Industry Committee on April 29th, 2021

[The Chair, Liberal, Sherry Romanado]

We will go now to MP Ehsassi.

You have the floor for five minutes.

[Ali Ehsassi, Liberal, Willowdale, ON]

Thank you, Madam Chair.

Thank you to all the witnesses for their incredibly valuable testimony today.

I will start with Ms. Bak.

You obviously look at things from a global perspective, and you also touched in your testimony on the clean future act in the U.S. What are the lessons for us to learn from the framework that has been set up in the U.S.? Is there anything we can learn from the American approach?

[Céline Bak]

The clean future act is legislation that is making its way to the house floor, so it's obviously legislation that's still being considered. I thought the comments that I brought as a witness would be appreciated by all parties of this committee, in terms of the idea of a highly decentralized mandate for each federal agency to plan for its contribution to Canada's achieving its goal of reducing emissions by 45% by 2030.

I think this is the only way we're going to achieve what we need to achieve. I say that because I think traditionally in Canada, the ministry on which your committee is focused has not had a mandate to report on the progress of the industry. I'm afraid we can see that in the lack of industrial policy for electric vehicles. The fact that the U.S. is taking this structure, the highly decentralized approach, under which every agency has to come up with a plan and report to Congress in a way that is transparent, and such that citizens can review and see progress and consider the plan before it's finalized, I think is really relevant. This committee could request that of the minister with information on all of the industries that are within the purview of the ministry.

[Ali Ehsassi, Liberal, Willowdale, ON]

As you rightly point out, it's a very decentralized approach, and an integral part of the American framework, or the proposed framework, is the role of the states.

Is there anything to be learned there for Canadians in terms of what the provinces are supposed to be doing?

[Céline Bak]

Each province, as you know, under the carbon legislation of Canada has to show progress in terms of reducing emissions. I think there are areas in which the Government of Canada has an important role to play. In the build back better plan we pointed one of those out, which is interprovincial transmission. It's fundamental to have really strong interprovincial transmission to attract massive private sector investment.

I follow very closely the Canadian and global oil and gas industry and I can tell you that capex in the oil and gas industry varies between $5 billion and $8 billion a year. It happens that the opportunity for renewable energy in Alberta is of that same order, 10 times over. If we had the strong transmission interprovincially, we would be able to attract world-class infrastructure investors for renewable energy in Alberta and Saskatchewan, as an example.

[Ali Ehsassi, Liberal, Willowdale, ON]

Thank you very much, Ms. Bak.

Now I would like to go to Mr. La Salle.

Mr. La Salle, you're obviously very passionate about critical minerals. In your view, is it imperative that we adopt a continental approach to critical minerals along with our southern neighbours or can we go it alone?

[Benoit La Salle]

I think we should have both. We should start alone by requesting transformation in Canada to start, but clearly we won't be able to do it alone. They have 20 plants in construction. We have none right now for battery manufacturing. We're so far behind. Somebody mentioned that Ford and GM are all going into electrical cars. Monsieur Poilievre was asking if it is really better if the trend that has started is accelerating. I think we should have both.

Your question is great because we can't do it all but we absolutely have to stop raw materials going south without transformation.

[Ali Ehsassi, Liberal, Willowdale, ON]

Thank you.

[The Chair, Liberal, Sherry Romanado]

Thank you very much.

Mr. Lemire, you have the floor for two and a half minutes.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you, Madam Chair.

Mr. La Salle, what can the government do, and what can it not do, in context, to intervene?

I am thinking specifically of a strategy to protect strategic and critical minerals.

What are the levers that can be put in place?

[Benoit La Salle]

We absolutely must have a system. I'm an entrepreneur and we've always done business in a free market, but as someone said earlier, we're in a unique time that no one could ever have imagined. It's a time of profound transformation and we need the government to step in.

It's as if the California state water company came to British Columbia to make a deal to build a pipeline to get all the water from British Columbia to the south. Everyone would be up in arms. Yet it's the same principle. So we need to respond.

They're going to come and take all our resources, because the demand is so great. It's going to happen, but we have a vast territory and a huge amount of natural resources. We need the Canadian government to step in, because it's strategic, and I still don't see the provinces stepping in.

In my opinion, this is as critical as controlling drinking water. We managed to control oil in the west, and we in Quebec control hydroelectricity. If, tomorrow morning, the Goldman Sachs Group launched an initial public offering for Hydro-Québec, it would be a bit funny, wouldn't it? We would oppose it.

We need to put safeguards in place. I want the federal government to review critical minerals transactions and make sure that we have an integrated industrial strategy, but also that we have veto power over those transactions. The survival of our economy is at stake. We need to control the costs associated with our economy.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

That's all well and good, but I'd like to know more about you.

The environmental issue is fundamental. What is your reputation on the environment and corporate social responsibility?

[Benoit La Salle]

I am a certified public accountant by training. In 1995, I created a company, which is called SEMAFO, when I was on a humanitarian trip to help children in Africa. It has grown into a huge company with thousands of employees.

As I said, we also have a foundation, the SEMAFO Foundation. We have helped millions of people, and we were even nominated for the Nobel Prize for corporate social responsibility, or CSR. I went to make a presentation in Sweden regarding this nomination.

So our reputation is real. We want to promote those same values in Abitibi with the lithium mine project.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you very much, Mr. La Salle.

[The Chair, Liberal, Sherry Romanado]

Thank you very much.

We'll now go to MP Masse.

You have the floor for two and a half minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Madam Chair.

I want to bring Dr. Exner-Pirot into the conversation.

We had presentations from the Toronto Community Benefits Network. It's something that I worked on in my area to get some additional supports for local areas geographically where we had traditionally overrepresentation of unemployment, poverty and lack of opportunity for federal projects. What they have proposed and what they're doing on a number of projects themselves is to include those components into contracts, similar to the United States, where there are percentages of allotment in a geographically looked-at area to reverse some of the historic lost opportunities.

I wonder what your thoughts are with regard to community benefits in federal programs for building back, especially when it comes to specific targeted areas where we know the representation is not equal to the opportunities.

[Dr. Heather Exner-Pirot]

I know we're talking about a green recovery, but we also need to talk about an inclusive recovery, and including those people you just mentioned.

The resource development sector has become much better at procuring from indigenous companies. It's not an easy thing to do. There's a lot of capacity building, a lot of relationships that have to be built. The federal government, as you probably know, has committed to 5% procurement and is very slow in getting to that stage. As we pour more federal funds and spend more federal dollars on infrastructure, it's going to be very important they work much more closely with indigenous small and medium-sized companies and communities to make sure they can access those opportunities and get to that 5% mark and beyond.

With regard to a lot of the other discussion, we're talking about how we're going to need new resources, we're going to need electrification, all these things. These are all projects that happen with natural resources on land. If we don't get it right with indigenous peoples, there will be delays, there will be problems, and they will also miss out on the opportunities.

As we recover, we need to be much smarter on including indigenous peoples meaningfully. I don't think we'll get very far in developing any of these resources if we don't do a better job.

[Brian Masse, NDP, Windsor West, ON]

This will be really quick as I only have a couple of seconds.

If they miss the 5% target, is there an opportunity to bring forward the piece that was missed to another project, or is it just lost forever? Is there an obligation to fill the void that was missed from the 5%?

[Dr. Heather Exner-Pirot]

There's no obligation. I think it's a target, not an obligation. They just need to do more work, obviously, to get to that point.

[Brian Masse, NDP, Windsor West, ON]

Thank you.

Thank you, Madam Chair.

[The Chair, Liberal, Sherry Romanado]

Thank you so much.

We will now got to MP Dreeshen.

You have the floor for five minutes.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Thanks once again, Madam Chair.

We've just finished a study on the red tape permit economy and the like. This is one of the questions I'd like to start off with. In Canada, it takes years to get projects approved, whereas in other places in the world, they certainly don't have to deal with that. We've seen this with Bill C-69 and the other issues associated with that. We've seen billions of dollars leave Canada because of the time it takes or projects perhaps not being allowed to get on the road here.

Mr. La Salle, can you give me a quick comparison of the time it takes to get through the red tape we have here in Canada? If we're going to come up with a solution, we have to look at that first and then take it from there.

[Benoit La Salle]

Thank you so much. This is my pet project.

I've worked in mining everywhere around the world. As an example, we're operating and building a bigger mine now in Morocco. The time from presenting the study to getting a full permit is six to nine months. We're following IFC standards and World Bank environmental standards. We do take care of the local population. Permitting takes less than one year. In Canada, it would be a minimum of four to five years.

This is why, of course, China is so much into Africa. The natural resources are there, and permitting...don't believe that permitting is being paid off. I've been there for 25 years and it's not the case. They're very strict. The embassies from all the European countries are there. They're checking all of that. We're following international norms, but they want and need mining or natural resource projects. You're absolutely right. I think the ratio is approximately one to five. If you were to look at the United States, it would probably be one to 10 because they are much more difficult.

I've been saying that to the Quebec government here because that's where I want to get involved. I said, “You've got to cut those years by at least 50%.”

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Yes, I think that's a critical part. A lot of folks think that by adding extra laws, bureaucracy and so on, that's going to just make it better, but quite frankly, that's because they haven't looked at what Canada actually does. I think it's time that we stop apologizing for being Canadians and recognize the great things that we do. I think that's part of it.

My other question is about the electric vehicles and so on that we keep hearing about. I'm interested in who we think should be paying for the municipal electricity system upgrades that are going to be required. An example would be if someone lives in a condo and there are 70 cars in the parking lot. How do we manage that and who is going to be responsible for it?

[Benoit La Salle]

Look, I'm the miner; I'm not the one taking care of the infrastructure.

I'm telling you, though, there is room. You could ask the automobile makers. Look at Tesla's profits last quarter, and it's just starting. There's room to have a tax, if there is a need for it, to subsidize all of this. It's going forward. It's going very fast, and that economic system has room to pay for infrastructure.