Natural Resources Committee on Nov. 24th, 2025

[Ron McKinnon, Liberal, Coquitlam—Port Coquitlam, BC]

Thank you, Minister and officials. I welcome you, as do my colleagues, to the committee today.

I'm going to branch out a bit. I want to talk about trees.

The forestry industry, as we know, is a critical part of the Canadian economy, and particularly so in British Columbia, which is my province. We have heard that there are tremendous opportunities to leverage investments in forestry in terms of housing and sustainable construction.

What actions are we taking to exploit this opportunity and to grow this sector?

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

Thank you for that question.

It's something that's near and dear to my heart. As I think you know, when I was a young teenager, I lived in a forestry town in northern Vancouver Island. I know how important forestry is to small towns all across this country.

We are in the process of looking at retooling our forest sector. For context—I think it's really important to understand the context—I look at the forest product sector and I see it as the canary in the coal mine.

We've had free trade with the Americans, theoretically, since the time of Brian Mulroney, a Conservative prime minister, and Ronald Reagan. During that entire time, the Americans have launched trade war after trade war on the forest product sector. We're in our fifth version of that trade war. Every time we go to the tribunals under the free trade agreement, or to the WTO, we win, and then the Americans find another excuse to start the trade war again.

This has had a very challenging impact on the sector. Quite frankly, what we're seeing now in these other sectors, the 15% we talked about, is the Americans using the same tactics they've used on forest products for the last 30 years.

We, particularly in forestry, rely heavily on exports to the United States. We need to work hard to reduce that dependence on commodity products going to the U.S. That's how we will build strong. That's how we will create reliable jobs.

The Prime Minister has talked about how we do two things. First, we find new export markets for our solid wood; second, and more importantly, we build here in Canada to use more of our own solid wood. The Build Canada Homes program is designed to take our annual housing starts from around 220,000 or 240,000 a year to 500,000 a year by the end of the decade. That's a big goal.

We have been very clear that, as that goal rolls out, we would like it to be manufactured homes, because that is the affordable way to build. That's the way we drive down the costs of housing. We have said that those manufactured homes will be built with Canadian solid wood, particularly mass timber.

To get to your question, we are laser-focused with provinces like British Columbia. I've spent time with Minister Parmar, who's very focused and has a shared vision. We need to be helping the commodity solid wood business evolve to the value-added mass timber business to support the rollout of Build Canada Homes.

I was just in Castlegar, British Columbia, a week or two ago, meeting with a fantastic entrepreneurial company called Kalesnikoff, a company very similar to the one in Chibougamau that you have shared and I intend to get to, where they are designing product to go from tree to sawmill to mass timber to manufactured homes, radically driving down the time and cost it takes to build a home.

If we do that, we will significantly increase the amount of solid wood we use in this country. That's how we give ourselves more than anyone can take away from us, and that's what we're focused on.

[The Chair, Liberal, Terry Duguid]

Thank you.

Mr. Simard, you have two and a half minutes.

[Mario Simard, Bloc, Jonquière, QC]

Thank you very much, Mr. Chair.

Minister, I would like to continue talking to you about the forestry industry.

Earlier, you had a bit of a difference of opinion with my colleague about the expression “elbows up”. To a francophone, elbows up means drinking to forget, and that is not what we want for forestry workers.

I want to come back to something rather essential. There is a proposal that has been around for a while that was made by people from Chantiers Chibougamau, which you just mentioned, Domtar and the major unions in Quebec.

As you know, nearly $12 billion in countervailing and anti-dumping duties are lying dormant at the border right now. It was proposed that the government buy back some of those amounts. I understand that is a big pill for the government to swallow, but these people are trying to compromise. What they are currently proposing is that the government buy back 50% of the countervailing and anti-dumping duties at the end of every month, which would allow them to continue to have access to the market and protect the jobs in question.

We know very well that the forestry industry is a big chain. As soon as one link in the chain is cut, it becomes very difficult to maintain the entire ecosystem. These people are concerned because what is happening now is equivalent to cutting multiple links in the chain. I therefore think that this is a reasonable suggestion that does not go against our trade agreements because there are hedge funds that are buying back these duties.

I would like to hear your comments on that. What do you think about this proposal?

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

Thank you for the question.

We are in this difficult negotiation with the Americans. We need to be playing chess, not checkers.

We are—and I am personally—in regular contact with the CEOs of various leading companies, the heads of family-owned businesses. We are dealing with a number of trade unions, including in Quebec, and the companies you mentioned. I was sitting with them as recently as last Friday, thinking about how we make sure that the $1.2 billion we've already allocated to the industry is allocated to their support as quickly as possible.

One of the things we've been focusing on is the liquidity support. We have already provided $700 million in liquidity support. I will be sitting with the heads of all the commercial banks this evening to talk about making sure that money will be going to all the companies that need it as quickly as possible. I've personally undertaken that.

In the conversations, as recently as Friday, there are differences of opinion around whether buying the duties would be a good thing.

[The Chair, Liberal, Terry Duguid]

Thank you, Minister.

We're going on to Monsieur Martel.

You have five minutes.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

Thank you, Mr. Chair.

Minister, thank you for being here with us today.

I want to come back to the Major Projects Office. As you know, the United Kingdom created the Major Projects Authority to oversee its major projects. Initially, it failed in several cases because of a lack of power and follow-up.

How can the Canadian government ensure that its Major Projects Office will not make the same mistakes?

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

We have an extraordinarily experienced Prime Minister who has allocated capital at the highest levels all over the world. We have a Clerk of the Privy Council who is one of the most sophisticated businesspeople ever to hold that role. I would point out that, in addition to being CEO, he was also CFO, so he was a C-suite member of not one, not two, but three different blue-chip Canadian corporations, as well as CEO of the second-largest pension plan in the country allocating capital. We have a chief of staff who ran the infrastructure investments of the second-largest pension plan in the country. I think you know my background.

I would put those backgrounds up for understanding how to get projects built against any government in the world. I would also highlight that choosing the right person to lead the major projects is an incredibly important decision. I believe it was Premier Smith who said in the National Post that she could not think of a better person to run the Major Projects Office.

The proof will be in the pudding, but I think we're doing the right things and we're putting the right people against the problem.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

Minister, you came to Saguenay. You saw that we have the potential to market our products and that we have excellent facilities.

For my region to prosper, it needs projects. For those projects to be carried out, investors are needed. To attract investors, there must be an attractive regulatory environment. Do you think Canada is offering that right now?

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

I think we should look at what CEOs are saying. We should look at what the CEO of Shell Global said, which is that this is the most attractive time he's ever seen to invest in Canada. We should look at the CEOs of Teck and Anglo American, who've said that Canada is a great place to invest.

I was in the Saguenay at Rio Tinto, which is investing, I believe, almost $3 billion in a new aluminum smelter because it believes Canada is a great place to invest.

At the G7 ministerial meeting, we announced that multiple G7 allies of ours were investing in the scandium processing plant in Saguenay because they think it's a great place to invest.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

However, we know that it is difficult to get permits, that every economic development project depends a great deal on timing and that every time that timing is thrown off because of regulations it undermines our credibility on the international stage.

We are talking about bureaucracy. Will there be any measures in that regard?

[The Chair, Liberal, Terry Duguid]

You have 30 seconds, Minister.

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

The goal is for something referred to the Major Projects Office to get a conditions document within two years. If we do this, we will be the best in the OECD. If someone who allocated capital had that kind of clarity, I would be excited about putting money to work.

We're also announcing “one project, one review” with each of the provinces. Let me tell you what that means. In the case of the Ksi Lisims project in British Columbia, the British Columbia government approved that project at 4 p.m. on a Monday about a month ago. The federal government approved it at 4:30.

[The Chair, Liberal, Terry Duguid]

Thank you both.

Wrapping up this round, we have Mr. Danko for five minutes.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

Once again, thank you, Minister.

I'm going back to economic development.

You spoke very eloquently about the fact that we are currently at an inflection point in our nation's history, and you gave a fairly frank assessment of the geopolitical realities we're facing.

Natural resources have always been a cornerstone of Canada's economy since the founding of the country. My question on economic development is, what is the scope and the scale of natural resources as part of Canada's future economic growth? What opportunities do we have, both domestically and globally, to leverage the vast natural resources across this country?

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

What I have seen when I've travelled to other countries, and what I have heard from my colleagues who've also travelled to other countries, is that they all want what Canada has. Whether it's the Mittelstand companies in Berlin—which are feeling the threat of their uncertain supply chains, from a critical minerals perspective—seeing Canada as a solution...or whether it's our LNG or any of our resources, they see Canada as a reliable and fair trading partner. They see Canada as a country that will not use their energy or critical minerals for coercive political ends and that shares their values. What I hear, over and over again, is that they want Canada. Canada provides them the diversity of supply, the security and the sovereignty they are looking for.

I was really struck—I was in Germany speaking with people from a number of the large utilities there—when they said to me that they relied on Vladimir Putin for their natural gas, but that was a huge mistake. They said that their economies ground to a halt at the start of the war in Ukraine. It has taken them an immense amount of time to get off that reliance. They're now being told they have to buy their LNG from another supplier. While they may be comfortable buying some of their natural gas from that supplier, they have no interest in becoming beholden to that other supplier.

By the way, when they can get Canadian LNG, which is produced in the most environmentally responsible way out of any LNG in the world—we have the lowest carbon intensity of any LNG producer in the world, and we do it in partnership with first nations—they say, “I like that. That's consistent with my values. If I have a choice between two suppliers, that's a supplier I want to buy from.” I use that as an example.

I could do the same thing with critical minerals: They want to buy from us, not from non-market actors who will use their critical minerals for coercion.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

Thank you, Minister.

We have just a couple of minutes remaining, so I want to give you the opportunity to add anything else that you think was missed in this discussion.

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

We are at a difficult time in which we have to figure out how to win this trade war, but this trade war is also an opportunity to put our differences away, come together and re-engineer the Canadian economy so that we are stronger coming out of this. The more we can diversify our economy and be the supplier of choice for our allies around the world, the more sovereign, secure and economically better off we will be.

That's good for Canadians. That creates jobs, as well as the tax and royalty revenues that pay for $10-per-day day care, pharma care, health care and post-secondary education, be it at a community college or a university. These types of resources, when we develop them in the right way, are good for Canada, and I think that's what Canadians are looking for.

[The Chair, Liberal, Terry Duguid]

Thank you, Minister.

I'm wondering whether you have a hard stop at 4:30 p.m. That's the time we advertised for you. We may have a short round of a couple of minutes for each member, if that's okay with you. We're going to—

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

I serve at the pleasure of the committee. I do have something in a while, but I will be—

[The Chair, Liberal, Terry Duguid]

Let's go with one round of questions. Let's go two, two and one. How about that?

There's time for a quick question for you, Mr. Tochor.

[Corey Tochor, Conservative, Saskatoon—University, SK]

Thank you very much.

The IEA has just recanted its original claim that oil demand has peaked worldwide. Do you agree that oil demand has not peaked?

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

I'm sorry to do this again, but I fundamentally disagree with your premise. The IEA does not make predictions. The IEA provides scenarios.

[Corey Tochor, Conservative, Saskatoon—University, SK]

They recanted that it's not peak oil—

[Tim Hodgson, Liberal, Markham—Thornhill, ON]

No. They have added scenarios. I've read the report. I've actually looked at it. They have scenarios that look at net zero, and they have added other scenarios. They have additional scenarios.