Mr. Speaker, I am pleased to speak at second reading of Bill C-69. I will focus my comments on part 2, the Canadian energy regulator act.
Bill C-69 is about so much more than exactly how pipelines and other major energy projects are reviewed and approved. It is about what role Canada will play internationally on resource development and energy production. It is about whether Canada will continue to be a leader in producing the most environmentally and socially responsible energy under the highest standards in the world. It is about whether the federal government will fulfill its moral obligation and economic imperative to enable Canada to supply the ever-growing global demand with Canadian oil and gas. Canada must remain open for business. The world needs and wants more Canada. The world needs and wants more Canadian oil.
Every other oil-exporting country is stepping up to meet that demand and to seize its growing share of the world market, but during the two years since the last election, energy investment in Canada has declined more than in any other two-year period in 70 years. The dollar value is the equivalent of losing 75% of auto manufacturing and 100% of aerospace investment in Canada. Recent reports show that in 2017 alone, four projects worth $84 billion left Canada.
The decline in Canadian energy investment is not only due to lower energy prices, which are now rallying, but due to irresponsible anti-energy policies and a lack of leadership and political will. The real consequences have been hundreds of thousands of Canadians, one-sixth of the total oil and gas workers in Canada, out of work; bankruptcies and foreclosures; family breakdowns; and escalating crime. The economic impacts have rippled through other sectors and across Canada. Canada is falling behind.
Reuters reports that Canadian oil producers are running out of options to get through to markets as pipeline and rail capacity fill up, driving prices to four-year lows and increasing the risk of firms having to sell cheaply until at least late 2019. Canada is a captive merchant to its American market with 99% of Canadian oil exports going to the U.S. However, the result of American regulatory reform and cost-cutting with the removal of the 40-year ban on oil exports is that U.S. shale oil is being recovered and sold to new markets at an ever-increasing pace. In 2005, the U.S. imported 12.5 million barrels per day. Today, it imports only four million. Today, it exports almost two million, and this number is estimated to double in only four years. The U.S. is expected to provide over 80% of the global supply growth over the next decade.
Market diversification is critical for Canada, and Canadian energy companies are trying to find a way to reach tidewater so that they can compete for international markets and not sell at a discount to the U.S. Meanwhile, the U.S. is removing red tape, ramping up exports, and rapidly pursuing its energy independence. However, the Liberal delays, uncertainty, and anti-energy agenda are threatening Canada's economy now and our position as a potential global leader.
The government's failure of leadership on the Trans Mountain expansion is the latest in a pattern of roadblocks to Canadian energy development. The same day the Liberals approved the Trans Mountain expansion, over 400 days ago now, they vetoed the federally approved northern gateway pipeline, which would have connected Alberta oil to the west coast for export to the Asia-Pacific region, where demand for oil will grow exponentially for decades.
Northern gateway had undergone the same rigorous review and consultation as Trans Mountain and Line 3, which were both approved, but despite the science and the evidence that the route was sound, despite the project being in the national interest, despite the 31 equity partnerships with indigenous communities, instead of the Prime Minister offering additional consultation or any options, he said that he did not “feel” right about the project and he vetoed it.
Recently, in October 2017, TransCanada was forced to abandon the nation-building energy east opportunity. It would have been one of the largest private sector infrastructure investments in Canadian history, and would have carried crude from the west through the heart of Canada to Atlantic ports for use in eastern Canadian markets and sale to Europe. However, the political risks and pressure were too great for the Prime Minister and after three years of delay, stops, and starts, additional review, and last-minute conditions, TransCanada finally warned and then withdrew its plans for the $15 billion project. TransCanada estimates that it lost just over $1 billion on energy east. Enbridge estimates it lost just over half a billion dollars on northern gateway, and that does not even come close to the lost opportunities for Canadians. Billions of dollars that should have been added to Canada's economy are going to other jurisdictions.
In July, Petronas cancelled the $36 billion Pacific NorthWest LNG project after regulatory delays because “headwinds were too great”, despite widespread support, including the majority of first nations. Progress Energy, Petronas's Canadian subsidiary, anticipated Canadian investment dollars moving to American projects.
Calgary-based company, Veresen, recently announced it was investing up to $10 billion on a new LNG project, proudly called “Jordan Cove”, in Oregon. The project will invest $10 billion in the American economy and provide thousands of jobs in the U.S.
Oil and gas companies are moving their assets to the U.S. because the Liberals are constantly changing the rules of the game, making it ever more difficult to invest in Canadian energy. What is especially disappointing is that Canada has a long track record of rigorous and comprehensive environmental, social, safety, and economic assessments for energy projects like pipelines.
In 2014, WorleyParsons issued an exceptionally thorough report examining the processes and policies for oil and gas in many jurisdictions around the world to evaluate Canada's situation and compare it to its international competitors. It measured Canada against other countries for performance in areas such as overall decision-making process; cumulative assessments for regions with multiple projects; implementation of early and meaningful consultation with stakeholders and indigenous people, including the real integration of traditional indigenous knowledge; and the implementation of effective social impact in health assessments.
Here are the report's conclusions:
The results of the current review re-emphasize that Canada's EA Processes are among the best in the world. Canada has state of the art guidelines for consultation, TK, and cumulative effects assessment, Canadian practitioners are among the leaders in the area of indigenous involvement, and social and health impact assessment. Canada has the existing frameworks, the global sharing of best practices, the government institutions and the capable people to make improvements to EA for the benefit of the country and for the benefit of the environment communities and the economy....
In summary, the review found that EA cannot be everything to everyone. In Canada, however, it is a state of the art, global best process, with real opportunities for public input, transparency in both process and outcomes, and appeal processes involving independent scientists, stakeholders, panels, and courts.
However, since the 2015 election, the Liberals have constantly denigrated and undermined confidence in the regulator and in Canada's reputation, and have created a regulatory vacuum for energy development in Canada by ongoing reviews.