Natural Resources Committee on March 3rd, 2011

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

That is precisely why we will be doing everything it takes to make sure that the NRU operates until 2016. But some alternative methods are very promising. I think that is good news. Whether in Sherbrooke or in Saskatoon or elsewhere in Canada, there are various centres working on it. It is very promising.

[Paule Brunelle, Bloc, Trois-Rivières, QC]

I will not reiterate what Mr. Coderre said about protecting employees, but we are watching the decline in the number of jobs and the layoffs in positions where there is considerable expertise. This is a loss of Canadian expertise. At the same time, the fact that there are so many terminations, going from 870 engineers to 340, is of considerable concern to us.

I would like to talk to you about something else. We see that in the supplementary estimates there is $1 million being transferred that was used at Natural Resources for the review of safety and environmental requirements for offshore drilling in the Arctic. Do you have concerns of that nature for Old Harry? Where are you at present in your negotiations with the Quebec government? You know there is a moratorium in Quebec until 2012. The environment is very fragile and there are impacts.

We have learned that Corridor Resources Inc., the manager, if you like, for Canada and Newfoundland, would have carte blanche to get a licence and drill. Do you intend to enter into agreements with the Quebec government, because a large part of what will be pumped is within Quebec? Do you intend to get involved the same way as in the Arctic to prevent the harm to the environment that this might cause in the Gulf of St. Lawrence?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

First, I think it's a good thing. That million dollars has been invested more than well. The National Energy Board, an expert regulator in which we have full confidence, made the proactive decision, as early as last May, to do an assessment and involve the people living in the North and people from the industry. That will allow us to review everything being done.

The National Energy Board is very proactive. There are several phases. After the first one, the information gathering, the data will be analyzed and ultimately a report will be submitted. The Board is studying what happened in the Gulf of Mexico carefully, be it in terms of the operations, rescue measures, industry involvement or the cause of what happened with the blowout prevention equipment. Obviously that is still being studied. We are probably going to get some very valuable findings that will help us improve all of the technology in this field.

You mentioned Old Harry. We are in talks with Quebec; we are even in negotiations. That is public, it's an open secret. I think it would be good to reach an agreement with Quebec. The Canada-Newfoundland and Labrador Offshore Petroleum Board is an independent regulator and we have complete confidence in it.

[The Chair, Conservative, Leon Benoit]

Excuse me, Minister.

Madame Brunelle's time is well past. You may get a chance to finish that answer later.

I'll go now to Mr. Cullen.

You have up to seven minutes.

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

Whoa, Chair, cutting off a minister; that doesn't look good.

Bonjour.

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

Bonjour.

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

These numbers we have before us are staggering. For this year, it is 190% overbudget. Last year it was 140% overbudget. In 2008-09 it was 84% overbudget. It's almost another billion dollars into the nuclear industry, after last year's almost $1 billion.

To be honest, Minister, I'm a little surprised that you're not more angry as somebody who's in charge of this file, meant to be managing the money that's going into it. It's 190% overbudget, and after years of going overbudget....

I thought you'd come here with a different message for us today, and for Canadians, that you were going to rein this thing in. This is something that you're trying to sell. I guess what's confusing to Canadians is that, if you're trying to sell something, is there any chance that Canada is going to recoup even a fraction of what we're putting into AECL right now?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

You know, angriness is.... I am angry, but being here and showing that I'm angry--I don't know how useful it is. I have to be in solution mode, and this is where I am now.

It shows that we have to restructure that thing; CANDU definitely needs to be restructured. A contract of refurbishment has been signed in the past. We have over-costs, over-delays.

I'm not a professional myself, so when I got into the office I made sure that I had professionals to monitor what was happening on the sites. Now we have revisited the timelines, and I'm quite confident that we have now...

We have more realistic timelines.

We will get through this now. We know better where we are going with this.

But in terms of being angry, yes, I am angry. This is why it shows that we have to get that thing restructured as soon as possible.

I mean, in saying that this is a fire sale...it's not a fire sale. We can achieve a good agreement that will be useful for everybody. But now, as we speak, the burden is definitely too heavy for taxpayers, and we have to get out of this situation as soon as possible.

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

No kidding the burden is heavy; I mean, it's almost $2 billion in the last two years.

I didn't use the term “fire sale” in my question. My question was this: can Canadians expect to recoup even a fraction of what we're putting into AECL right now when it is finally sold?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

As to what Canadians can expect, we have to make sure that we have a viable nuclear industry in the coming years; keep our highly skilled jobs; make sure that we have this form of energy that can produced. It's a clean energy. But we have to do it in an affordable way, which is not the case now.

This is why we have to go through this restructuring process. We have to achieve it, and this is where I am putting my effort.

So I can be angry and I can shout, and I can...but I am in solution mode, and I work on the process itself.

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

The government often calls this an investment. Investments usually have a return of some sort of money back to you.

Can AECL sign any of these refurbishment contracts while it is up for sale? Does the government allow it permission to sign onto these contracts while you are going through the selling process?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

The policy is that while we restructure AECL, we won't take any more financial material risk.

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

You won't take any more?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

We don't want to take any more financial material risk. This is not the way to do it.

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

If that is the direction you've given to them, can they...? We've been told that AECL can't sign contracts over a certain amount of money, and it's a very low amount of money....

Is that not true? They can sign any contract they want?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

They can sign contracts, and as I said, we do everything possible to seize opportunities. On the other hand, we will avoid taking any more financial material risk. This is a matter of balance, and this is what I said earlier. We cannot go with a company that is overloaded or with extra risk. We have to sit down; we are in a negotiation room with committed investors, so time is of the essence. This is why I said that before; this is everything we have to manage, as we speak now.

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

You mentioned the so-called nuclear renaissance. There are 190 new builds that are being proposed worldwide right now. How many does AECL have contracts for?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

Do you know that by heart, Serge?

[Serge Dupont, Deputy Minister, Department of Natural Resources]

I would imagine that of the 190, there are relatively few that would actually have firm contracts. Those are 190 projects on the books. AECL is pursuing some of those opportunities, but there are none that could be firmly established in the CANDU kind of camp right now. That would be true for many other companies.

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

Right. But globally there are no contracts signed for new builds right now. Is that correct?

[Serge Dupont]

That's correct.

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

Okay.

So in terms of the renaissance, which has supposedly been going on for the last three or four years--five years, even, by some estimates--AECL doesn't have...?

It feels like we're in a chicken-and-egg situation. Excuse the English expression, but it seems like you're trying to sell this thing, and in the midst of the sale you are unable to build any new contracts that would supposedly add value to the sale. But you've put this limit saying....

What's the expression you use, that you're not willing to take on any risks...?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

Significant financial material risks: we won't take them.

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

What does “significant financial material risks” mean? Does that mean no new contracts for new builds?

[Christian Paradis, Conservative, Mégantic—L'Érable, QC]

As we speak now, when you say we are stuck between the chicken and the egg, this is exactly where we have to get out from. We have to restructure the thing, and while we are doing it, there's no way we will overload the company with extra contracts with...

What is the exact expression?