Natural Resources committee  It's a good question. I'll take a quick stab at this. For our company, each year we submit, I think, somewhere in the range of $50 million to $60 million worth of activity that would qualify for SR and ED, so it meets the stringent tests of the research and development. Absolutely, that's in the upstream side.

Natural Resources committee  Yes, thank you. I'd appreciate adding to it because we've been working on the LNG side. The market works, and United States gas is closer to the eastern Canadian market and is displacing western Canadian gas. So the market works, and the market is what it is. At this point, United States imports into Canada are some three or so billion cubic feet a day.

Natural Resources committee  It's not to the same extent. There is somewhat of a differential. Gas is probably selling for, let's say, around the $3 to $3.50 per 1,000 cubic feet—mcf. At this point there would probably be a differential of 25¢, principally due to transportation distance from western Canada, and that's part of the advantage that the Marcellus gas would have in eastern Canada.

Natural Resources committee  We have developed what we call a responsible products program, and we have shared this with the industry. We sat down with a toxicologist and looked at the accepted toxicological types of rankings of various fluids. As well, we worked with our suppliers, and even where there was confidentiality information we went in and signed non-disclosure agreements, on a company-to-company basis, so we had all the information that's in there.

Natural Resources committee  The intent of the chemical packages that we use would be the same, whether it be a surfactant or a biocide or some sort of corrosion control. What we've been able to do within those packages is substitute less harmful chemicals, if you will, to meet that same intent. To be honest with you, I don't understand what we swapped in, but I do understand what we swapped out, and that's really the beauty of it all.

Natural Resources committee  Canada is an innovative place. It's not the easiest place to do business in at times, with the environment and such. If you look at pumping large volumes of water and keeping it from freezing in the dead of winter, Canadians have come up with incredibly innovative methods.

Natural Resources committee  Certainly, if you look at hydraulic fracturing in the service companies I mentioned.... One area, with regard to the development of the oil sands and the SAGD technology, for example, was all developed out of the University of Calgary with a professor named Roger Butler. There was some incredibly innovative work done to work on Canadian resources.

Natural Resources committee  As mentioned, I believe the SR and ED...giving these things tax advantages. Especially in times when dollars are tight, we're looking critically at all expenditures. Tax advantage expenditures would get that benefit.

Natural Resources committee  Certainly we looked at the impact of the changes, but we felt they were manageable, by and large, and wouldn't have too great an impact.

Natural Resources committee  I'm not sure. I'm not aware.

Natural Resources committee  Probably somewhat less than 1%.

Natural Resources committee  No. I would say that all companies have an innovative focus, and you'll fund items in a number of different ways, apart from distinct funds. I believe this innovation fund is, if not unique to Encana...there are probably a very limited number of companies that would target environmental innovation funds.

Natural Resources committee  No. I think what he's saying is that when a Canadian product is severely discounted, the less we get for it the better the opportunity is to do something else, but that's not where we want to be.

Natural Resources committee  It's certainly an area that again I think we have good solid regulations for in terms of managing the liability. Currently, the focus is on addressing more of the problem sites, those defined as older sites that are proximal to residences and such. Again, the industry and the regulator are working together to make sure that those sites are well managed and the wells are put to bed in a very effective manner.

Natural Resources committee  I think as we continue to push the horizontal legs out further, so you can access more reservoir from the same surface location, that's really the innovation. It's a combination of being able to drill out further, but it's also the innovation on the completion side of the technology, to be able to place the sand and fracturing fluids out further as well.