Indigenous and Northern Affairs Committee on Oct. 17th, 2018

[The Chair, Liberal, MaryAnn Mihychuk]

Yes, transportation.

[Wally Schumann]

We have 33 communities in the Northwest Territories. That wouldn't be a policy. We have some Arctic communities that would never have a road to them: Sachs Harbour, Paulatuk, and Ulukhaktok, but as far as connectivity through telecommunications goes, we have cell service in all our communities now. The Government of the Northwest Territories has recently completed an $80-million fibre link from Inuvik all the way down through the Mackenzie Valley to Alberta. We're looking at how we're going to connect some of those communities, possibly through the Tuk road, now that it's open, and put them on fibre, and a couple of other ones. They just had the Indigenous Connectivity Summit in Inuvik last week. The Internet Society was up here with 150 participants to bring awareness to those issues.

[The Chair, Liberal, MaryAnn Mihychuk]

Your goal is to have fibre to every community, or are you using satellite?

Then we'll move over to Will.

[Wally Schumann]

Some of them we would never get fibre to, but we have it down the valley and we're going to look at how we're going to hitch up the rest of them on the valley—

[The Chair, Liberal, MaryAnn Mihychuk]

Okay, Will.

[William Amos, Liberal, Pontiac, QC]

Thank you, Chair.

Thanks to our witnesses.

I want to pursue that line of inquiry with the minister. It was a good one. Obviously the north is not alone in seeking better broadband and wireless coverage. All of rural Canada is hurting in that regard, so, Minister, it was really great to hear how your government has prioritized that kind of cell and wireless investment.

Minister, you have many opportunities for road infrastructure investment, and I imagine the requests from any number of different companies for investment to achieve that are significant.

We have one proposal here that we're looking at, Grays Bay Road, but there are many of these. How do you go about prioritizing, given that not all roads and ports will be built? At a certain point there's an infrastructure deficit, but there also has to be a recognition that just as in our rural communities, it can't all be built.

[Wally Schumann]

My presentation lists our priorities for Taltson and the road system. For the road system ones, it was part of this government's mandate to put those three forward. We've locked down and secured conditional funding for the Whati road as a P3 project through P3 Canada. That's going through its environmental process right now, and we're working with the last three proponents in the bidding on it. We had seven people come forward. We narrowed it down to three and we're working on that.

As for the other two, we recently got $102 million dollars for the MacKenzie Valley Highway. That ask was broken into six pieces. Instead of submitting one big lump sum, the officials and I decided that we needed to break it out into pieces, to make it a little bit easier, seeing that the funding available across Canada is tight.

I want to update the committee a little bit, because I'm at 10 different FPT tables in the country, so my outlook on how things are going is a little bit different compared to that of a lot of other ministers. On the transportation file, when we first went to the table after the Liberal government got in, I distinctly remember sitting there and telling all the ministers in Canada that we have to get behindMarc Garneau and support him, because at that time he had $1 billion for this whole country. I could spend a billion dollars in a heartbeat, just on roads in the Northwest Territories, never mind all of Canada.

We were lucky enough that he got $2 billion dollars, and he did a carve-out for the north for $400 million. It's not where we need to be, but it was definitely something. We're taking those avenues to pursue that with our other two projects, the MacKenzie Valley Highway and the Slave Geological Province.

The big thing that surrounds some of this stuff—I think people might be aware that I've said it at a number of tables—is that we have to quit looking at these types of projects in this country in a four-year election cycle. That is not going to get us anywhere. It's not going to help us develop our country. In the last couple of meetings I've been to, we've talked about reconciliation with aboriginal people, which is great. I believe we need to do that, and as I said in my presentation, I think we're the leaders on that. But a big part of it is that we've been talking about how to brand and sell our country to the global economy. I said to the last committee that I was in front of—the sovereignty guys who were here a couple of weeks ago—that we have our own issues in our own country that we need to resolve on some of these things too. We can't even get a pipeline across borders in our own country. We have a lot of issues we need to deal with internally, but at the same time, when he's talking about these types of infrastructure projects, $2 billion dollars for the whole country really is peanuts. The infrastructure bank is an opportunity, but.... Someone asked what can be done differently with the infrastructure bank for the north. One of the opportunities we could do is to not give it to the national trade corridor fund. Maybe we'd do a carve-out for the north with a little bit different set of rules and conditions that help, because our situation is a lot different from that of the rest of Canada.

Our applications for the next round will be for the Slave Geological Province.

[The Chair, Liberal, MaryAnn Mihychuk]

We have about 30 seconds, or 45 seconds.

[William Amos, Liberal, Pontiac, QC]

Sure.

Could you summarize very quickly for the rest of rural Canada, which might not understand why the north needs so much more than other rural communities do, and which also feel as though they don't get enough, what the nutshell argument is?

[Wally Schumann]

We're probably at least 20 or 30 years behind on infrastructure in northern Canada. The Government of the Northwest Territories has an infrastructure deficit of between probably $3 billion and $4 billion. We don't have the basics that a lot of people have. We don't have roads. We don't have access to a lot of these things. As I said, I've sat at a lot of different tables, and there is some concern around rural and northern provinces for sure, but I think we're in a way tougher situation, and the cost of living is a killer.

[The Chair, Liberal, MaryAnn Mihychuk]

Very good. It's a huge challenge, but a huge opportunity as well. Thank you so much for coming to present to us.

That concludes our first panel. We'll take a short break. We will reconvene immediately to have our second panel.

Thank you very much.

[The Chair, Liberal, MaryAnn Mihychuk]

I want to give enough time for all members to ask you questions, and for you to get your proposals in front of the committee.

Welcome to the Standing Committee on Indigenous and Northern Affairs, for the second hour. We have two presenters.

Again, you have up to 10 minutes to present, and then after both presentations are done, we'll have an opportunity to ask questions.

We're going to start with Tom Zubko from New North Networks, Ltd.

[Tom Zubko, President, New North Networks Ltd.]

Thank you, Madam Chairman.

I have a book with me that will underline some of the issues I want to speak to you about. I thought perhaps I could pass it around to your members while we're having this discussion.

[The Chair, Liberal, MaryAnn Mihychuk]

That's not going to work, says Mike.

[Tom Zubko]

It'll get stuck in one place, I'm sure.

I have a magazine here, Madam Chairman, that was published in the north. It says on the cover that everybody's looking at Canada's far north except Canadians. It's much the way we feel often. It's good to see that your committee is taking a look at the north.

My name is Tom Zubko. I was born in Aklavik before the town of Inuvik was conceived and built. I was a pilot for my father, who was the first aircraft operator north of the Arctic Circle in 1946. My mother was the first nurse in Fort McPherson in 1948 until my father lured her to Aklavik and married her. We moved to Inuvik in 1959, the year the school and the residential schools opened.

After my aviation life, I got into communications. We work on cable television, Internet and many other communication systems to this day.

I would like to take the opportunity to address some issues on Arctic development. First I would like to address the issue of Arctic policy. Our Minister Schumann alluded to some of this.

I'm not sure why you are doing this process, except that it has been a practice for each governing party to abandon the policy of the previous governing party and develop a new one. Did you have a philosophical or fundamental disagreement with the previous government's policy? I would suggest that you probably did not, underlined by the lack of any kind of stated position coming into this term. I would suggest, then, that the north of Canada and its traditional treatment by southern Canada parties is more a matter of politics than policy.

Other northern countries like Norway have sustaining Arctic policies, and I would strongly recommend that, at the end of this committee process, you find a way to create an enduring position of the Government of Canada on northern development.

This is not to say that such policy should not be a living document, but changes should be tweaked in a massage, not through throwing out the baby, the bathwater and the tub and starting over. Perhaps you can start this journey by adopting some elements of the last government's policy and moving forward from there.

Starting with social fabric, lack of consistent policy has been very damaging to the social and economic fabric of the north. Following the residential school experience and its disruption to the last mid-century social fabric, many parts of northern Canada have been given the promise of strong opportunities to move into a sustaining wage economy and the accompanying potential to build strong families and the affordability of maintaining some semblance of traditional lifestyle much like the one the Inupiat in Alaska have been successful at.

When in almost every case these opportunities have been ripped away, this has been done in a pretty dramatic and disruptive manner, leaving many families in turmoil where the breadwinners of the family are now unemployed and no longer able to provide for their families. This has led to embarrassment, shame, alcohol abuse, severe family discord and the resulting social problems evident in our communities today.

To make it even worse, in my part of the north, this boom-bust cycle has taken place in three major cycles in my lifetime—build up, tear down, repeat. The north has become a place in which all development is considered high risk and for all the wrong reasons. Attracting capital becomes more difficult with each debacle.

Next, I'll talk about consultation and the per diem economy. In 1969, the Government of Canada indicated to oil companies from the U.S. that it would not entertain an application to build a pipeline from Prudhoe Bay to the rest of the U.S. through the northern Yukon and Mackenzie Valley. This was done with no consultation with the people of the north.

That lack of consultation was soon followed by consultations, which have existed to the present. We, of course, had the Berger commission, a three-and-a-half year process. This was followed by the export gas hearings and the Norman Wells pipeline hearings in the early 1980s, each of them about three years long. Then we had the JRP, which went on for six years in the 2000s. In between, we had a number of studies and processes such as the northern oil and gas action plan and the development impact zone, which went on for a number of years, studying how to maximize positive and minimize negative impacts.

In total, we've had fifteen and a half years of oil and gas hearings along with numerous other processes to govern development in the last 50 years. One has to ask, to what end?

Each and every hearing has had the same elements as its conclusion: Do it right, and respect the people and the environment. One result that was determined early on by some northerners, and certainly a good number of consultants and lawyers, was that the real and sustainable gravy train was in the hearings and the consultations. Many careers in Canada have been built and sustained almost exclusively on these activities. They are carpetbaggers, I think, as the resolution is a negative one from their perspective.

On top of all of this, we know that many of the special interest and environmental groups that are active in the north are funded by foreign interests, which are not acting in the best interests of Canada or Canada's north.

Such government-funded or -supported activities perpetuate and accelerate the view that studying and consulting is superior to taking a chance on development. Given this backdrop, it was deeply disturbing when the Prime Minister placed a moratorium on drilling in the Beaufort Sea with absolutely no consultation.

On the north and its part in Canada's economic framework, the question is, how can Canada have an Arctic policy if it forces everyone to leave? The Internet and the availability and exposure to the world make people realize there may be more options that do not include staying in the north as refugees in our own country.

More and more we see the brightest and best potential leaders coming out of school, going to university, and electing not to return.

Wasted opportunity and science in the north.... In 1969, right after Prudhoe Bay was discovered, Banister Pipelines led a group of companies in research facilities in Inuvik, where they brought two kilometres of four-foot in diameter pipe and heavy oil to build a test facility to determine how best to build a pipeline in permafrost conditions. They also set up a test facility near the Sans Sault Rapids near Fort Good Hope, where they experimented with natural gas pipeline options such as freezing the ground to maintain stability. This research helped engineers design and build the TransCanada pipeline and other developments on the north slope of Alaska.

Beaufort Sea development spawned significant groundbreaking and icebreaking systems to enable operations in ice-infested waters. Artificial islands with sacrificial beaches were pioneered in the Beaufort. New designs for icebreakers were developed that enabled ships to be effective with a fraction of the power of earlier designs. Caissons of several types were built and deployed into the Beaufort. Live trial studies on the effect of oil released under the ice were performed and extensively documented, along with experiments for mitigation of such potential events.

A huge inventory of research has been accumulated over the years, yet the people who make decisions on the future of the north have little or no awareness of this information.

I have a map—

[The Chair, Liberal, MaryAnn Mihychuk]

There's one minute left.

[Tom Zubko]

All right, I'll show you the map later.

A great majority of this equipment and knowledge went to Russia, which has been rapidly developing its northern resources, such as the recent opening of the Yamal natural gas system that is shipping LNG to China and Korea in icebreaking LNG tankers.

I have, very quickly, an example of government not acting in the interests of the north. Satellite ground stations have been built in Inuvik because of its location. There's a Canadian government site, and two years ago, a private site was built with clients from the U. S. and Norway, which could not make an arrangement with the Government of Canada site. It's been over two years since those companies engaged Global Affairs Canada to obtain licensing. It's still not completed. NRCan worked actively to prevent this licensing as they saw it as a threat to the station they built.

[The Chair, Liberal, MaryAnn Mihychuk]

Thank you. We're going to move on. You'll have an opportunity when members ask you some questions, so you can take that opportunity to finish your presentation.

We have another presentation, and this is from the Kivalliq Inuit Association, about a project they have.

You have 10 minutes to present. Go ahead.

[David Ningeongan, President, Kivalliq Inuit Association]

Thank you.

I have some important comments to make today, so I'm going to read from a prepared statement. I look forward to speaking with you further following my remarks.

[Witness speaks in Inuktituk]

Good afternoon, Madam Chair. My name is David Ningeongan, and I am the president of the Kivalliq Inuit Association. With me are representatives who are working with us, David Chadwick and Tom Garrett, from Chadwick Consulting. As well, travelling here to join us today is Phil Duguay, vice president Canada, Anbaric Development Partners, who is also working with us.

I am pleased that the committee is addressing the important topic of northern infrastructure projects and strategies. Northern communities are remote and isolated, and they pay some of the highest costs in all of Canada for goods and services.

As president of Kivalliq Inuit Association, I represent seven communities in the Kivalliq region of Nunavut, directly north of Manitoba. These are the communities of Arviat, Whale Cove, Rankin Inlet, Chesterfield Inlet, Naujaat, Coral Harbour and Baker Lake, representing a combined population of over 12,000 residents, roughly a third of Nunavut.

Our region is growing in both population and economic opportunities. Rankin Inlet alone has grown by 30% in the last three years. Our communities are young, and our youth are seeking opportunities. What holds us back the most from economic development opportunities is the lack of infrastructure that southern Canada takes for granted. The lack of broadband affects our education and health care. The lack of roads and proper port facilities affect the ability of communities to share resources or travel easily to a job.

This is a critical time for the federal government to be having these discussions. Through a new relationship of reconciliation, we have the opportunity to partner together to invest in infrastructure projects that will benefit communities and the federal government.

I am going to focus my remarks today on a critical national infrastructure project within our region, the Kivalliq hydro fibre link project.

The lack of renewable energy and reliable broadband infrastructure in the Kivalliq region is an issue faced by all of Nunavut. However, we have a unique opportunity before us right now. I'm going to highlight how this Inuit-led project is advancing at a critical time, with widespread government and private partner support.

I have come a long way to appear before you today. The fact is, I could not participate by video teleconference from my home community of Rankin Inlet because of the poor broadband Internet service in my community.

As mentioned, economic opportunities in our region are growing. The largest private sector employer in Nunavut, Agnico Eagle Mines, operates a gold mine north of Baker Lake. They are constructing a new open-pit mine north of Baker Lake, and are well into construction of a brand new large gold mine 25 kilometres north of Rankin Inlet.

These two construction projects alone represent a private sector investment of over $1.2 billion. It is estimated that next year, when these new mines are operating, they will employ over 2,000 people, a third of whom are Inuit. Each year, the federal government will receive over $60 million in payroll taxes alone from these new mines.

I mentioned these mines because they show that despite huge costs and the lack of basic infrastructure, our region has huge mining and other economic potential. What we need to do is unlock this potential with renewable, reliable, affordable energy and reliable broadband. The time to do so is now.

The seven communities and mines in the Kivalliq region, like all of Nunavut, depend entirely on burning diesel for electricity generation and heating. There is no access to North American electricity or natural gas grids and there are no roads in the Kivalliq region or connecting its communities.

Diesel fuel is transported by ship to the Kivalliq region during the summer months and is stored in each community. Diesel use leads to environmental problems, such as toxic fumes, the risk of ground contamination, spills and greenhouse gas emissions. Many of the diesel plants are operating beyond their life expectancy and need to be replaced. These plants were built and owned by the federal government some 40 years ago and are a federal government legacy.

We have a plan that would see our first community get off diesel power by June 2024. The Kivalliq region shares a border with the province of Manitoba, which has abundant renewable hydroelectric power. This creates the opportunity to connect the communities and mines in the Kivalliq region to Manitoba and the North American energy grid. The project also includes a plan for fibre optic cable networks so that for the first time we can have reliable cost-effective broadband Internet services in our region.

This project would link Nunavut to the rest of Canada for the first time.

As I mentioned, the time to advance the project is now. The Kivalliq Inuit have been working on this for many years. We completed an engineering scoping study on the project in 2015. The scoping study concluded that this project could save the federal government and the Nunavut government upwards of $40 million annually in reduced subsidies of diesel power, while addressing environmental concerns. The savings for the mining industry were estimated to be upwards of $60 million annually. With the pending price on carbon coming into effect soon, these numbers will go up, as will the urgency for renewable energy solutions.

The mining industry needs energy to operate and grow. We are at a critical time to ensure that private sector investment in renewable energy will maximize community benefits. The hydro and fibre transmission line will do that, and we prefer this project.

I am pleased to inform the committee today that we have also reached an important milestone in our planning process. We've launched a partnership with a private sector transmission company: Anbaric Development Partners. Anbaric is backed by an institutional investor. This will allow the federal government to leverage significant private sector capital to complete this project.

This is an incredible opportunity for the Inuit of Nunavut. With federal support, we will be able to enter into a joint equity partnership and advance the project. Our engineering and feasibility study planning is rapidly advancing.

This is a nation-building infrastructure project. It has the strong support of the Government of Nunavut; our territorial and national Inuit organizations, Nunavut Tunngavik Incorporated and Inuit Tapiriit Kanatami; all local leadership within the Kivalliq communities; Qulliq Energy, our territory's power corporation; the mining sector; and Agnico Eagle Mines.

Earlier this summer we submitted a pre-budget submission to the House of Commons Standing Committee on Finance that sets out the proposed project and the opportunity for private sector investment in partnership with the Inuit to advance this infrastructure project. I will provide the clerk with this submission, which includes letters of support for this project.

The project also has the potential to become a key component of a new federal Arctic policy framework. On Monday, you heard from federal government departments on how the new Arctic policy framework has identified the necessity for new approaches to address the needs of the territories.

In conclusion, the hydro fibre project will provide renewable, reliable and affordable energy. It will be a driver of economic development that will benefit all of Nunavut and Canada. The cable hydro-fibre link addresses reconciliation between Canada and the Nunavummiut in Kivalliq region. It is an infrastructure project that creates both economic opportunity and a cleaner environment.

Thank you for listening to a brief summary regarding northern infrastructure and the need for a hydro-fibre link between Nunavut and Manitoba.

I will be happy to answer any questions.

[The Chair, Liberal, MaryAnn Mihychuk]

Thank you.

We're going to start that right now with MP Don Rusnak.

[Don Rusnak, Thunder Bay—Rainy River, Lib.]

Thank you to all the presenters for coming, and for coming as far as you had to come.

I'm going to be sharing my time with the member for Nunavut, Mr. Tootoo, but before that I have just one question. It is a question I asked NRCan officials here the other day.

You're talking about a project, a hydro transmission line, in the range of $2 plus billion. Has anything else been looked at, like a mix of renewables within the communities? I know in northwestern Ontario, the federal government invested $1.6 billion in the Wawatay power transmission line to connect 16 or 17 communities in northwestern Ontario. Some communities are looking at producing energy through run of river. I know Pic River and Pic Mobert are doing that on rivers that flow into Lake Superior. Is that an option for some of the communities in the territory you represent? Have other potential energy sources been looked at? Has a cost-benefit analysis been done comparatively to the money spent on a transmission line?

[David Ningeongan]

Thank you for that question.

The cost for this project is about $1.2 billion. This project brings in fibre, as well, which we do not have. We're on satellite bandwidth right now. This would bring fibre optic cable into our region.

It is our preference as a project, as it's going to allow us to get fibre optic into our region so we're able to communicate like the rest of Canada and southern Canada.

[Don Rusnak]

It's a bundled project. It's $1.2 billion for fibre and for transmission?

[David Ningeongan]

Absolutely, it's for both. It will connect five communities and two mines. It's not piecemeal.

[Don Rusnak]

Have you looked at other solutions to providing renewable energy in the communities? Has that been done?