Foreign Affairs Committee on Nov. 14th, 2022

[Hedy Fry, Liberal, Vancouver Centre, BC]

I did ask him to tell me why we would dismiss those other ways of producing hydrogen.

[Timothy Egan]

I didn't dismiss them. In fact, my industry is advocating them and is doing a lot of work on all of them.

I would point out that the development of rare earth minerals is a very costly experience and requires a great deal of energy input. If the energy input is too expensive, you won't develop those rare earth minerals, and that means you won't ever develop the kinds of electric technologies and other technologies that the member's referring to.

We all want to develop those things. Affordability is fundamental to all of this.

[The Chair, Liberal, Ali Ehsassi]

Thank you, Mr. Egan.

We now go to Mr. Bergeron. You have a minute and a half, Mr. Bergeron.

[Stéphane Bergeron, Bloc, Montarville, QC]

Thank you, Mr. Chair.

Mr. Egan, this past August you gave an interview to The Hill Times in which you stated that the world will consume much more natural gas in the coming decades, regardless of emissions limits or targets.

Are you telling us that the targets set by Canada and others are just meaningless numbers?

[Timothy Egan]

What I'm saying is that countries around the world are starved for energy, and the energy they want is natural gas, and they're developing that resource or finding others who are developing that resource and buying it from them, so while Canada can indeed pursue the targets it has and pursue them in a host of ways—and again, my member companies are very active in pursuing those targets in co-operation with government—globally the reality is that the first priority for millions and millions is getting access to affordable energy, and more natural gas is going to need to be produced and used in the world in order to achieve that end.

[Stéphane Bergeron, Bloc, Montarville, QC]

It's far from affordable energy these days.

Thank you, Mr. Egan.

[The Chair, Liberal, Ali Ehsassi]

Thank you very much, Mr. Bergeron.

We now go to Ms. McPherson. You have a minute and a half.

[Heather McPherson, NDP, Edmonton Strathcona, AB]

A minute and a half....

Thank you again for your testimony.

When I last asked you some questions, you gave the impression that there are a lot of indigenous groups that are supportive of natural gas projects and that there are many provinces, including my own of Alberta, that are very supportive of a natural gas pipeline, so what's the problem?

Realistically, you're talking about the idea that we have. We are a massive country with many provinces, many indigenous peoples that have many opinions, so the reality is is that we have to adhere to UNDRIP. We should want to. We have to adhere to provincial jurisdiction. We should want to. There is complexity in building massive infrastructure projects in this country; we can say that this shouldn't be the case, but it is the case. I know that quite well. I come from an oil family. I understand this.

However, realistically, the facts remain. This is the reality that we have. This is the reality of our situation at the moment: The potential for us to be able to get natural gas to Germany to help with Germany's immediate problems right now is quite limited. It's quite limited for us to help in 2023 and it's quite limited for us to help in 2024, 2025, 2026, and they're hopeful to not need it very much after that. Is that not accurate?

I know that you're talking about the global situation, but we're talking about Germany here. This study was about the impacts of the weaponization of energy.

That's my statement.

[The Chair, Liberal, Ali Ehsassi]

Ms. McPherson, you're well over your time.

Thank you, Mr. Egan.

Now we go to Mr. Epp. You have three minutes, sir.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Thank you, Mr. Chair.

My riding is the home of the second-largest cluster of greenhouses in the world after the Netherlands, and it consumes a lot of natural gas today. When gas prices spiked to $14 a gigajoule over 15 years ago, we went back to bunker C, back to coal, etc. Fortunately, now it's come back to natural gas, the cleanest-burning alternative that's available to that sector.

Can you talk about natural gas's position structurally from a price perspective, looking at long-term investments in infrastructure relative to what could be coming down the road, such as hydrogen or things like that?

[Timothy Egan]

We don't forecast gas prices. It's a quick pathway to abject failure to try to forecast energy prices.

What I will say is that the supply picture is an extraordinary one in Canada and in North America. We often talk about Canada and the United States. We should also note that Mexico sits on enormous gas resources, and as Mexico begins to look at the development of its resources in a more robust way, that also offers enormous environmental and social benefits.

To the specifics of your question and what's going to affect the price going forward, obviously there are certain things over which we have no control that can have a dramatic impact on gas markets, such as Russia's invasion of Ukraine. Things that we can control include sending a signal to investors that it's worth investing more in supply in Canada.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Thank you.

Mr. Chair, I'm going to cede the remainder of my time to Mr. Genuis.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Thank you, Mr. Chair.

Thank you, Mr. Egan, for your excellent testimony today and for your work. I very much appreciate what you've had to share with us. It underlines the importance of the work we need to do on energy security.

We're now at the conclusion of our study on Gazprom turbines, and in that light, I would like to move a motion that Conservatives have put on notice. The motion is this:

That the committee report to the House that it calls on the Government of Canada to immediately revoke the waiver to Russian sanctions granted for the export of Gazprom turbines.

I'll make a few remarks on that motion and then I look forward to hearing the comments of other members. Again, I want to thank our witness today.

We began this study on the government's decision to grant a waiver to Gazprom in the summer. We did so under the rubric of an emergency meeting. There was strong support to proceed with that study. We heard very clearly strong arguments against the government's decision to waive sanctions on Russia in this particular case.

Concerns were raised, of course, about how waiving sanctions provides an economic benefit to Russia—

[Heather McPherson, NDP, Edmonton Strathcona, AB]

Mr. Chair, I have a point of order.

Would it be possible for us to excuse Mr. Egan? I think our time with him is done, and we should probably allow him to leave if he would like.

[The Chair, Liberal, Ali Ehsassi]

We did have another member who had a time slot, but regrettably, it does not seem like he will get the opportunity. You have our apologies, Mr. Sarai.

Mr. Egan, allow me to thank you on behalf of the entire committee. We're very grateful for your time. You can leave if you so wish.

[Timothy Egan]

I'm happy to talk to any of the members afterwards and take questions privately, should that be a request. Thank you for the opportunity to appear today.

[The Chair, Liberal, Ali Ehsassi]

Thank you, Mr. Egan.

Go ahead, Mr. Genuis.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Thank you, Mr. Chair.

Of course, one reason to oppose the waiver was a concern about the economic benefit that comes to Russia any time you waive sanctions. We also heard clearly about the message it sends when countries talk a big game about sanctions, but then find exceptions here and exceptions there. The accumulation of exceptions leads to what one witness had described as kind of a sanctions Swiss cheese, where there are all sorts of holes and your sanctions regime is no longer effective.

These were some of the powerful arguments made. We had the opportunity, of course, to hear directly from the Ukrainian ambassador as part of that discussion.

We heard three distinct arguments from the government as to why they granted the sanctions waiver. First of all, they talked about how this was going to supposedly help get energy resources to Germany. That's obviously a moot point now in that the one turbine that was sent back to Europe was never used and now the pipeline has been out of commission. We're not seeing these turbines play any role in supplying energy to Germany.

The government then said that allowing the sanctions waiver, which was in effect giving Putin exactly what he wanted, was somehow a way of calling Putin's bluff. We didn't particularly buy that argument at the time, and at this point it's obviously past the moment of that argument because we've sent one turbine back and it hasn't been used. Any bluff that was or wasn't going to be called has been called and there's no reason to repair and send back five additional turbines.

Another argument that was used by the government was the alleged impact on jobs here in Canada, but we heard very clearly from Siemens representatives that no jobs in Canada would be negatively affected.

We've seen, either through witness testimony or through other global events, the dismantling of these arguments in favour of granting the sanctions waiver.

The point remains that if we're going to stand strong behind Ukraine, we should not be granting exemptions to our sanctions. We should not be repairing turbines for Gazprom. I think that's the clear conclusion for me from this study. Based on comments that have been made by others, I'm fairly confident this reflects the majority view on this committee.

I hope we'll be able, therefore, to send a strong message in support of our friends and allies in Ukraine by opposing the sanctions waiver and we call on the government to revoke it. Hopefully, we'll see the adoption of this motion, which indeed sends that message.

Thank you.

[The Chair, Liberal, Ali Ehsassi]

Thank you, Mr. Genuis.

We now go to Mr. Oliphant.

[Rob Oliphant, Liberal, Don Valley West, ON]

Thank you, Mr. Chair.

I've had a little bit of time to think about the motion—not a lot of time—and I'm opposed to it for two reasons.

The first is on principle, and the second is on the actual substance of the motion.

There may be a variety of disagreement with respect to the substance, but I want to talk about the principle first.

We are in the midst of a study on the war in Ukraine by Russia, including the aspect of the Gazprom turbines. We are in the midst of that study, and I do not think it is ever good for a committee to jump to conclusions before we finish the study. That is just good process. That is the way we work best as a parliamentary committee.

We have a study. We will have a report, and there can be recommendations in that report with respect to the waiver. I'm very willing to entertain it at that time, but I think that there's a certain amount of grandstanding that is going on with a motion like this that I don't think is necessarily helpful in a parliamentary system. Nor do I think it is wise for us to set that kind of a precedent for jumping to conclusions before we have finished our study.

In that regard, we have just spent an hour without any substance related to the topic at hand, which is the Gazprom turbines. We heard committee testimony that should have gone to our natural resources committee; that's where it belongs. It was an inappropriate waste of time of the foreign affairs and international development committee to spend time talking about a very important issue, but it's not our issue, sir. It is not our issue to deal with. It is the natural resources committee's responsibility as part of the energy infrastructure of this country to deal with it. It had nothing to do with a turbine, a pipeline or two pipelines in supplying Russia with energy. It was, again, a political manoeuvre by one of the opposition parties to attract attention to an issue that really deserves time, as I will admit, but not at this committee. This committee is meant to be dealing with our international relations and our international development portfolios that we are responsible for and charged with as part of the standing orders that we deal with.

We had an hour. I did not raise the question of relevance of the questioning because the witness was absolutely clear and absolutely forthright in his testimony. It had nothing to do with Russia and it had nothing to do with Germany and nothing to do with the Gazprom turbines particularly, but it had to do with a failure of one of the opposition parties to understand the nature of climate change, the nature of the change in the economy and the nature of energy.

No questions were raised about the fact that we have nuclear energy in this country, which far outweighs the importance. I would suggest to some European countries that they should deal with that. That's not, again, this committee's responsibility. Those are domestic issues in Germany, and their ability to have energy security is their absolute responsibility. They will seek other forms of energy. Particularly, we know that the Prime Minister and the Chancellor had great discussions with respect to green hydrogen, and I think that is an important discussion.

On the process, I simply disagree. Let's wait until we get our report. Let's get an understanding of the whole complex nature of the situation. Let's get a whole understanding of what is going on, and then we can, indeed, look at whether or not we want a recommendation with respect to one particular waiver. It's also facile to attempt to say that somehow the Government of Canada is not supportive of Ukraine with this one waiver.

Canada is ranked in the top five countries. Some of us were able to meet with the Polish Speaker a few months ago, who looked at the five or six countries that are key to supporting Ukraine militarily, economically, with sanctions, with UN resolutions at the International Criminal Court and at the International Court of Justice. That is what Canada is doing. Canada is well known for doing it.

Canada is extremely honoured on our defence spending, on our economic measures, as well as on our sanctions, which we do in concert with other countries.

Let's get the whole report and see whether there is a place for a recommendation to the government with respect to the waiver. That's on the principle.

On the content, I would still say I'm getting rather circular reasoning from the Conservatives. I hear that the turbine is of no value, is not being used and is simply superfluous to the whole situation. I hear that somehow it is hindering Ukraine's ability to fight in a war. It can't be both.

The reality is that I am hearing these arguments that then take me simply into pure politics and an attempt to divide. I think if there's one thing we've learned from other experiences of war, Canada has been at its best when we actually unite and talk together about how we do things in the best interest of Canada first and in our support for Ukraine.

We are engaged in the illegal conflict of Russia and its invasion of Ukraine for several reasons. It offends our sense of international law, of territorial integrity and of our understanding, and the world's understanding, of the history of Ukraine and the Ukrainian people. We have stood united, I believe, against Russia's illegal invasion. We should continue to do that based on the fact that it is wrong.

We also stand united by this because Canada has a unique relationship with Ukraine. We are home to the largest diaspora of Ukrainian people outside of Russia, if that is to be considered, on absolute numbers and on percentage. We have an emotional connection. Nobody doesn't care about Ukrainian people or Ukraine as an emerging yet fragile democracy that we have been supporting since its independence.

The second reason we are doing that, which I hope will come out in this report that we are united about, is the deep and abiding people-to-people connection that we have had for well over a century.

The third reason—and I sometimes have to remind people of this when I've been travelling—is that if you look at the globe in one way, Russia seems very far away from Canada. If you look at the globe from the top, you recognize that we share a maritime border with Russia. It is a matter of Canadian security to be sure that we are able to watch, manage and push back on Russian aggression when it comes to anybody's territorial integrity because we have Canada's Arctic as well.

People live in the Arctic. Resources are in the Arctic. Climate change is affecting the Arctic. The ocean is opening. We are watching very closely what Russia is doing in Ukraine because we obviously have sovereignty concerns in our Arctic.

That tells me that we need to engage in a different way on this discussion. We need to find ways that don't play politics about it and don't try to divide and conquer. We have to find a way to be a unity government and we will take advice from the opposition regularly. The Minister of Foreign Affairs is regularly engaged with members of the opposition, who have had constructive, important and positive statements with respect to Ukraine and have been engaged all the way through.

It's absolutely appropriate for the opposition to push on military weapons that we should be sending to Ukraine. However, we've also seen that they are often out of date and may not actually be wanted in Ukraine.

We look at our allies. We look at NATO and at how we doing what we can. Canada offers transport for weapons constantly. We are engaged in providing support and care. We are continuing with the training mission, which began after the invasion of Crimea. We are continuing to provide financial support, sovereign loans and other supports to ensure that the economy continues. That's what we should be talking about.

On the content of the motion, it's circular, it's specious and it is going back and forth to try to somehow prove some nefarious idea that the government is not helping Ukraine to every degree we can. We are, and we will continue to do that.

Also, on the concept of principle, I would be against it because we haven't done our report yet.

If we need more evidence, we'll get more evidence, but I think we have a good calendar to get us to a report, despite the fact that we just wasted an hour on a natural resources committee hearing when we should have been doing more important work with respect to this study.

I would be against this motion as I just....

In closing, I'll repeat that on the principle, we have not finished our report yet. On the substance of the motion, I think it is wrong and not in the best interest of Canada's international position or Canada's domestic position, as well as our alliance with countries like Germany—but not exclusively Germany—and with respect to Ukraine. It has still not been proven to me that this has affected Ukraine in any negative way whatsoever. Perhaps, while being able to at least open the door to helping allies, we want to continue to work with and be with all of them every step of the way.

The very last point would be that every country needs a social licence from its voters, from its electorate, from its citizenry and from its residents to engage in these wars. That's what we need. Our European allies constantly need that. If they have an energy security threat, just as our southern neighbours may have a food security threat, we need to stand with them. We need to work on energy security, absolutely, and we need to work on food security, absolutely, while we push back against Putin's regime to say “enough is enough”.

Thank you, Mr. Chair.

[The Chair, Liberal, Ali Ehsassi]

Thank you, Mr. Oliphant.

We'll go to Mr. Genuis.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

I'm sorry. I'll strike for now.

[The Chair, Liberal, Ali Ehsassi]

We'll then go to Ms. Bendayan.

[Rachel Bendayan, Liberal, Outremont, QC]

Thank you, Mr. Chair.

I wanted to speak to the motion brought forward by my colleague. I am very interested in the discussion that we're having. As I'm sure he is well aware, the situation in Ukraine is something that I care about very deeply.

However, we heard testimony on various occasions that was very specific to the turbine issue, including with respect to where this turbine currently is and what it is being used for. I was unable to pull up the exact transcript, but I am sure that the clerk and analysts can help us with the testimony that we heard from witnesses, who told us that the turbine is essentially sitting in a room, serving no purpose to anyone, including Russia.

What I know is that we need to continue to move forward to support the Ukrainians in ending end this war. Huge advances have been made as recently as a few hours ago. Again, today we announced an additional $500 million in support of the Ukrainian war effort and the fight for democracy and freedom.

What I find a bit troubling.... Of course, I understand the position of my colleagues, but I would like to put on the record that the only time members of Parliament have ever voted to weaken the sanctions regime imposed on Russia by our country was when Conservative members put forward a motion on the opposition day of June 7, at the very height of the war. They requested that our government eliminate tariffs on fertilizer. At that point, all four members of the Conservative Party who sit on this committee voted in favour of that motion. It is a motion I found then and still find today extremely problematic.

That would be an important waiver of our sanctions regime. It would effectively mean that the Conservative position on sanctions against Russia is that we should weaken them, not strengthen them. I find it important to mention that today as my colleagues attempt to take the high road on sanctions following their vote on June 7 which, again, was at the height of the war.

Mr. Chair, I understand that my colleague will speak again, so perhaps I can respond to what he says at a later time during this discussion. That's all I wanted to say for the moment.

[The Chair, Liberal, Ali Ehsassi]

Thank you, Ms. Bendayan.

We'll go to Mr. Chong.