Proceedings of the Standing Senate Committee on
Energy, the Environment and Natural Resources

Issue 8 - Evidence - May 1, 2008


OTTAWA, Thursday, May 1, 2008

The Standing Senate Committee on Energy, the Environment and Natural Resources met this day at 8:34 a.m. to examine and report on emerging issues related to its mandate.

Senator Tommy Banks (Chair) in the chair.

[English]

The Chair: Good morning, honourable senators and guest to this meeting of the Standing Senate Committee on Energy, the Environment and Natural Resources. I am Senator Banks from Alberta, and I am the chair of the committee. Before I begin, I would like to briefly introduce those members of the committee who are with me this morning: the distinguished senator from Ontario, Senator Meighen; from Nunavut, Senator Adams; and, from Newfoundland and Labrador, Senator Cochrane.

Our guest this morning is Dr. Rob Huebert who is with us from Toronto via video conference. I am glad that we are not asking you to be up at 6:30 in the morning in Calgary, which is your normal place of business.

Dr. Huebert is Associate Director of the Centre for Military and Strategic Studies and Associate Professor in the Department of Political Science at the University of Calgary.

Our committee will be travelling to Canada's North in early June to examine, among other things, sovereignty in the North as it relates to energy, the environment and natural resources and other matters having to do with our mandate. We are going to school today: We would be very grateful to you if you could inform us of what we ought to look for, what we should be concerned with, what we should see and the questions we should ask.

I am grateful to you for taking the time to speak to us.

Rob Huebert, Associate Director of the Centre for Military and Strategic Studies, Associate Professor, Department of Political Science, University of Calgary, as an individual (by video conference): Thank you very much, Senator Banks and members for agreeing to meet with me on what I consider one of the most fundamentally important issues facing Canada's future.

The Arctic is, of course, one of those subjects that is in the news every day. You cannot pick up a newspaper or turn on the television without seeing a news story. National Defence is even writing some of its most recent recruiting commercials on what to do in case of an airliner going down. It is one of those overnight successes as far as where people are paying attention. However, it has been my thesis that the Arctic has been and is about to undergo fundamental change.

Given that we have the privilege of having a senator from Nunavut here, I am not speaking of anything that is new to any of the members of the committee. However, it tends to be somewhat new to most Canadians.

There are three major elements that will have a fundamental change on Canadian relations in the Arctic and, specifically, energy, the topic of your discussion.

Everyone knows about climate change. It was one of those issues that now everybody accepts; the change is almost common knowledge. However, until the Arctic Climate Impact Assessment made its findings so clear in the early 2000s, I do not think people really had an appreciation. The reality is that the Arctic, from a climatic condition, is fundamentally changing. It is changing to a degree that both Western science and traditional knowledge are having trouble coming to terms with exactly how drastically and fast that change is occurring.

I have asked the clerk of the committee to pass out some handouts. I also have some visuals in terms of showing the type of impacts that we are talking about. I have provided you with some pictures of satellite imagery of the melting ice.

Last year, as all of you will be aware from the news, we had the largest ice loss in recorded history. There is no question that, if we go back to the pathological record, there has been some periods where the ice has completely melted. However, as far as humans are concerned, this is the greatest amount of ice loss we have ever had.

The second fundamental change, though — and one that I think would be affecting what we are talking about regardless of whether or not the ice is melting — is the rising price of fuel. One only has to pick up the newspapers to see that, once again, every day we are facing higher and higher costs for oil, and it is expected that natural gas will be following.

From an international perspective, this is not hard to understand with the entry of China as a major developing economy, the expected entry of India as a developing economy and with the continued growth that the Western world is facing; there is no question that the pressures on new sources of energy is one that we will be facing today and well into the future.

The Arctic is estimated by some to contain up to 25 per cent of future reserves. This figure has been provided to us by the U.S. Geological Survey, and they are, at this point, trying to confirm that number. There is some quibbling as to whether or not it is 25, 20 or 18 per cent. However, most of the indicators are that between oil, gas and the new energy source, gas hydrates, we can expect to see that the Arctic will indeed be the future major area of development.

We often forget on the North American side of things that the Europeans and, in particular, the Russians are well in advance of developing their northern oil and gas. It was announced in April of this year that the Russians have just completed construction of a brand new offshore oil terminal in the Barents Sea that has become operational. The Russians, I might add, are well on their way to building several other offshore terminals, which goes to the very heart of the fact that they are not talking about developing their oil and gas resources; they are actually doing it at this point in time.

The changing geopolitical situation is the third issue that is changing the North and has a direct ramification when we talk about sovereignty and energy. There are three sub-factors of which you must be very aware. First, because of the impact of the United Nations Convention on the Law of the Sea, UNCLOS, the issue of who owns and who controls the sea bed that contains the oil and gas is very much under discussion as we speak.

Under the terms of UNCLOS, particularly under the terms of Article 76, coastal states have 10 years from the point at which they ratify the treaty to determine whether or not they have a continental shelf. This is very important for Canada because some geologists contend that the entire Arctic Ocean is an extension of the continental shelf.

The whole debate about what the exact geological element or reality of the Lomonosov Ridge is about determining if, in fact, the Arctic Ocean is a continental shelf, and if that is the case, who then has a claim over it? Currently, there are four Arctic states that are in a position to have an Arctic continental shelf: Russia, Denmark, Canada and the United States. The United States is an interesting issue because they are not party to the convention. As such, there is a bit of an issue as to whether or not they can participate in a division of the continental shelf.

However, all four of these states, plus the state of Norway that also has some continental shelf claim south of the Arctic Circle are meeting in Greenland on May 28-29 to discuss how we are to proceed in the division. We are including the Americans in this particular set of negotiations.

I would alert the committee to this particular meeting. I think it would be well worth your while to hear from Foreign Affairs and International Trade Canada officials after the May 28-29 deadline to find out exactly what was done at that particular meeting.

The other issues from a geopolitical perspective of which you have to be aware relate to a rising interest of Asian countries in the North. Many people will ask what countries such as China and South Korea have to do with the North. It has everything to do with resources.

The first major element is that the Chinese have one of the largest Arctic research vessels in existence, the Xue Long. I have provided the committee with pictures of her. She is literally the size of our navy replenishment vessels, which is about 20,000 tonnes. She is a very capable ice research vessel. She has been to the Arctic two times. She tends to be sent down to Antarctica most of the time, but the Chinese are becoming very interested in Arctic research. Many are speculating that it is because of their interest in the Arctic as an energy source. No one is suggesting the Chinese will be coming up to try to claim resources, but they are looking for new sources to buy from.

The second major element in terms of the Asian interest in the North is that the Japanese are now large funders of research into gas hydrate development.

I mentioned that gas hydrates are the new source of energy. Gas hydrates are a sort of gas that has come to the surface and forms a gel. This is created either by pressure or extreme cold temperatures. Many people have argued that gas hydrates may be a major source of future energy. There are problems, however, because they are predominantly methane gas. As you are aware, methane is one of the worst contributors to climate change. Therefore, the view is that this may be a future energy source, but significant environmental issues are associated with it.

Regardless of this, the Japanese are pumping hundreds of millions of dollars into this research. Some have argued the figure may be going into the billions. It is a hard to get a firm figure or quote on it; it is substantial.

The third major element — and this is one that has gone under the radar for many people — is that, starting five years ago, the South Koreans began investing heavily in the design and construction of ice-capable tankers. The Koreans, particularly Samsung Heavy Industries, have been under contract with the Russians to build ice-strengthened oil tankers.

They are using a new technology called the Azipod propulsion system. Rather than having a standard propeller on a shaft that goes forward, they basically figured out how to put a propeller that rotates 360 degrees underneath the ship. The reason this is important for the Arctic is that it allows you to put a regular sea-going bow on the front of the ship and, at the same time, put an ice-breaking bow on the stern. These literally become dual-purpose vessels. They can go through up to a metre and a half thick ice, but they can also operate economically in open water. They are a little more expensive to build, but they can be used for either purpose.

The Russians are now using this vessel to go into ice-covered waters where their Arctic offshore terminals are built. They offload onto these tankers. The tankers then go to Murmansk where they offload either onto larger tankers or into the pipeline system. The reason this is so significant for Canada is that it provides an alternative to the pipelines that we are now considering.

Given the difficulties that we have had deciding whether to build a gas pipeline along the MacKenzie Valley or that the Americans have had in trying to build their equivalent gas pipeline, at what point do the oil and gas companies say that this may, in fact, be a more economic and politically easier way to transport the oil?

Samsung Heavy Industries does not yet have an ice-capable liquid natural gas carrier, but they are working on the design. At a conference I attended in St. Petersburg, Russia earlier this year, they made it very clear that they expect to be able to offer the Russians construction of such a vessel in about a two- to three-year time period.

In other words, the carrying of oil and gas in Arctic waters with ice of up to a metre and a half thick may become the normal way of transit as opposed to pipeline. Where do these ramifications impact on your core issue of sovereignty and energy?

In my view, there will be three major impacts. The first impact is that you will see the Canadian North experience substantial development into the future. You are probably aware that Esso, starting this year, is beginning a research program pegged at between $560 million to $600 million. It is a five-year exploration program. When you go up North, ensure you go to Inuvik in the Northwest Territories. That is where all the activity is headquartered. You will see how hectic this exploration program will be. Therefore, first and foremost there will be an increased interest in this northern development.

However, in terms of sovereignty, several existing boundary issues will be aggravated. This is the second factor for consideration. We have a major maritime boundary issue between Canada and the United States in the Beaufort Sea. To date, we have had a gentlemen's agreement that neither of us would aggravate that particular circumstance. The problem we will face into the future is that most geologists have noted that there are probably substantial oil and gas resources within the disputed zone. Therefore, this boundary issue will probably be reignited.

We have an additional problem that makes it hard for our negotiating position. Our 1984 Western Arctic Claim: The Inuvialuit Final Agreement uses our maritime interpretation of the border. Therefore, any negotiations with the Americans that compromise that understanding of the border means we have to renegotiate the outlines of that particular land claims agreement. You can appreciate how politically sensitive that particular position will be.

There are solutions. We could go for a joint-management scheme and develop it today. However, there seems to be no political will for that at this point in time. That is another issue.

The other boundary issue we will face because of oil and gas is the continental shelf. I have provided you with a map showing where we think our continental shelf will be. You can see clearly that it overlaps with what the Americans will probably claim, and we can probably expect some form of dispute with the Russians.

Last year, you will recall, the Russians dropped a couple of flags at the North Pole. It was obviously a publicity stunt, but it was also a political gesture to show us how determined they are to claim the North Pole.

If we go to standard international legal constraints in the divisions of the continental shelf, there is good reason to argue that the North Pole is, in fact, Canadian, or even possibly Danish, rather than Russian. However, we should not be accepting the Russian claim that it goes up to the North Pole as simply one that exists. They are relying on this myth that the North Pole has some special international status. It does not have any special status in delimitation of boundaries. It merely illustrates that we will be facing difficulties when it comes to negotiating with our Russian and American neighbours on the delimitation on the continental shelf.

The third factor I leave for your consideration is that the outside world will become increasingly interested in what happens in the Arctic. As I have already argued, the Asian countries are becoming very interested in the Arctic as a new producer of oil and gas. They are putting their money where their mouth is, and this is, of course, will not lead to a situation where they will try to claim the resources, but you can expect to see the Chinese, Japanese and probably, in the long term, the Indians interested in the supplies of oil and gas that the Arctic region will have.

From a domestic political issue, I think we will be facing the situation very soon where the companies will say that it has taken too long to build the pipelines, that they will not build the pipeline now and that they will use this new offshore terminal technology, combined with the ice-strengthened tankers to get to the oil and gas that they wanted to ship by pipeline.

Once again, that will carry both positives and negatives. On the positive side, there are many who have argued that the pipelines would have been environmentally problematic running along the MacKenzie Valley. On the negative side, it means that the employment — the type of jobs that were being promised by the pipelines, the type of association that the Aboriginal pipeline consortium was expecting to benefit from — will no longer be a benefit. Rather, we will be seeing this issue of offshore development.

I leave you with one last point. If the Americans decide to go to an offshore terminal procedure rather than a pipeline for getting to the oil and gas that is in the Arctic Ocean, we may find ourselves back in a situation reminiscent of 1969 with the Manhattan. If the Americans build a terminal on their side of the boundary, we may be faced with a situation where they want to send these tankers eastward, which would mean going into the Northwest Passage.

I have had conversations — and I will be fully open about this — with officials from Foreign Affairs and International Trade Canada. They believe that we have come far enough that such a development would not be a threat to Arctic sovereignty, that we are now in the stage where the Americans would not try to push our buttons, so to speak, by not asking permission and that they would de facto accept our forms of control.

I will be equally clear that this is a position with which I do not agree. I do not think that if the Americans do go for the offshore terminal perspective and start using these tankers to carry oil and gas from their side of the border to, say, eastern markets along the New England states, they would ask our permission. Then we are back into a similar circumstance of what we faced in 1969 and 1970 with the Manhattan.

What is the timeline of this? Probably, it will be another five years before the oil companies finish their exploration. Esso's plan goes for five years. On the American side, Shell is doing a similar exploration, though they are not doing it this year because they did not do their community consultations correctly. As a result, their exploration program is now in court, but most people expect they will get that cleared up in time for next year. Therefore, it will take them about five years to do the exploration.

Assuming that they have good finds, it will take them another five years to build the necessary offshore terminals, if they decide to go that way, and roughly the same amount of time to buy the vessels from the South Koreans. Basically, we will be facing this situation in about 10 years.

In roughly about the same time period, we will be coming to a head in terms of the negotiations over the division of the continental shelf. The Russians have already come to their deadline; we will come to ours in 2013, and the Danes will come to theirs in 2014 for when all the science has to be done under the UNCLOS. In my estimation, the negotiations will start in earnest probably in 2014. Basically, the time period that you are really addressing — the time period that I think will be coming to a head in terms of sovereignty and Arctic energy for Canada — is in about a decade.

Once again, that seems like a fairly long period from now, but you can appreciate how quickly events move in the international community. The type of work that you are doing by addressing this issue today is a necessity. I am pleased to see that you are taking this issue seriously.

The Chair: Thank you, Dr. Huebert. You have certainly opened our eyes on a number of issues.

I have always understood, and I think many of my colleagues have, that in terms of flat-out economics — making money — a pipeline is a cheaper way to move stuff than ships. Is that right?

Mr. Huebert: The Russians are standing that idea on its head. The big problem has always been how to get the ship into ice-covered waters and then, from an economic perspective, handle the shipping into open waters. The type of ship needed in ice is very different than the type of ship needed in open waters.

The South Koreans, the Finns and the Russians have figured out how to combine the attributes of an ocean-going tanker with an ice-breaking tanker. Through this technology, the Russians seem to have it worked out. I would argue that the proof is in the application of the concept.

This is what the Russians are doing; they started in February this year. They have three more of these tankers coming on line. Quite frankly, we will see whether or not this new technology is cheaper. The argument that the Russians are making is that this new technological breakthrough in terms of ship construction and propulsion now challenges the prevailing view that the pipeline was cheaper.

In terms of pipelines, everyone thinks climate change equals more accessibility. The reality is when it comes to land-based transportation, climate change is making accessibility more difficult. The Russians are facing major problems of their pipeline system collapsing because the permafrost is melting; combine that with Soviet construction techniques and they have a major problem.

Not to put too fine of a point on the Russian issue, if you talk to most of the folks doing the pipelines on the Canadian and American side, you will see that there is a growing concern in terms of how to maintain the integrity of a pipeline in the face of collapsing permafrost. Is this just a temporary condition? Does the permafrost collapse and then you are okay, or will there be continuous freezing-melting, which is will be a major maintenance problem in terms of the continued existence of pipelines?

This is another cost factor that has not completely worked itself into the overall calculations yet.

Senator Adams: Mr. Huebert, I think you have a lot of experience in the Arctic. Mostly, I live around Hudson Bay. It is a long way from where you work in the High Arctic.

You mentioned a meeting in Greenland with Canada, the United States, Russia and Denmark concerning the boundaries. Is that true?

Mr. Huebert: Yes, it will be May 28-29 in Greenland.

Senator Adams: In the meantime, I will speak about the boundary. You mentioned Inuvialuit and the land claim that concerns the Arctic Ocean. I think the water is a boundary right up to the North Pole, is it not? It starts at the Beaufort Sea, does it not?

Mr. Huebert: Technically, no; it is a myth in Canada that we go all the way to the North Pole. One of your predecessors in the Senate, Senator Poirier, said in 1906 that we went up to the North Pole. In point of fact, in international law, we go 200 miles past the land, and that takes us nowhere near the North Pole. We like to claim that Santa Claus is ours, but the reality is that until we have the continental shelf resolved, that is still high seas.

Senator Adams: I think Canada will lose a lot of the Arctic Ocean. What is your opinion? When you look at other countries, such as Russia and the United States, they are more powerful than us. Will we lose some part of that — or will countries, such as Canada, the United States, Russia and Denmark, share the territory?

Mr. Huebert: My argument is that we are at a crossroads today. We can make the decision whether we will take a proactive, strong position to ensure that Canadian interests and values are best protected, or we can simply go along for the ride and let our interests be dictated by the Russians and the Americans. It is literally up in the air.

The negotiations are about to begin. The whole retransformation of the North is about to begin. We can take a very activist position, as we did during the negotiations of the law of the sea in the 1970s, where we ultimately assured that Canada benefited probably the most in the international system, or we can sit on the sidelines.

It really depends on the amount of resources that the government provides in showing the world that we are serious about controlling and protecting the North, and ensuring that our diplomats have the fullest, maximum support in terms of development of this new international regime. Literally, I am suggesting to you, sir, that it is in your hands today to determine what we will see in terms of the future of the North.

Senator Adams: What do you think about people living in Nunavut? You mentioned that you meet a lot of scientists from other countries. Are you concerned about the people who live in Nunavut in terms of the claims for Arctic sovereignty?

Mr. Huebert: I am often asked about the relationship between sovereignty and those who call the North home. The answer is straightforward: Sovereignty is not an end; it is a means to ensure that the protection of Canadian interests favours those who live in the North. Ultimately, we first have to determine that we want sovereignty to ensure that the rising influx of outsiders coming to the Canadian North fully appreciate that, first and foremost, all of their activities have to be to the benefit of all Canadians, and northerners in particular. Second, we must have a clear understanding of the role of our northern people — one that sets the stage for the rest of the world. For example, consider how the Scandinavians treat the Sami or how the Russians basically ignore their northern people. In respect of the Aleuts and Athabascans, the Americans only do what we do because of the Inuit Circumpolar Conference, ICC, and other organizations. We must make it clear that they have to include our people, to a certain degree. The model developed with the diamond companies provides a bit of insight in that context.

Third, we have to make it clear that any company doing business in the North must respect our existing agreements in terms of the rights of the various groups for the land and the water as set out in those various agreements. We have to ensure that everyone has their feet kept to the fire in that particular context.

I would argue that as we have these international interests coming into the Arctic, we have to be open-eyed. We cannot simply say that the Arctic is a museum, and there will not be development. It is not the way to go forward. We have to say that development has to be sustainable in the context of the communities that are experiencing such a growth amongst their young that new employment has to be maintained.

Senator Adams: You mentioned the Sami. I was up in Rankin Inlet and saw a film crew. There is also a new mine near Baker Lake in Nunavut. You also mentioned oil tankers going through ice that is about 1.5 metres thick. What will the future be for these tankers and icebreakers up there?

Mr. Huebert: If I am to believe some of the arguments and evidence of the non-government research by the ice scientist from the University of Manitoba, who is with ArcticNet, we will be faced with Arctic ice 1.5 metre thick in the summer and fall months, which will make transport practical. The big finding last summer was that the remaining multi-year ice, which is so difficult to get through, is beginning to disappear at a rate that is even greater than the first-year ice melting. If we look at a 10-year period and extrapolate the trends that we see today, with the expectation that ships can break through a metre of ice, we will see ships going through the Canadian archipelago to reach the oil and gas sources amongst these regions.

The Chair: I have a supplementary to Senator Adams point and the archipelago. Do we understand correctly that the United States has clearly recognized Canadian sovereignty on land?

Mr. Huebert: Yes, on land there is no question.

The Chair: I believe that you referred to this. The question is whether they recognize Canadian sovereignty in the waters that exist between the archipelagos. Do I understand correctly that while they say that those are international waters, they recognize that there should be Canadian control of them, or has that been established yet?

Mr. Huebert: Currently, this is the big point of debate. If you talk to the Americans off the record, they will say that they want Canada to have control of the Arctic. The Americans are concerned about the precedent it would set if the world saw them openly acknowledge that. They are more concerned about what happens in the waters around Indonesia and the Philippines in terms of freedom of navigation.

It is a technical issue: The Americans are saying that the Northwest Passage is an international strait not high seas or an open ocean. If it is indeed an international strait, then the Russians, who have resumed their long-range bomber patrols in the Arctic, have the international right to fly one of their bombers through the Northwest Passage with the right of overhead passage over international straits. If you ask the Americans whether they want a bear bomber flying over the Northwest Passage, of course they will say, no. Off the record, they will say that they want to come to some form of understanding. However, by the same token, they cannot be seen as surrendering on the precedent.

The issue of the current debate is, if tanker traffic started on the American side, whether the Americans would tell the companies going through that they have to follow Canadian standards of ship construction, safety and operation, which many contend would be de facto observation of our sovereignty. On the other hand, would the Americans feel it necessary to set the international precedent by making a point of allowing these vessels to go through without asking permission? How would the Americans handle it? Would they say that it is in their interest to not cause problems and ensure that the companies are following Canadian rules, or would we have to make a big point? That decision would have to be made at the presidential level, and you know that personalities are a factor. The type of presidential decision that President Bush would make would be different than that of a future decision made by Mr. Obama, Ms. Clinton or Mr. McCain. It is tricky to predict, but those are the two sides.

The Americans have the highest international standards for oil and gas transference in their waters. They do it in a very sneaky way with a piece of protectionism that they refer to as the Jones Act, which states that any shipping between two American states has to be in American-built crude vessels under American regulations.

When they ship from Valdez to California, their standards equal if not exceed our requirements under the Arctic Waters Pollution Prevention Act. However, they side-step this issue of international waters by saying that they are protectionist and that only Americans ships can do this. In addition, any American ships that do so, have to follow the Oil Protection Act of 1990, which is outstanding.

Therefore, the argument is that the Americans are already there; we can come to some unofficial agreement, but whether that would happen politically is the open question, unfortunately.

The Chair: Shipping from the Alaska North Slope to somewhere in Maine would also fall under that argument.

Mr. Huebert: Exactly, and this is what we do not know. The Americans are starting to face problems with their existing oil pipeline, which experienced a major leak last year. Not only have there been problems with hunters taking pot shots at the pipeline but also BP discovered corrosion and had to shut the oil pipeline down. They will have to replace that pipeline within five to ten years. Once again, international factors will be a big influence. For example, the price of steel has skyrocketed because of the demand created by Chinese economic development, and the Indians are expected to put out equal demands for steel in the next five years. If we do the calculations to build a pipeline, we realize that it is not the deal that people said it was in the past.

The argument I present is that international factors might greatly influence pipeline politics and economics that the tanker option might be the way of the future. I am not saying for certain that it will happen that way, but the indicators are taking us in that direction.

Senator Milne: Professor, I have rarely heard such a comprehensive briefing from anyone in a Senate committee. This is marvellous background you are giving us.

I am interested in frozen gas hydrates because I heard a presentation on Parliament Hill a few years ago about that. They are volatile, and they are deep. You say that the Japanese are pouring money into hydrates research. How much research is happening in Canada on hydrates now?

Mr. Huebert: There is a mixed feeling within Canadian industry. Being based in Calgary, I attend a number of energy conferences, and it is split down the middle.

One presentation will say that it is economically inconceivable to see any development capable of being able to exploit gas hydrates. The environmental risks are too high. They will be a marginal energy source that people may focus on, but will never become a major source of production.

The presentation immediately following will say that gas hydrates are the wave of the future, that they have such a powerful energy source — once again it is methane — but more concentrated than normal gas. Once they figure out the economics to of how to bring gas hydrates to the surface and exploit them, it is a much more economic energy source, climate change notwithstanding. I am not an expertise in that area and cannot make a judgment in terms of what is happening.

I can make the observation that the Japanese are not slowing down in terms of their funding of this. Are they doing it because they have invested so much that they want to keep investing to make it worth their effort or do they see something we do not? The research in Canada tends to be connected with the Japanese research, not exclusively, but the two seem to be going hand-in-hand.

It will still be substantially into the future before we see the exploitation, if it will occur. However, if you want to stir a debate, walk into an energy conference and say: Gas hydrates — the future or a dead end. I guarantee you will get a very lively discussion.

Senator Milne: I know we have a lot of it. It is under the Arctic Ocean and off the West Coast, which is where the Japanese connection is.

Mr. Huebert: Yes, that is correct.

Senator Cochrane: What specific measures should Canada take to ensure that its Arctic sovereignty is clearly protected?

Mr. Huebert: We need to do three things.

First, we need to have a clear and complete understanding at the highest level as to why we want this sovereignty. What is Canada's Arctic policy?

We started to do this with the Martin government and see it continued into the Harper government. However, I would argue that sovereignty for sovereignty's sake alone is a misguided policy. We want to know in terms of development, sustainability and the impact for those who call the North home. What do we want and see as our vision for what the Arctic? We need a clear understanding about what we want to see and do not want to see. From a policy perspective, we need a chair statement.

Second, we need to continue the development of our capabilities, particularly our capabilities in the context of enforcement and surveillance. You may have seen National Defence's recent commercials about rescuing a plane that goes down in the North. It is a nice commercial but somewhat unrealistic. They show one of our more recent Canadian Coast Guard helicopters and a Canadian Rangers patrol being able to get to the downed aircraft. That would be realistic if the air companies would let us know when they plan to have a crash so that we can pre-position the equipment. The reality is that we do not have such capability.

We must look at what we need to be able to act in the North. This government has made good steps in terms of its promises. As a political scientist who has followed this closely, I am always scared that we do not repeat what we did in 1985. You will recall, we had a clear program of what we were going to do and promptly stopped doing it in 1987 following the Polar Sea incident. Joe Clark presented a six-point Arctic policy that made good sense at the time, but, ultimately, we walked away from it. Hopefully, we will not see that repeated.

The development of the offshore patrol vessels in conjunction with the redevelopment of our icebreaking fleet is an essential element. We need to strengthen the RCMP capability to provide good sovereignty control domestically, and we need to continue in the development of Nanisivik as the port. Most Canadians are unaware that it is closer for our navy to sail from St. John's, Newfoundland to London than it is to sail to Nanisivik, to get an appreciation of the distances.

We also have to ensure surveillance. I was happy to see the government deny MacDonald, Dettwiler and Associates Limited's, MDA, sale of RADARSAT-2, or the arm that controlled it, to the Americans. If we had allowed that, we would have been a laughing stock amongst countries. I do not know of a single country that would consider that possibility, let alone permit it go forward. It was the proper decision to not allow RADARSAT-2 to be sold.

It raises the future question of what do we do to ensure MDA does not pull a fast one and allow that arm to collapse. In terms of Arctic surveillance, I have argued that because of what RADARSAT-2 allows us, it should be placed under the Canadian Space Agency rather than private industry. However, that carries considerable resource allocations with it.

Third, Canada has to take the same type of attitude it had about the oceans in the 1970s, when we became the leader for negotiating an international regime that favoured Canadian interests but also protected, from the normative perspective, the rules interest when it came to the utilization of oceans and their resources.

Looking back to the 1970s with the expertise of such people as Allan Beasley and others, when we negotiated the United Nations Convention on the Law of the Sea, Canada provided whatever resources were necessary to create this regime.

The time has come today to start thinking about how Canada can once again become an international leader in creating an international regime to ensure that Canadian values and interests are protected in the Arctic and that the entire region be developed in the most cooperative and environmentally sustainable fashion possible.

Rather than simply sending enough diplomats so that we have attendance, we should take an activist lead in providing the vision. Therefore, when the Arctic opens up in 10 to 20 years, we will have been one of the major architects and can look back with satisfaction and say that we were able to ensure it turned into something similar to the North Sea and not Spratly Island. The North Sea was a good model of cooperation internationally when it came to oil and gas, whereas Spratly Island is the area where the Chinese, Vietnamese, Taiwanese and Filipinos are constantly fighting over the various oil and gas resources.

Senator Cochrane: Now that you have raised RADARSAT-2, how important is technology such as that in protecting Canada's Arctic sovereignty?

Mr. Huebert: I would say that it is vital, but we need to have the full picture. The synthetic aperture radar, SAR, involved in RADARSAT is something in which Canadians need to take particular pride. We were planning to do it in conjunction with the Americans. We were working with the Americans in the 1970s on RADARSAT. However, they said it could not be done, and we persevered. That is a Canadian development. We have the highest technology when it comes to synthetic aperture radar; we are world leaders.

However, we need to combine that with mid-level technology. We need various radar systems on the ground and need to still to maintain the boots on the ground. This is where the Canadian Rangers program is instrumental. Most Canadians will be unaware that we have almost 5,000 Canadian Rangers in the northern region. When that is put into context of the overall population, it is amazing. They are the epitome of the citizen soldier. What they observe is equally important.

We need a comprehensive picture. The Canadian Arctic is the same size as Europe from a geographical perspective. The population is approximately 40,000 within that region. We need everything: the highest technology and the lowest technology in order to get a proper picture of what is happening. More will be happening in the future.

Senator Cochrane: You are saying that we have 5,000 Canadian Rangers.

Mr. Huebert: That is the number we are expected to go up to. It is huge when you consider the overall population. It is an area in which Canadians have to take major pride. We have a ranger patrol in every northern community. Not a single community that I am aware of is without a ranger patrol.

Senator Cochrane: Who else do we have there? We have RCMP.

Mr. Huebert: Yes, we have RCMP. We have covered everything that we have. We have four aircraft based in the North, the four Twin Otters that were built from 1971 to 1972.

We can get others up there. We have the four forward operating bases, where we can base F-18s, which we need to utilize since President Putin decided to reinvigorate the bomber patrols carried out by the Russians. We do forward the F-18s once in awhile from Cold Lake to some of these forward operating bases. Then there are the RCMP detachments, but it stops there.

Senator Cochrane: Who else should we have?

Mr. Huebert: We should be beefing up each and every one of those capacities.

Let me give you a point of comparison. Most Canadians are unaware that when we look at our American neighbours to the west of us in Alaska, the Americans maintain a military presence in that state of over 26,000 troops. That is almost 50 per cent of the size of Canada's total forces.

They also maintain three wings of F-15s in Alaska. Each wing has 22 F-15 fighters. They have 66 fighters in Alaska; and I daresay that if you compare that to our F-18 fleet, 66 is probably beyond the number of our operational F-18s. In theory, we have about 120 F-18s, but a large number are hangar queens — they will never fly again.

The Americans have a massive military capability, but it pales in the face of the Russian military capability in the Kola Peninsula. The Russians still maintain probably about 100,000 troops. The situation is that the Russians have resumed their bombers, and in April of this year, the head of the Russian navy went on record as saying that their current plan is to develop four to five carrier battle groups, of which most they expect to base in Murmansk, in northern waters. We can expect the Russian navy to become much more active in about 10 years.

It puts it into perspective when we talk about Canadian military capabilities: We have 80 troops up in Alert, Nunavut; about 200 troops in Yellowknife, Northwest Territories; 5 troops in Whitehorse, Yukon; and 2 troops in Nunavut.

I chuckle when I hear people talking about all this recent commitment and saying that we are remilitarizing the North. To put it in perspective, the American side has 26,000 troops, the Russian side has 120,000 troops, and we are talking about maybe going from 300 troops up to 1,000 troops. I do not think militarization really captures what we are doing.

Senator Milne: I believe, for the company that owned RADARSAT-2 and is attempting to sell it, that offer is not completely off the table.

Mr. Huebert: No, it is not yet.

Senator Milne: There have 30 days, and I believe the company is starting a public relations exercise to try to force the sale.

Mr. Huebert: There is no question that that is the case. I will give you an example of how silly we have been with this from a policy perspective.

In the 1990s, we said that government should be out of everything. We told MDA, as they were developing RADARSAT, that we do not want to have ownership of it, that they should have it as a private enterprise. In 2002, to make it profitable, MDA took the imagery from RADARSAT-1 and sold it to the Danish meteorological organization. What happened in that year? That was the year that the Danish government decided to send a military vessel — a naval frigate — to Hans Island to land troops. Guess whose technology allowed them to get there safely?

I do not know of a single country that would be selling another country the means to do that. Let us face it, it is a fun invasion. We did it — the mouse that roared — we did it in the best of spirits; but they physically invaded a piece of territory we claim as our own with military force, and we sold them the technology so that they could do it safely.

I ask you, would the Chinese, the Vietnamese, the Americans or the French do that? That was back in 2002. It was followed by this lunacy that we insisted that RADARSAT-2 had to be a private-public organization. I do not see another example of that anywhere. Even Spot, which pretends to be a private organization in France, is controlled by the government.

The idea that we even need to have this debate is unique in the international space environment. Other countries probably have a good chuckle about it.

Senator Meighen: There is enough gloom and doom around here to cut with a knife, so let me add to it.

Even if we took the steps, as you outlined to Senator Cochrane, to assert a greater presence in the Arctic, as I understood you to say, there is the whole question of the delineation of the continental shelf. What happens if that does not go our way?

Mr. Huebert: It will not be a question of all or nothing. It is a question of how far we can push our interests. It is similar to any other boundary negotiation. We will very seldom be in a situation that we win or lose everything. The question is how far will we go to win? Will we cave in to the Russian claims that their claim goes up to the North Pole, or do we get the part of the Lomonosov Ridge that goes beyond the North Pole toward them? We are not talking about a total loss, but about maximizing our gains.

Foreign Affairs and International Trade Canada, DFAIT, has a clear understanding that they want to push to the maximum. However, from a political perspective, the question is whether they will receive the backing when it is necessary to go nose to nose with both the Russians and the Americans.

I think we have just lost the connection.

The Chair: No, you are still there. We hear you. I think it was the Russians listening.

Mr. Huebert: You will not see me, but you can hear me then.

The Chair: We see you and we can hear you.

Mr. Huebert: That is great. I have just lost your screen, but automation is wonderful; MDA must be behind this.

Senator Meighen: In your estimation, what is it that is essential for us to win in terms of future international negotiations in the Arctic? Is the North Pole per se of any great strategic or other purpose?

Mr. Huebert: The North Pole is symbolic, but if we lose it, it is not a disaster. If we gain the territory, that is great. A lot of it still depends on our future scientific findings. Can we really make the claim that it is part of our extension of the continental shelf? That is something we are still scientifically trying to determine.

It is critical to ensure that Canadian interests and values are maintained to the fullest at each and every one of these negotiations. In other words, we have to recognize that we are in the process of continued negotiations with our neighbours. We need a very clear vision and the type of determination that we showed throughout the 1970s when we were negotiating with the UNCLOS.

We have a tendency to say, ''Well, fine, we have achieved this, so we can relax.'' When it comes to the Arctic, we will not be able to relax; we will face pushing from our neighbours constantly. We have to be ready.

We have outstanding individuals in DFAIT, but we do not have enough of them. It is a capacity issue. We need to build up at this point in time to be able to deal with these coming issues.

Senator Trenholme Counsell: Listening to all of this throughout the morning, you mentioned a number of elements that we need to have in place in terms of vision and long-term strategy. If we work back from a number of things that you said will happen in 10 to 20 years, does Canada have a realistic timetable to meet those eventualities? Do we have enough people addressing the issues from all angles to make this happen?

Mr. Huebert: On the bureaucratic side, National Defence is definitely paying close attention. After I speak with you, I will be addressing a class at their staff college. Their junior officers are receiving good education and are spending a lot of time thinking about this issue. The DFAIT has very good individuals in the legal division. However, the numbers have been cut back. For example, we have eliminated the position of the circumpolar ambassador, which was a mistake. The remaining Arctic region is way understaffed and needs to be increased.

As I testified before the Standing Senate Committee on Fisheries and Oceans, the Canadian Coast Guard does outstanding service individually, but it has been an orphan service in terms of capacity. It is difficult to justify the need for more people to deal with a problem that will happen in 10 years' time. It is difficult to get people's attention on such matters.

Having said that, the real problem we face is the attention of our political elites. I can be sympathetic that the demands of running a country will require us to focus on the crises that we face today, not tomorrow. However, the reality is that we can maintain a proper preparation for a timeline in preparing for the Arctic as long as our political elites make it a priority.

When former prime ministers and our current Prime Minister say that the Arctic is important, all things become possible. However, can we have a rational policy in terms of the timeline? The problem is that a new prime minister might not see the issue as important, so the timeline becomes meaningless. It is almost a feast or famine situation.

The reality in Canadian Arctic politics is that we have to take advantage when we have the prime minister's attention. We saw this with Prime Ministers Mulroney, Trudeau, Martin and now Harper. I am not being facetious when I say that we need a minor Arctic sovereignty crisis about every five years, and that would probably be the best guarantee of having a proper outline prepared. We need the Americans to create a small enough crisis to keep people's attention on the item. That would allow us to have the time period. It is a question of political reality and how to keep the prime minister engaged. We have the right steps in place, but it is the follow-through that matters. That is the real issue that we face. Will we have the proper follow-through of everything that former Prime Minister Martin and Prime Minister Harper have promised us?

Senator Trenholme Counsell: To your knowledge, is there a federal cross-sectoral committee at a very high level that deals with Arctic issues? Is there such a committee that would report directly to the prime minister?

Mr. Huebert: I am told that the Privy Council Office periodically puts people together. There is a lower-level organization called the Arctic Security Working Group at the bureaucratic level, not at the political level. The group does very good work, and I am part of that. It is not at the highest level subsequent to what we see in the context of the security groups that have been created.

The Chair: Mr. Huebert, you referred to a deadline in respect of Canada's undersea mapping so that we can proceed with our claims.

Will we make it in time? How far along is it, or have we done it?

Mr. Huebert: Jacob Verhoef, the federal scientist leading Canada's undersea mapping mission in the Arctic, has informed both publicly and off the record that with this recent infusion of funds of $200 million allocated in the February budget, he is fairly confident that they will make the deadline. It looks as if everything is well in place and that we will be ready by 2013.

The real challenge we will face in 2013 is the UN commission that examines the scientific basis of the claim, not the political basis. The commission is becoming so heavily backlogged that even when we make the 2013 deadline under the terms of the convention, it will be quite some time before the commission looks at our claim and passes judgment as to whether it scientifically passes mustard. Once our claim passes, then we go into negotiations with our neighbours. It will get quite interesting at that point.

The Chair: Is there any prospect of the United States becoming signatory to the UNCLOS? Is it a United Nations body, per se, under UNCLOS that will do the adjudication to which you have been referring?

Mr. Huebert: This is one of the ironies. This is where the irrationality of politics just undercuts national interests. The U.S. Department of Defence, the U.S. Department of State, every single coastal governor and anyone with a modicum of intelligence knows that the United States' interest is vastly served by being in the convention. There is a small rump of very far rightwing Republicans who, for ideological reasons, oppose the UNCLOS.

I raise this because before he began his bid for the presidency, Mr. McCain had been one of the Republicans in the U.S. Senate with enough intelligence to be in favour of ratification. However, since he began his run for the presidency, and found a need to demonstrate his conservative pedigree, one would argue, he has reversed his position, saying that he no longer supports ratification.

It is confounding because the opposition that the Americans had to the convention were dealt with entirely in an annex to the convention that was signed and ratified in 1994. The Americans had everything that they were concerned about addressed, and yet this was still not good enough. It leaves most people who look for rationality in government just scratching their heads and asking what else the Americans want on this.

The fact that the U.S State Department, the U.S. Department of Defence and the public are now aware that the Americans need to be in UNCLOS with respect to the division of the Arctic, one hopes that rationality will prevail. However, the big problem is that under the American system of government, they have to have a two-thirds majority within the U.S. Senate. Unfortunately, there are enough of these Republicans that, quite frankly, do not want to pay attention to their own history or look at what they got in 1994 as is annexed to UNCLOS, and still stand in its way.

I am somewhat pessimistic. It would pass if there were a president who was willing to assert a lot of political pressure and credit to pushing it. President Bush is not the president that will do it. By the time Mr. Clinton was ready to do it, he had to deal with the Monica Lewinsky issue and became politically problematic. Will the next president pass it? Mr. Obama and Ms. Clinton have not said anything about UNCLOS; Mr. McCain says that he is against it; and so I am a little pessimistic.

To answer the second part of your question, the UN commission that examines the claims does so only on the scientific merit of the claim. They do not pass judgment on the values or the delimitation. The process of delimitation is left up to those states that have to delimitate. Therefore, Canada, Russia, Denmark and the United States will have to sit down and either bilaterally or multilaterally negotiate in standard boundary negotiations where the limits start and end. That will be left up to us.

The convention only requires us to negotiate in a peaceful manner, which is fairly obvious. We can do it under any of the bodies that the UN convention sets up. We can go to the International Court of Justice or we could have bilateral negotiations. It is entirely up to the nations involved to determine how they will proceed with the negotiations.

The Chair: The nations involved would either create or agree to become subservient to an adjudication body, or might do that as part of their process.

Mr. Huebert: They may if they choose to do that. Current indications are that both the Americans, unofficially, and the Russians have indicated that they do not want to go to an international body. They will be trying to negotiate either bilaterally or multilaterally on a direct level.

The Chair: Thank you. As Senator Milne said, we are all grateful for your extensive and useful information. We are grateful for your time this morning.

Mr. Huebert: It is my pleasure, and I applaud the work your committee is doing.

Public attention must be maintained on this issue. It will only come from the work of yourselves and the media to ensure that our politicians do not lose sight that the Arctic is something we ignore once in a while, but we do so at our peril.

Changes are coming that if we are not proactive about, we will be reactive, and that will not be pretty if everything comes to pass as the indicators suggest they will.

The Chair: Thank you again.

The committee continued in camera.


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