Natural Resources Committee on Feb. 1st, 2011

[Randy Hoback, Conservative, Prince Albert, SK]

You said that within the province you'll even see different departments come to a site. Of course, they must have different issues. There must be a reason why they're doing that.

Do you know why?

[Dr. Gerry Angevine]

They have different issues, but if they can come together through a single window kind of approach, it does make it easier, and sometimes I would think it would reduce the time and the cost of processing applications.

[Randy Hoback, Conservative, Prince Albert, SK]

So if you're giving advice to the Minister of Natural Resources from New Brunswick, who happens to be here today, how would you have him arrange his bureaucracy in such a way that you could see the systems or the technology move forward in an efficient manner, in a competitive manner? Any advice to give to him?

[Dr. Gerry Angevine]

I think he's doing the right thing, certainly, going out and seeing what is taking place in Arkansas, B.C., and other jurisdictions, and learning from the mistakes that have been made and hoping to take a best practices approach. There certainly is a benefit in being able to see what has gone before. The difficulty for New Brunswick will be to find a market for that gas. How will that gas compete economically? But that's a bit off your question. That's another issue.

I think that most likely the regulatory apparatus in New Brunswick will need to be expanded to have the expertise to look at these new issues of shale gas. They'll have to have excellent, on-the-mark regulation, but they'll have to have regulators who are capable. They'll have to have inspectors and so on.

There'll be a number of changes, but I think industry welcomes good sensible regulation, and enforcement as well, because if people are allowed to violate regulations and get off the hook easily without much penalty, it damages the reputation of the industry and hurts the whole process.

So the industry is onside, I would think, ensuring that the regulations from square one are appropriate from a technical point of view, to protect people, to protect the environment, but also ensuring that enforcement is strong and realistic, in the sense that no one can get away with floating, so to speak.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Hoback.

We go now, finally for today, to Mr. Cullen, for up to five minutes.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Thank you, Chair.

First, Mr. Ingraffea, I apologize on my colleague's behalf for the earlier line of questioning. I'm sure you're quite used to that with American-style politics. In Canada we're just growing accustomed to it, with a new direction from the current government.

The last thing Mr. Angevine said was with respect to--

[The Chair, Conservative, Leon Benoit]

A point of order, Mr. Anderson.

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

Chair, if Nathan wants to apologize, he can apologize for himself. He doesn't need to apologize for me.

I just wanted to point out that Mr. Ingraffea has been involved politically on this issue for quite some time. He can check that on the Internet. I think we just needed to know that.

[The Chair, Conservative, Leon Benoit]

Okay, Mr. Anderson. That isn't a point of order.

Go ahead, please, Mr. Cullen.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Well, Mr. Ingraffea, I had some questions for you with respect to industry, so-called, being onside, according to Mr. Angevine, but let me change tack, just to follow-up on Mr. Anderson's comment.

Mr. Angevine, can you confirm whether the Fraser Institute receives any money from U.S. foundations?

[Dr. Gerry Angevine]

The Fraser Institute, as you know, is a non-profit organization. It's not a consulting organization. It receives no money for consulting work. It's not a consultant and receives no money from government. It operates strictly from donations from individuals, companies, and foundations.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

So just specifically to my question, do you receive money from U.S. foundations?

[Dr. Gerry Angevine]

I believe it may...I think it does, but I'm not absolutely certain.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Let me apply some certainty. Are you familiar with the Koch Foundation?

[Dr. Gerry Angevine]

I'm not familiar with them. I've heard of them.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

They are the primary funders of the Tea Party in the U.S. They also help fund you folks.

The question I put to you is that nine of your directors who currently sit on the Fraser Institute board are involved in the oil and gas industry. They are also heavy contributors to your foundation. The government has raised its concerns about witnesses in the past to the effect that if they receive money from industry or if they receive money from across the border, that may taint any of their testimony or research in front of this committee. The government has seen that as a problem for anybody who ever raises a concern about the oil and gas industry, but it seems to have no problem with anyone who comes here to defend the oil and gas industry.

I find the lack of questioning by my Conservative colleagues with respect to any potential bias on the part of those who support the oil and gas industry somewhat troubling and a little weak on logic.

Mr. Ingraffea, the general fear raised by the public is with respect to water contamination and then the liability that follows any contamination that happens. We saw recently that Talisman--and this is for Mr. Hoback, who hasn't seen any incidence of spills--recently shut down continent-wide drilling for more than a week. Canbriam Energy is leaking in Quebec right now, and, according to the Quebec minister, “the industry is not in control of the situation”, and I am quoting.

Am I typifying the concerns of the general public correctly, that is that it's both water contamination and supply, and then who's responsible, who's on the hook, if any contamination does occur, once it begins?

[Dr. Anthony R. Ingraffea]

Yes, you are on both counts.

I hinted in my opening comments that I wanted to have the opportunity to correct some of the earlier testimony that your committee has received. In particular, I noted that during a previous meeting, the senior vice-president of Talisman was quoted as saying “We have been fined in Pennsylvania three times in the last three years a total of $21,000. None of it was for contaminating surface water.” With respect to your second point, about whether regulations are in place that are adequate, I should point out that he failed to point out that his company has been cited for violations of regulations in Pennsylvania 285 times in the last three years. The fine was only $21,000 because the fines hadn't been assessed yet for the 285 regulation violations.

I should also quote someone that you would do well to invite to a future meeting, and this is the outgoing director of the department of environmental preservation in the State of Pennsylvania, John Hanger. Right now the department really has very questionable authority when telling a company that it operates so badly that the department is not going to give it permission to get any more permits. He's also quoted as saying “the maximum fines that environmental regulators can issue to violators of the state's oil and gas law are...'scandalously low'”. He goes on to say that currently a gas company like Talisman operating in Pennsylvania pays a $25,000 bond to cover as many wells as that company would ever develop in the state, and that's one quarter of the cost to the state of plugging an abandoned well, of which there are 100,000 in Pennsylvania.

So the point I made before, to look before you leap, to go slowly, and to study what's already been done wrong in other places.... The gentleman from New Brunswick is right on target. He just needs to expand a little farther and ask more questions in more places. Don't count on hearing from just the industry people in one location as to how to proceed. Ask people like him, the director of environmental preservation in Pennsylvania. He'd be glad to come up and talk to you. By the way, he was charged with both promoting--which he did--and regulating shale gas development in Pennsylvania, and he did both jobs very well. But he is very realistic about the current state.

[The Chair, Conservative, Leon Benoit]

Thank you very much.

Thank you, Mr. Cullen.

Thank you all for your questions and comments today, members of the committee.

To all the witnesses, thank you very much for coming today and for giving information that's very helpful to the committee. Thank you very much for your input.

We are finished with the meeting for today.

The meeting is adjourned.