Evidence of meeting #52 for Natural Resources in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was buildings.
A recording is available from Parliament.
5:10 p.m.
Liberal
Geng Tan Liberal Don Valley North, ON
Thank you, Chair.
Mr. Ferguson, I'm very interested in knowing more details about your carbon capture and storage technology. When you say “storage”, what is the capacity of this technology? In other words, what percentage of all carbon dioxide produced by industries such as oil sands or oil and gas can you realistically collect, transport, and store?
5:10 p.m.
Vice-President, Policy and Performance, Canadian Association of Petroleum Producers
I would say the industry is pretty spread out in the province of Alberta, but in Saskatchewan and British Columbia, a lot of the challenges we have, certainly, as you point out, are the ability to collect and transport, given the way the industry is laid out. We have some insulations that have been used pretty successfully, proving out some of the technologies.
There is still a challenge on cost. A big issue there, I understand, is around scale, and scale not only from the collection side but also in ensuring we have the right size of reservoirs to get to that scale as well.
In some parts of our country, like British Columbia, which I know reasonably well, there is a bit of a challenge in terms of the size of some of the reservoirs that are competent enough to withstand the pressures under storage. All of those provide challenges for Canada on carbon capture and storage.
The quick answer is there is a lot of work to be done on all those aspects.
5:10 p.m.
Liberal
Geng Tan Liberal Don Valley North, ON
Okay.
I've been trying to compare your technology with another technology that's used in the nuclear industry, the deep geological repository technology. In the nuclear industry, the nuclear waste is stored deeply inside stable rock. In contrast, you are talking about storing the CO2 gas in the oil fields or wells.
What's the risk of leakage of CO2 from your oil fields?
5:10 p.m.
Vice-President, Policy and Performance, Canadian Association of Petroleum Producers
I think that's my point around finding the right competent reservoirs. Most of the regulatory jurisdictions we have in Canada have specific rules set out for long-term monitoring of the competency of reservoirs to make sure there isn't leakage somewhere. There's also a lot of effort, as we heard a few times today, on the upfront planning side as well, making sure that we have reservoirs that are competent before we start pumping.
I don't think there's anything different from what you described in the nuclear sector, where there's a lot of concern around making sure, if we're storing something underground, it's there safely for the long term.
5:15 p.m.
Liberal
Geng Tan Liberal Don Valley North, ON
Okay.
Again looking at CO2, what is the quality of your CO2 in storage? Is the quality high or low? If it's high, how do you make sure you can keep it from being diluted? If the quality is low, how will you find an economical use for the CO2 in the future?
5:15 p.m.
Vice-President, Policy and Performance, Canadian Association of Petroleum Producers
That's a good question. I did want to comment right up front that long-term storage of CO2 is one of the tools available. We also have a good, healthy opportunity, and we do this significantly, to use CO2 to drive more oil production out of a certain oil place. I think both provide, or one provides certainly, an opportunity to get more value out of CO2 that's pumped underground. It's not insignificant in terms of a value opportunity for Canada and the industry.
I would have to come back to you with more specific answers around how we manage the quality of CO2 in terms of the storage parameters and the use parameters. I can certainly dig around and make sure that's available.
5:15 p.m.
Liberal
Geng Tan Liberal Don Valley North, ON
Three minutes? Wow. That's a long time. I may not have prepared enough questions, or I may have to share a question.... No. I have one more quick question.
Mr. Mueller, you believe that the construction of new no-emission or green buildings is a key solution to climate change. Richard had a question about this as well. You mentioned here, and in your notes as well, that you believe that buildings currently generate up to 35% of all greenhouse gas. If you check the notes provided by Mr. Ferguson, from their pie you can see that the biggest emissions contributor is transportation, which only produces about one quarter of the total emissions in Canada.
How do you match these two numbers?
5:15 p.m.
President and Chief Executive Officer, Canada Green Building Council
It's just a matter of accounting. Typically, even if you look at the pie chart from Environment Canada, they have divided the pie from a more regulatory perspective, the point sources they can regulate in terms of air pollution and those types of things. We take it more from the perspective of the end use. When we heat a building or light a building, we look at the electricity that's being used to light that building. Does it come from a clean source or does it come from a dirty grid, meaning that coal is being used to generate electricity?
We talk about the same pie, but it's just a different distribution. We look at the sources, at where the energy is coming from. When you do that, you realize that when you combine those different smaller slices, it actually becomes about 30% to 35% of all emissions in Canada.
5:15 p.m.
Liberal
Geng Tan Liberal Don Valley North, ON
I have two more questions, but I'll give my time to my colleague.
5:15 p.m.
Liberal
April 11th, 2017 / 5:15 p.m.
Conservative
Arnold Viersen Conservative Peace River—Westlock, AB
Thank you, Mr. Chair.
Thank you to our guests for being here today. I'm pleased to have representatives from Enbridge here.
One of the things we have to remember when talking about energy innovation is that all of this comes back to our quality of life in the western world, particularly places that have cheap, reliable energy. I know that our infant mortality rates are some of the lowest in the world and our life expectancy is among the highest in the world, and that comes from the fact that we have clean water, warm houses to live in, and the most amazing health care, which is all predicated on the cheap energy we have. The conversation we are having today is driving the quality of life that we have in Canada. I just wanted to make that point.
My first question is for Alex.
Budget 2017 proposes that expenditures relating to drilling or completing a discovery well, the key words being “discovery well”, are going to be classified as a development expense instead of an exploration expense. Can you explain to us what that means and how it is going to impact oil and gas exploration in Canada?
5:20 p.m.
Vice-President, Policy and Performance, Canadian Association of Petroleum Producers
It's an accounting procedure, a tax procedure, if you're familiar with that. Conceptually, if you are at the front end of the risk spectrum, finding new things, new plays, you take on quite a bit more significant risk in terms of finding something or not finding something. If you go around the world, generally speaking, in the absence of a lot of historical data, it is high risk. You can have a lot of failure, but in order to continue to—
5:20 p.m.
Conservative
Arnold Viersen Conservative Peace River—Westlock, AB
Is failure a dry hole? You drill a hole and you get nothing.
5:20 p.m.
Vice-President, Policy and Performance, Canadian Association of Petroleum Producers
Yes, exactly.
In order to continue the drive to get people to invest in that high-risk area, the government has set up.... It's very similar in a lot of other jurisdictions. The model is pretty clear. In order to incent or drive that kind of behaviour, you want to provide the ability for those who run into that situation, who have a dry hole or are in that high-risk area, to write that off more quickly in terms of a depreciation schedule.
5:20 p.m.
Conservative
5:20 p.m.
Vice-President, Policy and Performance, Canadian Association of Petroleum Producers
Right. Well, be careful about what drives investment. It isn't just tax. It's many other considerations that companies would have. But that certainly provided a safer landing spot to more quickly drive investment into that part of our business. It is a necessary part of our business as we go forward, so we were somewhat disappointed in the budget language around that. I will say, though, that we have been in talks around redefining some of that tax model. Generally speaking, the CRA rules around that were invented long before the current technologies that we've been using for the last several years, so it's really an instrument that's out of place as well.
5:20 p.m.
Conservative
Arnold Viersen Conservative Peace River—Westlock, AB
Thank you.
Our guests here from Cylo and Enbridge can probably both answer this. Both of you are working on cutting-edge technologies. I have two questions.
Are our regulations and protections for intellectual property strong enough in Canada? Do you see any improvements on that?
The other question is about standards, particularly in the data world. I'm an automotive mechanic. I come from an automotive background. We have OBD, on-board diagnostics. It's standardized data, so anybody can plug in. It doesn't matter what the vehicle is, we can all plug into it and see what's going on. Are there any data standards? Do you think that there need to be data standards?
5:20 p.m.
Director, Business Development, Cylo Technologies Inc.
Could Darren answer that question? He's a total technology specialist.
5:20 p.m.
Darren Gerling President and Chief Technology Officer, Cylo Technologies Inc.
In terms of data standards, that's something the industry is working on. In the pipeline space, there is a data standard called PODS. I think they do a good job. There is always room for improvement on the cutting edge.
The other thing I would say is about the support for intellectual property development. I think Canada has a pretty good system, actually. SR and ED is something that our companies utilize. The more the better, though. I would say it's sufficient, but it can always be improved upon.
5:20 p.m.
Conservative
Arnold Viersen Conservative Peace River—Westlock, AB
I have just a few seconds left. Does Enbridge have any comments on those two points?
5:20 p.m.
Vice-President, Pipeline Integrity, Enbridge Inc.
Yes. I would quickly say I don't really see intellectual property as a big hurdle. There are mechanisms in place for business.
The data standards, though, is a really interesting question. The world of information management is blossoming for potential growth. I don't think we've even touched on what's possible there. We talk about artificial intelligence in our company as if it's old news now, things like cloud computing, data structure and sharing. The possibilities for advancing technology and science are enormous when we start to pool together our resources globally with the intel that's out there. I think that's where the baby steps are at right now. If we can break down some of those barriers in sharing globally, we can really accomplish some big things.
