Natural Resources Committee on May 4th, 2017

[Jim Carr, Liberal, Winnipeg South Centre, MB]

Well, come on. We will judge—

[John Barlow, Conservative, Foothills, AB]

It's a nation-building project. Will you back it?

[The Chair, Liberal, James Maloney]

One person at a time, please. Let him answer the question.

[Jim Carr, Liberal, Winnipeg South Centre, MB]

We will judge the actions of whomever the British Columbians elect as their government. We have approved the Trans Mountain expansion pipeline project, and will continue to support it. If there is a new government in British Columbia has a different idea and wants to express that, of course we'll talk to them about that, but you know what our position is.

[John Barlow, Conservative, Foothills, AB]

No.

That was the answer I wanted. Thanks.

[The Chair, Liberal, James Maloney]

Thank you, Minister.

Mr. Cannings.

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

Thank you, Minister, for being here today. I appreciate it.

I'm going to bring it back to the softwood lumber situation. Thanks for your call last week. Some of the first words you spoke, as you did today, were about the impacts that are going to happen. You said there will be layoffs and and job losses. In the short term you pointed out that there are existing programs that can help in some way in those matters—E.I. for the workers that lose their jobs, and EDC and BDC loans for the companies that may require some sort of support.

This is a very difficult situation, as other people have mentioned. I'm from British Columbia. The last time this happened we lost 100 mills or something like that. I forget the exact number. We lost tens of thousands of jobs. It really changed the face of a lot of communities, so I think it calls for more direct measures from the government to help the situation across the country.

We've seen Ontario and Quebec asking for loan guarantees from the federal government in the short term. Also, during the last softwood lumber dispute, the Martin government provided funds of, I think, $20 million to the forest industry to offset their legal costs stemming from the dispute, money that that helped those companies in the short term.

In terms of that and what we can do today, because a lot of these small companies are going to be making big retroactive payments very soon, are loan guarantees something that your government is contemplating providing, and will you contemplate providing help for legal fees?

[Jim Carr, Liberal, Winnipeg South Centre, MB]

We're looking at any and all reasonable action to help workers and producers. We also have a long historical record, dating back to 1982 in the common era, of what the impact of these countervailing duties and anti-dumping duties have been on communities, so we are able to anticipate. It's not the same situation now as it was 10 years ago. The economic situation is different. The American housing situation is not the same, and currency fluctuations are not identical. However, we have enough background to know what we should expect to happen once the total quantum of the duties is known.

We will look at every reasonable opportunity, not only in the short term—I think you've named ways in which governments can help in the short term—but also in the transition over a decade or more. We believe that because of the realities of climate change, the forestry sector should become a very important part of a new natural resource economy for Canada, where Canada can lead the world. In the longer term, I am optimistic about how the industry will adapt, but we're going to have to make sure that in the short term, governments—governments across the country and the Government of Canada, not only in my department, but in departments that have more direct impact on laid-off workers, and in government departments that have more impact on the capacity to use financial institutions to help companies now, in the short term....

I just want you to be assured that we are taking every effort to make sure that we can do whatever is reasonable in the circumstance—both now and looking at the next generation of forestry workers—to withstand these punitive countervails from the United States.

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

Moving to the mid to long term, I will grant you your point about large wood buildings.

You talked about diversifying into Asia and Europe. I was at the COFI meetings in Vancouver last month, where there was quite the opposite feeling about China. The analysts who specialize in that market were kind of negative about the opportunities—in the mid term, at least—of moving into China because of the Russian competition, the low ruble, and things like that...but I don't want to go there. I'm just talking about this opportunity to really boost our domestic market, and the market with the United States, through the use of wood in large buildings.

You mentioned the $40 million or so that you're providing in this year's budget. Unfortunately, that money won't be spent until next year, 2018-19. I want to know why the delay, when we could be helping these companies now. I would like to know how much of that $40 million will actually be spent building buildings...to use our industry.

I have a private member's bill that I tabled just before the break, C-354, that asks the federal government to consider the use of wood in building large wood buildings to help the industry right now, as we have in British Columbia.

Those are my three questions.

[Jim Carr, Liberal, Winnipeg South Centre, MB]

I think that's a very helpful and positive suggestion. I welcome it.

We think that tall wood construction is a fruitful possibility for the diversification and transformation of the industry. We know that Canada is one of very few countries that are actually leading in this technology. We now have examples to show others that this actually works. We think that not only does it have the advantage of diversifying products within the sector, but that it's also a carbon sink, so it has climate change advantages as well.

So, yes, we are serious about this possibility. We are talking to the industry about it, we're talking to provincial counterparts, and we welcome your positive suggestions.

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

Okay, and—

[The Chair, Liberal, James Maloney]

We're right on the button, unfortunately.

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

Okay. Thank you.

[The Chair, Liberal, James Maloney]

Mr. Tan.

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

Thank you, Mr. Chair.

I would like to share my time with my colleague Mr. Harvey. I sense that he may need more time to finish his questions.

We have been meeting many witnesses on the clean technology file throughout this study we're currently undertaking. In your opinion, Minister, how will this clean technology create a more sustainable and environmentally sound resource sector? What is the department doing to drive this progress? What are the opportunities or challenges?

[Jim Carr, Liberal, Winnipeg South Centre, MB]

Clean technology and innovation are really central to the government's program. There will be significant investments across a number of different government departments to make that happen. As a part of our mission to China in early to mid-June, we will be having serious conversations about this with the Chinese and others internationally.

Innovation is an extremely important element of how we will manage the transition from today's energy economy to tomorrow's. There would be agreement internationally that there is a trend away from fossil fuels. There will be a disagreement among the analysts about how long that's going to take, but I don't think there's much disagreement that this is the trajectory that can't be denied.

If you look at the oil sands themselves, we were in a position to develop them because of innovation. That resource sat in the ground a long time, until innovators figured out a way to get it out. Now we're seeing already that innovation is finding ways to take the resource out of the ground more sustainably, as judged by the carbon footprint it leaves behind.

In my conversations with other ministers from around the world, most recently at the G-7 in Rome, we are in an international marketplace and an international competition for innovation in clean technology. We should see this as an opportunity for Canada. We often talk about and should have in mind the competitive pressures from the United States but also that we are in a unique position to take advantage of our innovators, our entrepreneurs, and our riches within the energy sector, both traditional and renewable, to place Canada at the forefront.

People will know around the table of the great work of COSIA, the Canadian Oil Sands Alliance, which puts their own intellectual property aside and work together as an industry to share technologies and best practices for the benefit of all.

I appreciate that you isolated that as a very important part of the move towards the low-carbon energy future. Be assured that the Government of Canada understands the opportunities and is moving aggressively, in concert and cooperation with the private sector, to position Canada well, not only to look after our domestic situation but also to become an international leader.

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

Thank you.

[TJ Harvey, Liberal, Tobique—Mactaquac, NB]

I'm going to switch gears a little bit too. I'm going to draw on some of the comments you made in your opening statement.

I know that within this committee—there is no argument about it—I'm a feverish supporter of our oil and gas sector and a lot of the innovation that we've seen on both the Atlantic and west coasts, as they've tried to adapt new technologies in a more environmentally safe and sustainable manner, as you've said.

I recognize the innovation that we've seen there and the future innovation to come. You're right that it's not a stagnant industry, absolutely. It continues to evolve. The innovation is what continues to drive it. However, I'm also a big believer in recognizing patterns, shifts, and changes. You pointed to China and Saudi Arabia in your opening statement and the policy shift that we see within those countries towards their greenhouse gas emissions and their overall consumption of fossil fuels.

I just want you to elaborate a little bit on how you feel we can heed that signal and use it to help propel us to be a leader in new technologies that are going to keep us in front of the pack, as opposed to being a hanger-on or a straggler.

[Jim Carr, Liberal, Winnipeg South Centre, MB]

Ultimately, you have to rely not only on brain power and the innovators but you also have to incent them. You'll see in this budget that there are many policies directed to doing precisely that. We lead on about 30 of the 50 actions of the pan-Canadian framework on clean growth. NRCan is among the lead departments in ensuring that the policies are in place that can maximize our potential.

On the phase-out, over a very long time, I'm sure, of traditional sources of energy, we look at, for example, what the International Energy Agency says. It says that it's not going to happen anytime soon, that growth for oil and gas is increasing in the developing world, that middle classes that are becoming more and more able to consume are looking for sources of energy to satisfy that demand. It makes sense in Canada, as one of the very few nations in the world that is actually an exporter of energy, to look at satisfying this demand and then using the revenue we will achieve from creating more opportunity for our producers and exporters to finance the transition to a lower carbon economy, including renewables, and funding electric vehicle charging stations and many of the elements you'll see in budget 2017. Canada is better positioned than almost any other country in the world, I would say, to satisfy this growing demand more sustainably, moving the product more safely than we have traditionally, while having a clear eye on future opportunities as we incent the private sector to work with us in a renewable resource energy economy.

[The Chair, Liberal, James Maloney]

Perfect. Thank you. That was right on time.

Mr. Doherty, we'll go to you for five minutes.

[Todd Doherty, Conservative, Cariboo—Prince George, BC]

Thank you, Mr. Chair.

To the minister, I have a few comments.

Number one, Mr. Minister, Canada's forestry sector is already leading the way in technology as well as environmental practices. It's staggering for us to be hanging our hopes on China, as Canada has already been in China for over 10 years. We need an answer now, not down the road. We know that agreements take a long period of time. It is shocking for me to sit here and hear that there was much anticipation, that this government knew that the countervailing duties were coming. We all knew that was coming, yet there was no plan for the communities Mr. Harvey mentioned, as well as my communities, indeed the 650 communities that are forestry dependent right across our country.

With that, Mr. Chair, I'd like to read a motion into the record, if I can, please. I'll put forth a motion:

That the Committee invite the designated provincial envoys who represent their respective provinces on the Softwood Lumber file and hear from them their priorities for a new Softwood Lumber Agreement between Canada and the United States; that the Committee, after these initial meetings, then invite the Minister of Natural Resources to present the government’s plan on a new Softwood Lumber Agreement.

[The Chair, Liberal, James Maloney]

Mr. Doherty, you're eating into your time. We didn't have notice of this motion today and we are here discussing the estimates, so I don't think it is appropriate for the committee to deal with this today.

[Todd Doherty, Conservative, Cariboo—Prince George, BC]

Mr. Minister, can you confirm whether there was ever a proposal for a new softwood lumber agreement put on the table by the U.S.?

[Jim Carr, Liberal, Winnipeg South Centre, MB]

I know of no such proposal. I know that the President of the United States and the Prime Minister of Canada spoke about softwood lumber a number of times.

[Todd Doherty, Conservative, Cariboo—Prince George, BC]

Mr. Minister, can you give me an answer to the question?