Mr. Speaker, it is my privilege to stand today and speak to this report as well. I know the committee spent a long time doing a study on this.
There is no doubt that the government has a specific role to play in intellectual property. I am an automotive mechanic by trade, and one of the reasons I came here was that I was frustrated, because I often feel that the government gets involved in things that it has no business getting involved in. However, intellectual property is one of the areas in which I think the government definitely has a role to play. I would put it under the honest weights and measures aspect of what the government ought to be doing.
If one has a good idea and develops that idea, one ought to be rewarded for that idea. Often there is a great amount of risk that comes with bringing forward an idea. If the level of risk is there and one is successful in getting that idea brought forward, there should be some reward that comes with that.
I think this is an honourable, righteous, and necessary role for the government to be playing in Canadian society and in the world at large. I know that there are groups in the world that are always on the lookout for good ideas and that try to bring these ideas to market, long before folks here in Canada have the opportunity. Therefore, I am pleased to see that the committee studied this, and I am pleased to see that the report has come out. Overall, the report goes in the right direction on a number of things. What we need to always remember, though, is that necessity is the mother of most invention.
My colleague's point was that when the government starts to pick winners and losers, that is when we end up in an interesting area. I do think the government has a particular role to play when it comes to intellectual property, but it must always be careful to ensure that it does not pick winners and losers. It must set out a framework. It must set out a series of protections, much the same as we protect all other areas of life in Canada. It is the government's role to protect things. However, as the federal government, we should not necessarily be encouraging one area and not another area. We see that, in some respects, when it comes to particular industries. The government picks winners and definitely tries to stifle others. We see it with the aerospace industry, for example. The government will bend over backward to prop up that particular industry and ensure that it is capitalized, and that sort of thing, whereas in the oil patch, we see very little support. In fact, it wants to phase it out, as the Prime Minister has said.
Coming from northern Alberta, I would say that we have seen major advances in the intellectual property that has come to northern Alberta through necessity, essentially. Northern Alberta is a rugged place. The elements are fairly harsh, yet it is a thriving place. We have significant forestry, farming, and oil patch initiatives going on. When it comes to the government's role in all of those things, it is to manage them in a manner that allows the companies and individuals who are operating up there to protect their good ideas.
One of the things I like to talk about that I have a personal connection to is the fracking industry in northern Alberta. Members might be interested to know that to put one hole in the ground and frack it out in an average fracking operation costs about $17 million. The interesting part is that $10 million of that $17 million, more than half the cost, is for the water that is used. It is not necessarily for the water. It is purely for the trucking costs to get the water from where it is produced at one hole over to another hole. There is a huge cost associated just with using the water, because we do not want to use fresh water. We typically use polluted water from other sources.
For example, in Whitecourt, Alberta, the forestry and pulp industries use a bunch of water. At the end of that, they have a slurry that has been spent, they cannot use it anymore, so they sell that water to the oil patch, which pumps it down the holes when they do a frac. A significant amount of water is needed when that happens. They use that water. That water is not lost; it goes down the hole. They use it to break open the rocks at the bottom. Over the course of the next three years, all of that water will come back up.
Basically what has happened is that they keep using the same water over and over again. Once the water comes back up, they ship it over to the next hole and they start fracking at the next hole.
However, a large amount of water is used, and about 70% of it comes back within the first three months. Then it takes about three years for the rest of the water to come back up the hole. There always needs to be a significant volume of water, which is being trucked around from hole to hole as the fracking is done.
Fracking sounds like a harsh word, and a lot of people wonder what actually happens. The best way it has been described is that it is like blowing into a balloon that has a pinprick in it. When the balloon is fully deflated, everything looks normal. As the balloon is blown into, the hole in the balloon gets larger and larger, so someone has to blow faster to keep the balloon expanding until finally a point is reached where someone can blow really fast into a balloon and all the air leaks out of the hole because it keeps getting larger and larger.
That is essentially what happens during a frac. The water is pumped down the hole very fast, and the water squeezes into microscopic cracks in the rock. The water forces those cracks open, and tiny pieces of sand are sent out with the water. When the pressure is released, the water backs up out of the hole and leaves the sand behind. The sand holds the rocks open to allow the natural gas and oil to come back out.
Due to the amount of water that is needed and the cost, and as I said earlier more than half of the cost of a particular hole is just the water, there have been huge innovations in how to reduce the amount of water because of the benefits to it. If the amount of water needed can be reduced, that could mean less trucking, these holes could be produced cheaper, and it is in the best interests of everybody to ensure our water can be used for agriculture, for example.
Just on that point, the vast majority of industrial water use in Alberta is in the agricultural industry. The oil patch only accounts for 1% of all use of industrial water.
My personal connection to that is that my uncle works in the oil patch. He has a company that heats water. The company started out in the building construction industry, melting the frost out of the ground so people could pour basements during the winter. It was kind of an innovative thing that came about in the boom times, in 2004-06, when it could not build houses fast enough. When workers were heating the ground to get the frost out so it could dig a hole to pour the basement, he got the idea to get into the business of heating the ground.
The company then developed a technology that is fairly innovative. It does not use a boiler. It has a different way of heating the water. It has a patent on that, which has served it well. The company has branched into heating for the oil patch. It just started out, as we can imagine, with this large volume of water that is used for fracking, which happens at all times of the year. That cannot be left to freeze. It sits in tanks. If it freezes, then the tanks would rupture, and there would be a real problem.
Then what happened was it started talking with the folks, telling them that if the water was at a different temperature as it went down the hole, maybe less amounts of water could be used. The company has discovered, and has patented this idea as well, that as it does the frac, it actually heats the water up as it goes down the hole. Apparently that makes the water more slippery and it goes down the hole faster. It allows the frac to be done in a shorter amount of time, hence using less water. That, in and of itself, was interesting.
It has caused them to use much less chemical in the water, and it has also reduced the amount of water needed. That is an innovation that is happening in northern Alberta. It is an innovation that is happening just because of necessity, and it is interesting to see.
My hon. colleague from the NDP talked a lot about how the universities are playing a big role in that, and I would say that they are in this case as well. My uncle's company has partnered with the University of Alberta, and they are in constant contact getting the physics and mathematics of it organized. My uncle's company is doing business out in the real world. People often say, “This seems to work, but we do not know why. Can you help us figure out why it works? Are there any tweaks we can make on it?” I would say that our universities play a significant role in this as well.
We often talk about the commercialization aspect, and that is what this entire report is talking about: how we can take those ideas and make them viable in the real world. That is an important aspect, but in its recent rollout on intellectual property, the government missed the whole piece on the first patent.
I was talking with my uncle about that. The first patent was a hurdle to get over. These people had no idea what they were up against. They had not even thought about it. They were just trying to heat up water, and they were not thinking that maybe they were the first people to think of it and perhaps there was a patent. Once they had made it through that hurdle of patenting the first thing, suddenly the next patent was a lot easier. They were thinking, “Hey, this is an idea. Nobody else seems to be doing this. Maybe it is a patentable idea.” Their patents are now being used all over the world. They are operating all over North America, up in Alaska and down in Colorado. They have set up shops in both of those places. That speaks more to the record of the current government in terms of taxation and not championing the oil patch. They are definitely still thriving. They are working in Alberta, but also in the United States.
Recommendation 9 in the report talks about a tool kit for Canadian technology transfer. This is based on the work that has been done in the United Kingdom. I know that the United Kingdom and Canada were built on the same basic framework of the system of law, so the tool box built in the U.K. is definitely something we should look at bringing into Canada.
One thing that is interesting is that oftentimes universities, on the public dime, create a good idea but there is no good mechanism for that good idea, that intellectual property, to be transferred to a corporation or a commercial interest. That is where this tool kit comes in. It would be interesting to look at how that tool kit worked in the U.K., to ensure that we have a good transfer of great ideas from universities into the so-called real world, where they could be used to make all of our lives better. That is probably the thing we all need to remember.
My hon. colleague from the NDP was talking about these jobs that we do not even understand yet. Perhaps we do not necessarily know what his son does on a day-to-day basis, but it is a geology technology that is being used there. It sounds to me as if he is probably involved in mining or something like that, whether it be copper mines, the oil patch, or whatever.
In my opinion, the economy always comes back to food, clothing, and shelter. Those are the three basic necessities for all of humanity. To make all of our lives better, we want to be able to get our food cheaply and make sure that it is healthy. We want to be able to live in a place where we want to live. We want to find shelter and we want to be clothed. All those things drive the economy.
The member's son worked in geology technology. I know that is a big part of northern Alberta. For example, when I was a mechanic, I did an oil change on a customer's truck. He also had a Viper, so I will always remember him as one of the few customers we had with a Dodge Viper. His job was to estimate how much gravel was in a certain gravel bank when there was to be a gravel pit development. He had to estimate what kind of gravel potential was there so that the government could understand what kind of royalty revenue it could anticipate from that project.
One of the things that he used was a drone to take measurements of the land. He said that using this new drone technology allowed him do three or four times more work in a year. The drone in and of itself is very cool, and we have all seen the camera, but it is the software that takes the measurements through the camera that makes it immense. I am sure that this technology as well was being developed in northern Alberta—