Natural Resources Committee on Nov. 4th, 2024

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Sure. I do think it's a really important question.

If there are Canadians listening to us, I would really like to ask them to see past the ritualized jousting and the incivility here and recognize that there are some things that have happened with this project that I think every single MP elected to the House of Commons should be celebrating and every Canadian should celebrate.

There aren't that many things we all agree on. I think this is a project that we should all agree, as I think the committee has heard, is in the national interest. It helps our economy. It helps workers. It helps our economic national security. It also is a project in the direction of economic reconciliation. I really believe that historians are going to look back on recent years and say that Canada has turned a corner in the relationship between indigenous peoples in Canada and the economy.

One of the things that I am the most excited about is moving toward putting indigenous prosperity at the centre of the relationship of indigenous people with governments and with companies. This project is part of that great shift.

To give you some numbers, during construction, $6 billion was awarded to indigenous businesses and partnerships and $690 million was invested in 69 mutual benefit agreements, MBAs, signed with 81 indigenous groups. This is really about indigenous prosperity. It's about indigenous people participating directly in the economy of our whole country. That is a really good thing. I hope we'll be seeing more of it in the future.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you.

To both ministers, Minister Freeland explained the economic gain, and now I'd like to go to the process and specifically to the consultation process. I think that will lead to some of the other questions that I'm going to ask Minister Wilkinson.

Can you talk about that consultation process? How did it start, how did it evolve, and where is it now?

[Jonathan Wilkinson, Liberal, North Vancouver, BC]

Thank you. As I said at the beginning, one of the challenges this government faced in coming to power in 2015 was the fact that the previous government had gutted environmental assessment processes and had essentially eroded the social licence to be able to get any major projects built in this country.

That was true for communities and particularly true indigenous communities. We made a commitment to address this in the context of the continuing work that was being done on Trans Mountain, and we made a commitment to actually fix this process more generally. That was what we did through the Impact Assessment Act.

One of the most important changes made in the Impact Assessment Act was early engagement with indigenous communities on all projects that are subject to a federal environmental review. That is very important to ensure that communities understand and have an opportunity to weigh in. We also went beyond that and said that many of these communities actually are really interested in being participants in projects, whether it's hydrogen projects, critical minerals projects, transmission lines or a range of other things, and we created tools like the indigenous loan guarantee program to allow access to low-cost capital for indigenous communities to be partners in these projects moving forward.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Minister, we heard a lot about regulatory uncertainty and the role that it played.

With whatever time is left, can you expand on that? How will we manage it as we go into future national building projects?

[The Chair, Liberal, George Chahal]

Provide a short answer, please, because we're near the end of the time.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

I think this is a good example of how we can get big projects built in Canada, big nation-building projects that are good for governments, that are good for the private sector, that are good for workers and that are good for indigenous people.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you.

[The Chair, Liberal, George Chahal]

Thank you.

We'll now go to Monsieur Simard for two and a half minutes.

[Mario Simard, Bloc, Jonquière, QC]

Ms. Freeland, I note some obvious inconsistencies in what you said before. In large international forums, the expectation is that oil consumption will decline over the next 50 years. In principle, for your pipeline to be profitable, oil consumption will have to intensify. So that is already an inconsistency as to the pipeline's profitability.

The second inconsistency is the following. I have heard your colleague Mr. Guilbeault say on numerous occasions that he wants to put an end to fossil fuel subsidies. It seems that you have found a new way of supporting fossil fuels directly through the Canada Growth Fund. So it seems that your interest in ending fossil fuel subsidies is not as strong as what I have heard from Mr. Guilbeault.

I have a very simple question for you: Do you consider support for Pathways Alliance to be a type of fossil fuel subsidy?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

No.

[Mario Simard, Bloc, Jonquière, QC]

Don't carbon capture and sequestration initiatives represent a fossil fuel subsidy?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

No. They are an investment in decarbonizing the Canadian economy. They are a good investment for the planet and for the economy.

[Mario Simard, Bloc, Jonquière, QC]

Okay.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

May I talk about the issue of profitability that you raised initially?

[Mario Simard, Bloc, Jonquière, QC]

Right now, I would just like to know why companies have sent multiple signals that low-carbon oil is not profitable.

In my opinion, one of the foundations of capitalism is assuming risks. People who invest their money assume a certain kind of risk.

In the case of the oil and gas sector, however, there is no risk. For the pipeline, you assumed the risk. The same goes for the decarbonization of the oil and gas sector. Two publicly funded projects have been disasters. Now, massive tax credits totalling $12 billion have been granted through the Canada Growth Fund to support the same kind of project, probably because you don't seem to be denying that it does represent that kind of support.

In my opinion, you are assuming the risk that should be assumed by the oil and gas sector, which is obviously some kind of financial support. Otherwise, it would not be socially acceptable.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

I am absolutely convinced that to achieve decarbonization, the government has to adopt an industrial policy and invest in the process. Some people maintain that decarbonization is not important and might also think that it can be achieved without government investments. I disagree, and I note that all major economies that really want to work towards decarbonization have a government industrial policy that allows them to invest in the process. That is what we are doing, in the aluminum, steel, construction and automotive construction sectors in particular.

[Mario Simard, Bloc, Jonquière, QC]

Yes, but it is disproportionate.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

That is what the government has to do in order to have a strong, decarbonized economy.

[The Chair, Liberal, George Chahal]

Thank you.

We'll go to Mr. Angus for two and a half minutes.

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

Thank you.

The PBO has stated that there was no business case for TMX. He said that the numbers that you used were based on a 100-year operating lifetime, which is pretty fun math, I would say.

Is that what you're basing this on, that we're going to get our money back in the next 100 years?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

No, not at all. You had the CEO of TMX here testifying before you. He is a businessman, and he said to you that he is confident that the government can get its money back.

Trevor Tombe, a reliable and very good and objective economist, has also written and testified that he thinks this project, the project itself, not even talking about all the tertiary benefits, is going to—

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

It's costing between $581 and $1,248 per household.

Yes, I'll get you the Simon Fraser report. Don't worry; I'll send it to you. It's pretty straightforward.

That's a big chunk of money. This idea that it's financially doable when we are paying—and you've disagreed with me—52% of the tolls.... That's what the Canadian Energy Regulator... I don't think you should be tearing down a national institution when they come here and testify and then say they're wrong.

Why are we expecting that the Canadians who paid up to $1,200 per household for this thing are going to get their money back when we're subsidizing the way that we're going to get paid back, which is by the pipeline tolls? It's simple.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Well, we're going to get our money back because we do not intend to be the long-term owner of the pipeline. If you look at market analysis right now, the consensus view is this that is a project that is worth a lot of money, and if the—

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

Is it worth $34 billion?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Yes, and if the government—