Indigenous and Northern Affairs Committee on March 5th, 2009

[Larry Bagnell, Liberal, Yukon, YT]

I just had three quick questions.

Before I get to the amendments, if there is a self-governing first nation with a land claim, does this not apply to them? They have their own rules in their land claim and self-government agreement. Is that true?

[John Dempsey]

For this legislation to apply, a first nation would have to designate their lands by the Indian Act. They would have to go through a vote process to designate their lands for oil and gas development. So under a land claim a first nation may have the right to do that or not. It depends on which land claim.

[Larry Bagnell, Liberal, Yukon, YT]

Right, okay.

In relation to the proposed subsection 6.(1.1) limits, actually, I don't have much sympathy with the amendments, but I do have a question. Why would something about consulting with a first nation before you do this kind of thing actually be in regulation? It seems fairly fundamental. Why isn't that part of the bill?

[John Dempsey]

There are a series of decision points within the existing regulations that we'll be bringing over to new regulations. An example would be the suspension of operations. Right now there is the ability for the executive director of Indian Oil and Gas Canada to suspend operations. That isn't done with the consultation of a first nation because of the implications to a first nation if they were involved in that suspension order--liabilities. There are a lot of other technical decision points where a first nation may or may not have that technical expertise to share in the decisions, so that rests with Indian Oil and Gas Canada.

[Larry Bagnell, Liberal, Yukon, YT]

My last question is this. I'm not sure you totally answered Ms. Crowder's question. She asked about what you thought about the amendment that would give the first nation the decision to cancel these leases. And you said sometimes the first nation doesn't want it. Well, if they didn't want it, they wouldn't make that decision, then, if they had the authority to make the decisions. So the question she asked was about what you thought about the amendment that would allow that. She asked whether you could explain why you would or wouldn't as a department make the decision. But the question was on whether you agree with the amendment that would put that decision-making power into the hands of the first nation on whose property the oil and gas exists.

[John Dempsey]

It would be extremely difficult, I think, for us to support that type of amendment, simply because we would view it as a disincentive for the oil and gas industry. It would introduce another form of approvals. It would bring in some uncertainty to the process from the industry investment side. What the companies we deal with have told us in the past is this. When we're looking at making regulatory changes and legislative changes, they're looking for a regime that is more certain in their eyes so that when they go to their shareholders and their investors, and they want to invest money on Indian lands, there is some clarity in what they're investing in. Bringing in a first nation lease cancellation authority, in their eyes and in the eyes of Indian Oil and Gas Canada, would be problematic.

[The Chair, Conservative, Bruce Stanton]

Go ahead, Mr. Jacques.

[Karl Jacques]

This act basically has the management of oil and gas resources given to Canada. From a legal perspective, having the cancellation by a first nation, independently of the government or IOGA, would muddy the waters as to what the responsibilities are. If Canada has fiduciary obligations and there's interference, then it puts us in an uncertain situation legally as to what exactly the relationship is among first nations and Canada, and what kind of liability could arise.

[The Chair, Conservative, Bruce Stanton]

Thank you, Mr. Jacques.

Is there something else, Mr Dempsey?

[John Dempsey]

Yes, I would add just one more comment. The ability of a first nation to cancel a lease is an option for them right now under the First Nations Oil and Gas and Moneys Management Act. If a first nation went that route and were to opt into that piece of legislation, they would have the authority to cancel a lease or a permit or build their own regime around how that cancellation would work. It's not that the door's been closed completely to a first nation. There is an optional route for them to go.

[The Chair, Conservative, Bruce Stanton]

Thank you.

Members, essentially, I don't have any other speaker requests at this point. We have about 12 minutes left in the meeting today. I should point out, in reference to a couple of issues that did arise today—and we are essentially at the end of orders of the day—that if you wish to commence clause-by-clause consideration of the bill, we can commence that today, although there's very little time.

One thing should be pointed out, however, and I have circulated this to the subcommittee: the question of the Stoney Nakoda First Nation, whose concerns were circulated to you all in a letter on February 19, I believe. We had undertaken to provide them with an opportunity to come before committee today. Unfortunately, due to the late time.... We had a request from them to appear officially to the committee on February 26, but by the time we got back to them, the only spot that was open was today.

If it is the wish of the committee, there is another option. Tuesday is booked for Minister Strahl, on supplementary estimates C, as well as one hour on clause-by-clause analysis of Bill C-5. That's currently the schedule for Tuesday, and as you know, Thursday has been reserved for our discussions in terms of future study. So the only opportunity for consideration of testimony, if members wish, would be to ask them if they wish to give testimony by video conference on Monday, March 9, to members, perhaps through a reduced quorum, if members are available. I really pose that as a question, if you wish to. You have received, of course, the concerns from the Stoney Nakoda First Nation in the form of a letter, and so that's your perogative, if you wish.

Outside of that, the other thing I wish to point out today is that, following up from Tuesday's meeting, Minister Strahl made a commitment to circulate his letter to the IRC in respect to the question of regulations. He referred to it as a comfort letter expressing his wishes around the continuing evolution of the regulation-making aspects of this bill. So that has been circulated to you today in both official languages.

That's it, members. If you want to start today, that's fine, or we can adjourn and resume our consideration for clause-by-clause examination on Tuesday, as scheduled.

Mr. Duncan.

[John Duncan, Conservative, Vancouver Island North, BC]

We have the minister coming on Tuesday for the supplementary C estimates. But the estimates themselves have been tabled, so could we do both at the one go? I guess that's my question.

[The Chair, Conservative, Bruce Stanton]

I don't think the wish of the committee would support that direction. We've almost been estimated-out here. We just did these—

[John Duncan, Conservative, Vancouver Island North, BC]

Yes, we're getting the minister a lot.

[The Chair, Conservative, Bruce Stanton]

Is that all, Mr. Duncan?

Monsieur Lemay.

[Marc Lemay, Bloc, Abitibi—Témiscamingue, QC]

Mr. Chairman, my question is for the lawyers. I don't know if you have read the position of Rae and Company, the law firm representing the Stoney Nakoda First Nation.

In fact, my question could be a bit broader. The lawyers would like us to amend the bill by adding in section 4 a subsection 3 which would state that: in the case of non-payment of royalties, the council of the First Nation to whom these royalties are owed may give notice of lease cancellation. If these royalties are not fully paid within 60 days, the lease will be deemed null and void and all the rights of the lease holder lost.

I don't know if you have read it this way. If not, I would certainly like to have your view. This is the amendment that the lawyers wanted to introduce in the bill.

[Karl Jacques]

I am not in a position to answer that question. I would have to look at the text. I don't have it in front of me. However, if I understand you correctly the amendment would have the same effect to suspend or put an end to the contract. Perhaps Mr. Dempsey has more information on how this would be put into effect.

[John Dempsey]

On the Stoney Nakoda proposed amendments, I'd just like to make a couple of comments.

Since we first started this process back in 1998, Stoney Nakoda Nation has been a key part of our consultations. They've been a key part of all committees that we've put together. They are a significant oil and gas producer, so it was thought that they needed to be involved at every step of the way, which they have been. They've had members on all subcommittees. They've attended all meetings. They've received all the information about the proposed changes.

This change being talked about now isn't something that was formally raised through that process. There have been informal discussions about those types of things, but they were involved in the drafting of Bill C-5 as well. That proposal was never tabled within our committee structure.

[The Chair, Conservative, Bruce Stanton]

Are there any other speakers?

Mr. Duncan.

[John Duncan, Conservative, Vancouver Island North, BC]

I guess I'm wondering if it's the will of the group to proceed with clause-by-clause or not.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

I would suggest at this time that we go to clause-by-clause on Tuesday.

Now, we didn't resolve yet whether or not there would be a telephone meeting with--

[The Chair, Conservative, Bruce Stanton]

I didn't hear any members speak to it. I assumed, since there wasn't interest.... If there is no further expression in doing it, then we won't do anything further at this point in time.

Mr. Russell, and then Mr. Bagnell.

[Todd Russell, Liberal, Labrador, NL]

I agree with the chair. We would see the minister for estimates, supplementary (C), on Tuesday, and then go with cause-by-clause.

[The Chair, Conservative, Bruce Stanton]

Mr. Bagnell.

[Larry Bagnell, Liberal, Yukon, YT]

I agree, but I'm just wondering; the minister has actually responded--I have a copy here--to the seven questions.