Natural Resources Committee on Nov. 18th, 2013

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Regan.

We will go now to the five-minute round, and we'll start on the government side with Mr. Trost and Parliamentary Secretary Block. Then we will go to Ms. Moore from the official opposition.

Go ahead, please, Mr. Trost, for up to five minutes.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Thank you.

One of the reasons you were put together was to improve timelines and increase efficiency. Every project is unique in its characteristics, so how do you measure your success? What sort of benchmarks are you using to say that a project which didn't exist in the past but you are working on now is being more efficiently delivered?

Can you explain to me the benchmarks you've been using to understand and decide if the process has been successful, if your organization is delivering on what is promised?

[Jim Clarke]

I'll start that off and maybe pass it to Terence afterwards.

The original analysis leading up to the creation of the major projects management office and the initiative analyzed a number of major resource projects that had taken place to date and concluded that the average time for the regulatory review was up to four years. That included the environmental assessment and the regulatory permitting. One of the overall objectives of the initiative was to cut that time in half while in no way compromising environmental protection measures and effectiveness of the review.

If you average the amount of federal time taken on the 17 reviews we have completed, we have met the target of two years or less.

Another element in terms of success though is not just efficiency; it is effectiveness, and we have some information on that now. We are embarking on that in a more concerted effort now to get effectiveness performance measures nailed down so we can be able to comment on how effective the review processes have been in this next round of evaluation of the initiative and potential renewal.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

You can measure time, but you don't quite have the metrics yet to measure effectiveness?

[Jim Clarke]

We have information, but we don't have as systematic a process as we would like to measure effectiveness. This is what we're in the process of doing now.

The funding for the initiative expires at the end of March, and there will be an evaluation and a decision on whether or not it should be renewed. Going into that evaluation, we're driving towards having information on effectiveness of review processes as well.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

In your remarks, you noted—and in Canada I think this is obvious to everyone—that coordination between levels of government is important. You mentioned in your remarks coordination with the provinces.

Could you expand on that and also explain how this has been going, whether you've been meeting your objectives there, and if not, what needs to be done?

[Terence Hubbard]

Thank you for the question.

One of the key objectives through the MPMO Initiative was to ensure one project, one review. The federal government is only one of the decision-makers with respect to these projects. The provinces, as you're aware, own and manage the resources within their boundaries and have primary responsibility for many of the projects we deal with.

One of the shared objectives of the federal and provincial governments was to move towards this objective of one project, one review. Over the years, we've made a lot of progress towards it. There's a memorandum of understanding in place between the federal and provincial governments to ensure alignment of environmental assessments. More recently, through the legislative changes that were introduced as part of the responsible resource development plan, there are new tools in place now to ensure that we can better move towards this objective of one project, one review; tools such as substitution and equivalency whereby, if provincial governments can meet all of the requirements under federal legislation, they can through their process satisfy federal requirements, so that we move away from duplicative review processes.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

I can see why the provinces would be motivated to do that for costs and efficiencies. Has there been fairly good uptake by the provinces, and has it been uniform or has it been variable across the country?

[Jim Clarke]

I'll start with that.

In terms of substitution, there's been a big uptake from British Columbia. They've been the first province out of the gate to have discussions with the Canadian Environmental Assessment Agency. They have landed on agreements for substitution on five projects so far. I could provide a list of those projects for you, if you're interested.

I know there are other provinces that are interested, but they haven't reached the point British Columbia has in having formal agreements in place for substituted processes.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

My time is up, Mr. Chair.

[The Chair, Conservative, Leon Benoit]

Yes, your time is up, Mr. Trost.

We go now to Ms. Block, for up to five minutes.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Thank you, Mr. Chair.

I too would like to join my colleagues in welcoming the witnesses today. It's been a very informative presentation. I am pleased to hear about the impact the MPMO has had since its creation.

You said in your presentation that addressing a system-wide challenge requires a system-wide response. You highlighted some of the challenges needing to be addressed. I could ask what would the cost to the economy have been had we not moved to this coordinating body looking at the projects through the lenses that the MPMO is looking through, but what I will ask is whether you can comment on how greater regulatory efficiency creates investment opportunities for Canada.

[Terence Hubbard]

Thank you.

Again, both the comments and the question are very interesting and involve difficult questions to wrestle with.

In terms of the importance of regulatory certainty, Canada is just one country blessed with resource opportunities. There are a number of other regions and other countries throughout the world that are looking at opportunities to move forward and develop their resources to take advantage of the growing markets for these commodities.

As Jim highlighted, we have hundreds of billions of dollars of potential new investment over the next decade. For Canada to capitalize on these opportunities and realize this development potential, we need to provide investors the opportunity and clarity, that if they're going to invest in Canada and develop these very complicated projects, they will have some sort of certainty about when they'll have a decision as to whether or not they can move forward with the investment decisions.

If we can't provide that certainty to them, they'll look at competitors in other countries that may not have the same level of rigour in their assessment processes as us. We're not looking to cut corners, but we're looking to ensure that we can make efficient and effective decisions within a defined timeframe so that investors have that certainty and so that we can attract the capital to make these opportunities happen.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Thank you.

I also want to ask about your slide 9 concerning policy leadership. You highlighted a systemic change across government. The first bullet speaks to providing horizontal leadership.

Could you comment on the relationship—you may have touched on this already—among other departments that you work with and say whether some of the work you're doing could or could not be plugged into what might become a best practice when considering the work that MPMO does?

[Terence Hubbard]

In the creation of the major projects management office, there was a realization that there was a gap. Departments of course have responsibility for their own individual mandates and for moving them forward, but these projects bring together cross-cutting horizontal issues that don't necessarily lie neatly within an individual department and mandate. Given that, it was often very difficult to identify which would be the lead department responsible for going forward and addressing an issue. There was a lot of finger pointing and a lot of time wasted in delays that really impacted this multi-billion dollar investment potential.

With the major projects management office, now we have a clear focal point, an organization not with a legislative mandate but with a mandate to work in partnership with these regulatory departments and agencies to address these cross-cutting issues. We have a horizontal governance mechanism in place now to ensure that we get timely decisions on these horizontal issues that don't necessarily fit nicely within an individual departmental mandate.

Other initiatives across the federal government have looked to the work the MPMO has done and are exploring opportunities to take this approach to address other horizontal policy issues. For example, in the north we have a new office called the northern projects management office, which is taking a similar approach to northern projects.

Other levels of government have also taken a look at what the MPMO is doing. Alberta is taking a similar type of approach. Ontario is investigating whether or not this type of approach could work within their provincial context.

We have also met with a number of international jurisdictions that have been looking at the MPMO and whether the approach we're taking, this horizontal cross-cutting approach to addressing those systemic issues, can be applied in their jurisdictions. Countries such as the United States and Australia, some of our competitors when it comes to developing our resources, are taking notice of what we've done and of the success we've had and are looking to replicate it.

[The Chair, Conservative, Leon Benoit]

Thank you, Ms. Block.

We'll go now to Ms. Moore, followed by Mr. Zimmer, Monsieur Gravelle, and Mr. Leef.

Go ahead, please, Ms. Moore.

[Christine Moore, NDP, Abitibi—Témiscamingue, QC]

Thank you very much.

I would like to begin by mentioning that the committee will undertake a study on the mining of rare earths. Could you please send us a list of your current projects that involve rare earths, along with their status?

I would also like to go back to Mr. Trost's questions about the objective of coordinating with the provinces in order to ensure only one review per project. I would like to know whether your office has a designated individual for dealing with each province. By that I mean a different person for each province, since the laws are different. Is all that managed by a single person instead?

Since your creation in 2006, have you recruited to your team people with specific experience in interprovincial cooperation in order to establish common review processes?

My second question is somewhat similar, but it has to do with the consultation of aboriginals. Have you recruited any individuals who have expertise specifically in that area and can contribute greatly? Have you been targeting people with such expertise?

[Jim Clarke]

Thank you very much for your question. It has several parts, but I will try to answer it.

I was very fortunate to be at the MPMO from the very beginning, so instead of inheriting a group of staff, I got to staff from the beginning. My team is very small.

I think it has only eight officers and two directors.

In terms of how I break that down across the country, I have a western director and an eastern director. I have officers who have experience in certain sectors in terms of natural resource projects. I have officers who focus on a certain region as well.

In the province of Quebec, for example, I have two officers who are generally managing projects in that province. In terms of skill sets, a key skill set in my officers is collaboration. Just by the nature of who we are and what we do, my officers have to work collaboratively across the federal government and with other jurisdictions.

Some of my officers are experts in aboriginal consultation; others are experts in other fields. I feel very fortunate that I got to staff what I always call the A-team in terms of skill sets and abilities to really pull together horizontally the departmental officials and to work very collaboratively with other jurisdictions.

[Christine Moore, NDP, Abitibi—Témiscamingue, QC]

When it comes to aboriginal communities, are people from those communities integrated directly into your team in one way or another?

[Jim Clarke]

No, not specifically on my team. I believe we do have people like that in our office, but not specifically on my team.

That being said, on the role of the MPMO per se, we don't have a direct role in actually going out and conducting aboriginal consultations. We have a role to work system-wide to ensure there's a whole-of-government approach to aboriginal consultations.

We work with our federal government colleagues in terms of ensuring that approaches are appropriate. For example, when there's an environmental assessment led by the Canadian Environmental Assessment Agency, it will be the Canadian Environmental Assessment Agency that will be the crown consultation coordinator and will be leading consultations on behalf of the Government of Canada. We'll make sure that all the appropriate federal departments are working with the Environmental Assessment Agency in the consultations they're leading.

[Christine Moore, NDP, Abitibi—Témiscamingue, QC]

However, no representatives of aboriginal communities are working directly with you to ensure that your supervision, consultation, coordination and approach methods are in line with the ideal way they would like to work or the method they are interested in.

[Jim Clarke]

We work collaboratively with representatives from first nations on a number of our policy approaches. Perhaps Mr. Hubbard could comment on those as well.

[Terence Hubbard]

Thank you.

One of the key commitments we've outlined in terms of the plan for responsible resource development is moving forward with an enhanced approach to aboriginal consultations. One of the commitments there was to develop and move forward with the development of protocols with aboriginal communities that would outline the communities' expectations in the process for moving forward with consultations within those individual communities.

Our colleagues at Aboriginal Affairs, whom we worked very closely with on this initiative, are working directly with first nations communities to identify an interest in pursuing and moving forward with those agreements. At this point in time, they do have an agreement with the Mi'kmaq in Nova Scotia and are moving forward and pursuing discussions with other interested first nations communities to develop such understandings and approaches.

[The Chair, Conservative, Leon Benoit]

Thank you, Ms. Moore.

We'll go now to Mr. Zimmer, for up to five minutes.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

I want to thank the witnesses for appearing today.

What you've spoken about since the directive was given to you about the MPMO is something we support. We want a streamlined process for developing our resources. I'm from northeastern B.C., and natural gas and oil is what we do. Forestry is also a big part of what we do.

There are some concerns. I'd like to hear a comment from you about the recent comments made about the Prosperity mine and its resubmission of an environmental plan, and the rejection of that. I would like your comments on that, please, if you could.