Natural Resources Committee on March 31st, 2015

[Geoff Regan, Liberal, Halifax West, NS]

That's true.

Mr. Miron.

[Ian Miron]

I can't disagree with any of those comments. Cutting funding and then expecting more just seems counterintuitive.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Olszynski, do you have anything else to add?

[Martin Olszynski]

I agree with what the other witnesses have said about that.

[Geoff Regan, Liberal, Halifax West, NS]

Let me ask you about the risks to taxpayers in the case of a catastrophic spill. I ask because currently, of course, if pipeline company X were unable to pay the entire cost associated with the spill, some things could in fact go unpaid. Under Bill C-46, we would have a regime where the consolidated revenue fund comes over to the taxpayer. It would be called upon to cover unpaid awards.

The question is, I guess, whether it's fair to taxpayers to carry this risk, although there seems to be some mechanisms to allow the NEB to recover any compensation that might be paid out. Do you think this aspect of the bill should be amended, and if so, do you have any suggestions?

Mr. Olszynski, I'll start with you.

[Martin Olszynski]

Essentially, in thinking about these provisions, they are very similar to what we have in the United States and the Superfund there. The goal is really to mobilize money quickly, even where the operator cannot or refuses to do so, to deal with those issues. I think the one difference maybe is around the discretionary nature in how this fund will be replenished. I think in the United States, there's essentially a levy placed on operators who fit within a certain regulated community. We see some of that here too, but it just seems to be a bit more discretionary.

So, if you wanted to make sure that money would in fact be replenished, that the general account of Canada would...and that Canadian taxpayers would not essentially be subsidizing these kinds of incidents, then you would just make that recovery mandatory. You can maybe leave some flexibility around the mechanisms, but you make the recovery mandatory.

[Geoff Regan, Liberal, Halifax West, NS]

I have one minute.

Does anyone else want to comment? Would you like to raise your hand if you'd like to add a comment on that?

[Ian Miron]

I would just comment that I agree with those comments.

[Robert Blakely]

I would say one thing differently. A pipeline company has assets, whether it's the pipe in the ground or whatever else, or the contracts of cartage or whatever they're called. Those should be exigible.

[Geoff Regan, Liberal, Halifax West, NS]

Thank you very much.

[The Vice-Chair, NDP, Guy Caron]

Thank you very much, Mr. Regan.

We have time for one last set of questions.

Ms. Crockatt.

[Joan Crockatt, Conservative, Calgary Centre, AB]

Thanks so much, Mr. Chair.

I just wanted to go a little bit further, I guess. We've talked a lot about the risks to Canadians and how this bill prevents Canadians from being liable for the risks in the unlikely event of a pipeline spill, but I wanted to talk a bit about the benefits to Canadians of this legislation allowing this activity to continue.

I want to ask you, Mr. Blakely, if I could, to talk about how you see the Keystone XL pipeline. Should it go ahead? What benefits may there be to Canadians?

[Robert Blakely]

Basically, it means we have to build and maintain a resource that is capable of delivering 800,000 barrels a day to the gulf coast. I would very much like to build that.

[Joan Crockatt, Conservative, Calgary Centre, AB]

What would be the benefit to Canadians of being able to do that?

[Robert Blakely]

It would be jobs, security in terms of social programs, and the ability to fund what we do, to train a subsequent workforce, and to have economic security for North America. Those are pretty laudable goals. We still import oil in significant amounts. Maybe we don't have to do that anymore. Maybe we could be Fortress North America and—

[Joan Crockatt, Conservative, Calgary Centre, AB]

Get us off Algerian oil?

[Robert Blakely]

Well, [Inaudible—Editor] knew there are a lot of people who don't like us and our way of life.

[Joan Crockatt, Conservative, Calgary Centre, AB]

Mr. Donihee, could I ask you the same question? What kind of jobs flow from a project like Keystone, and how does that fit into our conversation here today?

[Jim Donihee]

Ultimately, whether it be Keystone...and I would suggest that the other projects, which are hoping to flow either east or west, are even more important to us because the reality is that we are currently suffering a loss in the order of $50 million per day in terms of full value for our resources that are flowing to one single market—albeit to our good neighbour to the south, which is enjoying that subsidy on Canada's behalf at the moment. As Mr. Blakely has said, it is crucial that, as a nation, we create options for ourselves by having access to other markets so that we can be sure we are getting full value for our resources.

Sixty billion dollars in projects are on the table over the next many years, and 25,000 jobs currently in the sector. You heard Mr. Blakely speak to the very significant numbers of jobs through the construction phases, at least. Last year, $100 billion in resources were transported, even at that discount, which provides tremendous contributions to the social fabric of our nation. We need to find a way to get there. It is incumbent upon government to create the circumstances, and for business to do it right.

[Joan Crockatt, Conservative, Calgary Centre, AB]

I think that satisfies my questioning. Thank you, Mr. Chair.

[The Vice-Chair, NDP, Guy Caron]

Thank you very much, Ms. Crockatt.

You have one quick question.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

This issue has come up quite a bit from all of the witnesses. I've really appreciated all of your testimony. This bill provides for the promulgation of a lot of regulations. Without those regulations, we still have a lot of legal uncertainty on exactly what the regime will be.

I put the question to the government and to the National Energy Board of whether or not they have already been conferring, and with the energy sector, which it seems would be logical, on the beginning of drafting the regulations. When I was assistant deputy minister, it was my understanding that when you are coming forth with a whole new legislative regime, you are also thinking about what regulations to implement that put substance to the bill, and then what kind of staffing and training you are going to need in order to implement that new regime in a constructive and effective way.

I guess I would like to hear from any of you. I appreciate the comments by Mr. Donihee, which were very honest. It is nice to hear that you once worked at the NEB, so you know what is needed.

I would just like to know if you agree, or if in any way you concur with my concern. I can only go on the basis of what the government and NEB have told us, and that is that no work has been done yet on these regulations. Does it not make sense that they ought to be expedited in a consultative process to promulgate these necessary regulations so we finally know what the new regulatory regime will be?

[Robert Blakely]

The sooner we get on with it, the better off we are.

[The Vice-Chair, NDP, Guy Caron]

Mr. Donihee, did you want to say something?

[Jim Donihee]

We have strongly indicated our support throughout the drafting of the bill to this point. Like a wide spectrum of stakeholders, we have the privilege of being consulted. We are eager to see it passed, and we would very much look forward to continuing consultation in terms of drafting the actual regulations.