Natural Resources Committee on Feb. 12th, 2026

[Claude Guay, Liberal, LaSalle—Émard—Verdun, QC]

It's just to implement.

[Tracy Sletto]

The policy rationale for the legislative change we would ultimately implement, if it were approved, would be better answered by the policy lead in the department.

I'll turn it over to Ms. O'Brien.

[Claude Guay, Liberal, LaSalle—Émard—Verdun, QC]

Ms. O'Brien.

[Erin O'Brien, Assistant Deputy Minister, Fuels Sector, Department of Natural Resources]

As you've implied with the question, the rationale behind these amendments is to ensure that we have a more competitive regulatory system for LNG projects. Indeed, the rationale behind the amendments came out of the many discussions we've been having directly with project proponents. We have engaged in economic modelling with a number of proponents. This had come up as a measure that would support the economic competitiveness of LNG projects going forward.

I would note this is one of two measures included in budget 2025 that would support the development of LNG projects. The other is the extension of the ACCA, or the accelerated capital cost allowance, treatment to these projects. We are still developing that amendment with the Department of Finance and expect to be in a position to legislate that shortly.

[Claude Guay, Liberal, LaSalle—Émard—Verdun, QC]

Thank you for that answer.

You mentioned the feedback you received from project proponents. When we take feedback like that, what kind of consultation is there, and with which stakeholders, to get to a final outcome that says we're going to put it in the BIA?

[Erin O'Brien]

A lot of our work was done directly with project proponents. We had conversations with provinces as well. In fact, we engage in a lot of that economic work collaboratively with my provincial colleagues.

In addition, we appreciate that this is a legislative amendment to fulfill the government's responsibilities under UNDA. We engaged with indigenous groups, indigenous nations themselves and indigenous associations. That was also an important consideration as we were bringing this amendment forward.

[Claude Guay, Liberal, LaSalle—Émard—Verdun, QC]

Ms. O'Brien, I don't know if you're the best person for this, or who on the floor would be, but I'm also curious about what the global position is, because this is a global capital investment game for these proponents. Well, it's not a game; this is serious business. They make decisions on where to invest around the world.

What position is that going to put us in versus other countries or geographies, if you don't mind helping us on that?

[Erin O'Brien]

That's a great question.

We have looked at regimes in other countries. The United States, for instance, has a very different approach whereby export licences are pretty much automatically approved if exports are going to any country with which the United States has a free trade agreement. More recently, under President Trump, export licences for projects that are exporting product to countries without a free trade agreement are also going forward.

Australia, which is another major LNG-exporting country, has a very different approach whereby it largely does not have regulations in place. It's seeing dynamics in its gas markets largely as a result of a lot of production being diverted to export opportunities. It's seeing significant spikes in domestic gas prices.

As such, we feel that this regulation really balances different needs—the need for Canada to diversify market access for its LNG and the need to be responsible in ensuring that it has long-term domestic supply so it can meet domestic needs as well.

[The Chair, Liberal, Terry Duguid]

Thank you.

Mr. Bonin, you have the floor for six minutes.

[Patrick Bonin, Bloc, Repentigny, QC]

Thank you, Mr. Chair.

Ms. Sletto, I'm trying to understand how to reconcile targets to achieve net-zero emissions by 2050 with export licences, which would basically be for 50 years. How do you explain that? I can't.

[Tracy Sletto]

I may turn the question to Ms. O'Brien for the policy rationale behind the change.

[Erin O'Brien]

Just to ensure that there's an understanding of the scope of this measure, this measure only impacts the length of time a project can export LNG. It does not impact the volume of LNG that they're able to export. That is approved under a different regulatory process.

This measure in and of itself should not have an adverse impact on the emissions profile of LNG projects. If a proponent wishes to increase the volume it is exporting under the project, it can apply to change a different approval that it receives as part of its environmental assessment process.

[Patrick Bonin, Bloc, Repentigny, QC]

I don't think you understood my question.

Canada has targets to achieve net-zero emissions by 2050, does it not? However, here you are saying you want to issue 50-year export licences. We're now in 2025, so the licences will take us to 2075. Gas will still be produced, transported and exported in 2075.

How can Canada's targets to achieve net-zero emissions in 25 years' time, or in 2050, be reconciled with the fact that you are issuing licences that mean we will be producing and exporting gas up until 2075? I don't understand how that can be done without compromising the net zero targets.

[Erin O'Brien]

What I would add to my very technical answer previously is that Canada has among the cleanest LNG product globally. For LNG Canada phase one, for instance, its emissions profile is 35% better.

[Patrick Bonin, Bloc, Repentigny, QC]

Producing gas generates emissions, doesn't it? Even if you're telling me about carbon neutrality in a plant, a plant with a 50-year licence will still be producing gas. This means Canada will have greenhouse gas emissions until 2075.

How can we allow that and still say we will be carbon neutral by 2050? That's my question. I'm not talking about plants. I know you're going to say they are carbon neutral.

[Erin O'Brien]

There will certainly be emissions. New projects that are being developed, particularly on the west coast, are required to be net-zero-ready in B.C.

[Patrick Bonin, Bloc, Repentigny, QC]

I'm not talking about liquefaction plants. That's not what I'm talking about.

You can't look at one pipeline only. You have to look upstream and look at the big picture. There is gas production. You have to look at the big picture. Canada has emissions associated with oil production. The emissions are going up, you know. I'm not even talking about what is going to be burnt on the other end.

Canada has a target to achieve net-zero greenhouse gas emissions by 2050. What are you doing to justify 50-year export licences? There are greenhouse gas emissions. What are we doing to achieve net-zero greenhouse gas emissions by 2050 if you grant 50-year licences?

[Erin O'Brien]

I think net zero is an important commitment. The government remains committed to reaching that target. There are many measures that will have to come together in order for that target to be met. While LNG does emit, it also contributes to the global reduction of—

[Patrick Bonin, Bloc, Repentigny, QC]

I'm talking about Canada. Canada has a target to achieve net-zero emissions by 2050.

[Erin O'Brien]

There will be increased emissions in Canada as a result of a growing or increasing of Canada's LNG ambitions.

[Patrick Bonin, Bloc, Repentigny, QC]

In that case, what are we doing to be carbon neutral by 2050?

[Erin O'Brien]

Canada's projects, those that are currently under construction and development, particularly on our west coast, have a requirement to be net zero. Those that are coming forward—for instance, Woodfibre, Cedar LNG and other projects—are going to be electrified. There's a commitment.... Well, it's more than a commitment; there's a requirement that they be net-zero-ready.

[Patrick Bonin, Bloc, Repentigny, QC]

You're talking about plants. I understand that clearly, but let us get down to brass tacks. Let us talk about emissions in Canada, not just in plants—

[The Chair, Liberal, Terry Duguid]

Thank you, Mr. Bonin. That is your time.

I want to thank you both.

We're now moving on to Ms. Stubbs.

You have five minutes.

[Shannon Stubbs, Conservative, Lakeland, AB]

Thank you, Chair, and thank you to all of the witnesses here today for your challenging public service. I appreciate you being here.

My questions will relate to indigenous participation and consultation, primarily with respect to the north coast transmission line, which will feed 600 megawatts to the Ksi Lisims LNG project. Hopefully we can have an efficient discussion in the short time available to us.

Has the Canada Energy Regulator had any contact with the Major Projects Office since the minister referred the north coast transmission line to the MPO?