Natural Resources Committee on Oct. 18th, 2016

[The Chair, Liberal, James Maloney]

Okay, we're approaching the 10-minute mark now.

[Richard Paquin]

There are four issues I would like the committee to concentrate on, and they are four issues that Unifor feels are important in order for this sector to survive and flourish.

We need to establish a foreign ownership policy or define what net benefit really means. The test itself is very vague, and it needs to be amplified. It needs to concentrate on investments, research and development, spending, and crucially employment and the guarantee of employment.

Foreign takeovers should be screened and have a clear and ambitious net benefit test that aims to develop the sector for the benefit of all Canadians. We also have to look at our hydroelectricity costs. That is a big burden for employers. Another thing we need to look at is the royalties being given to all levels of governments. We have our municipal, provincial, and federal governments, and some of the royalties aren't, in our assessment, fair with some of the players.

We need to develop a national strategy around mining. It will draw the best practices of all other mining jurisdictions, including the measures around conservation and efficiency, public ownership, regulatory oversights, public consultation, and the security of supply. More importantly, it will build maximum benefits for all Canadians.

We must find creative ways to attract as many community benefits from mining resources as possible.

Thank you.

[The Chair, Liberal, James Maloney]

Thank you very much, sir.

Mr. Tan, you're first on the list.

[Geng Tan, Liberal, Don Valley North, ON]

Thank you, Chair.

Thanks, gentlemen, for being with us today.

I have a number of questions for Dr. Sleep. I know you are the chair of the Department of Civil Engineering at U of T. My notes say that you are appearing here as an individual. I'm very curious about that. Does that mean that what you have said to the committee does not reflect the view of your department or U of T?

[Prof. Brent Sleep]

No. I am not sure where I indicated I was appearing as an individual. I'm appearing here as the chair of the Department of Civil Engineering.

[Geng Tan, Liberal, Don Valley North, ON]

Okay, thanks.

I'm sure that your department and the Institute of Mining are doing a great job in your leading-edge research. As you mentioned, your department and the institute maintain very close links with industry. I guess, from the time that you have invited industry experts it'll come to the university to give lectures and share with us the lead of industry for innovation.

As mentioned by the previous witness, research and innovation are similar, but they are different concepts. Can you share with us a few successful examples about transferring your research or development into the innovation and making use of it in the industry?

[Prof. Brent Sleep]

Sure, I could mention a couple of companies that have spun out of the department. One of them is Rock Science, which is a company that develops software that is sold worldwide. I think they have about a million dollar a year market in software for mine development. We have a recent company, Geomechanica, that has developed software tools for looking at rock fracturing processes. Those are a couple of applications. The work that I mentioned, the research related to mine tailings management, is research that's supported by a number of companies, and that research is being done on site at the companies to improve the understanding of the various processes in the mine tailings, which will lead to new ways to manage those tailings.

[Geng Tan, Liberal, Don Valley North, ON]

Okay. I still remember the mining building on College Street.

[Prof. Brent Sleep]

Yes.

[Geng Tan, Liberal, Don Valley North, ON]

I started at the Wallberg building, coming to the department for six years and for even more time for my post-graduate degrees.

I'm sure U of T is not the only university that has a mining program or research. Is there coordination among the universities or the research institutes in Canada to make the best use of the expertise?

[Prof. Brent Sleep]

There is certainly collaboration on a researcher-to-researcher basis so that a person who works in the mine tailings area, like Professor Lesley Warren, works with people at the University of British Columbia, and she also works with people internationally at Berkeley and also in Australia.

I have two programs in groundwater remediation that are both multi-institutional programs. One of them is an NSERC create program that has collaborators from Toronto, Western, Queen's, and Waterloo. I have a second Ontario research fund program with researchers from Western and Queen's. There are lots of examples of collaboration between universities where people get together to work on collaborative projects, which is, of course, highly encouraged by the granting agencies and leads to much better productivity and collaboration.

[Geng Tan, Liberal, Don Valley North, ON]

I graduated from chemical engineering and applied chemistry. Are there many environmental protection or chemistry programs involved in the research in your department or in the institute?

[Prof. Brent Sleep]

Sure. My undergraduate degree is in chemical engineering but not from Toronto. Personally I collaborate a lot in chemical engineering with Elizabeth Edwards, who is the director of BioZone. And there are a couple of people in chemical engineering who were heavily involved in the mining area and in the Lassonde Institute, including Professor Vladimiros Papangelakis, who works in the hydrometallurgy area; and also Professor Mansoor Barati, who's in materials science and engineering, who teaches mineral processing to our undergraduate students.

[Geng Tan, Liberal, Don Valley North, ON]

Okay. I have a final quick one.

So far in this mining sector we have invited some witnesses but most of the witnesses are from the industry, either in associations or the companies. Normally they give us a very different perspective or vision about their company, about their industry. I find some of them are over-optimistic while the others emphasized too much the difficulties in the industry. So you're from university. We say you are doing the pure research, you're an academic and you're the third party. From your perspective as a chair of a civil engineering department, give us a few quick words about the future of the innovation in the mining sector.

[Prof. Brent Sleep]

I've gone to many conferences where leaders from the mining industry have spoken about the need for innovation in mining, and I'm sure Carl Weatherell would have also emphasized that. We actually hosted a CMIC event on innovation in mining and also a second CMIC event in innovations in comminution. So there are opportunities for improving the productivity of the mining industry and reducing the environmental impacts of the mining industry. Corporate social responsibility, of course, is also an important aspect that we make sure our students are also trained in.

[The Chair, Liberal, James Maloney]

Thank you. That's right on time.

Mr. Strahl.

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Mr. Paquin, I appreciated your testimony and I know you got rushed there at the end. I really appreciated your comments on Prime Minister Harper having it right; there are certainly no arguments from this end of this side of the table.

One of the things you really didn't have time to expand on was your concern about hydroelectricity cost. We talked earlier in the first hour about carbon pricing, which will put additional costs on top of really high electricity costs in Ontario especially. Perhaps you could expand on your concerns or your recommendations on government action to deal with hydroelectricity costs and whether your predicted price on carbon will address that concern or make it worse.

[Richard Paquin]

High electrical costs are some of the highest costs for employers in the mining industry. The only two provinces that really flourish in that area currently are British Columbia and Quebec. One of the reasons is because both of those provinces generate their own power. They have the ability to tap into the rivers that are nearby and they create their own energy. For them it's a win-win situation, but it's not the same everywhere, unfortunately. In a lot of our areas where the mining sector is growing, there is very little opportunity for them to have access to the natural resource that gives them that ability. Therefore, it's important for them to have the ability to somehow be subsidized or be given some ability to recover some of those costs because it is very expensive for a lot of them.

If we're going to take the Ring of Fire, which is the next biggest development in Canada that we foresee, there is no infrastructure whatsoever in that area to allow that to happen. Without electricity, unless technology really changes in the next few years, it's going to be very expensive for somebody to go up there and do the actual mining. Prospecting and developing is a different area, but once you get into the production phase, this is where electricity really comes into play.

To answer your question on carbon pricing, it may assist. It may force employers to look at different ways of getting electricity up to those areas, but at this point in time it's hard to say if it will really help or not because we're not there yet.

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Another issue that certainly flared up a couple of years ago was the issue of temporary foreign workers in the mining sector. At HD Mining, in British Columbia, there was a proposal for an entire workforce to be sourced from outside of the country, essentially. Certainly, the Conservative government took decisive action to change that program as a result of stories like that.

There's been some talk about going back on that tightening of the rules. What is the current situation, as far as Unifor is concerned, with labour in the mining sector? Do you have any concerns with the direction, or the pivot, perhaps, that the new government has taken in terms of the temporary foreign worker program?

[Richard Paquin]

That program, in our mind, was put in place to deal with a specific situation at that one point in time. It doesn't really exist anywhere else in the mining industry except for that incident in B.C. itself. I've been in the mining industry for 35 years now. I've worked in uranium mines, nickel mines. I've worked in all kinds of mines over my career. I can recall the early days in our school system. The reason we look at those workers is because we don't have the ability in Canada itself to get the specialty skills that we need. They're not currently available. They're very rare, I should say.

We all know that the skilled trades will be 80,000 workers short within the next five years. There are stats all over the place that show that. Our current school system, including high schools, does not have the same ability it used to have 25 years ago, when we had shops in the high schools and all this stuff that would really promote students to follow that path. That's gone away now for some reason. It has to come back. We have to make sure that comes back.

The other issue is that, even in our universities or colleges, a lot of focus was put on getting diplomas—not as much in colleges, but universities—in administrative skills versus the actual skilled labour. We need to get around that.

Also, we used to have lots of subsidies for employers to offer apprenticeships, a lot more than we do today. That has to come back, otherwise it's hard to get regular Canadians to get the right skills they need to be employed by those mining companies.

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

You'll get no disagreement from me about the need to promote skilled trades and to promote them as a great family-supporting career that isn't a lesser path for individuals. I think governments at all levels need to wrap their heads around ways to promote those kids who have an interest in having a well-paid, family-supporting job, encouraging them that they're not somehow inferior for not pursuing perhaps a university education or further studies that way.

The other thing you talked about, which you didn't get a chance to expand on, are the royalty regime and foreign ownership policy. Perhaps in that order, if you can just expand on what your concerns are with the royalty regime, specifically if there's a federal component to that, and then if there's any time left, if you could discuss the foreign ownership policy.

[Richard Paquin]

To my knowledge, the issue with that area is that the monies collected from mining firms based on royalties are not equivalent to the actual product being pulled out of the ground. We all know these are non-renewable products. Once you move that rock, it ain't coming back for millions and millions of years—probably never.

It's not like a renewable source, where it will grow and eventually benefit the communities again. It doesn't do that once it's gone, so there has to be some type of compensation for municipal governments, because the roads are destroyed by the big trucks and everything, and also for provincial governments, because they give permits to allow that activity, under the mandate of the Constitution.

We have to make sure these big corporations now coming into Canada pay the government to provide for you, the federal government and the big infrastructure needed for those areas to flourish. Without that money being available, it's hard to do.

We all know that companies profit largely from mining resources. When the price is high, their profits go beyond the scope of imagination. Very few of them stay within Canada, because they're all global corporations. A lot of the time the profits end up in other countries instead of our communities. That has to be changed. The only way to do that, as we see it, is to establish a national strategy that forces those big corporations to do all these steps in order for them to do business in Canada.

[The Chair, Liberal, James Maloney]

I'm going to have to interrupt you there. Thank you.

Mr. Cannings.

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

Thank you, and my thanks you both for being here today.

I'd like to start with Dr. Sleep. I know part of your expertise is in the remediation of groundwater, which is a very important part of the mining process. Certainly I hear a lot about that from my constituents. I wonder if you could expand on what the current state of groundwater remediation or reclamation is in Canada.

[Prof. Brent Sleep]

The areas I work in are primarily brownfields and remediation related to organic contaminants. The state in Canada, and around the world for that matter, is that there are easy sites to clean up, and those easy sites have been cleaned up. These are sites with contaminants near the ground's surface in nice, permeable, sandy soils. There are a number of different technologies available to clean up those kinds of sites.

At the other end of the spectrum, you get into contaminants in fractured rock at great depths, and you have contaminants like PCBs or heavy metals that are very difficult to remove. That's still a challenging area for remediation scientists.