Natural Resources Committee on June 15th, 2010

[The Chair, Conservative, Leon Benoit]

I call the meeting to order. Good morning, everyone.

We're here to continue our study of the regulations and status of the emergency response to offshore oil and gas drilling accidents. We had two meetings on this a few weeks ago and we're continuing this four-meeting study.

I think we'll get right to the witnesses. We have five presentations today. I will do them, as usual, in the order in which they appear on the agenda, starting with Ron Bowden, manager of international sales at Aqua-Guard Spill Response Inc.

Go ahead, please.

[Ron Bowden, Manager, International Sales, Aqua-Guard Spill Response Inc.]

Thank you, and good morning to everyone.

I gather that I have the honour of being the first one to speak. My last stay in this city, our capital, dates back to when I was three years old.

I believe I have seven minutes, so it's a bit difficult to cover the areas I'd like to today. In general, we are active in the oil spill response industry. We're designers and manufacturers of oil spill response equipment and services. In the past we have also provided services for offshore contingency planning for oil spill response from the Bohai in China to the state of Alaska after the Exxon Valdez oil spill, etc. Actually, worldwide wherever there's water and there's oil, Aqua-Guard is present.

Generally, I think today I'd just like to say that we're here to see the procedures. I suppose it will be important for our country, as well as others, to actually legislate. Basically, we're responsible for our actions, so first we have to look at what our activity is, and that will determine what we need to have in place. We notice a lot in our work that we have the most difficulty where there is no legislation and everybody does whatever they want. It's important, therefore, in the context of Ottawa to actually understand what's going on in the gulf today. We have a great opportunity to learn now how we can actually hopefully avoid that in our waters.

I remember telling my children, when they were young and they'd go out, to make good choices. I think if we can make good choices, we'll stay on the right road.

We can take what's happening in the gulf today as an example. If the water pipe here breaks when we're turning on the faucet, we go up and shut off the main valve. Basically, that's what happened. It's very simple. What's happening today is happening because there wasn't a good choice made to have the necessary precautions in place. What can we learn from that? We're very busy ourselves with the oil spill. We're supplying equipment and sending a lot down. We can't supply enough, and I think most companies can't either now. That's the situation we're in.

I think what's important is that the governments and the oil spill response companies work together internationally to put together as many members as possible to try to combat the situation, which is actually overwhelming. Before we get there, I think we'd like you to know that we as oil spill response providers of equipment and services can actually offer the expertise, and we hope you will take the next step to actually put that into legislation, which we do have in this country in fact. Canada is very fortunate that we're very well equipped and organized.

We work with the coast guard on the west coast. We're actually not very present in Canada. We started out as a small family business in 1968, and we're still run by the same family. We're everywhere else in the world. It seemed easier for us to have access worldwide, but we're becoming more and more involved in Canada. Of course on the west coast we don't have offshore activity, so we've been more present in other arenas. We are involved in supplying our colleagues on the east coast, but I think there is a wonderful forum now in which we can actually see how we can better act and then react when it's time to react to these kinds of situations.

Those from BP, the entity involved in this spill, are the industrials. I began in 1974 with Gulf Oil and Petro-Canada, and I've spent my whole career in the oil business. It's very difficult for industrials--it seems funny to say--to get what they need, because often the legislation isn't there to help them. They're providing their services. They're specialists in what they do. They're doing the best they can, but obviously they're in over their feet. What I'm saying is we need the industrials to be there. They should be here today. The people in the oil business should be here today with us. They could help us with their expertise. Then, of course, they could give it to you people who could turn that into legislation, regulations, and so on, so we'd all be protected.

I think I have one more minute left. What I want to sum up in this brief talk is that we in the industry are very frustrated only because we've been waiting, since this situation began, for BP to call us with their needs so that we could help. Last week it began with BP--last week.

If BP had had a plan that was a little more developed and very clear in these kinds of cases of worst scenario... Many years ago, when I was head of safety and environment with an oil company in Europe--I spent 20 years in Europe--it was amazing. My boss said to me, “What do we have as far as our precautions? Next meeting, we're going to look at our worst-case scenario.” So we looked at our worst-case scenario and had a report: we weren't prepared. It looked real good, but we weren't prepared.

I think the worst-case scenario is what's happening today in the gulf. If they had been prepared, I think they would be in a much different situation today.

I'm sorry I don't have more time. I think we could go on for a long time here, trying to iron out the wrinkles, but I look forward to any questions when it comes to that time.

Thank you very much for your time.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Bowden, for your presentation.

We go now to the second presenter today, Carl E. Brown, manager of the emergencies science and technology section of the Department of the Environment.

Go ahead, please, Mr. Brown.

[Dr. Carl Brown, Manager, Emergencies Science and Technology Section, Department of the Environment]

Thank you, Mr. Chairman.

Mr. Chairman, members of the committee, as a research manager with Environment Canada's emergencies science and technology section of the science and technology branch, I oversee a research and development program to study the fate, effects, and behaviour of spilled chemicals on the environment. A major focus of this program is the study of oil and related petroleum products.

Before I provide details on the oil spill research and development program, I would like to describe to you Environment Canada's role in responding to an oil spill.

As the committee will be aware, responses to oil spills in Canada are always a combined effort of industry, non-governmental organizations, and federal, provincial, and municipal governments, depending on the location and scale of the event.

Environment Canada's role in the event of an oil spill is to provide scientific and environmental advice to the lead federal agency managing the spill. As the committee will be aware, in the case of an offshore oil and gas development in the Arctic, the lead agency would be the National Energy Board. In Atlantic Canada the lead agency would be either the Canada-Newfoundland and Labrador Offshore Petroleum Board or the Canada-Nova Scotia Offshore Petroleum Board.

Regional environmental emergencies teams, or REETs, chaired or co-chaired by Environment Canada, exist in every part of the country to provide consolidated scientific and environmental information from federal, provincial, or municipal agencies, universities, and industry representatives with expertise in emergency matters. During the management of a particular spill, the REET is always convened to provide advice at the request of the lead federal agency. Much of the advice provided to the REETs originates from the emergencies science and technology section, which I manage.

Environment Canada's environmental emergencies program and the research component were established under a 1973 cabinet directive on environmental emergency activities. Under this directive, the R and D component of the program undertakes to "develop, evaluate, or test new equipment and techniques, and develop an integrated technology program to improve preventative measures and ensure that field operators are trained in new techniques".

The program, through the emergencies science and technology section, carries out R and D on the fate and effects of chemicals on the environment resulting from emergency spill situations. The scientific knowledge generated is disseminated through published documents such as guidelines, technical seminars, and training courses for responders and partner agencies.

Environment Canada collaborates widely with Canadian and international government, industry, and academic partners on oil spill response research and development projects. Many of these collaborations have existed since the early 1970s. Some of the early research activities related to the Beaufort Sea project have already been reported to this committee by Dr. William Adams.

In 1976 the Government of Canada funded the five-year Arctic marine oil spill program, or AMOP, which was administered by Environment Canada. The objective of AMOP was "to develop oil spill countermeasures for use in offshore Arctic waters". The targeted result of the program was to be greater knowledge for operational agencies such as the Canadian Coast Guard and oil company cooperatives to acquire skills and equipment to deal successfully with a spill in Arctic waters. AMOP carried out feasibility studies, equipment design work, and in some cases the development of prototype systems.

As a way to communicate the findings of AMOP, a technical seminar was organized in 1977. The AMOP technical seminar has been held on an annual basis since that time, and is unique in that it is the only peer-reviewed international scientific forum focusing on research activities related to oil spills in all environments.

Since 1983 the emergencies science and technology section has also hosted the technical seminar on chemical spills, or TSOCS, which focuses on research activities related to spills of chemical materials.

Beginning in 2002, AMOP and TSOCS were combined into one peer-review process, and in the ensuing years the separate AMOP and TSOCS proceedings were published under the AMOP banner. To reflect the combined nature of these technical seminars, AMOP and TSOCS are now known as the AMOP technical seminar on environmental contamination and response. The 33rd annual AMOP was held last week in Halifax, Nova Scotia, June 7 to 9. Most of the significant oil spill research studies conducted around the globe are presented and discussed by international researchers and spill responders annually at AMOP.

Since AMOP was established, in 1976, Environment Canada has continued to fund an oil spill research program that has focused on the following areas.

One: the physical and chemical properties of oil and related petroleum products. We have a database that includes hundreds of Canadian and international oils, including Gulf of Mexico oils.

Two: the forensic analysis of fresh and weathered crude oils to determine the source of the spilled oil, which is important for the enforcement of Canada's environmental laws.

Three: the fate, effects, and behaviour of spilled oil, including trajectory modelling.

Four: oil spill countermeasures, including mechanical recovery, chemical treating agents, in situ burning, and natural attenuation.

Five: evaluation of the effectiveness and toxicity of spill treating agents, such as dispersants, solidifiers, and shoreline treating agents.

Six: oil-sediment interactions.

Seven: the study of water-in-oil emulsion formation and stability.

Eight: the development and evaluation of oil spill remote sensors, including a system that provided the world's first absolute measurement of oil slick thickness on water. This knowledge is important for the effective direction of spill countermeasure resources.

Nine: the development and evaluation of oil-under-ice detectors.

Ten: the evaluation and modification of mechanical recovery equipment, such as booms, skimmers, and heavy oil pumps.

Eleven: extensive laboratory studies, meso-scale and full-scale, on ocean in situ oil burning to measure related burn emissions, residue compositions, and dissolution into the water column. Environment Canada has developed significant expertise in the field of in situ burning, with over ten years of laboratory and field experience, including the 1993 Newfoundland offshore burn experiment. Scientists from a number of U.S. federal agencies recently contacted Environment Canada so that we could provide scientific advice on in situ burn air emissions associated with the Deepwater Horizon oil spill incident.

Twelve: shoreline cleanup and assessment of oil contamination, including fate and effects on shorelines--the shoreline cleanup assessment technique, or SCAT, which characterizes shorelines prior to and following an oil spill--cleanup techniques, ecological effects and recovery, and the development of decision-making aids and protocols.

Thirteen: oil spill sorbent evaluation.

And fourteen: the development of oil spill countermeasure standards, such as ASTM standards, which evaluate the effectiveness of commercially available countermeasures, allowing for informed decisions by spill responders.

In summary, my role as research manager is to communicate with domestic and international government organizations, academia, industry, oil spill responders, non-governmental organizations, and the public to identify oil spill research needs and establish priorities for future activities. These priorities are then used to direct oil spill research and development activities at Environment Canada, disseminate these findings, and provide advice to the lead federal agency managing a spill.

Members of the committee, I would like to thank you for your attention. I'm available to answer any questions you may have.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Mr. Brown.

Our third presenter, from the Department of Fisheries and Oceans, is René Grenier, Deputy Commissioner of the Canadian Coast Guard. With him is Chantal Guenette, manager, environmental response, Canadian Coast Guard.

Go ahead with your presentation. You have up to seven minutes.

[D/Commr René Grenier, Deputy Commissioner, Canadian Coast Guard, Department of Fisheries and Oceans]

Thank you, Mr. Chair.

Thank you for inviting me to discuss the Canadian Coast Guard's readiness to assist in marine pollution incidents related to offshore oil and gas drilling.

Legislative changes to the Canada Shipping Act in 1993 resulted in the establishment of Canada's marine oil spill preparedness and response regime in 1995. The regime was established to respond to ship-source spills; however, other governments and agencies have benefited, and can benefit, from this preparedness capacity. This includes offshore platforms.

The regime, still in place today, is under the responsibility of Transport Canada, and governs oil spill response in Canadian waters. The regime was created through legislation to ensure that the potential polluters pay for industry's preparedness capacity. It is built on a partnership between government and industry.

The industry, through a bulk oil cargo fee, funds preparedness capacity of private companies called “response organizations”. There are four response organizations in Canada. Together, the industry provides the capacity to respond to its own oil spills.

The geographic area of response covered by the four Canadian certified response organizations include all waters as defined in the Canada Shipping Act--in the Great Lakes and Hudson Bay, and on the east and west coasts. It does not, however, include those waters located north of 60 degrees.

On the government side, the Canadian Coast Guard is the lead federal response agency for ship-source and mystery-source pollution spills into the marine environment. This specifically includes spills on or into water by ships, or spills on water in connection with the loading or unloading of pollutants from ships at oil handling facilities.

As for the waters located north of 60, the coast guard is the main respondent in the event of spills caused by ships. Although its mandate includes being in a state of preparedness and having a response capability in the event of ship-source pollution incidents, but not of those caused by offshore oil companies, the coast guard must be ready to intervene in case there is a marine pollution incident in Canadian waters.

We work in collaboration with our industry partners and certified response agencies in order to ensure a state of readiness in the event of an oil spill. As such, we conduct regular exercises and training activities.

Specifically, the coast guard maintains more than 80 response equipment depot sites across the country, of which 19 are in the Arctic. That includes containment, recovery, and storage capabilities as well as a cadre of 80 dedicated trained responders. Other coast guard assets, such as fleet vessels with trained fleet personnel, could also be tasked to assist. In addition, other government departments, including the Department of National Defence, Transport Canada, Environment Canada, and Public Safety Canada, would have a specific role to play in accordance with their mandates and would therefore be engaged as required.

Obviously response must be commensurate with risks. Therefore the coast guard's response capability is based on the principle of escalation. A response begins at the regional level and involves local coast guard and industry resources. Should the required response effort exceed regional capabilities, additional resources from other coast guard regions would be brought to the spill site. Similarly, industry resources—mainly response organization resources—can also be cascaded to the affected region.

In addition, should national resources prove insufficient, agreements are in place to obtain international assistance. In ratifying international treaties addressing marine pollution, Canada supports a principle of mutual aid to respond to marine pollution emergencies. Similar to the Canadian Coast Guard, response organizations have strategically placed equipment depot sites across the country, as well as a cadre of trained responders that could be deployed to the incident scene. Response organizations are part of the global response network, an international group of responders who have agreed to offer mutual aid when available.

Let me assure this committee and all Canadians that when facing a major spill from an offshore platform, the coast guard would provide all available resources to assist our federal partners, industry partners, and international partners to minimize the damage caused by the spill.

Thank you.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Mr. Grenier and Ms. Guenette.

We go now to the Department of Indian Affairs and Northern Development. We have from the department Mimi Fortier, director general, northern oil and gas—welcome—and Kerry Newkirk, director, oil and gas management directorate.

Go ahead with the presentation for up to seven minutes.

[Mimi Fortier, Director General, Northern Oil and Gas, Department of Indian Affairs and Northern Development]

Thank you very much, Chair. Thank you very much for inviting us to be part of your meeting this morning.

Managing the exploration and development of Canada’s oil and gas resources on federal lands in the Northwest Territories, Nunavut, and northern offshore is a federal responsibility. The Minister of Indian Affairs and Northern Development is charged with this responsibility.

The department works in partnership with northern governments and aboriginal people to govern the allocation of crown lands to the private sector for oil and gas exploration and development; set, assess, and collect royalties; coordinate related scientific research to inform oil and gas management; and approve benefit plans before each oil and gas activity and development takes place.

Collaborating with other government departments and stakeholders, the northern oil and gas program ensures the existence of a transparent and robust regulatory regime characterized by the application of a market-based approach where the private sector explores and develops crown lands, and in return a fair return on development revenues accrues to the crown, and there are significant economic opportunities for communities.

Specifically for the Beaufort Sea, the department has been working with the Inuvialuit institutions and communities every step of the way since the signing of the Inuvialuit Final Agreement in 1984. The department's oil and gas program also involves activities associated with the preparedness for dealing with pending and emerging oil and gas development opportunities that are currently in the planning stages in the north. Among those activities has been the emergence of a coordination and promotion role for greater science in support of the knowledge base necessary for sound decision-making.

Between 2002 and 2010, INAC led the development and implementation of a science program in support of northern energy development. INAC is also actively involved in the environmental studies research fund mandated by the Canada Petroleum Resources Act, which finances environmental and social studies pertaining to exploration, development, and production activities on Canada’s frontier lands through levies on oil and gas licences. The program is also involved in shaping research conducted through Natural Resources Canada’s program of energy research and development, and specifically its frontier oil and gas portfolio.

Management responsibilities pursuant to the Canada Petroleum Resources Act rest with the Minister of Indian Affairs and Northern Development Canada, while the National Energy Board administers the Canada Oil and Gas Operations Act. Other legislation concerning land use and environmental protection are fundamental to the sustainable development of oil and gas resources in the north. These aspects are managed by independent boards set up pursuant to land claim agreements, and where these authorities are maintained, by the regional divisions of INAC in the Northwest Territories and Nunavut.

The Canadian Environmental Assessment Act applies offshore in the Beaufort, and an environmental assessment under this act is triggered when an application is made to the National Energy Board, as federal regulator, to undertake an offshore project. The minister reports to Parliament on the administration of oil and gas lands in the Northwest Territories, Nunavut, and the northern offshore on a yearly basis.

The issuance of licences to explore for oil and gas is governed by the Canada Petroleum Resources Act. The rights issuance cycle is composed of four stages. In the first phase, preliminary consultation with aboriginal organizations, communities, territorial governments, and expert authorities, particularly in renewable resources, are used to assess and support rights issuance within a particular region, identify exclusion zones, and confirm the terms and conditions of the licences.

In the second phase, a call for nominations allows industry to specify lands of interest for inclusion in a subsequent call for bids. The third formal phase is a call for bids, open for the statutory minimum of 120 days. And finally, of course, there is the issuance of an exploration licence following acceptance of a winning bid by the Minister of Indian Affairs and Northern Development.

Exploration rights issued pursuant to an open, competitive bidding process confer an exclusive right to apply to drill for petroleum and to apply for a production licence to produce discovered oil and gas. The successful bidder is expected to spend the dollar value of the proposed work during the first period of the licence and is required to drill one well during this first period to continue the licence into the second period. It should be noted, though, that the approval of these activities and specifically the drilling of a well is subject to National Energy Board regulatory approvals. The licence only confers the right, not the authorization to drill. The National Energy Board assesses drilling plans when they are filed for review, and drilling will not occur unless the National Energy Board is satisfied that drilling plans are safe for workers and the environment.

Calls for nominations have been held annually in the Beaufort-Mackenzie region since 1989, with the support of the Inuvialuit and informed by their concerns. Emphasis is placed on the protection of the environmentally or culturally sensitive areas in the decision-making process. To this end, Indian and Northern Affairs Canada relies upon scientific and traditional knowledge to make informed decisions regarding rights issuance.

The ecosystem of the Beaufort Sea is well studied. One consequence of the long history of oil and gas exploration extending over several decades has been the growth of scientific knowledge about the Beaufort Sea ecosystem, geology, and physical operating environment. Programs such as the Beaufort Sea project of the 1970s, the Beaufort environmental monitoring project of the 1980s, and the recent research program from 2002 to 2010 and currently researched under ArcticNet all provide a scientific foundation upon which decision-making is undertaken to issue rights.

A pragmatic understanding has also developed in local communities based on direct experience of oil and gas activities fused with traditional knowledge. This experience and the research initiatives have yielded critical information used in INAC’s day-to-day activities. One consequence has been that large areas of the Beaufort Sea have been excluded from nomination, including all areas proposed as marine protected areas and all nearshore waters along the Yukon coast.

To synthesize Beaufort Sea information, INAC’s northern oil and gas program launched an online information system called the petroleum and environmental management tool. This web-based tool integrates key information on environmental and socio-economic factors to help make informed decisions regarding oil and gas management.

Current interest in the north dates from the mid-1990s, and renewed interest in the offshore Beaufort sea from 1999. Recently, this interest extended to deeper-water areas of the outer continental shelf in the central Beaufort sea.

In 2007 and 2008, the Minister of Indian and Northern Affairs issued rights extending to deeper-water areas of the Beaufort sea: a total of six parcels are currently subject to a total work commitment of close to $2 billion.

[The Chair, Conservative, Leon Benoit]

Ms. Fortier, you're over your seven minutes. Everyone has your presentation in front of them. If you could, please wrap it up with a very quick summary so we can get on to the next presentation. I want to ensure we have ample time for questions, and there are five groups to question.

[Mimi Fortier]

In closing, I want to reassure the members that oil and gas management decisions are considered very carefully, and a significant level of assessment and consultation occur prior to any recommendation being provided to the minister regarding rights issuance.

We acknowledge that the events of the Gulf of Mexico are tragic, and they will have implications for Canada’s Arctic. The lessons learned will help shape the oil and gas program, but it is too early to speculate on the impacts. INAC is working closely with these other federal departments represented here today, as well as aboriginal communities and stakeholders, to incorporate the learnings from the event unfolding in the United States.

Thank you.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Ms. Fortier and Mr. Newkirk.

We will have a final presentation now from the Department of Natural Resources. We have Mark Corey, assistant deputy minister, energy sector; and Eric Landry, director of the frontier lands management division, petroleum resources branch.

Please go ahead with a presentation up to seven minutes.

[Mark Corey, Assistant Deputy Minister, Energy Sector, Department of Natural Resources]

Thank you, Mr. Chair.

I'm just going to go quickly through this deck. This is the same deck that we presented to the Senate standing committee last Tuesday night. We just wanted to provide them and you with a brief overview. You may know all of these things already, but we thought that providing an overview of the legal and regulatory frame would be useful. This deck provides a summary of the legislative framework, safety and liability provisions, the environmental assessment processes, and a lot of our emergency response plans.

If you go to slide 3, two key acts govern petroleum activity on Canada's frontier lands. First is the Canada Petroleum Resources Act, the CPRA, which deals primarily with rights issuance and royalties. Under the CPRA the Minister of Northern Affairs, in northern Canada, and the Minister of Natural Resources, in southern Canada, may issue expiration licences, significant discovery licences, and production licences. The second piece of legislation is the Canada Oil and Gas Operations Act, CAGOA. It promotes safety and the protection of the environment. It's basically the legislation that's used for governing the safety and protection of the environment and the operations. Those are the two key pieces of legislation that underline the federal system.

If you go to slide 4, you will see that in Newfoundland and Labrador and in Nova Scotia, we set aside in the 1980s the issue of jurisdiction in favour of joint management regimes. We set up boards in both of those areas. The rights and resources are administered and managed by the offshore petroleum resource boards, which report both to our minister and the respective provincial ministers. Certain decisions, such as issuing a licence and other things, require joint ministerial approval and are called fundamental decisions. So we have a separate system set up, administered jointly with the provinces, in these two areas; but again, the principles go back to those two key pieces of legislation.

In the non-accord areas, the regulator is the National Energy Board. It is responsible for administering CAGOA, meaning that it regulates petroleum activity in all of Canada's frontier areas that are subject to the act, including Canada's Arctic offshore in the non-accord areas. The NEB is the lead agency in the event of an emergency, for example, in the Arctic, or any other frontier lands subject to CAGOA that are outside of the accord areas.

In those areas NRCan is responsible, as is INAC in the north, for collecting, managing, and administering royalties and land tenure management. As we mentioned, the NEB is the regulator in these areas.

You can now turn to slide 6.

Before carrying out work or activities related to oil operations, operators must obtain appropriate authorizations and approvals from the appropriate regulatory board. In order to obtain an authorization, an operator must ensure that it has satisfied all legal and regulatory requirements concerning the work or activity. The authorization can include the approval of certain documents, plans or other issues, as specified in regulatory requirements, or the approval of specific activities carried out pursuant to an authorization.

We can now move on to the next slide.

Here we are underlining that we have two different areas, the accord and non-accord areas.

Prior to an area for exploration in the north being opened up, as Mimi mentioned, aboriginal groups are notified and provided the opportunity to identify areas of environmental sensitivity and those of special interest for cultural reasons. The dialogue explores the concerns that may be raised about oil and gas activities initiated by the issuance of licences. In the Atlantic areas, prior to an area being opened up the boards will carry out what's called a strategic environmental assessment, an SEA. These perform largely the same function: they help to identify environmental issues at early stages, which can assist the boards in determining whether or not to open an area to exploration.

The next slide is there just to underline that environmental assessments are then required prior to any drilling. They are required at various other stages. Project-specific environmental assessments are required prior to the regulatory boards' authorization of offshore petroleum-related work or activities, and every project requires an environmental assessment.

Slide 9 just outlines the ladder of responsibility. The primary responsibility is with the operator. As René mentioned, the operator is responsible for preventing, mitigating, and managing oil spills, and they are liable for the costs of cleaning up a spill and paying for losses or damages. An operator is legally required to demonstrate a certain amount of financial capability before undertaking activity, which is referred to as financial activity. It's the minimum required by the boards. It can vary, depending on the project. The general practice has been overall responsibility of about $350 million in tiers. The operators have unlimited liability if they are sued by others and are found negligent. So these are basic minimums the boards insist on. The financial responsibility is not a limit or a cap on the operator's liability, which is unlimited. Again, the liability provisions are basically just to establish certain minimums.

Slide 10 outlines that emergency management systems are in place at various levels. At the operational level, operators must submit a detailed emergency response and an oil spill response plan as part of their application to drill a well. Operators must be members of a Transport Canada certified response organization. Membership in these organizations allows caches of spill-response equipment and expertise and manpower to be brought in to assist. The regulator's role can range from monitoring activities to the authority, in a very extreme case, to actually stepping in and taking over if they feel a spill is not being properly managed.

We now turn to slide 9. The Department of Natural Resources manages 10 emergency response plans, each of which is adapted to a specific type of incident. The department conducts regular simulation exercises, which are intended to assess various emergency scenarios. The latest offshore emergency simulation exercise was conducted by our department on March 25, 2010, together with the Canada - Newfoundland-and-Labrador offshore petroleum board. All that to say that we have plans in place and are conducting exercises quite regularly.

Slide 12 gives you an overview of the rules and responsibilities of various federal agencies in order to respond to oil spills. As you have seen, four of these agencies are here today in order to give you an overview of our responsibilities.

The last slide says that the Government of Canada is watching events in the Gulf of Mexico for lessons learned. We've taken a number of steps. On May 11 the NEB announced it would be conducting a comprehensive review of Arctic safety. On May 12 the Province of Newfoundland and Labrador announced an independent assessment of offshore spill prevention and response. On May 13 a joint decision was issued between the Department of Natural Resources and Nova Scotia extending the moratorium on oil and gas exploration in the Georges Bank area. On May 20 the Canada-Newfoundland and Labrador Offshore Petroleum Board announced a number of additional measures on Chevron's drilling project in the Orphan Basin. On June 10 the NEB announced its preliminary scope for the review it's now undertaking of the activities it regulates in the north.

The bottom line is that we have a strong regulatory system in place. We have independent regulators who are very experienced. We've taken a number of steps since the incidents in the gulf to further heighten our vigilance on it, and we will be watching very closely, because we know there are lessons we can and will learn from that tragedy.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Mr. Corey and Mr. Landry, for being here.

Thank you all for your presentations. It's very helpful information for the committee. And thank you for the role you play in regulating and accommodating the process of offshore drilling, training, and preparing for cleanup in case that should be necessary.

We'll start the questioning with Mr. Regan, for up to seven minutes. Go ahead, please.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Chairman, on a point of order, I have two quick points.

First of all, I notice we have officials from NRCan here today, and that's good, but I'd like to know if that means the minister will not be appearing. He was invited. I note he has appeared at committees where he wasn't invited, and now he's not appearing at this meeting where he is invited. I wonder if this means we have to invite his senior policy advisory, Bruce Winchester, in order to get him to appear. Is he in fact going to come, or not? That's what I'd like to know first.

On the second point, Mr. Bowden mentioned he wasn't called by BP until last week. Obviously that's alarming and disconcerting. We have also asked certain oil companies, like Chevron, to come before us. As a point of order, I'd like to know if they're coming. My understanding is that Chevron has refused. Have any other oil companies agreed to come?

First, the minister has refused to come, I gather, and secondly, are any of the oil companies coming?

[The Chair, Conservative, Leon Benoit]

In terms of the minister, I'll let Mr. Anderson answer that.

In terms of the other witnesses, I don't believe we've had another oil company. We had BP in the first round and they had a representative here. I don't think we've had our invitations accepted by any other oil company

Mr. Anderson, do you know about the minister?

Of course on short notice it's always difficult to get a minister. You would know that. It was like that when you were there.

Go ahead.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Mr. Chair, obviously the minister is a busy guy, and on short notice... As you said, the invitation has been extended. He takes all these invitations seriously and he has been very happy to provide senior officials to the committee for information. We're certainly working with the committee on this.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Mr. Anderson.

So we have the answers. If you have any more questions about the other witnesses who have been invited—we have invited the witnesses in the order they have appeared on the priority list from each party—you can discuss that with the clerk if you'd like, or with me.

[Geoff Regan, Liberal, Halifax West, NS]

Thank you, Mr. Chairman. I'll go on, but I will note--

[The Chair, Conservative, Leon Benoit]

Go ahead with the questioning. We will start the clock now.

[Geoff Regan, Liberal, Halifax West, NS]

I'll note that clearly the minister was able to find the time to attend a committee where he wasn't actually invited, so it's interesting that he couldn't make it here. However, I know he's very busy.

Let me ask if any of the witnesses today can provide us with insight into what caused the Deepwater Horizon explosion in the Gulf of Mexico that led to this enormous disaster. Do you know what actually caused this?

[The Chair, Conservative, Leon Benoit]

Does anyone want to tackle that?

Yes, go ahead.

[Ron Bowden]

We in the industry who are supplying BP and others in their response have the same question. And I think all of us know that probably we have access to the same information. It was very censored, especially in the beginning. We know the American government had requested, and then ordered, that more information be released. So it's very censored. We don't really know why--and I'm sure the reports will come out later. But I don't think there is any information that I would have, or any of my colleagues would have, that we are in possession of. And I think that's the reality we've all discussed in the industry.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Bowden, have you had any calls in Canada since this started, from any of the departments in relation to preparing for the possibility of a major spill here?

[Ron Bowden]

We have our business as usual, so we do have calls coming from our domestic customers, but not in relation to the situation in the gulf.

When I mentioned earlier that we were contacted last week by BP, that was to supply them with the equipment that we manufacture and supply in our services. Initially we were contacted by a horde of service companies in the United States, which were told to go out and accumulate, acquire, and procure equipment. Then they realized that we were specialized in response activity and equipment. We design and manufacture basically skimmers, from very small to 30,000-pound units we put on offshore ships.

[Geoff Regan, Liberal, Halifax West, NS]

I'm sorry, Mr. Bowden, but I only have a very few minutes and I've got a thousand more questions than I have time for. So I'm sorry to move on, but what I was looking for was on the narrow question of whether you had been called--and you indicated that you haven't been--in relation to any response to what's happened in the gulf, or a major spill here.