Evidence of meeting #9 for Natural Resources in the 43rd Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was natural.
A video is available from Parliament.
2:15 p.m.
Conservative
The Vice-Chair Conservative Greg McLean
Thanks, Minister.
We're moving now to round three, starting with MP Bob Zimmer.
Mr. Zimmer.
2:15 p.m.
Conservative
Bob Zimmer Conservative Prince George—Peace River—Northern Rockies, BC
Thank you, Minister, for coming today. I appreciate that.
Again, our condolences to you especially on losing your dad. My dad means a lot to me and I know how much your dad meant to you.
2:15 p.m.
Conservative
Bob Zimmer Conservative Prince George—Peace River—Northern Rockies, BC
I want to start off by asking some key questions about the standards for Canada's exploration industry. We've often seen even bus placards in Ottawa that say, “The world needs more Canada.” I guess that's why I'm a little troubled.
I know you've spoken positively about the resource sector here, but I'm really puzzled about why the clean fuel standard, even in articles that are just printed today, mentions refinery shutdowns. Shutdowns are not a new phenomenon in Canada, but this CFS is going to basically cause some of these refineries that we have in our country to shut down.
Why would we make a policy such as that, especially at a time, during COVID, when we're trying to keep every Canadian job we can and even expand those jobs? Why would we be shutting those refineries down at a time such as this?
2:15 p.m.
Liberal
Seamus O'Regan Liberal St. John's South—Mount Pearl, NL
We actually think we will be gaining jobs in the clean fuel standard almost immediately from the farming community, from farmers, but also, importantly, for our future competitiveness. The fact is, talking to people who are on the ground in Washington, we know that one of the biggest and most effective lobbies in Washington is the farmers' lobby. As we understand it, they are lobbying the incoming administration very hard on an American clean fuel standard.
When one of your biggest competitors and biggest customers is starting to head in that direction, when the European Union, South Korea, Japan and so many other countries that we are allied with, both as people who provide us and people who we provide, are heading in that direction, it's simply a matter of, okay, on what terms do we do that? How do we make sure that this is a made-in-Canada solution and how do we remain competitive globally?
That is the direction we're seeing investors going in as well. They're putting their money into jurisdictions that are taking action on this. We think the clean fuel standard is a really important part of that plan to reduce emissions and accelerate the use of clean fuels.
2:15 p.m.
Conservative
Bob Zimmer Conservative Prince George—Peace River—Northern Rockies, BC
Minister, I appreciate that. Maybe there's a disconnect between you as minister and who our Prime Minister is today. We're seeing quotes about the clean fuel standard. We already heard the announcement this morning of the potential increases in cost to Canadians, where it even adds gaseous fuels into the capture.
In northern B.C., and I'm sure it's the same in Newfoundland, heating is not an option for us in our homes. Therefore, to me, when we see a tax that gets applied to folks just to simply keep warm in the winter, there's something wrong. Plus, not to have a full understanding of the potential positive impacts to the environment by getting our natural gas to places in Asia to reduce their emissions doesn't seem right. Why wouldn't we be promoting the best production standards, the best exploration standards and the best human rights standards in the world, and that's Canada? We should be selling more of our resources, not less.
I'll mention a quote. This is from the same Financial Post article that I mentioned before.
There is a wide range of estimates on how the CFS will affect gasoline and diesel prices, with some estimates as low as 2 cents per litre for fuel all the way up to 15 cents per litre. “If it’s not done right, we’re going to lose existing infrastructure,” Laracque said, adding that could include refinery closures in Canada. “If we’re not doing this right, we miss a huge opportunity for existing infrastructure, which will increase the cost of compliance.”
To me, this goes back to what we were saying. Even the Green Party has said before that we need more refining capacity in Canada. Rather than sending the raw product somewhere else to get refined, we should be doing that here.
Again, why would we be doing something that puts our refining capacity in Canada at risk?
2:20 p.m.
Liberal
Seamus O'Regan Liberal St. John's South—Mount Pearl, NL
Mr. Zimmer, using cleaner fuels in our buildings and our vehicles and industries is one of the best ways we can reduce emissions. It will cut pollution by up to 30 million tonnes by 2030, which is the equivalent of taking seven million cars off the road. It's going to create opportunities for farmers and companies that are going to be producing renewable fuels. It will encourage investments in energy efficiency—
2:20 p.m.
Conservative
Bob Zimmer Conservative Prince George—Peace River—Northern Rockies, BC
Minister, I appreciate your opinion on this. I think it's awfully shortsighted of the Liberal government, though, when we see our global impact, how much of a positive impact we can have in reduction of emissions in Asia and other places around the world. We're just looking at our small country of 36 million Canadians, and yes, it's significant in terms of our carbon dioxide emissions, but when you see the reductions that we can make by getting natural gas to very highly populated areas across—
2:20 p.m.
Conservative
Bob Zimmer Conservative Prince George—Peace River—Northern Rockies, BC
Why wouldn't we do that and accelerate that process? I just don't get it. I don't think the government understands that. Why would we be reducing our capacity to reduce emissions around the globe?
That's something I wish you could make our Prime Minister understand, because I don't think he understands it now.
2:20 p.m.
Liberal
Seamus O'Regan Liberal St. John's South—Mount Pearl, NL
To very quickly answer the question, the biggest example would be LNG Canada, the biggest private-sector investment in Canadian history, whereby we will be doing exactly that—making some of the cleanest liquefied natural gas in the world for export to Asia.
We are looking at other projects in British Columbia, particularly given its proximity to Asia. We're also looking at the proximity, here on the east coast here in Newfoundland and Labrador with our natural gas reserves, to the European marketplace. So certainly we have not.... That is something, frankly, that if you look at LNG Canada, you'll see we've been very aggressive on.
2:20 p.m.
Conservative
The Vice-Chair Conservative Greg McLean
Thank you.
The next round of questions will go to split time for five minutes between MPs Yvonne Jones and Maninder Sidhu.
2:20 p.m.
Liberal
Yvonne Jones Liberal Labrador, NL
Thank you very much, Minister, for being with us today, and thank you for the great work that you've been doing throughout COVID. Again, like other members of the committee, I want to certainly express my condolences to you and your family in what has been a very difficult time in recent weeks.
My question, obviously, is about the oil and gas industry in Newfoundland and Labrador. I would just note that I speak to you today from your old hometown of Happy Valley-Goose Bay, by the way. Obviously, the oil and gas industry is fundamental to the economic growth of Newfoundland and Labrador. I know you have a tremendous amount of pride in what the industry has accomplished in this province.
Can you update us today on what the response program from the federal government has been to assist so many people in the industry in our province through what has been a very difficult time because of COVID-19?
2:25 p.m.
Liberal
Seamus O'Regan Liberal St. John's South—Mount Pearl, NL
As the member knows, because we talked an awful lot about this with Newfoundland and Labrador MPs, and as I mentioned to our colleague earlier, Newfoundland and Labrador depends more on oil and gas than even Alberta or Saskatchewan does. When we were hit with the two crises, we were hit extremely hard in this province as well and we had to look very carefully at a solution for the offshore.
There are a few things I should make note of that Newfoundland and Labrador's offshore product has going for it. First of all, it's in tidewater, which is why it's traded at Brent prices. As we now know, we've always said it's a sweet light crude, but we didn't really appreciate what that meant. It means these are some of the lowest-emitting barrels of oil in the world. That is a huge competitive advantage in a changing marketplace.
So when Premier Kenney said that he wanted to see the last barrel of oil sold in the world to be Canadian, I agree with him. It means that we have to meet those standards and that each barrel has to be the lowest emitting that we can find, and the market will dictate that.
What we've done in this province, a year and a half ago through the Atlantic Accord, was to have $2.5 million in new money for the province as the principal beneficiary of its offshore. Then since this pandemic, there's been close to $400 million to support workers, to lower emissions and to make the industry here more competitive.
We worked with the province very closely on that, so what they have done is brought together a task force of union leadership, of industry leadership and of government sitting together to determine where they will put the $320 million that we have given on top of $75 million that we gave in order to reduce emissions.
It is a considerable chunk of change, and just earlier we announced $41 million that's going toward the West White Rose Project to keep that in place and to make sure that those workers have good work. It was matched by the private sector.
That's what happens when you listen to people locally on the ground and you listen to those people who know. I am very proud of our offshore oil and gas workers here in this province. The president of ExxonMobil Canada, which is headquartered here in St. John's, said that there is no more hazardous environment that his people operate—his company operates—in in the world than Newfoundland's offshore. It is not easy out there. It takes guts and it takes pride, and we want to stand by these people.
2:25 p.m.
Conservative
2:25 p.m.
Liberal
Maninder Sidhu Liberal Brampton East, ON
MInister, I see throughout the main estimates and the supplementary estimates (B) many items relating to indigenous engagement with items relating to TMX accommodations, measures on capacity building for communities, as well as for consultations on major projects. We have seen what happens when we get indigenous consultation wrong and major projects don't get built.
Can you share your thoughts on the importance of funding for these areas and share some of the work you are doing to ensure that we are meaningfully consulting in the right way on major projects?
2:25 p.m.
Liberal
Seamus O'Regan Liberal St. John's South—Mount Pearl, NL
When I moved to Labrador as a young boy, the first people who I was introduced to were the Innu leadership in Labrador, who had names that would be familiar to Ms. Jones, Bart Jack, Ben Michel, Daniel Ashini, who were the leadership at the time and good guys. It is something that sticks with you, seeing the state of the neighbouring community, the Innu community of Sheshatsiu, compared to where I lived in Happy Valley-Goose Bay, when you're 13 years old that stays with you.
I worked in university and in my academic career studying indigenous participation in natural resource projects, because I saw at a very early age that—
2:25 p.m.
Liberal
Seamus O'Regan Liberal St. John's South—Mount Pearl, NL
—economic development was key. Maybe I'll talk about this a little more later.
All that to say is that this is something that is very close to my heart. I have operated at two different tables in Labrador negotiating and working on impact and benefit agreements and what we have managed to do with TMX is a playbook for how we move in the future.
2:25 p.m.
Liberal
Bryan May Liberal Cambridge, ON
If I might jump in, Mr. Chair. I just want to be conscious of the time—
2:25 p.m.
Conservative
The Vice-Chair Conservative Greg McLean
We are going to continue here. I think it's my round here as long as that's okay with the minister. He said he'd stay for an hour. We're not there yet.
2:25 p.m.
Liberal
Bryan May Liberal Cambridge, ON
We're not? I beg your pardon, Mr. Chair. I thought we were getting close to that hour.
2:25 p.m.
Conservative
The Vice-Chair Conservative Greg McLean
We are getting close to the hour.
If I can start, Minister—and I'm usually peppier with my questions—the first thing I'll go to is the Canadian Energy Regulator, because they are asking for an extra $21 million in the supplementary estimates, and yet they came out with a report. Somehow they didn't have the money to produce a report that it is, in my opinion, beyond its own purview at this point in time. Yet, they came through with a report saying there was a limit to where Canadians...but we were still going to grow in oil and gas.
The tough part about that is how do we justify, number one, first of all, $22 million extra for the organization?
2:30 p.m.
Liberal
Seamus O'Regan Liberal St. John's South—Mount Pearl, NL
Why don't I take this question and ask my deputy minister, Jean-François Tremblay, to answer?
Jean-François.