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

Issue No. 72 - Evidence - June 18, 2019


OTTAWA, Tuesday, June 18, 2019

The Standing Senate Committee on Energy, the Environment and Natural Resources, to which was referred Bill C-88, An Act to amend the Mackenzie Valley Resource Management Act and the Canada Petroleum Resources Act and to make consequential amendments to other Acts, met this day at 5:20 p.m. to give consideration to the bill.

Senator Rosa Galvez (Chair) in the chair.

[English]

The Chair: Good evening and welcome to this meeting of the Standing Senate Committee on Energy, the Environment and Natural Resources.

My name is Rosa Galvez. I’m a senator from Quebec, and I am the chair of this committee. I will now ask senators around the table to introduce themselves.

Senator Woo: Yuen Pau Woo, British Columbia.

Senator Richards: Dave Richards, New Brunswick.

Senator LaBoucane-Benson: Patti LaBoucane-Benson, Treaty 6 territory, Alberta.

Senator Patterson: Dennis Patterson, Nunavut territory.

Senator MacDonald: Michael MacDonald, Nova Scotia.

Senator Cordy: Jane Cordy, Nova Scotia.

Senator Anderson: Dawn Anderson, Northwest Territories.

Senator Simons: Paula Simons, Alberta, Treaty 6 territory.

Senator McCallum: Mary Jane McCallum, Treaty 10, Manitoba.

Senator Duncan: Pat Duncan, Yukon.

The Chair: Thank you very much. I would also like to thank the clerk and the analysts of the committee, who have always been punctual and ready to receive these bills at such short notice.

Colleagues, tonight we are studying Bill C-88, An Act to amend the Mackenzie Valley Resource Management Act and the Canada Petroleum Resources Act and to make consequential amendments to other Acts.

For the first panel we welcome the Honourable Carolyn Bennett, P.C., M.P., Minister of Crown-Indigenous Relations. Welcome, minister. You are accompanied by officials from Crown-Indigenous Relations and Northern Affairs Canada, Ms. Diane Lafleur, Associate Deputy Minister; Mark Hopkins, Director General, Natural Resources and Environment Branch; Gilles Binda, Director, Resource Policy and Programs Directorate; and Michel Chénier, Director, Petroleum and Mineral Resources Management Directorate.

Thank you very much for joining us, minister and your team. I invite you to proceed with your opening statement, after which we will go into a question period. Thank you.

Hon. Carolyn Bennett, P.C., M.P., Minister of Crown-Indigenous Relations: Madam Chair, thank you for inviting me and giving us the opportunity to explain the importance of Bill C-88, An Act to amend the Mackenzie Valley Resource Management Act and the Canada Petroleum Resources Act.

I also bring good news from Minister LeBlanc that he had posted a very positive video yesterday that he’s ready to go and run again, and he’s feeling much better. But he is a bit bald. We weren’t quite sure who it was at the beginning.

[Translation]

I would like to begin by acknowledging that we meet today on traditional Algonquin territory.

[English]

Firstly, we thank you for dealing with this in such an expedited way. We are very grateful. I think you’ll hear in the panels that the people of the Northwest Territories are very grateful as well, because Bill C-88 really will improve the regulatory regime governing resource development in the Mackenzie Valley as well as the oil and gas development in the offshore Arctic. It also fosters reconciliation with Indigenous peoples by ensuring that they have a meaningful say in projects likely to affect their traditional lands.

The primary focus of Bill C-88 regarding the Mackenzie Valley Resource Management Act is the restoration of the constitutionally protected land and water boards, now subject, unfortunately, to ongoing litigation.

When Bill C-15 was introduced and passed by the previous government, it was focused on the devolution of responsibilities from Ottawa to the territorial government, which was largely a very positive bill, but buried in the small print was the elimination of the three regional panels of the Mackenzie Valley Land and Water Board and the imposition of a single “superboard.”

The attempt to eliminate the Sahtu, Gwich’in and Wek’èezhìi (Tlicho) Land and Water Boards severely eroded confidence in the Mackenzie Valley regime.

[Translation]

This ended up in court almost immediately, because it violated constitutionally protected Indigenous land claim and self-government agreements.

[English]

In early 2015, the Supreme Court of the Northwest Territories granted an injunction that suspended the proposed board restructuring, along with, unfortunately, all the other positive regulatory amendments that had been included in Bill C-15.

Bill C-88 will resolve the litigation regarding the restructuring of the boards and reintroduces the positive policy elements of Bill C-15 that are currently prevented from coming into force by the said injunction.

This will re-establish the trust with Indigenous partners in the Northwest Territories. It will respect their constitutionally protected land claim and self-government agreements and restore the legal certainty for responsible resource development.

As David Wright, legal counsel for the Gwich’in Tribal Council, stated before the Standing Committee on Indigenous and Northern Affairs in the other place:

. . . the consultation process on Bill C-88 has actually helped restore some of the trust between Canada and the GTC. That trust would be eroded by any further delay, or at worst, failure to pass this bill in a timely manner.

The Tlicho government and the Government of the Northwest Territories have also clearly expressed their support for the passage of this bill, stating that the negative implications on the status quo are significant.

When appearing before the Standing Committee on Indigenous and Northern Affairs, Northwest Territories Premier Bob McLeod said:

We don’t see Bill C-88 as a partisan bill. It ensures that land claim agreements are fully implemented by maintaining the regional boards, and also has modern amendments with multi-party support.

[Translation]

Canadians expect regulatory systems to be fair and balanced. Industry expects regulatory systems to be predictable, efficient and consistent.

[English]

Bill C-88 satisfies all of these expectations through the proposed amendments to the MVRMA.

Bill C-88 also proposes new criteria in the Canada Petroleum Resources Act for the Governor-in-Council to prohibit existing exploration licence holders and significant discovery licence holders from carrying on any oil and gas activities, in the case of the national interest.

[Translation]

It would likewise freeze the terms of the existing licences in the Arctic offshore for the duration of any such prohibition.

[English]

The “national interest” refers to a country’s national goals and ambitions, whether economic, military or cultural, and is not a new legislative concept. It is in numerous other acts, including a number in the North. For example, the term appears in section 51 of the Yukon Act and in section 57 of the Northwest Territories Act.

In both acts the Governor-in-Council may prohibit any use of waters or the deposit of waste where the Governor-in-Council considers the use of water or deposit of waste to be incompatible with the national interest.

When developing the CPRA aspects of Bill C-88, consultations were launched with the three territorial governments, with the Inuvialuit and Inuit organizations and with existing oil and gas rights from March to July 2017. The consultations provided important feedback about industry and Indigenous interests as well as their plans and a vision for future oil and gas development in the Arctic offshore.

All parties affirmed the strategic economic value to the North from oil and gas development in the Arctic offshore and supported the measure in Bill C-88 to authorize the Governor-in-Council to issue a prohibition order to “freeze the terms” of the existing licences in the Beaufort Sea for the duration of the moratorium.

As some of you know, the Inuvialuit Regional Corporation has played a major role in those consultations; however, we understand that they have recently expressed a concern about the required consultations before issuing a prohibition under the new CPRA “national interest” provision.

I’m here to reassure you that the CPRA already recognizes the rights of the Inuvialuit and other northern Indigenous communities in regard to the legislative and regulatory measures in the act and states explicitly:

Nothing in the CPRA shall be construed so as to abrogate or derogate from any existing Indigenous or treaty rights of the Indigenous peoples of Canada under section 35 of the Constitution Act, 1982.

In keeping with that clause and the federal government’s constitutional obligation, this government is committed to consulting with the Inuvialuit and any other northern Indigenous organization with rights in the Arctic offshore prior to taking a decision to introduce a CPRA prohibition order under the new “national interest” criterion.

In terms of the policy-based moratorium on the new Arctic offshore oil and gas licences in federal waters, that was a risk-based decision in light of the potential unknown effects of an oil spill in the offshore area and the limited science about drilling and oil-spill response capability in that area. It’s important to remember that the moratorium is not a CPRA legislative-based prohibition order, such as what is contemplated under the proposed amendments through Bill C-88; it was a policy-based decision.

[Translation]

It is also important to note that, when the moratorium was announced, there was no active drilling occurring in the Beaufort Sea and no realistic plans to initiate drilling in the short or medium term.

[English]

The moratorium was also announced in conjunction with a five-year science-based review, as well as a consultation on the details of that review. Territories and Indigenous and northern communities are co-partners in this ongoing science-based review process, and others, including industry, are being actively engaged as part of that review.

[Translation]

The Inuvialuit are also fully involved in ongoing offshore co-management negotiations.

[English]

The Inuvialuit’s standing as a full party to the negotiations is a recognition of the importance of the Beaufort Sea to the people of the Inuvialuit region. This is a first in Canada’s offshore oil and gas management and is commensurate with Canada’s commitment to partnering with the Inuvialuit.

The development of Bill C-88 involved extensive consultations with Indigenous governments, organizations and the Northwest Territories. The proposed amendments to both the MVRMA and the CPRA are essential to ensuring a responsible, sustainable and fair resource development regime in the Northwest Territories and the Arctic.

We urge senators to join us in supporting Bill C-88, and we look forward to your questions.

The Chair: Thank you very much. We’re going to start with our question period.

Senator Patterson: Thank you for being here, minister, at this busy time.

Minister, in your Northern Oil and Gas Annual Report 2018, your opening message describes your goal of:

. . . protecting the Arctic’s unique marine ecosystem and ensuring that science plays a key role in any Arctic offshore oil and gas development . . . will allow the Government to establish a path forward for the strategic management of these resources in collaboration with our partners.

I was heartened when Minister LeBlanc — and we’re very happy to hear that he has recovered — announced that your government would negotiate a Beaufort oil and gas co-management and revenue-sharing agreement with the governments of the Northwest Territories and Yukon, and the Inuvialuit Regional Corporation, in October 2018. You’ve just spoken approvingly of the full involvement of the Inuvialuit as a partner in ongoing offshore co-management negotiations for the Beaufort Sea.

Is this approach in the Beaufort part of a longer-term vision of co-management for the Arctic offshore? I’m thinking, of course, specifically of Nunavut. Is that what we’re working toward, with the Government of Nunavut and the Inuit in my home territory?

Ms. Bennett: Thank you so much, senator, for the question. Last year, I think, when you chaired the panel at the UN, we were boasting about how co-management is working in our North in the territory land base. Last October, when Minister LeBlanc was announcing the next steps on the Arctic oil and gas, he mentioned a commitment to negotiate for the Beaufort Sea oil and gas co-management and revenue-sharing with the governments of Yukon and Northwest Territories, and the Inuvialuit Regional Corporation. Once we’ve gotten a final devolution agreement in Nunavut, we would be very happy to begin negotiations with Nunavut on co-management, as well as resource revenue-sharing with, not only the Government of Nunavut, but the Government of the NWT, so that we have for the offshore this consistent collaborative approach that has worked so well on the land.

Senator Patterson: That’s music to my ears.

Senator Cordy: Thank you very much, minister. It’s nice to have you before our committee. We seem to be doing a lot of energy bills this year.

Minister, if I understand correctly, directions were given shortly after the election in 2015 by you to halt the appeal of the court decision, claiming the amalgamation of the boards is contravening treaty rights. I wonder if you could walk us through how your department came to have Bill C-88. When I look at the comments made by David Wright, Legal Counsel for Gwich’in Tribal Council, and the comments by Premier McLeod, they are very happy with what’s happened. Could you talk about consultation? Clearly it seems that people are very happy with it. What made the consultations work? How did you go about it? What types of consultations did you have to come to a consensus of what would work best?

Ms. Bennett: Thank you for the question. My job is always to get us out of court, so when there is an injunction, as happened pretty quickly after Bill C-15 came into effect, everything stopped, including all the good parts of the bill. Then, as we formed government, we decided it was going to be very important to consult not only with the Inuvialuit and the government of the Northwest Territories but also with the proponents, industry, oil and gas — all of the people who would benefit from the certainty that these regional boards had provided and how we go forward. We probably started in the fall of 2016. We had teleconferences and face-to-face meetings.

We also believe, senator, that groups need financial support in order to fairly participate in these kinds of consultations, because it can sometimes be seen a little bit uneven if government has all the resources and the groups that are consulting with us don’t have the support to do the kind of research and to be able to offer opinions.

It bore the fruit of a good bill that people supported.

Senator Cordy: Some people look at the bill and say that it started in 2016 or when you cancelled the court appeal. How did it take so long to get to this point? Was it because of the consultation process?

Ms. Bennett: We had always decided that we had to consult properly, and it takes time to get it right. You have to consult until you have consensus, and it sometimes takes some time to get it right and get to a place where everybody agrees.

The Chair: The sponsor of the bill will ask a question next.

Senator Anderson: Thank you for your presentation. I’ll read a statement first.

When the Inuvialuit Final Agreement, or IFA, was signed in 1984, it did not deal with jurisdiction in the offshore. The Inuvialuit Settlement Region covers approximately 435,000 square kilometres in the Mackenzie Delta, Beaufort Sea and Amundsen Gulf area. Of that, only 90,650 square kilometres is land.

As part of the devolution agreement signed in 2013, Canada, the Government of Northwest Territories and the Inuvialuit Regional Corporation agreed to sit down at a future date and negotiate the management of the oil and gas resources in the Beaufort Sea. It is my understanding that these negotiations are now in the early stages, and I think you spoke to it in a bit. However, the IFA is one of the oldest land claims in Canada and as such, according to Duane Ningaqsiq Smith’s brief about the proposed amendment in subclauses 85(1) and (2) of this bill in the other place, it does not “. . . incorporate excess protections for rights holders where conservation areas are contemplated.”

Going forward, how will the government ensure it meets its obligations for meaningful consultation with the Inuvialuit about proposed conservation areas or moratorium extensions?

Ms. Bennett: Thank you so much for the question. Again, because of the intervention of the Inuvialuit, we have sent a letter, which I think you have, that I hope will describe to the satisfaction of the chair and CEO Duane Smith how we plan to go forward in the ongoing negotiations with the governments of the Yukon and the Northwest Territories.

The Inuvialuit would be fully involved in that as we now begin that exploration of a co-management regime and resource revenue sharing. They would be full partners in that and we think this is a milestone. I think Senator Patterson alluded to that. As we move into that co-management framework, it is about having the Inuvialuit as a full partner in the Arctic offshore.

As you know, there is a separate table which is working on the IFA. We are pretty excited as the Indigenous governments now come to look at the kinds of negotiations that we’re having with other nations about how they want their agreement modernized or refreshed to reflect the new way of doing business.

The Chair: I know you have to leave, so we have four minutes.

Ms. Bennett: Apparently I have a vote now, yes. The officials will stay and take all the tough questions, if that’s all right.

Senator Richards: Thank you for being here, minister. This will be very quick. Was there any stated reason in Bill C-15 for the elimination of the local boards in 2014? Do you know the stated reason for that, madam?

Ms. Bennett: I don’t know the stated reason because it came as a total surprise. Everything else in the bill had been consulted upon about being able to extend board members’ tenure. There were a lot of really good things in it but this creation of the superboard really surprised people and that’s why it got that reaction and then an injunction.

Senator Richards: Thank you.

[Translation]

Senator Massicotte: Thank you, minister, for appearing before the committee today. I very much like the idea of dividing up the decision-making authority between three different groups and letting the people who know the land best decide how it should be managed.

However, the bill refers to the “national interest.” That’s a rather vague notion, don’t you think? Can the government cite national interest as grounds to constantly interfere in the management of Indigenous territories and their assets? Is the concept defined in legislation? Does it apply only in special cases or situations where it is geographically important? What does the term mean, and when can the concept be invoked?

Ms. Bennett: It is important to clearly understand the system of co-management involving territorial and Indigenous or Inuit governments. Councils make decisions in conjunction with provincial or territorial governments and Inuit or First Nations governments.

Senator Massicotte: If I understand correctly, despite this positive management approach and structure, the Prime Minister or the government can, at any time, make a decision in the name of the national interest, that runs counter to a decision made by an Indigenous government. That’s a bit contradictory, don’t you think? The government gives them the authority to make decisions about how to manage their own land and then imposes its position in the name of the national interest.

Ms. Bennett: Originally, the definition of “national interest” encompassed military, cultural and economic interests, but further to consultation, it’s important to note that rights set out in section 35 of the Constitution Act still apply. Prime Minister Trudeau’s decision is based on the risk of an oil spill and the lack of scientific knowledge needed to properly manage the region. Therefore, companies were granted licences for a period of five years, and those licences will be subject to a science-based review.

The Chair: Thank you very much. Minister, you may now take your leave, unless you still have some time for us.

[English]

Ms. Bennett: I’m good to go?

The Chair: You are good to go. Thank you so much.

Senator Simons: Thank you very much. I don’t know who is taking questions, precisely.

[Translation]

I often take the opportunity to ask my questions in French so I can practise my language skills, but I’m going to ask them in English today. Thank you for your suggestion.

[English]

In her prepared remarks, the minister said the government is committed to consulting with the Inuvialuit and any other Indigenous organizations prior to making a decision.

What I don’t understand, since most of what we are talking about here today is a cascading series of failures to do that consultation, is that commitment to consulting part of the bill? Is it in any way written down or is that a promise?

Diane Lafleur, Associate Deputy Minister, Crown-Indigenous Relations and Northern Affairs Canada: What the bill does is essentially protect and state clearly that nothing in the legislation will take away from the constitutionally protected agreements that are in place. Those agreements contain clear obligations with respect to engagement and consultation prior to action.

Senator Simons: Is the obverse true? If the government decides it is in the national interest to do something, does the Crown retain that right?

Ms. Lafleur: The obligation to consult would remain and the ultimate decision would be the right of the Crown, but there would have to be prior consultation.

When you have a properly functioning co-management regime, you at least would have conversations about what is in the national interest, before the decision is made on the basis of national interests.

Senator Simons: I would offer the editorial comment that it is a shame that a similar moratorium with a five-year science-based review was not the foundation for Bill C-48. I am also on the Transport Committee and it seems to me this would have been a better model on Bill C-48, and now I will be quiet about that.

Senator McCallum: I found it very encouraging. It is the first bill I’ve seen that has the Indigenous organizations and the energy as part of a bill, because I think we need to see more of that. But I wanted to go back to the significant discovery licences, and that many of them can remain dormant for many years. What is the number of years that they can remain dormant or have remained dormant? Could it be 60 years or more?

Michel Chénier, Director, Petroleum and Mineral Resources Management Directorate, Crown-Indigenous Relations and Northern Affairs Canada: The significant discovery licence has an indefinite term. The policy reasoning behind that is that they are normally brought into commercial production when they are economic. It is a question of balance, in the sense that when companies explore an area and then actually find a resource, they are entitled to the rights that could be developed once they are deemed to be commercial.

Senator McCallum: When they are dormant, you said they go straight into development. Have they done the exploration already?

Mr. Chénier: The sequence is that the discovery licence typically comes after the exploration licence. You have to explore an area and then, if there is the identification of significant hydrocarbons, that qualifies for a significant discovery licence or what we call an SDL. In that case, companies then start reviewing those resources per plans that may eventually unfold in the future.

Senator McCallum: I guess it won’t apply to significant discovery. I had brought up the seismic activity that goes on when they do the exploration and how, when we went on the East Coast trip, the fracking was very detrimental to the ecosystem, to marine life.

I’m wondering, with their science-based review that you are doing, is that going to be taken into account? That’s a pretty new activity and they don’t have any science base on fracking, whether it is on land or in water. I’m wondering if that’s part of your review.

Mr. Chénier: In that case, marine science, including marine mammals, is a key component of the five-year review. It is very much at the heart of what we are currently reviewing with our partners in the ongoing five-year review, yes.

The Chair: I want to go back to the question of Senator Massicotte, because I think it is a very important point, defining national interest. You can please tell us the current definition of the national interest?

Ms. Lafleur: I think the minister actually alluded to it in her statement.

The Chair: Is this in the bill?

Ms. Lafleur: No, it is not because it is actually a concept that has been used in a number of other pieces of legislation. It is quite well understood in terms of the jurisprudence, so there wasn’t a feeling that it needed to be specifically defined in the legislation.

The Chair: So what is it? Do you have it?

Ms. Lafleur: Sorry, I want to go back to part of the minister’s statements. It refers to a country’s national goals and ambitions, whether they be economic, military or cultural. Economic, military and cultural are actually pretty limited in scope.

The Chair: So you could not give examples at this point of what could be national interest, for example, culturally?

Ms. Lafleur: Military, you could speculate, but we see increased international activity in the Arctic with a number of countries that are trying to stake their claims to the Arctic. And I’m not suggesting that there is any military activity that’s going to stem from that, but you could see —

The Chair: And culturally?

Ms. Lafleur: Culturally, if you are looking to protect a way of life in the North, which is greatly impacted by things like climate change, it is happening way more quickly in the North than elsewhere. Again, I can’t speculate as to what would constitute something that is so extreme that you wouldn’t want to go that extra step, but I don’t know what the future holds.

The Chair: Thank you.

Senator Duncan: I thank the panel for the presentation and that of the minister.

I have a concern with language in the minister’s address. The Inuvialuit Regional Corporation is mentioned and, in particular, discussions with regard to the offshore. The Inuvialuit settlement agreement includes a portion of the Yukon offshore. There were phrases about Yukon having been actively involved in discussions with Inuvialuit, the Government of Northwest Territories and the Yukon, three parties at the table.” I am concerned with the minister’s comments at page 6: “Territories and indigenous and northern territories are co-partners . . . .” May I ask that it be referenced “Yukon and the Northwest Territories” as opposed to just saying “territories?” Because the Yukon can tend to be forgotten. When we reference the North, the Arctic, we need to say “the three northern territories.”

Ms. Lafleur: Your point is taken.

An Hon. Senator: Agreed.

The Chair: I have another question. Concerning Part 2, there are already a dozen licences for exploration and around 50 licences for discovery and research. The ones that were in exploration are almost expired. So this Part 2 of the bill is a way to extend the licences of these companies. If Part 2 were not there, the licences would expire and then these companies will have to pay the Canadian government for the work that was not done during these nine years. Can you tell, of these companies, are they Canadian or American or international? And what is the amount of money, the level of funding that we are not recuperating by extending the licence using Part 2 of Bill C-88?

Ms. Lafleur: Mr. Chénier has the list of companies that are implicated.

Mr. Chénier: The specific companies that hold exploration licences in the Beaufort Sea are Imperial Oil Resources Ventures Limited, BP Exploration Operating Company Limited, Chevron Canada Limited, ConocoPhillips Canada Resources Corporation and Franklin Petroleum Canada Limited.

The reason we are contemplating the freeze of existing licence is because, as the minister referenced, a policy decision was made because of the risk associated to oil spills and the lack of science, which led the government to put in place a moratorium. Consequently, it was determined that it would be equitable to proceed with the possible freezing of the licences per the dispositions of this legislation.

The Chair: Because these companies owe money to the government, wouldn’t this be a form of subsidy to this industry?

Ms. Lafleur: They did not owe money to the government. They had paid deposits, which the government held. Because the government made a policy decision to prevent those companies from exercising those rights, it was felt that it was fair and equitable to return those deposits to the company.

[Translation]

Senator Carignan: I’m trying to find the provision that deals with national interest in the Canada Petroleum Resources Act. I’ve been trying to find the requirement for a few minutes now.

Ms. Lafleur: It’s in subsection 86(1).

Senator Carignan: Is there a mechanism, an authority or a duty to provide compensation since this is a form of expropriation?

Ms. Lafleur: As far as the national interest requirement is concerned, it depends on the circumstances.

Senator Carignan: I see.

Say I’ve discovered the biggest oil reserve in the world, but the government tells me that it is putting everything on hold in the name of the national interest. I am the rights holder, and that has value. How would I be compensated for the suspension of my activities in the name of the national interest? This is a form of expropriation, after all. How do you plan to compensate companies you force to cease oil and gas operations?

Mr. Chénier: I’d like to thank the honourable senator for his question.

Before we get into discussing compensation, it’s important to keep in mind that the idea is to put the rights on hold or freeze the terms of the existing licences, as the minister mentioned. We are in the midst of completing the five-year science-based review, which will dictate the next steps. At that point, we’ll decide on the appropriate course of action. It’s too soon to think about that now.

Ms. Lafleur: Economically speaking, it was important to impose a moratorium as of now given the lack of any planned projects. No company had plans for resource exploitation because it didn’t make economic sense. At this time, no one has lost an opportunity to develop a resource.

Senator Carignan: The moratorium is immediate, then. Let’s say the moratorium ends and further exploitation is permitted. Does the Crown retain its authority to suspend oil licence rights it granted, in the name of the national interest?

Ms. Lafleur: The Crown would have the authority to suspend those rights following consultations.

Senator Carignan: That’s what I thought.

You have the authority to suspend oil rights, but you haven’t yet figured out the powers or method to provide compensation for suspending those rights. Is that correct?

Ms. Lafleur: It would be up to the government in power to do that. In the current context, it was decided to reimburse payments that had already been made.

Senator Carignan: That’s peanuts. If a major deposit of minerals, diamonds or what have you is discovered, reimbursing payments is reimbursing payments, but it doesn’t compensate for the loss of profits that the developer or rights holder will incur for not being able to exploit the deposit.

Mr. Chénier: It’s a bit premature at this point to think that exploitation won’t be possible in the future. If it is, the government will have to explore its options. In 2017, when we consulted rights holders, we were able to understand companies’ strategic and economic interests and the long-term prospects associated with those rights. Corporate interests were taken into account, and the government decided for the time being only to freeze licences and to review next steps when the necessary information and scientific data were available.

Senator Carignan: Are you saying that, during the consultations, no rights holder asked you how their losses would be compensated? No one brought that up?

Ms. Lafleur: I think that what companies were most concerned about was not losing their development rights and not having their licences run out. That was their priority. They don’t want to lose their rights since they have already done work and made investments. That’s why freezing the licences was important. Otherwise, they would start running out this summer.

Senator Carignan: I understand all that. I realize the purpose of the freeze is to keep companies from losing their development rights, but my question is about compensation. None of the stakeholders asked about that? Those aren’t your usual developers.

Ms. Lafleur: Development isn’t economically viable yet; that’s why. They couldn’t put a number on losses they suffered as a result of this decision, because they hadn’t gotten to that stage.

[English]

The Chair: Thank you so much.

We now welcome, via video conference from Yellowknife, from the Government of Northwest Territories, Mr. James Fulford, Chief Negotiator, Offshore, Executive and Indigenous Affairs. And from the Tlicho Government we have Grand Chief George Mackenzie; Ms. Bertha Rabesca Zoe, Legal Counsel and Laws Guardian; and David MacMartin, Director, Intergovernmental Relations.

Thank you very much for joining us. I invite you to proceed with your opening statements, which will be followed by a question period.

George Mackenzie, Grand Chief, Tlicho Government: Thank you for inviting the Tlicho Government to appear before you today to address Bill C-88. It is very important for me as the grand chief to speak to you personally to reinforce how vital this bill is for our communities, our territories and our treaty relationship. The Laws Guardian of the Tlicho, Bertha Rabesca Zoe, is here with me and will respond to technical or legal questions.

I urge the committee to move swiftly and decisively to ensure that Bill C-88 is passed and proclaimed into force during the current session of Parliament. Time is running short. This bill reaffirms the rights treaty promised the Tlicho people and we support it without reservations.

It is necessary that the committee understand the significance of our modern treaty, the Tlicho Agreement, and its relationship to Bill C-88.

The Tlicho Agreement was signed in 2003 and has been in force since 2005. The Tlicho Agreement confirms the Tlicho Government has jurisdiction over 39,000 square kilometres of Tlicho lands. Tlicho citizens also exercise Aboriginal rights, including harvesting rights, throughout all our larger traditional territories, which we call Monwhi Gogha De Niitlee.

In the heart of Monwhi Gogha De Niitlee is the environmental and resource co-management area of Wek’èezhìi, which covers about 160,000 square kilometres of land.

Co-management and joint decision making respecting natural resources is an essential part of the Tlicho Agreement. The Tlicho Agreement provides for co-management through the establishment of regional land and water boards and renewable resource boards. The Tlicho Government, other Indigenous governments and public government are all represented.

Tlicho Government has the treaty rights to appoint 50 per cent of the members of all co-management boards within Wek’èezhìi. This includes Wek’èezhìi Land and Water Board, which is the centrepiece of the management regime for land and water boards in Wek’èezhìi. The Tlicho agreement requires Canada to establish the Wek’èezhìi Land and Water Board through legislation. It did this in 2005 through the Mackenzie Valley Resource Management Act after extensive consultation with the Tlicho Government.

In our view, there are three key characteristics of the Wek’èezhìi Land and Water Board that you need to know. It implements treaty rights. It represents co-management in action. It has built capacity and experience in the trust in Wek’èezhìi residents. It has been documented that it performs its function well and operates effectively and efficiently in the public interest.

When the Northwest Territories Devolution Act was passed in 2015, it included an amendment to the Mackenzie Valley Resource Management Act that would eliminate the Wek’èezhìi Land and Water Board. The Wek’èezhìi Land and Water Board and other boards in the NWT would be replaced with a single superboard. Instead of appointing 50 per cent of the board’s members as our Tlicho agreement requires, the Tlicho Government would appoint only one out of 11 members on this superboard. The Mackenzie Valley Resource Management Act amendments could allow decisions of the Wek’èezhìi to be made by a panel of the superboard without any Tlicho Government appointees at all. This would be in violation of Canada’s treaty promises. The Tlicho Government filed a lawsuit to enforce our treaty rights and a first step to seek out an injunction on the Supreme Court of the Northwest Territories. That injunction was granted in 2015. It prevents the Mackenzie Valley Resource Management Act amendments from coming into force.

The injunction remains in effect to this day and will remain in effect until either a new law is passed or the lawsuit runs its course. The underlying lawsuit remains active, pending the result of this legislative process. If Bill C-88 is not passed by the current Parliament, we will be faced with either restarting the legislative process from the beginning or proceeding with our lawsuit against Canada. Both could take years.

Proceeding with our lawsuit could be a hard result for all stakeholders, in addition to being long and expensive. Failing to resolve these matters cooperatively would damage our treaty relationship and would undermine the process of reconciliation. Long-term regulatory uncertainty will damage the economy of the Northwest Territories, including within Tlicho communities. This could be avoided by the swift passage of Bill C-88.

Bill C-88 serves at least three essential functions. It preserves the establishment of an effective co-management board. It strengthens the co-management system by reinforcing other new provisions that could not come into force because of the injunction. These have broad support from industry and government, including the Tlicho Government. It delivers industry certainty. It will allow us to cooperate and collaborate with proponents in our co-management and treaty partners to ensure responsible use in the development of our shared resources. In other words, this bill supports reconciliation. It supports the environment and it supports resource development at the same time.

Bill C-88 is a good-news story for all shareholders. The Tlicho Government encourages the community to prioritize the passage of Bill C-88 with the urgency an important treaty amendment deserves.

I thank the committee for the opportunity to appear before you today and hope that these submissions assist you in fulfilling your important responsibility. We are happy to address any questions that you may have. Mahsi cho for listening to me.

The Chair: Thank you.

James Fulford, Chief Negotiator, Offshore, Executive and Indigenous Affairs, Government of Northwest Territories: Good afternoon and thank you for your invitation to appear before this committee today as you review Bill C-88, An Act to amend the Mackenzie Valley Resource Management Act and the Canada Petroleum Resources Act and to make consequential amendments to other Acts.

The Northwest Territories Premier Bob McLeod recently presented to the parliamentary Standing Committee on Indigenous and Northern Affairs when it reviewed this same bill. My goals here today are to express our government’s strong support for the bill and explain why we encourage Parliament to adopt it as swiftly as possible.

The Northwest Territories is home to 44,000 residents who live in 33 communities, spread out over more than 1.3 million square kilometres. We are a unique jurisdiction where Indigenous and non-Indigenous people live, work and govern together in the same communities and where half of our population identifies as First Nations, Inuit or Metis. The result of this combination of Indigenous and non-Indigenous people living and working together is a public government where actions and decisions are informed by and include northern Indigenous views and priorities right from the outset.

A large part of our territory’s modern history can be linked to resource development dating back to the 1920s with the discovery of oil in the Sahtu region. Today, our economy is still heavily reliant on resource development, with mining, oil and gas accounting for more than 25 per cent of our GDP.

Since 1984, the governments of Canada and the Northwest Territories have been party to several modern treaties that formally recognize the rights of Indigenous governments to manage and benefit from the ownership of lands and resources in their regions. These rights are reflected in the Mackenzie Valley Resource Management Act, enacted in 1998. It provides an integrated co-managed land and water management regime throughout the Mackenzie Valley. The MVRMA has been a world-recognized model for public-Indigenous cooperation in the management of lands, waters and other resources for more than 20 years.

For more background, we’ve provided committee members with a handout, MVRMA at a Glance, and a map of the territory. The MVRMA applies to all NWT areas except for the northernmost region, the Inuvialuit Settlement Region, which takes a different resource-management approach.

The Government of the NWT wants to ensure we have a progressive regulatory system that works for the people of the NWT, their governments and industry. Bill C-88 advances numerous modern amendments to the MVRMA that were first passed with the NWT Devolution Act in 2014, also referred to as Bill C-15. Those include the authority to direct regional studies, which can examine the effects of development at a regional scale; the authority to develop administrative monetary-penalty regulations, which can be used to promote compliance; and the establishment of development certificates. These are becoming common tools across Canada to ensure measures from environmental assessments, and impact reviews are carried out.

These important amendments never came into force due to a court injunction brought about because of another section of the Devolution Act that would have consolidated the four regional land and water boards into one larger board. Bill C-88 rightly preserves each of the regional land and water boards, and will allow the implementation of the modernizing elements.

The proposed amendments to the MVRMA in Bill C-88 will increase certainty around responsible resource development in the Northwest Territories. That certainty is something our territory needs, as we continue to work with the Indigenous governments in our territory to attract responsible resource development.

I would also like to touch on Bill C-88’s proposed changes to the Canada Petroleum Resources Act, CPRA. As you know, Canada unilaterally imposed a moratorium on new offshore oil and gas licences in 2016 without consulting Indigenous or public governments in the NWT. We were disappointed with how the moratorium was imposed; however, we also recognize that Canada must address the interests of oil and gas companies that had financial commitments attached to their exploration licences.

The amendments to the CPRA would allow Canada to freeze the terms of the existing petroleum licences in the Arctic. We, too, want to see those licences frozen so that the NWT’s offshore exploration industry doesn’t have to be rebuilt from scratch in the future.

Our current focus is moving toward co-management of the Northwest Territories’s Arctic offshore waters and resources. We recently started negotiations with Canada, the Government of Yukon and the Inuvialuit Regional Corporation on an offshore accord similar to the shared management accords that have been in place in Atlantic Canada for years. Negotiations are going well so far. The accord will ensure northerners will be decision makers on oil and gas exploration and development in our offshore, including making decisions on if, when, where and how it happens.

As a result of this progress, we expect the need for this CPRA provision — and I’m referring to the public-interest provision — to be a short-term measure, pending the successful conclusion of a Western Arctic co-management accord.

The Government of the NWT supports swift passage of Bill C-88. The implications of not proceeding with Bill C-88 within the life of this government are significant. Amendments to the MVRMA have been on the books for five years, and we don’t want any more uncertainty associated with our regulatory regime. Resource developers are contemplating investing in developing in the Northwest Territories’s rich natural resources, and everyone benefits from some regulatory certainty.

The Government of the Northwest Territories and Indigenous governments are working together to build our territorial economy. The passage of Bill C-88 and the preservation of the regional land and water boards, as committed to in land claim and self-government agreements, is an important part of this.

I would like to thank the committee for its time. I’m happy to answer any questions that might arise.

The Chair: Thank you. Mr. MacMartin, please go ahead with your presentation.

David MacMartin, Director, Intergovernmental Relations, Gwich’in Tribal Council: Thank you. Mahsi cho. I have sent a copy of my printed remarks to the committee clerk for reference by the committee members.

I’m pleased to be able to appear before your committee today. We welcome the opportunity to provide our views on Bill C-88. The GTC is seeking swift passage of this bill, as well. We stand with our Northwest Territories Indigenous government partners, the Tlicho Government and the Sahtu Secretariat Incorporated, and with the Government of the Northwest Territories, in seeking prompt passage of Bill C-88 within the life of the present Parliament.

Taking such action is a key step in following through on the commitments that have been made to us. It is an important formal step to eliminate any prospect of an amalgamated Land and Water Board in the Mackenzie Valley region. Together with our Indigenous government partners, we see Bill C-88 as an essential step needed to protect our land and water boards that were established through our modern treaties; in our case, through the Gwitch’in Comprehensive Land Claim Agreement, which was signed in 1992. As such, these land and water board elements of our treaties are protected by section 35 of the Constitution Act, 1982. Similar to the Tlicho and the Sahtu, the Gwich’in have a treaty right to co-management, including requirements in chapter 24 of the Gwich’in Comprehensive Land Claim Agreement that establishes the Gwich’in Land and Water Board.

As many of you know, the Gwich’in are North America’s northernmost First Nations people. Since time immemorial, the Gwich’in have occupied traditional territories spanning what is today the Northwest Territories, Yukon and Alaska. In 1921, the chiefs and headmen of Gwich’in in Fort McPherson and Tsiigehtchic signed Treaty 11 with representatives of the Crown. In 1992, as I indicated, we signed our modern treaty. We view these treaties as an integrated whole, establishing the foundation for the relationship between the Gwich’in Nation and the Crown in Canada.

In conjunction with the treaty in 1992, the Gwich’in Tribal Council was established to protect the Gwich’in rights and interests in the Mackenzie Valley region and beyond. Since that signing, the Gwich’in Tribal Council and our four community-level land claim organizations have been worked hard to implement it.

With respect to the specifics of Bill C-88, I will make three main points, all in relation to Part 1 of the bill, which is the part dealing with the MVRMA.

First, passage of Bill C-88 in a timely manner has great importance in terms of Gwich’in treaty rights, Crown-Indigenous relations and reconciliation, as well, more broadly. Your review of the bill is taking place within a broader context of the implementation of modern treaties in Canada. The implementation of these agreements has not been a straightforward or smooth journey for any of the parties.

Despite several recent positive steps by the Government of Canada, since the signing of our modern treaty and of Treaty 11 in 1921, Canada has lost the trust of Indigenous treaty parties at many turns. There are numerous examples of this, but certainly a clear case in point is the problematic changes that Bill C-15 attempted to bring in. These are the proposed creation of the superboard and the elimination of the land and water boards of the Gwich’in, Tlicho and Sahtu. As you know, the current government committed to eliminating these problematic Bill C-15 changes.

This is an extremely important commitment made by Canada to Indigenous governments of the Northwest Territories. It represents an important step toward restoring trust. Indeed, the consultation process on Bill C-88 has helped to restore some of that trust between the GTC and Canada. That trust would be eroded by further delay or, worse, failure to pass Bill C-88 in a timely manner.

Second, the GTC will defer to the comments of the Tlicho government for the discussion of the litigation and court injunction that was referenced by the grand chief. However, I will say that the Gwich’in Tribal Council was pleased with the result obtained by the Tlicho in court and sees Bill C-88 as a critical follow-up step. If Bill C-88 is not passed, Canada will not fulfill its commitment to the Northwest Territories Indigenous governments, which will then be forced back into time-consuming, expensive and acrimonious litigation.

All of this would adversely affect both treaty relationships with Indigenous governments of the Northwest Territories and also the ongoing process of reconciliation. Further, failure to pass the bill would generate regulatory uncertainty that would benefit no one as the architecture for project reviews in the Mackenzie Valley would remain fluid. Passing Bill C-88 is a step toward certainty in the Mackenzie Valley and that is the step we believe should be taken at this time.

Further, failure of Bill C-88 to be passed by the current Parliament could undermine the prospects for constructive engagement by Indigenous governments of the NWT in broader reviews of both the devolution provisions of the MVRMA and of the legislation more broadly. These are important reviews and swift passage of the bill can have the effect of kickstarting priority attention and collaboration by Indigenous and public governments on them.

Third, for members of the committee interested in reforms that may not be included in Bill C-88 in its present form, we would suggest that now is not the time to pursue these. Rather, now is the time to pass the important changes that are contained in Bill C-88 so that the NWT modern treaty parties can move forward beyond the threat of the superboard and the toxicity of the chance of litigation.

An opportunity for a further review of the MVRMA is in the offing. It is coming as part of the five-year post-devolution review of the legislation and as part of a previously announced broader review of the MVRMA. If members wish to consider whether changes such as an explicit reference to the United Nations Declaration on the Rights of Indigenous Peoples ought to be included, for example, then that could be part of the forthcoming review.

Similarly, this review will likely take place at a time when there is finally certainty with respect to the changes resulting from the new federal impact assessment legislation. It makes sense to revisit the MVRMA at a later time to ensure appropriate alignment between the northern and southern project assessment regimes and with those of the Yukon and Nunavut.

If you will, a release valve or parking lot of sorts exists right now for ideas that go beyond the current version of Bill C-88. Discussion about potential inclusion of those ideas in the current bill is inappropriate in our view. This would be better directed toward this future process, which we expect will be a process where Indigenous governments fully collaborate.

Thank you for the opportunity to appear before the committee. The GTC urges that you give swift passage of Bill C-88 so that this important step can take place within the life of the present Parliament. Along with my colleagues, I would be pleased to take questions on our submission members of the committee may have. Mahsi cho.

Senator Patterson: I would like to acknowledge Grand Chief Mackenzie and Ms. Zoe. Thank you for being here with us by video. I am the critic for this bill. As I told you when we met earlier, I do support the swift passage of this bill. I would like to commend you, Madam Chair, for organizing this meeting at a very busy time, where we hope to complete clause-by-clause consideration of the bill tonight and, hopefully, a third reading of the bill in what could be the last week of Parliament.

My question would be for Mr. Fulford. You referred to the strong language that your premier used in describing the moratorium. He described it as offensive, patronizing, one-sided, ill-informed and unfair to the North. But he later welcomed the decisions to partner with Yukon and Inuvialuit on a review of Beaufort drilling.

How do you feel about Part 2, the CPRA regime? Are the safeguards in place there sufficient to prevent a repeat of December 2016 and that announcement that was so resisted?

And a quick side question: Do you have a time frame for the new northern accord that you’ve described as going well?

Mr. Fulford: Thank you, Madam Chair. I thank the member for his question. I can confirm that the Government of the Northwest Territories is participating in the five-year review of the moratorium along with the Inuvialuit Regional Corporation, Yukon and Canada.

We feel that the terms of reference for that process offer us the opportunity to have a real influence over decision making in the offshore, so we feel that it is definitely an improvement.

I can also refer to the onset of the northern accord negotiations. As I indicated, so far they are proceeding quite well. Just to draw some context there, none of the East Coast offshore oil and gas regimes currently have anything like a national interest provision in their legislation. We’ve been informed and assured that we are looking at negotiating a northern accord that looks much like those East Coast offshore regimes so we would expect that our regime looks like those.

We considered the prohibition amendment in the CPRA to be a purpose-specific clause to address a problem created by the moratorium if I can be that blunt. We expect that, like in the offshore negotiations on the East Coast, the CPRA will be swept away and replaced by the new legislative regime that we negotiate together.

Thank you.

Senator Patterson: What about the time frame?

Mr. Fulford: I think it is a little bit premature to begin offering a timeline. I can tell you we have had three negotiations to date. The last one concluded last week. Due to the federal caretaker period, we will likely be downing tools for a period over the election. The territorial government is also having an election, but I think we are well positioned to pick up the tools again in January based on the framework we have negotiated for the ongoing negotiations. That gives us quite a bit of comfort.

Senator Cordy: I am from Nova Scotia and I assure you that at the Atlantic Accord is extremely important to the people of Nova Scotia and Newfoundland and Labrador.

You all talked about passing the bill with speed, but in your presentations you gave us a good indication of the importance of the bill passing quickly. We have heard in the past with legislation we’ve had that negotiations with Indigenous peoples were not always clear, but everything that I’ve heard about this bill indicates that consultations have worked and they’ve been extensive.

Grand Chief Mackenzie, can you talk about why these consultations worked and whether you feel the voices of the Indigenous peoples of the Northwest Territories were heard by the government?

Mr. Mackenzie: Thank you for the questions. My involvement with this has been for the past two years since I was elected. My legal counsel has been involved with it for more years than I have been so I would like her to answer it if you don’t mind.

Bertha Rabesca Zoe, Legal Counsel and Laws Guardian, Tlicho Government: Thank you, senators. The MVRMA consultation work started way before when it was Bill C-15. We were quite involved in — I wouldn’t really call it consultation, but we were involved in expressing a lot of concerns and we had a lot of technical meetings and, as a result, a lot of the amendments were proposed.

In the current legislation, after the litigation was stayed so that we could start working toward making amendments to the current MVRMA, that engagement to do collaborative work started a little bit later. It took a while to engage the government departments and the key people together to start working on that collaborative work. There were a lot of person-to-person meetings a lot of conference calls. We had a legal team and resource people working together with the government on the way the current bill is right now.

So it was more than consultation. It was a collaborative drafting. There were a few issues that were sticking points but, in the end, this is the product that we were able to work out with Canada.

Senator Richards: Norway, Denmark, Russia and the U.S.A. have said they will extend their continental boundaries in search of much-needed natural resources. How will these claims by these nations impact or resonate with the people of the North? Might it or will it ever impact the positive steps in this bill? I will ask Mr. Fulford if he might answer that.

Mr. Fulford: As many know, Canada applied for its extended continental shelf claim about two weeks ago.

Certainly, if activity occurs on the extended continental shelf, it would have to be regulated by something. On the East Coast offshore, Newfoundland, those areas are regulated by the Canada-Newfoundland and Labrador Offshore Petroleum Board. So potentially it offers the opportunity for more oil and gas development, if it is deemed advisable, but it is in the same region. It is the extended continental shelf that extends from the Northwest Territories, so there is at least the potential that oil and gas will be subject to the co-management regime that we are negotiating presently.

I don’t know if that answers the member’s question.

Senator Richards: I’m just wondering if that would be honoured by the Russian or Danish government, for instance?

Mr. Fulford: In response to that, I guess we don’t quite know yet. Any overlaps in the claims would need to be resolved before we know who has the exclusive authority in each area. There are, I think, a number of areas that have been triple-claimed. Perhaps up around the North Pole and Russia, along the Lomonosov Ridge, extends toward Canada’s claims. That would need to be worked out.

It is subject to a lengthy, multi-year review by the UN body that reviews the submissions.

Senator Massicotte: My question will be addressed to Mr. Fulford. In your presentation you said Canada unilaterally imposed a moratorium on new offshore oil and gas licences in 2016 without consulting Indigenous or public governments in the Northwest Territories.

You also go on to say that the amendments to the CPRA would allow Canada to freeze the terms of the existing petroleum licences in the Arctic. You said we, too, want to see those licences frozen so that the Northwest Territories offshore exploration industry doesn’t have to be rebuilt from scratch in the future. Help me out here. In other words, you have frozen those licences. You have told the companies to go home. Take your deposits and go away with it.

I presume they didn’t spend too much on exploration. How does that help you, not starting from scratch? Why do you think they will be so interested in coming back, given the way they were treated, when we imposed our will upon them? Can you help me out there?

Mr. Fulford: If I can attempt to address the member’s question there, of course, we can’t guarantee that the industry will want to come back, because this has created a lot of uncertainty. The change and the freezing of the terms of the licence at least offers the opportunity for them to come back. If the clock keeps on ticking and their licences expire, then they have to start from square one. They have to participate in a call for bids and make a work-bid commitment and start from square one. We don’t think that’s fair. And possibly that could cause claims against Canada.

I don’t want to speculate on that, but I think some referred to constructive expropriation. We don’t want that kind of uncertainty in our offshore regime. It is a fledgling regime and we want to send a signal of consistency and certainty.

The Chair: Okay, with that, I thank our witnesses. Thank you very much. We will continue then with clause by clause?

Hon. Senators: Agreed.

The Chair: Okay, colleagues, we are now at the stage where we will begin going through the bill clause by clause. I won’t go through the full speech on clause by clause, but if at any point any senator needs clarification or to know where we are in the process, please just ask me.

Is it agreed that the committee proceeds to clause-by-clause consideration of Bill C-88, An Act to amend the Mackenzie Valley Resource Management Act and the Canada Petroleum Resources Act and to make consequential amendments to other Acts?

Hon. Senators: Agreed.

The Chair: Shall the title stand postponed?

Hon. Senators: Agreed.

The Chair: Is it agreed, with leave, that the clauses are grouped by groups of ten when appropriate?

Hon. Senators: Agreed.

The Chair: Clause 1, page 1, to clause 10, page 5. Shall clauses 1 to 10 carry?

Hon. Senators: Agreed.

The Chair: Carried.

Clause 11, page 5, to clause 20, page 10?

Hon. Senators: Agreed.

The Chair: Carried.

Shall clauses 21 to 30 carry?

Hon. Senators: Agreed.

The Chair: Carried.

Shall clauses 31 to 40 carry?

Hon. Senators: Agreed.

The Chair: Carried.

Shall clauses 41 to 50 carry?

Hon. Senators: Agreed.

The Chair: Carried.

Shall clauses 51 to 60 carry?

Hon. Senators: Agreed.

The Chair: Carried.

Shall clauses 61 to 70 carry?

Hon. Senators: Agreed.

The Chair: Carried.

Shall clauses 71 to 80 carry?

Hon. Senators: Agreed.

The Chair: Carried.

Shall clauses 81 to 86 carry?

Hon. Senators: Agreed.

The Chair: Carried.

Shall the title carry?

Hon. Senators: Agreed.

The Chair: Shall the bill carry?

Hon. Senators: Agreed.

The Chair: Carried.

Does the committee wish to consider appending observations to the report?

Senator Simons: Yes.

Senator Patterson: I would like to suggest an observation but, before doing so, I would like to inform the committee that I worked closely with Senator Anderson on this proposed observation which I believe has been translated and circulated.

The Chair: Does everybody have a copy in French and in English?

Hon. Senators: Yes.

The Chair: Continue, Senator Patterson.

Senator Patterson: This addresses the concern that Senator Anderson expressed at the outset of this meeting, about consultation with rights holders in the review process that is under way toward a new regime for offshore co-management in the Beaufort Sea and elsewhere in the Arctic.

It has to do with reinforcing what the minister said in her letter and remarks to the committee, but assurances that are not expressly cited in the bill. In fact, the bill has a non-derogation clause which is in a negative format. I think Senator Simons understood that, in her remarks. At least I understood that to what Senator Simons astutely observed, that the non-derogation clause could have been stronger and in more positive terms.

This makes the Inuvialuit, whose land claim was the very first comprehensive land claim in the North — it requires us to give them assurances.

Therefore, I would like to move this proposed observation with respect to subclauses 85(1) and 85(2), and I would like to read it.

An Hon. Senator: We read it.

Senator Patterson: It has been read. Okay.

Senator Neufeld: I don’t have any problem with it.

The Chair: You have expressed your reasons. Thank you very much, Senator Patterson.

May we have the opinion of Senator Anderson?

Senator Anderson: We definitely worked together to develop this as it was an issue that was brought forward to us. We worked closely together on this observation.

The Chair: Does anyone have an opinion?

I find this observation very long. I see the purpose of paragraph 1 and paragraph 3. I don’t know exactly what the purpose of paragraph 2 is, but it sounds partisan. I see the point of the context, which is paragraph 1, and I see what the observation is, which is to strongly recommend meaningful consultation with Indigenous peoples going forward.

Senator Massicotte: I’m okay with this.

Senator Patterson: If I may respond to your comment. We did hear the witness from the non-partisan, consensus-based Northwest Territories government criticize the unilateral imposition of the moratorium. May I say that Bill C-15 — the previous legislation that this legislation is amending — also had a non-derogation clause in it at the time the unilateral announcement of a moratorium was made in December 2016.

That non-derogation clause didn’t help give the Inuvialuit or, in fact, the territorial governments that were affected by that announcement any protection at all from the right to be consulted.

I think that the second paragraph reflects what we heard in testimony. The non-derogation clause was certainly shown not to have sufficient strength when it was there in the identical words in the previous legislation. We can’t emphasize that enough.

Fortunately, that chapter is closed. Premier McLeod has expressed his satisfaction with the new approach. We are all optimistic it will work out well, but it doesn’t hurt to emphasize what got us to this point since 2016.

The Chair: Okay.

Is it agreed that the draft observation be adopted?

Hon. Senators: Agreed.

The Chair: Is it agreed that the Subcommittee on Agenda and Procedure be empowered to approve the final version of the observation, taking into consideration this meeting’s discussion, with any necessary editorial, grammatical and translation changes required?

Hon. Senators: Agreed.

Senator Neufeld: I heard what you said, but the observation will be as it is written here, correct? I just want to make sure.

The Chair: That’s correct. We may correct a mistake or —

Senator Neufeld: If it’s a typo, that’s different. I think you expanded that a little bit, so I wanted to make it clear.

The Chair: Is it agreed that I report this bill, with observations, to the Senate?

Hon. Senators: Agreed.

The Chair: Agreed. Thank you very much.

We have one last item to take care of. We have to go in camera because it concerns our last discussion that was in camera.

(The committee continued in camera.)