Natural Resources Committee on Sept. 16th, 2024

[Jean-Denis Garon, Bloc, Mirabel, QC]

It's not a matter of public policy. It's really a transportation issue. That's why my colleagues here don't like it.

Some government members are telling us that we have to transport products safely and in an environmentally friendly manner. All of this obscures two central points in the Trans Mountain pipeline issue, which go beyond the cost and make absolutely no sense, which we don't have time to look at.

The first is that this pipeline safely transports the dirtiest petroleum product to be produced in the world. The second is that, if we want to improve the issue of transportation safety, transporting less of this product will be the first solution to consider once we have energy security.

On that, I want to point out that neither a government member nor a Conservative member ever makes the effort to properly inform the public on this point.

[The Chair, Liberal, George Chahal]

Monsieur Garon, thank you.

Mr. Angus, we'll now proceed to you for six minutes. Go ahead. The floor is yours.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you, Chair.

Thank you to our witnesses.

The reason we're studying TMX is twofold. One is that this massive increase that's going to come from the pipeline represents a major carbon bomb, which will make a mockery of the Liberals' promise to the global community on an emissions cap, and the other is the $34 billion the Canadian taxpayers got stuck with. I will focus on how we're going to get that money back.

You say that interim toll rates have been established. What are those interim toll rates now?

[Tracy Sletto]

I'm happy to answer some of those specific questions, but partly what I will observe—and I do thank you for the question—is that this is a matter before our commission right now.

With respect to our role—

[Charlie Angus, NDP, Timmins—James Bay, ON]

I get that. That's why I was just asking what the rates are now, not what's going to be renegotiated.

[Tracy Sletto]

All right. I will turn to my colleague Mr. Loewen. He may have some of that information at his fingertips to provide to you.

[Chris Loewen]

There are fixed tolls and there are variable tolls right now. The variable toll is a component of a benchmark toll, which is about 58¢ per barrel, and the total benchmark toll is about $11.46 a barrel, which represents $10.88 plus 58¢. I'm not sure if that's exactly what you're trying to get at.

[Charlie Angus, NDP, Timmins—James Bay, ON]

I'm trying to figure out how much the public is on the hook for, because we were told, first off, that the cap on what the oil companies would be paid would be 22%, meaning 78% was out there. Was that on the taxpayers?

I'm looking at the Tsleil-Waututh Nation's report on the pipeline running through their area. They say that 48% of the costs are recoverable in tolls, which is less than half of the cost. That would mean, I guess, that unless unicorns come down and cover the rest of the costs, they would go to Canadian taxpayers. Are they correct that right now only 48% of those costs per barrel are recoverable?

[Chris Loewen]

At this time, as Ms. Sletto had already mentioned, this is an issue in front of our commission. Our role in financial regulatory oversight includes evaluating the economic feasibility of a proposed pipeline and then ensuring that tolls and tariffs are just and reasonable and that the costs were necessarily and reasonably incurred by the company.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you.

Because we know our oil company friends, who are refusing to come to our committee, have been saying that they think it's unfair they're having to pay 48% of the costs, while the public gets stiffed with 52%. They want a better deal. Hopefully, they'll come. We'll be asking them to come.

When I look at the Tsleil-Waututh Nation's report...and you talked about your great indigenous partnerships. They say this pipeline is in the heart of their territory. It states:

Tolls that cover less than half of a project’s costs cannot be found to be just nor reasonable, nor in the public interest. Approving this interim toll application would set a dangerous precedent by conflicting with the CER Act, and with guidelines from the NEB and CER. More importantly, the applied for tolls violate well established principles of rate design, including cost-of-service recovery; fair return; revenue sufficiency; efficiency; and transparency.

Do you think that's a fair analysis of us being stiffed as taxpayers for the other 52% of Imperial Oil's costs to run bitumen?

[Tracy Sletto]

If I could answer...and thank you for that observation and question. You are right to observe the community you mentioned is an impacted community by the project and is certainly involved in the indigenous advisory and monitoring committee work that we do. We're very proud of that work.

I will mention that the matter before the commission right now is to establish those tolls. Right now, there is evidence on the record, including those of participants and interveners. For us, it's very important that we do respect that adjudicative process. The matters that are before the commission are with respect to tolls.

[Charlie Angus, NDP, Timmins—James Bay, ON]

I agree.

Do you have an idea when those tolls will made public? Would we be able to hear from you on that, so we have a sense of whether or not we're getting ripped off as Joe Q. Public?

[Tracy Sletto]

The timing of the tolling matter is currently active before the commission. We expect the process to be occurring over the coming months and into 2025. There will be procedures and processes that would allow for that very public exchange. A considerable amount of information has been filed on the record as part of that hearing process right now and is publicly available.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you.

It was fascinating this morning. We learned that if we had had the TMX pipeline maybe that horrific tragedy in Lac-Mégantic might not have occurred. The Lac-Mégantic disaster was oil from Dakota. It had nothing to do with what's coming out of Alberta, yet the Liberals would pretend, when we set up this pipeline, that it's taking oil off—

[Shannon Stubbs, Conservative, Lakeland, AB]

That's the whole point; it wasn't Canadian oil.

[Charlie Angus, NDP, Timmins—James Bay, ON]

—the railway, as opposed to increasing it.

I just want to ask you, because I read the TD financial report. I get up in the morning, go to the washroom and read my TD financial report. It says:

After a relatively weak year for Canada’s oil producers, output growth in 2024 could amount to a significant 300 to 500k/barrels per day, putting [Canada] in the running to be the largest source of global oil supply growth.

The Justin Trudeau government is leading the way.

Would you say this massive increase that's happening because of TMX means it's not simply that we're shifting from railway to pipeline, but we're adding capacity? Is that a fair analysis?

[Tracy Sletto]

The commission, in the context of the deliberations on this project, considered.... We mentioned the social, economic and environmental impacts of the project. Certainly, an increase in capacity would have been part of what would have been considered by the commission at that time, but the decision at that time was to proceed.

The context around what you're describing, in terms of global market impacts, is also something that needs to be considered in the context of supply and demand and pricing. There's a complex market in place.

[Charlie Angus, NDP, Timmins—James Bay, ON]

That's a significant 300,000 to 500,000 barrels per day. It says that Trans Mountain is the biggest factor. That's not Charlie Angus saying that, that's the TD financial report.

Thank you.

[The Chair, Liberal, George Chahal]

Thank you, Mr. Angus.

We'll now proceed to our next speaker.

We'll start with Mrs. Stubbs and then go to Mr. Patzer.

You have five minutes.

[Shannon Stubbs, Conservative, Lakeland, AB]

Thanks, Chair.

Just to our Bloc colleague, certainly, I would assure him that we, Conservatives, support the expanded production and exports of Canadian oil and gas to help lower global emissions—

[Jean-Denis Garon, Bloc, Mirabel, QC]

I have a point of order, Mr. Chair.

[Shannon Stubbs, Conservative, Lakeland, AB]

—and to bring powerful paycheques for our people virtually in this country.

We look forward to testing—

[Jean-Denis Garon, Bloc, Mirabel, QC]

Mr. Chair, I have a point of order.

[Shannon Stubbs, Conservative, Lakeland, AB]

—his comments against the Bloc leader who pledged to support the Liberals.

[The Chair, Liberal, George Chahal]

Hold on, Mrs. Stubbs.

We have a point of order from Mr. Garon.