Indigenous and Northern Affairs Committee on June 1st, 2010

As an Individual

Thomas Berger

Yes, I do. I would just add that some of these recommendations were worked out not only with the people in Nunavut but with the people in Indian Affairs and Northern Development. I think the program, which you indicated the government adopted in 2009, of course was a positive step.

I'm reminding everybody that it's a long-term project. Some of the industrial development projects are going to take a while. Mr. Reid said construction on the Mackenzie Valley pipeline won't start until 2016. There is lead time to do the things the government has indicated it intends to do, and that's all to the good.

Conservative

The Chair Conservative Bruce Stanton

Thank you very much, Your Honour.

Thank you, Mr. Rickford.

Mr. Lévesque, you have five minutes.

Bloc

Yvon Lévesque Bloc Abitibi—Baie-James—Nunavik—Eeyou, QC

Thank you, Mr. Chair. I will start with Justice Berger.

You have a unique name, Mr. Justice. We sometimes hear the expression, “once a judge, always a judge”. Your name, Thomas, can be pronounced Thomas, just as Berger can be pronounced Berger; in that respect, I think it would be hard to figure out which of our two founding nations you are from.

I may not share your ideas on education. My riding includes the region of Nunavik. The committee has also been to Nunavut, and whenever we talk about making education available in the language and culture of the various nations, we hit a brick wall. The communities do not have any housing for teachers who would come and teach local people educational theory. Then those people could give classes on respecting their culture.

There is a university out west. A first nations university pavilion was established in Val d'Or, in eastern Canada. I got a visit from my friend, Pita Aatami, and he told me that he refused to be recognized as a member of the first nations. He said that if he could not be recognized as an Inuk, he wanted to be considered an Eskimo. In recognition of that reality, the Université du Québec changed the name of the pavilion from “First Nations Pavilion” to “First Peoples Pavilion” in order to reach members of the various communities. The university is willing to offer courses online instead of building residences for teachers to learn on site. That would probably cost the government less than building residences for teachers, when local residents are already complaining about seeing white people housed on their land when they themselves do not have housing. What is your opinion on that, as a judge?

As an Individual

Thomas Berger

In my report about Nunavut, I urged that the training of Inuit people as teachers had to be enhanced, because in the nature of things it's very likely only Inuktitut-speaking people who will be able to give instruction in Inuktitut. That presents a difficulty. The difficulties we face in Nunavut are very serious, and the problem is that Mr. Quin can offer you a concrete proposition, as Mr. Reid can: here's a pipeline; here's a mine. That's our definition of industrial progress, and these things are going to come in the north.

The question is how to ensure that the aboriginal people, who were there before these developments came and will be there after these developments are completed, are able to participate. Mr. Reid indicated the measures that have been taken in the Mackenzie Valley, and they are significant.

In Nunavut we are just, in a sense, getting started and we have a public government. This isn't an aboriginal government. The Government of Nunavut is a government of all the people, aboriginal and non-aboriginal. They can all vote; they can all run for office. And there we have promised that 85% of the jobs will go to the Inuit, because they are 85% of the population. We made that promise 18 years ago, in 1993, and we have to do a great deal more to fulfill it.

Could I just add one thing, sir? When we signed that land claims agreement with the Inuit in 1993, they surrendered their aboriginal title to Nunavut to Canada, and that has made possible our claim to complete and exclusive sovereignty over Arctic waters and the Arctic islands. It completed our case for Arctic sovereignty. That was part of the agreement we made 18 years ago. That's why—forgive me—I take the liberty of simply asking that you folks, because you have the ear of Parliament and of the government, should ask them to bear that in mind.

Just returning to my point about subsidizing education in English and French, in Iqaluit, the capital of Nunavut, there is a not insignificant population of francophones, and the federal government has established a school in Iqaluit for French immersion, teaching of all subjects in French. That's fine, but they are not willing to do the same for teaching in Inuktitut. That's my point, and I think that if—

4:45 p.m.

Conservative

The Chair Conservative Bruce Stanton

Thank you, Your Honour; that's great. We are a little over time there.

Thank you, Mr. Lévesque.

Now we'll go to Mr. Payne for five minutes. He will be followed by Mr. Bevington and Mr. Duncan.

Mr. Payne, go ahead.

4:45 p.m.

Conservative

LaVar Payne Conservative Medicine Hat, AB

Thank you, Mr. Chair.

I'd like to thank the witnesses for their attendance today. This is a very interesting subject, northern economic development, and one that is working well for our committee.

I have a couple of questions that I want to ask. I'll start off, through the chair, with one to Mr. Reid.

The pipeline construction is scheduled for 2016, the cost being $16.2 billion. What I'm thinking about right now is that there is lots of new shale gas coming on across the country, and as I understand, there are huge supplies of gas. I'm wondering, with the costs and tariffs that will be on the pipeline, whether they will be able to compete with the other gas that's currently being found throughout the country.

4:45 p.m.

President, Mackenzie Valley Aboriginal Pipeline LP

Robert Reid

That's a very good question, and one we've been keeping a very close eye on. There are shale gas developments not just in Canada—in particular, northeast B.C.—but also in the United States, and right down in the heart of the market. We've had Ziff Energy, an energy consulting firm that looks at upstream resources very closely, do a study for us. The results of that study indicate, cutting right to the bottom line, that we're going to need both shale gas and both Alaska and Mackenzie pipelines to meet the forecast demand for natural gas. The main reason for that is the high decline rates of the existing wells. Typically, decline rates are now in the range of 20% per year, and production out of the western Canadian basin is on the order of 15 bcf a day.

We have to replace, each and every year, 3 bcf a day in capacity just to make up for the decline of the conventional resource. The Mackenzie is only 1.2 bcf a day. The conclusion is that we need both northern pipelines and all the shale gas we can get to meet forecast demands.

Conservative

LaVar Payne Conservative Medicine Hat, AB

Is that a recent study?

President, Mackenzie Valley Aboriginal Pipeline LP

Robert Reid

It is a study that was done for us last July, and we're just getting it updated.

Conservative

LaVar Payne Conservative Medicine Hat, AB

Thank you for that.

I'm trying to get a handle, Mr. Quin, on the terms of the regulatory process you're talking about and the difficulties of obtaining permits. Is this strictly around environmental issues, or are there some other issues impacting the regulations through which you get your permits in and projects under way?

President, Capstone Mining Corp.

I'd say it's the whole process. It's the environmental, socio-economic review, and then leading into the regulatory process. Most of the permits you require, the more significant ones, are environment-related.

I would come back to one of the comments Mr. Reid made. There is the sideline, which I mention in my letter, about the first nations being excluded from the benefits or projects, both on a first nations basis but also in the same way as one of the members of your panels said about the territorial participation. Yukon, for example, is capped at $3 million net gain from natural resources in its territory. Anything beyond $3 million gets taken back by the federal government. It creates a huge disincentive to the territorial government to see that process go forward. Similarly, the first nations are capped at $3 million cumulative for all first nations in the Yukon territory.

One mine—our mine in the Yukon, for example—passes the cap for both first nations and the territorial government on its own; therefore, any other mine being developed in that territory provides no net benefit to either the territory or the first nations. Therefore, it's not an incentive. They look to get their leverage another way, which is to say, we can't get it directly through the existing fiscal framework, so we want the pipeline or the company or the mine to pay on top of the fiscal regime for additional money. That often leads to delays in projects while those negotiations are worked out. They can obviously be a significant burden to the company.

Conservative

The Chair Conservative Bruce Stanton

Thank you, Mr. Payne.

Now we go to Mr. Bevington, who will be followed by Mr. Duncan.

NDP

Dennis Bevington NDP Western Arctic, NT

Thanks, Mr. Chair.

Thanks for that last statement, Mr. Quin. I've enjoyed some of the things you've said here today. They've rung very true. Ottawa being removed from the process is something that I think northerners have waited for decades with bated breath to see happen. All we've really seen, perhaps, is an increased amount of regulation by Ottawa.

When you talk about removing Ottawa from the process, you're suggesting that the Northwest Territories, the Yukon, and Nunavut should take over the process, much as a provincial government would, thereby increasing the ability of those territories to gain from resource development, even without a royalty structure. A province would look at a development like the Mackenzie gas pipeline, if it had the authority over it, and decide how that development would fit into their strategy for that region. What we see in the situation we're in now is that there is no strategy for the region because the decisions about strategy are made here in Ottawa.

There are two sides to getting Ottawa out of the process. One of them would be to provide quicker decision-making, because territorial governments would be able to run those decisions. The other side of it is that they'd be making the rules, so they'd have an opportunity to improve the rules for the gain of the people in that region. Is that not what you would see as well?

President, Capstone Mining Corp.

To some extent, but one clarification I would make is that going down the provincial route is not correct. For example, British Columbia has a joint federal-provincial process that is a problem. So I wouldn't hold the provinces up as an example of what we should be aiming for. I would hold Yukon up as the example, where there is only one process; there is no federal direction of the process.

Secondly, I would also caution that Ottawa sets the rules. YESAA is a federal act. The concern that people often have with devolution is that standards are going to get relaxed, they're not going to follow the processes, and they're going to take shortcuts. Well, Yukon can't do that. Ottawa has set the rules under YESAA on how this works, and Yukon cannot change YESAA. So it's all about implementation. Ottawa sets the framework, and then it's up to the territory to go and deliver it. The territory gets on and does it, because it's in their best interests. I think that's kind of the solution to the Gordian knot; Ottawa sets the rules and you have to meet the standards.

So let the territory go and do it and deliver the product. Yukon is showing it can do it.

NDP

Dennis Bevington NDP Western Arctic, NT

Okay.

Mr. Berger, if you look at the processes going on now in the Northwest Territories, the process by which we have achieved a decision on a pipeline, how would you view that process? The timeline has been very long, but have you had a chance to examine that process and see whether it has done a fair job? Have you had a chance to review the decisions of the joint review panel?

As an Individual

Thomas Berger

Well, sir, my answer is that I've been asked that question about once a month for three or four years and I've always declined to offer any comment. I wrote a report in 1977 that was well received, and to a great extent it has been carried out. I think I'd be pressing my luck if I started giving out opinions about the current process, about which I don't pretend to know a great deal, except what I read in the papers.

There's no point in my sharing that with you. You're aware of that already. I'm simply minding my own business.

Conservative

The Chair Conservative Bruce Stanton

Thank you, Mr. Bevington.

I don't have any other speakers on the list, so if anyone still wishes to add something, we have some time for a few more questions if you wish.

Let's go to Mr. Duncan.

Conservative

John Duncan Conservative Vancouver Island North, BC

Thank you, Mr. Chair. I guess that means I have 15 minutes.

Conservative

The Chair Conservative Bruce Stanton

Not really. We'll see how we do.

Go ahead.

Conservative

John Duncan Conservative Vancouver Island North, BC

I'm okay with five minutes.

Going back to Stephen Quin's document, on page 3 he says:

What became apparent was the Nunavut Impact Review Board (NIRB) process only allowed for a “yes” or “no” and so some relatively minor deficiencies forced a no....

I looked at what the new legislation would do in a case like that. It would allow NIRB to pause the assessment to obtain information they might need to continue the assessment. I think this is a positive change. In other words, they could stop the clock and get new information. If the information changed the application in a very substantive way, there might be a need to go back to square one. But all of the assessment that had been done could be used in the next review, and they should very quickly be able to make the review.

Do you have any comment on that? I think that's a vast improvement.

President, Capstone Mining Corp.

I think it's definitely a very positive step in the right direction. I think our project was the trigger that led to that change in the legislation. It became apparent to everyone--the territorial and federal governments, as well as us as proponents--that we were in a position that nobody was happy with. Nobody wanted to go back to restart the entire process and redo the 95% of the work that everybody was signed off on. So I think that's definitely a significant step in the right direction.

The bigger issue is the parallelism of the federal process with the local process. In the current setting the minister has a legal liability and responsibility. I'm not saying he shouldn't do what he's doing. Under the current system he has to. But I think that is a significant area that could be simplified and eliminated, as it has been in Yukon. The federal ministers do not sign off on territorial permits in Yukon.

Conservative

John Duncan Conservative Vancouver Island North, BC

For clarification, which project are you referring to in that example?

President, Capstone Mining Corp.

It's the Hope Bay project. We got to the end of the process after three years and it got a “no”. We had to go back and restart it.