Gerald Keddy

[Eldorado Nuclear Limited Reorganization And Divestiture Act, April 25th, 2001]

Madam Speaker, it is a pleasure to stand today to speak to Bill C-3, an act to amend the Eldorado Nuclear Limited Reorganization and Divestiture Act and the Petro-Canada Public Participation Act.

The bill opens up two Canadian companies to greater foreign ownership and expands the individual ownership provisions. The intent of the bill is to allow greater flexibility on the part of the two companies, Petro-Canada and Cameco, to better position themselves within the global marketplace.

Within their industries Petro-Canada and Cameco are national and world leaders respectively. Petro-Canada is familiar to most Canadians because of its retail gas outlets. However it also has significant oil and gas exploration and development initiatives in Canada's north and along the east coast. It is involved in the Alberta tar sands as well.

We all know the oil and gas sector is doing well and benefiting enormously from the high price of oil and gas. Petro-Canada is well positioned within the sector to profit from both upstream and downstream production. However it continues, like any company, to look for growth opportunities. The legislation is expected to give Petro-Canada greater flexibility for strategic management as the oil and gas sector continues to evolve.

While the lessening of restrictions on foreign and individual ownership is one issue addressed by the legislation, the bill would also allow Petro-Canada to sell, transfer or otherwise dispose of its assets without separate provisions for upstream and downstream operations.

Upstream operations such as development in the Alberta tar sands, offshore oil exploration in Newfoundland and natural gas exploration in western Canada are some of the core businesses of Petro-Canada. Downstream operations, including the nearly 2,000 retail and wholesale outlets across Canada, make Petro-Canada one of the more recognizable names in the gas delivery business and the second largest petroleum refining and marketing company in Canada.

Petro-Canada has recently focused on its core businesses, specifically the oil and gas production that has proven successful on the east coast and in western Canada. The legislation could provide the company additional leeway to concentrate on areas that have proven successful while allowing it to dispose of operations that do not meet its core focus.

The legislation should allow the federal government to divest itself of its remaining 18% stake in Petro-Canada. Oil and gas companies are profiting from current market conditions and it is a favourable time for the federal government to get out of the industry. We all know to buy low and sell high. If the government wants to maximize its investment now is the time to sell.

How the government manages the windfall from such a sale is another question. It was the Canadian taxpayer who footed the bill when the government established Petro-Canada as a crown corporation in 1975 and it should be the taxpayer who benefits now. That does not mean further health care cuts or increased devolution of services to the provinces without corresponding increases in transfer payments.

The Nova Scotia government has recently been addressing its own problem in the oil and gas industry: insignificant royalties from east coast oil and gas development. Nova Scotia sees only 18 cents of every dollar generated by the offshore. The remainder goes to the federal government.

There must be a more equitable sharing of revenues between the federal government and the provinces. Petro-Canada has its headquarters in Alberta. That province manages to operate in the black because of the substantial royalties it accrues from resource companies like Petro-Canada. Nova Scotia is asking for a similar setup so that it too can realize the benefits of oil and gas development.

Last year Petro-Canada had record net annual earnings of $893 million, easily surpassing the previous year's earnings of $233 million and almost tripling the previous high of $306 million. Petro-Canada is clearly doing something right. Still, no company should rest on its laurels. If this legislation provides greater flexibility and allows for strategic positioning within the industry, it is important to support it. The PC Party does so.

The legislation affects another Canadian company, Cameco, the world's largest uranium supplier. Cameco supplies 30% of the western world's uranium, some 18 million pounds.

The legislation would provide greater flexibility to the company in terms of foreign ownership, although a fixed limit of 25% would remain in place. There is a big difference, however, between the oil and gas sector and nuclear energy.

Although both sectors provide energy sources and both have inherent risks associated with them that can have grave environmental impacts, Canadians remain skeptical about nuclear energy and the safe use of such energy. Radioactive waste is one aspect of uranium mining that concerns all Canadians.

I would like to spend some time today looking at radioactive waste and the role that public perception plays in uranium production. With legislation that opens up foreign ownership of this Canadian uranium producing company, the world's largest, I think it is important to understand what issues are really at stake here.

For instance, the briefing material provided by the Department of Natural Resources respecting the legislation clearly indicates that nuclear proliferation standards will be maintained and are not impacted by the legislation. However, when one looks at uranium mining there are serious environmental questions that need to be addressed, not just the issue of nuclear proliferation.

The report, “Inventory of Radioactive Waste in Canada”, examines radioactive waste in Canada according to three categories, nuclear fuel waste, low level radioactive waste, and uranium mine and mill tailings. At the end of 1998 the total waste of these three categories were, respectively: 5,600 cubic metres, 1.8 million cubic metres, and 210 million tonnes. Again, those three categories were nuclear fuel waste, low level radioactive waste and uranium mine and mill tailings.

The report estimates that by 2035, the year when the last power reactor is forecast to shut down, the waste totals will be: 14,500 cubic metres, 210 million cubic metres, and 248 million tonnes.

The report goes on to state:

Radioactive waste is currently managed in a safe and environmentally responsible manner by storing the waste away from the public and isolating it from the environment. The management of those wastes meets the requirements of the Atomic Energy Control Board, Canada's independent nuclear regulator.

It is interesting to look at what has been happening recently respecting the organization that oversees nuclear reactors and public safety in Canada. On May 31, 2000, the Canadian Nuclear Safety Commission replaced the Atomic Energy Control Board. In his December 2000 report, the auditor general devoted a chapter to the review of nuclear safety, with a focus on power reactor regulations.

In his report, the auditor general noted that the risk analysis of power reactors is not rigorous, raising questions about the safety of Canada's 22 existing nuclear power reactors. While Cameco may not be in the business of supplying nuclear power reactors, it is directly affected by undertakings within the industry because of the impact this has on Canadians' acceptance of nuclear products, nuclear energy and nuclear waste.

Supporters of nuclear energy advocate that it is one of the cleanest sources of energy available and one that can help meet future demands as fossil fuel sources are depleted. Certainly it is true that nuclear energy is a possible solution for energy, one that some countries have been more open to than others.

France has embraced nuclear power as its primary energy producer, relying on nuclear energy to supply 75% of its electricity production, the result of a 1974 initiative to be energy independent. However, to be supportive of nuclear energy we must also have a method of dealing with the byproducts and the residues of nuclear energy exploitation.

Cameco addresses these issues on a daily basis because, as a result of its mining operations, the company must dispose of its waste materials. This can range from mine tailings to the protective clothing worn by employees.

Currently the low level radioactive waste produced as a result of nuclear power production is compressed and disposed of within nuclear reactors. This is not a long term solution, however, and other disposal methods have been discussed, including the availability of other sites as possible receptacles for this waste material.

The Canadian shield, because of its stable rock formation and low water levels, could be opportune in this regard and is something that the Canadian nuclear fuel waste management program has discussed since 1978. Public acceptance of such disposal methods will determine whether this is a long term solution to radioactive waste disposal.

Cameco is a well respected and successful company. However, like Petro-Canada, it too needs the flexibility to adapt to new market conditions and strategically position itself within the global marketplace.

While I have some concerns about the application of nuclear energy, particularly in regard to waste disposal and byproducts, the intent of this legislation is to help these two companies grow and expand within their respective industries. The PC Party supports this initiative.

A recent Cameco press release announced that reserves at McArthur River in northern Saskatchewan, the world's largest and highest grade uranium mine, is now expected to exceed anticipated production by 50%. As Cameco continues to develop mine sites like the McArthur mine, it will need the flexibility to attract new investment and diversify its holdings. This legislation should be one step toward providing that flexibility. The PC Party supports the legislation for that very reason.

[Lumber Industry, April 25th, 2001]

Mr. Speaker, my question is for the Minister for International Trade. Yesterday the Americans added Atlantic Canada to their softwood lumber countervail charges. Atlantic Canada through industry efforts had been excluded.

What action has the minister taken to deal with this important issue before we have bankrupt mills in Atlantic Canada?

[Resource Industries, April 24th, 2001]

Madam Chairman, I know the member for Brandon—Souris wants a kick at this can too but the issue of processing comes from globalization and is not part of the traditional primary resource industry.

A prime example of that, and this is the point I want to get across, is what has happened in Britain. With globalization and the amalgamation of meat processing plants in Britain, as well as the health standards that have been introduced in Canada, the United States and other parts of the world, many smaller abattoirs and meat processors in the U.K. have been forced out of business.

Foot and mouth disease was a direct result. Huge meat processing conglomerates started taking hogs, sheep and beef animals from one part of Britain and, instead of processing them in the local village, trucked them in some cases 400 or 500 miles. Because of the incubation period, foot and mouth disease spread throughout Britain and to France and Germany in no time. It was a direct result of the globalization of the meat processing industry. I would like to hear some comments on that or—

[Resource Industries, April 24th, 2001]

Mr. Chairman, I would be sharing my time with the member for Brandon—Souris and if I have a couple of minutes or 30 or 40 seconds left at the end of my 20 minutes he will get them. I think that is only fair and reasonable as a colleague.

The debate here tonight is on natural resources. I very much appreciate the Secretary of State for Rural Development being here and staying throughout the debate, and his colleagues with him.

Certainly I think that when we look at the economy and the global situation on the planet today we tend to trivialize the primary industries. Many of us tend to forget where we come from. A number of the ridings represented in this place are rural ridings. I would even dare to say that perhaps we rural ridings are equal to the urban ridings. If we counted them all, I think we would surprised by the number of parliamentarians who are here representing rural constituencies. There are a great number of us.

I am also going to take the opportunity in this debate to discuss rural issues, very much like the rest of the speakers have discussed rural issues, but I think we are discussing rural issues in a number of sectors.

I do not look at the Secretary of State for Rural Development as being responsible simply for rural Canada or the agricultural community. There is a very large forestry sector out there. There are large fishing communities on the three oceans around the country and on Canada's inland waterways. We have a huge mining sector in the country that has been quite often overlooked and underrepresented, I believe, by the present government, by other governments in the past and by provincial governments.

We have to find a way to accommodate our primary industries in the country, to have them represented so that the people have viable jobs and opportunities, not only for themselves but for their children and for their grandchildren.

Most of us from rural Canada are survivors. We live in communities that have survived for hundreds of years, quite often. We represent 15 or 16 generations of ancestors and more in some parts of Canada. We have managed to eke out a living, whether that has been a subsistence agricultural living or one dependent upon forestry or fisheries, for literally hundreds of years.

Now we have to find a way in the modern economy, with the globalization of the planet, with transportation that is immediate, this minute. It is no longer that day or that week, it is this minute. The discussion taking place here can be listened to in Australia or China. Decisions we make in the Parliament of Canada can be reacted to immediately by businesses halfway around the world. With all respect, I do not think this government or any government is quite ready for that type of accommodation of the new economy. I do not think we have adapted to that. The appointment of a minister of state for rural Canada is a step in the right direction. I applaud the government for it.

I would like to talk about a couple of specific areas and hopefully get some replies from the minister on these specific areas. I will try to be brief.

My first love is forestry, so I have to go there for at least a second. We tend not to recognize the importance of forestry in Canada. It is the primary industry. It is the second most important industry in the country. If we combine the primary industries such as forestry, agriculture, fisheries and mining, we can shut out the rest of the economy in this country. We produce the jobs. We put more money into the economy than the rest of the sectors put together.

A tremendous amount of money comes from the primary industries of this country and the majority of them are sustainable. The mining sector, we have found, is more sustainable than we thought. When people look for minerals today in Canada they do not try to look for a new mine. They go where we have been mining for generations and find more resources, more ore bodies, wherever that may be. Timmins, Ontario, is a prime example of that.

I started to talk about forestry. We should not take away or ever forget the fact that as much as we may love to look at a view scape of timber, the real economy of that timber is the noise of it hitting the ground. It is not only the fact that companies cut that timber. There are jobs involved in getting it to the mill. The wood is processed. Houses are built from it. There are value added products that come in, whether that be paper, pulpwood or finger jointed mouldings for door frames.

We tend to trivialize the contribution the forestry sector has made to this country and that it will make forever. It is 100% completely sustainable. In most of Canada it is not dependent on planting a whole lot of trees or putting a lot back into it. We can continue to harvest the forest through natural regeneration on the west coast of Canada and certainly on the east coast of Canada in those maritime climates. Very little of the land in eastern Canada needs to be replanted. Foresters have to go in there 10 years after harvest and thin it. There are so many stems coming up on the acreages that they have to be spaced. It is not a matter of planting trees unless someone is trying to grow a different type of forest, unless the land is better suited for Norway pine instead of black spruce, or perhaps better suited for an exotic species like Norway spruce instead of balsam fir. There are alternatives.

We need very much to look at the mining sector, on the east coast in particular now that we have the advantage of the development of the Sable gas fields and the Panuke oil fields. That oil and gas liquids and gas are coming ashore now in Nova Scotia. We have been talking for six months about a second pipeline. The first pipeline is already developed. Now there is discussion about a second pipeline double tracking the pipeline that is already there.

We need to look at a way to do a better job of sharing the money. I spoke about this earlier, about the fact that when Alberta was developing its oil and gas reserves the federal government recognized the position Alberta was in. From 1957 to 1964 Alberta received equalization payments from the rest of Canada and kept the revenues from their oil and gas reserves. That allowed them a head start in putting their infrastructure in place to actually develop and exploit the natural gas and the oil fields of Alberta.

Nova Scotia and Newfoundland and any other province should get no less a deal than Alberta got. That takes a little bit of backtracking by this government. That takes a different approach, but it can be done.

We are not asking for the cancellation of equalization payments or the refusal of the federal government to gather royalties from the east coast.

What we are asking for is a period of time similar to what Alberta got, five, seven or eight years, in order to build the infrastructure up so what has been happening does not continue to happen. For every dollar that is made in the offshore, 81 cents goes to the federal government and 19 cents goes to Nova Scotia. This is not rocket science. This is a very simple equation. Somehow we have to change that imbalance, and that takes time and that takes an initiative on behalf of the government to compromise on a position that it has already taken. I see no reason why we cannot do that.

We have tremendous resources in rural Canada and in our primary industry. In the South Shore riding that I represent we have 1,760 boats fishing. That is phenomenal. That is in three counties. The fishery is in decline and it is facing great hardship. We have a lot of people fishing.

We have a great primary resource that is sustainable and we need to maintain that. We have an oil field that is being developed that we need to encourage. We have a forestry resource sector that needs to be encouraged as well. I have left the agriculture sector for the hon. member for Brandon—Souris. We need to encourage agriculture in Canada and we need to find a way to enhance it. Those are issues that face rural Canadians every day.

If we want to encourage people to continue to live in rural Canada, if we want to have ghost towns in Saskatchewan and Manitoba and if our small towns in Atlantic Canada are to survive, we need infrastructure for transportation. We need all kinds of innovative ways to continue to live in rural Canada and have an economy of means that can support us to do that.

[Resource Industries, April 24th, 2001]

Mr. Chairman, I will try to be brief. There is a point that I want to try to get across to the member for Windsor—St. Clair. I am not in disagreement with him that we need to seek alternatives to fossil fuels and the finite resources of energy. We know fossil fuels are a finite resource. There is a certain amount of it and some day it will be gone. We continue to find more.

I take exception to his comments about Europe. Quite often we look at Europe as somehow being a warmer, fuzzier, cleaner, more environmentally friendly region of the world. I fundamentally disagree with that.

Germany may be able to say that it invests more money into wind energy or alternative energy resources but it buys natural gas from Russia and does not care how Russia gets that gas. It does not care about the political or social costs which come with that gas. It does not care about the technologies that the Russians use. Fracting a single zone in Russia, which they have developed in that zone, has never been done. They develop something deeper or something higher up the well bore. They just do not have the technology to do good work. As well, they make the rules and bend the rules to suit themselves.

We can have Europe or the European Union talking about being green and clean, but they will use uranium powered energy from France. They do not mind importing that energy. They do not mind importing Russian natural gas. They do not mind setting special levels for Norway. There is some danger in looking at Europe as the pristine example.

I am not saying that we should not head in that direction, but I am concerned that we should not put it on too high a pedestal.

[Resource Industries, April 24th, 2001]

Mr. Chairman, the hon. member spoke a fair amount about innovation and the importance of exploration companies to the mining sector and the fact that we obviously need to find ore before we can exploit a mine or ore body or potential ore body.

This is an open debate between all opposition parties and the government and it is not for me to stick up for the government side. However I certainly applauded its efforts in October of last year to bring back some form of flow through share policy to absorb the debts that exploration companies run up.

What did the hon. member and his party feel about the so-called new super flow through share which would allow exploration companies to deduct some of their debt burden by letting people invest in their companies and deduct 100% of their investment?

[Resource Industries, April 24th, 2001]

Mr. Chairman, the member for Athabasca talked about a former national energy policy, and there is a relevant point there.

In the past governments have tended to raid natural resource profits from individual provinces or territories. We have set that precedent and somehow or another we have to move away from that precedent. The specific instance I am referring to is the east coast.

The oil field on the east coast is now bringing in an unprecedented profit that was never there before. That is in direct loggerheads with equalization payments. When Alberta found its resources under the ground, the federal government accommodated Alberta by allowing it to keep the profit from those resources and its equalization payments from 1957 to 1964.

We have been asking the federal government to recognize the advantage it gave to Alberta so it could get out from under and become a have province instead of a have not province. Nova Scotia, Newfoundland, Quebec or any province is never going to get out from under the yolk unless they are allowed to keep some of their profits. It is not just the oil field. It could be the mining industry or the diamond industry in the Northwest Territories or in Nunavut.

I would like the member's comments on that.

[Resource Industries, April 24th, 2001]

Mr. Chairman, I appreciate the format this evening which allows more interaction between the government and opposition parties.

I have a quick question on private woodlot taxation. There are around 440,000 private woodlot owners in Canada. There are certainly more on the east coast than on the west coast but they are certainly prevalent across the country. Part of the challenge woodlot owners face is an onerous tax burden because they tend to harvest their woodlots every 50 to 80 years in a cyclical manner. There is no way to amortize that profit over a 10 or 15 year tax period. They pay their tax up front, all at once.

What we have been suggesting and pushing the government to do is to find a way to accommodate private woodlot owners so they do not have to pay all the tax up front and can amortize the tax payable over a 10 year period. This would provide them with the opportunity to do some replanting, some thinning and some silviculture practices in the meantime so they have some expenses to claim against it.

I would like to hear the minister's comments on that and the possibility of looking at that.

[Supply, April 24th, 2001]

Mr. Speaker, you are absolutely right. Through you, I will answer the hon. member's questions.

The question was about the Minister for International Trade. The only thing I have seen the Minister for International Trade do is contradict the Prime Minister. Then the Prime Minister comes back and contradicts the Minister for International Trade. We do not know if we have an agreement on water. We do not know if we are going to sign Kyoto. We do not know if we have a softwood lumber agreement. We do not know if the maritime accord will be left out. The government of this country does not know where it is headed.

I will tell the hon. member about transparency. Transparency was a Government of Canada that brought in the free trade agreement and that fought an election on it. Those sitting government members fought tooth and nail to the bitter end and made a tremendous statement that they would not support free trade. They ran an election on it. They completely forgot their election promises.

Now that is about transparency. That is about going to the polls in this country. That free trade agreement the Conservative government brought in is the reason that we have the economy we have today. If we want to look at the benefits of that and at the benefits from a Conservative government that brought in free trade, let us look at what happened provincially.

We saw an increase of 65% in exports for Newfoundland. We saw an increase of 445% for P.E.I. That was before the government refused to work on P.E.I. potatoes and bring in an agreement so farmers could do the job they do best, that is grow potatoes and have a market for them. We saw an increase of 116% in exports for Nova Scotia, 149% for New Brunswick and 209% for Quebec. I could go on and on.

Those are the benefits of free trade. That is democracy in place. That was, without question, a clear and open process that we fought an election on in Canada. The guys who were lucky enough to win in that election, who deluded the Canadian public, have not kept their promises.

[Supply, April 24th, 2001]

How much more petty can you guys get? You cannot get any more petty than that.