

Thank you all.

Following Mr. Falk and Mr. Poilievre will be Ms. Dzerowicz and Mr. Fragiskatos on a split.

Mr. Falk.

5:25 p.m.

Conservative

Ted Falk Conservative Provencher, MB

Thank you, Mr. Easter.

I want to thank all of the panellists for their presentations here at committee today. It's been very interesting and it's always a joy to learn something new.

Mr. Goodman, you talked in your presentation about abandoned and orphaned wells, and you also mentioned them in your brief. Your brief references the $1.72 billion that the industry received from the government to address some of those wells, but it says there's still a $70 billion gap to address the need to reclaim or close those wells.

Who is responsible for doing that?

5:25 p.m.

President, Explorers and Producers Association of Canada

Tristan Goodman

Thank you very much.

The industry is responsible for doing that, and we take ownership over that. We appreciate the federal government's program to get Canadian workers back to work. I think there were some good decisions on the part of the federal government to move forward on that.

Thank you.

5:25 p.m.

Conservative

Ted Falk Conservative Provencher, MB

Regarding the gap between the almost $2 billion that you have and the $70 billion that's estimated to still be required, do you have any ideas of where that's going to come from, or how we could address that? I see, as you mentioned in your last answer, that this is a job creation thing in addition to being environmentally responsible and being good stewards.

5:25 p.m.

President, Explorers and Producers Association of Canada

Tristan Goodman

First, the numbers are actually quite difficult to work out. Whether it's $70 billion or less, it really doesn't matter. I'm not going to specify what the number is because it actually depends on how you look at it. I can say the industry has put extra effort to this. I think it has recognized that investors are actually expecting it to do that. Canadians are expecting it to do that and there's a broad commitment to do that.

I can say also that the provincial governments... the way they've moved in British Columbia, Saskatchewan and Alberta recently is to put in place new policies and new procedures, whether those be timelines or percentage of spending targets. Those are appropriate policies, particularly right now when prices are difficult. As prices recover, there should be more money and more effort put towards that. That is a commitment by the industry.

5:25 p.m.

Conservative

Ted Falk Conservative Provencher, MB

Does the industry actually have a pool of funds? Is it something that somebody administers for them? Does the association look after it, or do individual companies and well owners need to make that provision?

5:25 p.m.

President, Explorers and Producers Association of Canada

Tristan Goodman

It's a bit of both. How it generally works is that there are two forms to any of these programs. Policies take different forms, but they are relatively simple. It's basically like your household income: What are your assets coming in and what are your liabilities associated with that? That's called an asset-to-liability ratio. Then the industry backstops with its money, in the hundreds of millions of dollars, any company that is financially distressed and not able to deal with its liabilities. It goes into what is called an “orphan fund”, and the industry then pays for that. They are all administered slightly differently, but they all have the same basic process. I should mention that, as a former energy regulator, I have quite a lot of expertise on the implementation of these programs.

5:30 p.m.

Liberal

The Chair Liberal Wayne Easter

Thanks to both of you.

We'll switch over to Mr. Poilievre, or we may be back to you, Mr. Falk.

Pierre.

5:30 p.m.

Conservative

Pierre Poilievre Conservative Carleton, ON

Thank you very much.

I have here the global demand for oil for 2019. This is obviously pre-COVID, but it was 100 million barrels per day, which represents an increase from the preceding five years and contradicts common misconception that oil is now a thing of the past. In fact, the International Energy Agency anticipates continued demand of at least 60 million barrels per day for decades to come. Again, oil will be produced. The question is, by whom? In North America, while our industry has been decimated in Canada for the last five years, production has doubled south of the border. We're seeing more money and more jobs go to less environmentally friendly sectors south of the border while we decimate ourselves. Would either of the oil and gas witnesses be willing to comment on what we're doing to our own national economic interests by driving oil and gas production out of our country to less environmentally friendly jurisdictions?

5:30 p.m.

Liberal

The Chair Liberal Wayne Easter

We'll take the time to go to both—

5:30 p.m.

President, Explorers and Producers Association of Canada

Tristan Goodman

I can certainly comment on that, but if it is okay, Mr. Chair, perhaps I'll ask Mr. Scholz if he would like to go first.

5:30 p.m.

Liberal

The Chair Liberal Wayne Easter

Yes, Mr. Scholz will go first and then Mr. Goodman.

Mr. Scholz, be fairly quick if you could.

5:30 p.m.

President and Chief Executive Officer, Canadian Association of Oilwell Drilling Contractors

Mark Scholz

I would agree. At the end of the day, it doesn't really matter what forecast you're looking at, although some are quite different from each other, depending on different stated policies. The reality is that the world is going to consume more energy. As Canadians, I know that we're committed to looking at climate change very seriously. However, the reality is that if we harm the industry, i.e., the oil and gas industry and the service sector that is embedded in that industry, we will not be able to develop into hydrogen or geothermal, have a robust petrochemical industry and also deal with our growing energy demands as a country. We have to be very pragmatic about our approach and ensure that our existing oil and gas industries are sustainable in the long term, not only to supply Canadians with these products but also internationally. We can either get it from Canada or we can get it from the Saudis or the Iranians. I think most Canadians would choose a Canadian product.

5:30 p.m.

Liberal

The Chair Liberal Wayne Easter

Mr. Goodman, you have 30 seconds.

5:30 p.m.

President, Explorers and Producers Association of Canada

Tristan Goodman

Absolutely, Mr. Chair. Thank you.

Mr. Poilievre, thank you for the question, and it's nice to see you again.

The International Energy Agency that you referenced is the gold standard. It predicts that we will see an increase in all energy use, including renewables, by the way, a sector that a number of previous oil and gas companies are starting to enter. I think there's great opportunity in the future for Canadians across the whole energy space. It's not one versus the other. I do think, though, we have to ensure that foreign capital is coming into Canada so that we can invest in all types of energy sources.

Thank you.

5:30 p.m.

Liberal

The Chair Liberal Wayne Easter

Thank you.

Next are Ms. Dzerowicz and Mr. Fragiskatos.

Ms. Dzerowicz, you're up first.

December 10th, 2020 / 5:30 p.m.

Liberal

Julie Dzerowicz Liberal Davenport, ON

Thank you so much, Mr. Chair.

I want to genuinely thank everyone for your excellent and important presentations.

I only have 2.5 minutes and so I can only ask one of you questions. Unfortunately, because Mr. Julian asked the same questions I was going to ask on electric vehicles of Mr. Breton, I'm going to turn my attention to Mr. Scholz.

Mr. Scholz, in the six minutes that Mr. Kelly asked you questions and basically only blamed Liberal policy over the last six years for what's happening in the oil sector, I did a quick search just to show that a lot of foreign investment is fleeing the oil sands in Canada because it is high cost and high carbon. Not only is it a high-cost jurisdiction, but it's producing lower-quality oil. There are regulatory challenges. There are interprovincial issues. There's a lack of pipeline capacity. There's also a lack of investment of capital by the companies that are actually here.

Irrespective of all of that, I thought that you made some very interesting and important points. There is a transition that's happening: We are moving to a low-carbon economy. We do want to make sure there is a transition to renewable energy, clean technology and clean energy. One of the things you asked was what the rules of engagement are moving forward. I felt that was a fair ask, so I wouldn't mind if you could elaborate on what exactly you feel is unclear in terms of the rules of engagement moving forward.

5:35 p.m.

President and Chief Executive Officer, Canadian Association of Oilwell Drilling Contractors

Mark Scholz

I think there are a lot of unknowns right now. I would just give you the example of Bill C-69. When you talk about the pipeline infrastructure that's desperately needed in Canada and will continue to be needed here, I just have to recall what Chris Bloomer, the president and CEO of the Canadian Energy Pipeline Association, said. He and his association say that don't really see a proponent that would be willing to go through the process under Bill C-69 to actually see another pipeline get built here in Canada. I'm not a pipeline expert; I'm looking at other sources that would indicate to me that Bill C-69 in many ways is broken from an industry perspective.

I think the industry worked really hard trying to provide some amendments that would make the bill it workable. We weren't successful in that. I do think that Bill C-69 is still problematic. There are still a lot of unknowns with the clean fuel standards and how they ultimately are going to be implemented.

I think that at the end of the day, when I say that we want some certainty as to what the goalposts look like, it really means, what is the regulatory framework that we're going to be operating in? I think we need industry and government to really work hand-in-hand to ensure that when we have these emission objectives, we're not going to throw the baby out with the bath water, but are actually going to work with these industries that are ultimately going to help us achieve some of those long-term, aspirational goals.

5:35 p.m.

Liberal

The Chair Liberal Wayne Easter

Thank you, both.

Mr. Fragiskatos.

5:35 p.m.

Liberal

Peter Fragiskatos Liberal London North Centre, ON

Thank you, Chair.

Mu question will go to Mayor Alty.

Mayor, I'm in Canada's south, all the way down in London, Ontario, but I think all of us can learn a great deal from the Canadian north. Thank you for your work as mayor.

You spoke eloquently in your testimony about the importance of healing centres, not just from a cultural perspective for indigenous people, but also from a healing perspective itself.

I have an organization in London that has been quite anxious to have a healing centre built in the community here with federal assistance. I'm wondering if you can elaborate on the importance of healing centres. You talked about it from your perspective as mayor, but I think there are general lessons to take from this.

5:35 p.m.

Mayor, City of Yellowknife

Rebecca Alty

One of the things that I hear from residents who attended is that it's structured so that you call to make a counselling appointment, and you go to your appointment and it's for an hour, regardless of what stage you are at. You've just disclosed this terrible trauma you've experienced, and it's like, “The hour is up. See ya.” Out the door you go, but “Let's book another appointment”.

In contrast, the Arctic Indigenous Wellness Foundation is there and helps you through that journey of trauma. It's not that rigid structure that boots you out the door once your time is up. It's been incredibly beneficial. For example, there was a resident who had been drinking on the streets for many years and he went there just to enjoy tea and something to eat. There was no pressure to talk. The attitude is that “When you're ready, you can open up, and we'll be there for you”. He never left. He stayed and he was the security for the camp, and that was his thing that helped him get sober. Then he was able to go to treatments and come back and continue to work there.

The other beneficial thing is that it really enables the sharing of the traditional knowledge between the elders and the new generation so that it can be continued for years to come. There are so many great success stories. It's just a grassroots organization that currently has no core funding. It is struggling to continue to operate year after year.

5:35 p.m.

Liberal

The Chair Liberal Wayne Easter

We will have to end it at that.

I have just a couple of points of clarification for Mr. Scholz.

You said that natural gas will continue to grow and that we have the world's lowest carbon profile. Is that data in your original brief, Mr. Scholz? If not, could you send it to us?

My second question is on the geothermal wells, which you mentioned. I'm quite familiar with the geothermal wells in Iceland. Are we talking much the same thing in Canada? What are we talking about?