Natural Resources Committee on June 20th, 2019

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

Mr. Chair, first of all, we have done the consultations in a way that reduces the chances of litigation. If somebody does challenge this decision in the Federal Court of Appeal, we are in a very good position to demonstrate that we have discharged our duty to consult by having extensive consultations and by keeping a record of the consultations.

It's also very important, Mr. Chair, to understand that unlike Conservatives, we will not undermine the due process that needs to be followed. We will not cut corners on the regulatory steps that need to be taken by the proponent in this case in relation to the NEB. Conservatives wanted us to cut corners at every step; we refused to do that. That is why we have reached this decision.

We owe it to Alberta workers. We owe it to the energy sector workers to do this.

[Shannon Stubbs, Conservative, Lakeland, AB]

It is not the case that Conservatives have ever advocated for any steps at the NEB to be skipped. Those steps, of course, were all followed and completed when Kinder Morgan, the private sector proponent, was advancing the Trans Mountain expansion, after which you failed to provide the legal and political certainty for them to go ahead.

Ian Anderson has also indicated that the court injunction remains in place, so what is your government prepared to do if foreign-funded or domestic anti-energy protestors seek to hold up construction?

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

As I said earlier, unfortunately energy sector projects such as [Technical difficulty—Editor] controversial because of the steps taken by the Stephen Harper government to polarize Canadians by not respecting Canadians' right to participate and by gutting the environmental protections that were put in place. We will do whatever we can to ensure that this project moves forward in the right way.

In the case of an injunction, I understand that an injunction is in place and we expect anyone who is going to participate in any form of activity to do that within the rule of law. The rule of law will be respected, but I'm not going to speculate on something that has not happened. Our goal is to reduce the tension. Our goal is to reduce the polarization.

I'm confident that the work we have done over the last seven months will allow us to demonstrate to Canadians that we followed due process and are offering accommodations that appropriately deal with the concerns of indigenous communities.

[Shannon Stubbs, Conservative, Lakeland, AB]

Part of the concern is that literally last year, one week before the Federal Court of Appeal said you failed in your indigenous consultations last time around, you said you believed that your process would hold up. Then the Prime Minister, the finance minister and the natural resources minister all promised legislation to give the legal and political certainty needed for the private sector proponent to proceed. Then you didn't deliver, and then you attacked anyone who suggested the very thing your own Prime Minister promised.

Let's just look at costs quickly, since this is a really important aspect to taxpayers now that you've put them on the hook. The Parliamentary Budget Officer says that if you miss this year's construction season, it will cost taxpayers billions of dollars more and that these increases in construction costs will reduce the sale value of the pipeline and drop the value of the asset.

Can you explain exactly what the cost to taxpayers will be for the construction and completion of the Trans Mountain expansion?

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

It is very important that we see moving forward on the Trans Mountain pipeline expansion as an investment in Alberta's economy, in the Canadian economy, in the workers of Alberta. They deserve that support. We are providing them that support because having not a single pipeline to get our resources to non-U.S. markets has hurt our potential in Canada.

We—

[Shannon Stubbs, Conservative, Lakeland, AB]

Of course, Minister, the vast majority of—

[The Chair, Liberal, James Maloney]

Your time is up, Ms. Stubbs—

[Shannon Stubbs, Conservative, Lakeland, AB]

—product shipped through TMX will go to U.S. refineries, and the only two export pipelines have been cancelled by your government.

[The Chair, Liberal, James Maloney]

Ms. Stubbs, your time is up. Thank you.

Mr. Cannings is next.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you, Minister, for being with us today.

I'm going to pick up on that commentary about first nations consultation and accommodation. It was this aspect that caused the Federal Court of Appeal to rule against the government last year.

After the announcement that you were okaying the permit, I heard an interview with Chief Lee Spahan of the Coldwater band on CBC, and I've read interviews with him in the press since then. He said that “the meaningful dialogue that was supposed to happen never happened”. This is since the court case, and in that court case, the appeal court said that “missing from Canada's consultation was any attempt to explore how Coldwater's concerns could be addressed.”. This was a band that really wanted accommodation and demanded meaningful accommodation, as the courts have said, and they're saying that it hasn't happened.

I talked to Rueben George of the Tsleil-Waututh recently. They're not happy either.

How confident are you that we're not going back to litigation? It seems that the hard work that needed to be done still has not been done.

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

First of all, we acknowledge and appreciate the diversity of opinions on this project among indigenous communities, as among other Canadians.

I have met with Chief Lee a number of times. I have met with leadership of the Tsleil-Waututh, with the former chief and with Chief Leah, who is the current chief, to talk about these issues. As far as Coldwater is concerned, our discussions with them are continuing. There are a number of options we are exploring with them to deal with their outstanding issues.

Our consultation doesn't end because the approval of this project has been given. We will continue to work with them.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

They're saying that the questions they asked last February—February of 2018—still haven't been answered.

You've just said, I think twice—both in your introductory remarks and in your responses to Ms. Stubbs—that really the only reason we need to build this pipeline.... We've gone through a heck of a lot in this country to try to get this pipeline built, and apparently the only reason is to get our product to tidewater so that we'll have access to Asia and we'll get better prices.

You know this isn't true. This is just a false narrative. Nobody in the industry is saying that we're going to get better prices in Asia. The best prices for our product are in the United States, and they will be for many, many years to come.

Why are we doing this?

We have these price differentials that happen occasionally. They have nothing to do with the fact that the U.S. is our only customer. It's because there are temporary shutdowns of pipelines to fix leaks or because refineries are getting repairs. That seems to be the reason we have this price differential, which covers only about 20% of our oil exports. Eighty per cent of them get world prices because they're exported by companies that are vertically integrated and have their own upgraders and refineries.

Why are we continuing with his false narrative that we're going to get a better price by getting oil to tidewater when that is simply not true?

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

I know that this issue has been raised by the NDP before. If you talk to industry folks and to premiers in Alberta who have been advocating this project, from Premier Notley to Premier Kenney, 80% of the capacity of the expansion has already been booked by shippers for up to 20 years. That demonstrates to you that there's a demand. The existing pipeline has been full for the last number of years. There's a capacity that is required, and we believe that building this capacity will allow us to get those resources to the global market.

I'm really disappointed to hear the Conservative members saying that TMX will not get our resources to global markets. I hope that the Conservative members will have discussions with Premier Kenney and will be better engaged on that file. The premier has been advocating for this project because it allows us to get a better price and expand our markets beyond the U.S.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

I want to get one more question in before my time is up.

Basically, you're admitting that we're not going to get a better price and that the reason we're building this pipeline is that it's an expansion project because the industry wants to expand its operations in the oil sands.

None of the risks that caused Kinder Morgan to walk away from this project have been alleviated. B.C. is still asserting its rights to protect the environment. Many first nations are still steadfastly against it. Vancouver-Burnaby is against it. The Prime Minister has said repeatedly that the government can give the permits, but only communities can give permission. How are you going to convince them that this pipeline is in the national interest?

It's a project that will fuel expansion of the oil sands and increase our carbon emissions when we're desperately trying to reduce them. This isn't about getting a better price for our oil; it's about expanding our oil production.

I think this is an opportune time.... When you were considering this decision, you could have said, “Let's join the rest of the world and move toward a no-carbon future.” Building a pipeline is locking us into a future that just won't be there in 20 or 30 years, so why are we doing this?

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

The building of the Trans Mountain pipeline expansion does not undermine or hinder our ability to meet our Paris Agreement commitments. We are putting a price on pollution. We are phasing out coal. We are supporting investment in public transit. Every dollar earned from revenue from this project will actually be invested back into a greener and cleaner economy so that we can accelerate our transition to a clean economy.

We all know that as the world transitions, there will still be a demand for oil, and our oil resources are developed in a sustainable way. The intensity of the emissions from the oil sands is continuing to decline, and we are supporting the industry to further reduce that intensity. We want to be the supplier of the energy that the world needs and at the same time use the resources and the revenue to accelerate that transition. It's a win-win situation for our economy: creating jobs at the same time as protecting our environment and dealing with the impacts of climate change.

[The Chair, Liberal, James Maloney]

Thank you, Mr. Cannings.

Mr. Whalen is next.

[Nick Whalen, Liberal, St. John's East, NL]

Thank you very much, Mr. Chair.

I also wanted to pass along some thanks to the interpreters in the booth, the technical folks and the staff who sit behind us and prepare us for these meetings. This wouldn't be able to happen without you.

Minister, this is a great week for Canada. I'm really excited about the prospect of Trans Mountain. You've been a leader in our party not only on the infrastructure file, but since you've taken over this very delicate but economically vital matter of twinning of the Trans Mountain pipeline. You've been a very steady hand at the wheel.

I just want to get a sense from you of how important it is not only to you personally but also to Albertans to have this significant victory in finally getting an opportunity to triple the capacity of this pipeline.

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

This is a very important project for our country. This is a project that is in the public interest. This is a project that will create thousands of jobs in Alberta, in British Columbia and in the Atlantic provinces.

As we all know, the growth of the energy sector in Alberta has provided opportunities for many people throughout this country from the Atlantic provinces through Ontario, Quebec and the prairie provinces. When we were in Fort McMurray the last time with the Prime Minister, we met with workers from British Columbia who were working in Fort McMurray.

This is about prosperity for all Canadians. It's very important for us to recognize and communicate this. This is about expanding our global markets. It's very disappointing that the Conservatives say that we don't need to expand our global markets and that we can continue to rely on the U.S. The U.S. is a very important customer for us, but we did the hard work necessary to get to this stage and we will continue to do the hard work necessary to ensure it gets to completion.

[Nick Whalen, Liberal, St. John's East, NL]

Thank you very much, Minister.

In your opening remarks, you chastised the Conservatives for wanting to do appeals and for taking the legislative route. I must admit that I was also nervous about the path that had been chosen. You and the Minister of Finance convinced me that it was the right way and, of course, I guess now I have to admit that I was wrong on this and you were right, so congratulations on that.

I also have found that some of the opposition rhetoric on this project—including at today's meeting, when the member suggested that somehow we should have begun the process of obtaining permits and entering into construction contracts prior to the completion of the process—demonstrates a fundamental misunderstanding of how this process is meant to work. How irresponsible would it have been to prejudge the outcome or to have rushed this court-required and constitutionally required process?

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

I think it is very important that we make sure to follow the proper processes and procedures put in place for the NEB and our proponents. Whenever you undermine them, whenever you undercut them, you get into trouble and good projects get delayed.

Going back to why the Trans Mountain pipeline expansion got into this situation in the first place, in 2013 and 2014, when the initial review was started, the decision was made by the Stephen Harper government to not do the review to understand the impact of marine shipping on the marine environment and to—

[Nick Whalen, Liberal, St. John's East, NL]

I'm sorry, Mr. Minister, but were all those decisions and mistakes that were highlighted in the Federal Court of Appeal decision made when the Conservatives where in power?

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

No. I think we need to take some responsibility as well. They made the mistake of not including the marine shipping and its impact on the marine environment, and we did not do a good job on the consultation. I take full responsibility for that. That's why we need to do better. We need to improve our process to ensure that good projects can move forward.

[Nick Whalen, Liberal, St. John's East, NL]

We've had a lot of difficulty until very recently on clearing exploratory drilling on the east coast, and of course we have the injunction on TMX. Bill C-69 seems to achieve the right balance and seems to push us beyond the mistakes that existed in CEAA 2012 to ensure these types of mistakes don't happen again. Are you confident that's the case?

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

I am a firm believer that if Bill C-69 had been in place in 2013 when this review was started, the Trans Mountain pipeline would have been completed by now and would have been in operation, delivering our resources to non-U.S. markets. It is very important, because we are fixing a broken system.

As far as the exploratory oil wells in the Atlantic provinces are concerned, having a regional review done actually expedited some of that work.

[Nick Whalen, Liberal, St. John's East, NL]

We were very excited to see that completed in December to provide an off-ramp from exploratory drilling and massive environmental assessments on a well-by-well basis. That's a great initiative from your and Minister McKenna's departments.

Another concern that's been expressed to me is that we want to make sure the Canadian building trades have access to as much of the work on the Trans Mountain expansion as possible. I know there are different thresholds and limits in other projects. How can we ensure that Canadian workers benefit as much as possible from this megaproject?