Natural Resources Committee on Nov. 15th, 2022

[Elizabeth Wademan]

I'd like to come back to you on that.

As you're probably aware, CDEV is the holding company that holds this asset as a subsidiary. The nature of your questions is more detailed, and I'd like the opportunity to revert back to you on that.

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

I'm officially requesting whether or not this is true, so I'm asking you to get that information to our committee.

Thank you.

[The Chair, Liberal, John Aldag]

Thank you. We are out of time on that one.

To finish off this round, we have five minutes for the Conservatives and five minutes for the Liberals.

We'll start with Ms. Stubbs, who is going to share her time with Mr. Patzer.

Ms. Stubbs, it's over to you for the start of the five-minute round.

[Shannon Stubbs, Conservative, Lakeland, AB]

Thank you, Chair.

Certainly, of course, the Conservatives supported the Trans Mountain expansion but also believed that it should be completely built, owned, operated and paid for by the private sector...if only the government had provided the legal and political certainty to allow that proponent to go ahead and build that project after they had also approved it.

This is for either the Department of Finance or for Elizabeth from the Canada Development Investment Corporation, whichever is appropriate—or maybe both.

I'm going to quickly ask if you can provide, as written submissions to this committee, the figures for the purchase cost of TMX from Kinder Morgan, just so it's on the record; the projected cost of TMX by the private sector proponent when it was originally proposed; the current projected cost of construction of the Trans Mountain expansion; what the projected completion date was when it was first announced by its private sector proponent; and what the projected completion date now is. Also, if there is any information that can be provided in written form about the status of the consideration of new ownership, I think we'd all appreciate that too.

Now I will pass my questions over to my colleague Jeremy.

[Marie-Josée Lambert]

We'd be pleased to provide that information in writing.

[Shannon Stubbs, Conservative, Lakeland, AB]

Thank you.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

I'm going to start with Natural Resources Canada.

Finance, you might want to jump in on this one as well. It kind of touches on both of your departments.

How much of the equalization formula payment from the provinces of Saskatchewan and Alberta has been based on natural resource revenues from oil and gas?

[Daniel Dufour]

I'll have to defer to my finance colleagues on this question.

[Miodrag Jovanovic]

We will have to take this and share with our colleagues in the federal-provincial relations branch to see if there's a way to provide you with something.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

If you could get them to table a document for the committee with that information, it would be extremely helpful. Thank you.

This is more for the environment team. It touches on agriculture, but it comes through environment.

For the agricultural clean technology program, I understand the funding for the adoption stream has gone out. On the recipient list, 139 projects were approved. Only five of them were for Saskatchewan. This program was for grain dryers and basically for the agricultural sector to be able to transition, but from an environmental lens.

I'm just wondering if finance or environment have any insight as to how this program decided which projects to fund. Was the criteria based on environmental or economic impact?

[Jesse Fleming]

Thank you very much for the question.

The honourable member's quite right that this program would be administered by Agriculture and Agri-Food Canada. If the clerk would like to follow up with our colleagues in Agriculture and Agri-Food Canada, I'm sure they'd be happy to share some information.

I would say the premise of the question is quite right in that all sectors need to advance in terms of decarbonization. On the agricultural side, we need to continue to invest as we know that the farmers not only provide food to this table but are also wonderful stewards of our land. Efforts are required to try to further drive down greenhouse gas emissions.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

Lastly, for environment, I represent a few communities that are definitely impacted by the just transition. There's an economic development group called South Saskatchewan Ready. They've come up with a very detailed plan and some feasibility studies for the entire south region of Saskatchewan and for what they're going to do after the government eliminates their sole and main driver of the local economy.

We've seen audits from the Auditor General talking about how the program's been an absolute failure so far. I'm just wondering what your department's going to do to make sure that these communities are not left behind, as it's being indicated they are.

[Daniel Dufour]

I'm happy to take this one for Natural Resources Canada on the just transition. Thank you for the question.

We certainly accept and are actioning the audit's recommendations. I think it was narrower in scope and limited in the time involved in terms of the audit itself, but we're certainly looking at.... We would argue that a lot has been accomplished over the past few years to support economic growth and job creation across the country. Over the past two years, we've seen significant investment made in terms of supporting economic recovery, climate action, and skills and training that will create sustainable jobs. Once again, this is across the board. Over a billion dollars has been invested in workforce training and support for workers, including in sectors undergoing these transitions. NRCan is heavily investing in energy, mining and forestry programs that will support regions across the country in terms of sustainable job creation.

[The Chair, Liberal, John Aldag]

Thank you.

We're out of time on that one.

Now we're going to go to Mr. Sorbara for the last five minutes.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Thank you, Chair.

I wish to first speak to the Canada Development Investment Corporation.

Good afternoon to you, Elizabeth.

The CDEV is going to be tasked with the initial set-up of the Canada growth fund. Can you speak to the broad strokes of that fund, Ms. Wademan?

[Elizabeth Wademan]

Thank you, honourable member, for the question.

I will turn that to my colleague in finance.

[Marie-Josée Lambert]

I'm happy to take that question.

As part of the FES update, an annex was dedicated to the Canada growth fund. It announced that the CGF will attract private sector investment to help meet important national, economic and climate policy goals, which include the following goals:

Reduce emissions and achieve Canada's climate targets;

Accelerate the deployment of key technologies, such as low-carbon hydrogen and carbon capture, utilization, and storage (CCUS);

Scale up companies that will create jobs, drive productivity and clean growth...; and,

Capitalize on Canada's abundance of natural resources and strengthen critical supply chains to secure Canada's future economic and environmental well-being.

It will be a new public investment vehicle that will operate at arm's length from the federal government. It will use a broad suite of financial instruments and will be capitalized with $15 billion over the next five years.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

It will be a catalyst for private sector investment in the ongoing transition to a low-carbon economy and for what I would say is energy security and affordability as it continues, along with a response to the introduction of the Inflation Reduction Act in the United States with the tax credit for clean technologies.

Could I get an opinion on how powerful or how productive these tax credits—which are, for the most part, refundable tax credits, I believe—on clean technologies and clean hydrogen are in terms of being a catalyst for private sector investment? Do we have any idea what the multipliers are on that type of a mechanism?

I take it that would go to finance.

[Miodrag Jovanovic]

Thank you for your question.

We don't have a specific assessment in terms of, for instance, a multiplier. We know that these credits are, by any standard, relatively generous to the extent that not only is the rate at least at par with what the Inflation Reduction Act in the United States introduced, but they are fully refundable. This has a significant value in terms of creating certainty for taxpayers that they will actually get the money regardless of their financial position or tax position.

The fact that they are provided up front also has a significant value, particularly in that sector, which typically calls for relatively high discount rates. Overall, we are confident that these credits will have a positive effect on investment in these key sectors.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Thank you, Mr. Jovanovic.

The response, I believe, in the FES to the Inflation Reduction Act was appropriate and obviously quite timely.

Today in one of its analyses, Bloomberg noted that Canada is now a close second with regard to the battery supply chain and that “Canada's recent investment in its upstream clean [technology] supply and increasing demand in the US-Mexico-Canada Agreement...increases the country's competitiveness”.

We know we've laid out $3.8 billion in our critical minerals strategy. A lot of that funding will flow to companies that I know are in my colleague MP Lapointe's area of Ontario. The tax credits that we've introduced will certainly assist that.

How quickly can we get the funds flowing from the $3.8 billion critical mineral strategy?

I take it that question would be for finance, natural resources or even environment, because it overlaps on all three. Whoever wants to jump in, that would be great.

[Daniel Dufour]

Thank you for the question.

I'm for Natural Resources Canada here.

Again, budget 2022 announced the $3.8 billion to implement Canada's first-ever critical minerals strategy. Obviously, there will be significant engagement in the development of that strategy. It's looking at providing funding on a range of industrial activities, from geoscience to exploration to mineral processing, manufacturing and recycling applications. It includes some funding that will go toward research, development and technology deployments. There are multiple ramifications to this.

I will just say that right now the consultation process is closed. The public consultation period lasted until mid-September. Right now, the Department of Natural Resources is reviewing all the feedback that has been received following the consultations. The hope is to publish the strategy by the end of this calendar year, 2022.

[The Chair, Liberal, John Aldag]

Thank you. We're out of time.

[Mario Simard, Bloc, Jonquière, QC]

Mr. Chair, since it is not yet 6 p.m., would there be enough time left for a quick question that could be answered in writing?

[The Chair, Liberal, John Aldag]

That's the end of the second round. I said we'd try to get through the second round. That's what we've done.

I'd like to conclude at this point, because we are going to be bumping up against 6 o'clock, which is a hard stop time.

I want to thank all of the guests, the officials, for being here today. Thank you for your insights and your patience while we had the vote. It's greatly appreciated. Through our clerk, we will be following up with many of you for items that were requested in writing, so expect to hear from the clerk on that.

I want to mention that on Thursday, we will be back to hear from the regional development agencies on the study, and we have two representatives from the Canada Energy Regulator who have confirmed they'll be attending on Thursday. That's great news from them.

I have one final, quick thing. There has been a public statement made by one of our members, Ms. Yvonne Jones, that she is battling breast cancer. I want to know if the committee would be supportive of my sending a card of well wishes from the committee on the committee's behalf.

[An hon. member]

Absolutely.