Proceedings of the Standing Senate Committee on
Transport and Communications
Issue No. 7 - Evidence, October 21, 2016
HALIFAX, Friday, October 21, 2016
The Standing Senate Committee on Transport and Communications met this day at
1 p.m. to study the development of a strategy to facilitate the transport of
crude oil to eastern Canadian refineries and to ports on the East and West
coasts of Canada.
Senator Michael L. MacDonald (Deputy Chair) in the chair.
The Deputy Chair: Honourable senators, this afternoon the committee is
continuing its study on the development of a strategy to facilitate the
transport of crude oil to Eastern Canadian refineries and to ports on the east
and west coasts of Canada.
I would like to introduce our first witness of this afternoon from the
Ecology Action Centre, Stephen Thomas, Energy Campaign Coordinator.
Please begin your presentation, Mr. Thomas, and afterward the senators will
Stephen Thomas, Energy Campaign Coordinator, Ecology Action Centre: I
am the Energy Campaign Coordinator at the Ecology Action Centre here in Halifax.
I would like to begin my statements in recognition and gratitude for our
presence on unceded Mi'kmaq territory in K'jipuktuk or Halifax. I wish to thank
the Chair, the Standing Committee on Transport and Communications, and all
members of the standing committee for inviting me here today to speak on behalf
of the Ecology Action Centre and its members.
Since 1971 the Ecology Action Centre or EAC has been working to build a
healthier and more sustainable Nova Scotia and Atlantic Canada. Today the EAC is
Atlantic Canada's largest environmental advocacy organization with over 5,000
members, 500 volunteers, 45 staff and seven action areas including the energy
action team which I work for.
The EAC works closely with social and natural scientists and uses detailed
policy analysis to encourage a society that respects and protects nature and
provides environmentally and economically sustainable solutions for its
The EAC and I regularly participate as intervenors in project reviews and
processes with the Nova Scotia Utility and Review Board, the National Energy
Board and environmental assessment review panels.
I note that on March 9 of this year the Senate moved to approve the
undertaking that we are here today to speak about, the study on the development
of a strategy to facilitate the transport of crude oil to Eastern Canadian
refineries and to ports on the east and west coasts of Canada.
The activities under this study will cost Canadians a total of $354,652 as
per the budget approved April 12, 2016. The EAC would like to state for clarity
that we don't necessarily feel it is the best place for the Senate to be
spending resources on developing or participating in a strategy to facilitate
the transport of crude oil to Eastern Canadian refineries or to ports on the
east and west coasts of Canada for export.
The Ecology Action Centre and our members see that this study and the
committee's focus are somewhat contradictory to a number of high profile federal
undertakings currently under way, including the pan-Canadian framework on clean
growth and climate change and particularly the National Energy Board
modernization process. Also under way is the Senate Standing Committee on
Energy, The Environment and Natural Resources study on the effects of
transitioning to a low carbon economy, the successful vote in the House of
Commons to ratify the Paris Agreement this October, Canada's future and current
greenhouse gas reduction targets under the UNFCCC INDC process and most
appropriately or most importantly I feel it might be in conflict with the
National Energy Board's independent review of the TransCanada Energy East
pipeline on this coast and the Kinder Morgan Trans Mountain pipeline on the West
Specifically we feel strongly that it is not necessarily the place of the
federal government to facilitate a social licence for pipelines or any other
project. We feel that social licence can only come from communities and that
they must have the opportunity to accept or deny that licence through a fair,
thorough regulatory process. These regulatory processes must have room for
communities and stakeholders to choose and to deny social licence on their
At a time when the federal government is undertaking extensive consultation
with provinces, territories, First Nations, scientists and many stakeholders
across Canada on these issues, we feel that this Senate committee's work on this
study is in bad faith and a contradictory use of resources for the federal
I certainly am not blind to the reality that lies before us and to the
challenges that an ambitious, just transition to a decarbonized economy pose for
Canadian society. However I believe that this is a moment and this moment
provides us an opportunity for imagination, for research and for vision.
I believe Canadians and Atlantic Canadians in particular have much to
celebrate in terms of the steps that we have made to reduce emissions, to work
together to reimagine our economies, and to ensure that we have vibrant, healthy
communities for our grandchildren to inherit.
Across Canada we also have strong treaties that provide Aboriginal peoples
clear voice and consultative processes in acquiring free, prior and informed
consent. I feel that the focus of the Senate committee's study compromises that
past success, undermines important consultative processes with Aboriginal
peoples and somewhat limits the imagination.
I would love to live in a Canada where the Senate is undertaking studies on
supporting Canadians and Aboriginal peoples through the justice based transition
to a decarbonized economy. I recognize that in the earlier session this morning
the Mi'kmaq of Nova Scotia, in particular KMK and Sipekne'katik were here to
give their views. I support the standing committee in making every effort to
consult with the Mi'kmaq of Nova Scotia when considering issues that affect
their traditional lands, waters and livelihoods.
I have a number of supporting documents with me here today which I am happy
to reference and share with the committee electronically or in person. I am open
to hearing questions and responses from the committee and participants here
today. I am happy to engage in further discussion in this topic after today's
session is complete on the specific questions laid out in the study that the
Senate is currently undertaking.
This concludes my opening statement. Thank you for your opportunity and thank
you for your time.
Senator Mercer: It is usually at this point that I thank the witness
for being here, but I am not sure why you are here now that you have told us you
don't think we should be spending the money. You don't think we should be doing
the study but you are here to say this.
You don't understand the difference between the National Energy Board and the
Parliament of Canada. The National Energy Board has a specific role. The
Parliament of Canada and either the House of Commons or the Senate committees
can study certain subjects that they want on behalf of their constituents and on
behalf of Canadians.
I don't understand you. This makes absolutely no sense to me. You say that
the federal government has no place in helping to facilitate social licence for
private enterprise. Then maybe we should just close the place down. This could
be the best recommendation. We will close Parliament. Note: no taxes, as it is.
However you will have no donors to the Ecology Action Centre because guess what?
Everybody will be unemployed. Let's get real here.
The job of the Government of Canada, collectively the House of Commons and
the Senate, is to make sure the country runs smoothly. How do you expect the
country to run smoothly if we abandon the one particular industry that for the
past few years has been driving the economy of this country? That is the gas and
oil sector. How do you expect that to happen? How do you expect the people to be
working? How do you expect your donors to have any money to give you if the gas
and oil sector were to come to a screaming halt tomorrow?
Mr. Thomas: Thank you for the question. If I understand it, you are
asking for me to explain what other opportunities in our economy exist other
than the oil and gas sector for employment.
Senator Mercer: No, that isn't what I asked at all. We understand that
there are all kinds of other opportunities. We also understand that it would be
better if we were moving away from the carbon sector.
However that is not happening tomorrow. It is not going to happen today. It
is not going to happen tomorrow. But between now and the time we find better
ways of doing things this is where we are at. Isn't it the job of the Government
of Canada to maximize a positive economic situation for its citizens? Isn't that
what our job is?
Mr. Thomas: Absolutely.
Senator Mercer: Thank you very much.
Mr. Thomas: What I am suggesting is not that we shut down the oil and
gas sector certainly in Alberta or here on the East Coast today or tomorrow, but
the scale of development that is often talked about in these proceedings and
that is talked about at the National Energy Board with the two pipelines that I
mentioned, Energy East and the Kinder Morgan Trans Mountain pipeline, we are
talking about infrastructure that locks us into that way of meeting our energy
needs and that way of depending on that industry in our economy for 30, 40 or 50
years. It is my view that timescale is too long and too large.
I couldn't agree more and I tried to make that clear in my statement that I
am not blind to how difficult the path before us is. It necessitates vision and
research and working together to imagine a different way of having our economy
run. With all of the other processes that are going on, with all of the talk at
the federal government for taking the issue of the climate crisis seriously and
with the adoption of the Paris Agreement, I don't see that the federal
government and in this case the Senate committee spending resources trying to
facilitate or in some way augment or manufacture social licence or consent for
fossil fuel projects, and in this case oil transport by pipeline or rail.
I don't see those two things existing in the same world or existing in the
same Canada that we are heading toward. That is what I was intending to flag
with my statements and the conversation that I would love to have.
Senator Mercer: In our terms of reference we are talking about finding
a way to get the product to tidewater and we are discussing pipelines. We
haven't spent much time talking about rail other than in referencing it as
probably not a great idea after Lac-Mégantic. You think we are locked in for 30,
40 or 50 years. I don't know that 30, 40 or 50 years will be enough time because
the development of alternates has not happened as quickly as we would like. We
are all in favour of alternatives, but we are here and we are now. The world is
dependent on gas and oil.
We have the third largest reserves of gas and oil in the world. Should we not
capitalize on that to employ Canadians, to bring wealth to Canada, and to bring
wealth to Alberta and Saskatchewan so that they can pay equalization payments so
that those of us who live here in Nova Scotia can have good quality health care,
can have good education, can have good highways to drive on, can have good
public transit, or whatever else you might want to think of that we have an
abundance of in Nova Scotia?
Mr. Thomas: Thank you again. I think I don't disagree with you on
those points. I think I enjoy the social services that exist for Canadian
citizens and I think that we should continue to provide them. I think that what
perhaps I am trying to present here today is for us to have a bit more
imagination than to say that the oil and gas sector is the only or the largest
or a major way of us providing that for Canadians.
I think the moment that I was speaking about in my opening statement is the
moment that we are in, in terms of the climate crisis, and in terms of our
understanding of the signing of the Paris Agreement and the proceedings that led
up to it in the first Conference of Parties 21 at the UNFCCC.
You asked very clearly that Canada has the third largest oil reserves. Is
what I am saying that we shouldn't exploit them fully or we shouldn't develop
those resources fully? That is what I am saying, that we should not develop
those resources fully.
Senator Mercer: What is the alternative? Let's say we said, "Stephen,
that is a good idea.'' We will call up the Premier of Alberta tomorrow and the
Premier of Saskatchewan and say, "Close her down. We are getting out of the
What is the alternative? What do we do? I don't think we are going to find
anyone that is going to disagree with you that moving to an alternative energy
that does not pollute and does not cause global warming isn't a good thing. We
all agree with that, but it is not happening tomorrow.
You continue to support the benefits we have here in Nova Scotia. I am a Nova
Scotia resident, but you don't tell me how we are going to pay for them if we
shut down the gas and oil sector. How do we pay for this? How do we pay for the
wonderful lifestyle we have in this province if it wasn't for gas and oil?
Mr. Thomas: For clarity, I am not coming here with a plan for our
economy. I am not coming here with my own one, two, three step plan for getting
there. What I am asking the Senate committee to consider is other ways of
getting there than oil and gas development.
As you would have heard in my opening statement, I question whether or not
the resources that are being spent in this study are the most opportune or the
most wise use of those resources when we have a renewable electricity and a
renewable energy sector in Canada that is growing and could use support and
could use a study for how best we transition to that low carbon economy. That is
what I meant. We need to come together and have discussions about that instead
of having discussions about how to further develop existing oil and gas
Senator Mercer: I was just going to actually refer to you because you
do sit on the energy committee.
The Deputy Chair: I am on the energy committee and right now we are
studying the transition to a low carbon economy. That is in progress.
Senator Mercer: Amazingly we are capable of doing two things at once.
The Deputy Chair: Two things at one time, yes.
Senator Mercer: Imagine.
Senator Greene: I am not sure if I want to ask any questions actually.
First of all I was also taken aback by your presentation. You are obviously an
idealist and that is great, but what you presented is not practical for the
immediate future. I certainly share Senator Mercer's sense of outrage. Maybe
outrage is a little strong.
Senator Mercer: It is strong.
Senator Greene: It is strong, yes. He didn't present it in a strong
way but his questioning had a flavour of that and I share that also. However I
will ask you a couple of questions and one is a basic one. What is a social
licence? What is that? Where can I apply for one?
Mr. Thomas: Thank you for the question. I think that is at the crux of
what the disagreement is here today. Although I wanted to be honest in my
opening statement and I wanted to present how the Ecology Action Centre and I
feel on this issue, I didn't intend to disrespect the committee. I did want to
be honest and did want to provide a point of view that perhaps is different than
the impetus for this study.
What is social licence and how does apply for one or how does a government
facilitate getting social licence?
Senator Greene: Yes, and how do you know you have one when you have
Mr. Thomas: I think you know when you don't have one. I think in a
case of the Energy East pipeline it is clear that perhaps that is not being
I think social licence comes from communities. It comes from municipalities.
It comes from sectors of Canadian society. It comes from Aboriginal peoples,
from individual nations within Canada. I think through regulatory and
consultative processes the communities grant social licence if those communities
have the opportunity to participate in those processes, have the opportunity to
understand the project and to understand the way of developing Canada's economy,
and have the opportunity to make a decision.
Senator Greene: How do you know when a community is granting? Is there
a vote taken?
Mr. Thomas: I am sure that it is different in every community. I think
that in the case of the Assembly of First Nations in Quebec and Labrador that
has unanimously come out against the Energy East pipeline, in the case of 300
Quebec municipalities including Montreal that have come out against the Energy
East pipeline and in the case of the fishers and the coastal industries along
the Bay of Fundy in Nova Scotia have come out against the pipeline, I think you
are beginning to see a picture painted about how that social licence perhaps
does not exist. It certainly doesn't exist along all segments of this
4,600-kilometre pipeline in the case of Energy East.
I would agree with the Senate and the National Energy Board that it is
difficult to understand exactly. Perhaps that is not true. When given the
opportunity it is clear consent is being given and when given the opportunity it
is clear when consent is not being given. I think social licence and consent are
tied together very closely.
When I speak of strong robust regulatory processes at the National Energy
Board or through environmental assessment processes, being given that
opportunity for communities, municipalities and First Nations to provide consent
or withhold consent is important in those processes.
Senator Greene: You said that social licence and consent are tied
together but they are not the same. Is that what you are saying? They are not
the same. Are they the same?
Mr. Thomas: I don't know. In how social licence is talked about with
this government and with this study I think they are tied very closely with
consent and could be considered the same thing.
Senator Greene: Because social licence is so difficult to quantify is
it a useful term?
Mr. Thomas: I think it paints a picture. I think it is a useful term.
In general it paints a picture about whether or not Canadian society generally
gives licence for projects, developments and ways of developing our economy. It
is a useful term. I think that consent is a more useful term.
Senator Greene: In what way?
Mr. Thomas: Because it is more clear, because it gives the
communities, municipalities and First Nations a voice.
Senator Greene: Then why don't we use the word consent instead of
Mr. Thomas: I think that would be a good idea. I think you could ask
communities, ask First Nations, ask municipalities, and that would be a more
straightforward way of going about the process.
Senator Greene: I agree with that.
Mr. Thomas: Thank you.
Senator Boisvenu: On your website, you state that you are the
spokesperson for Nova Scotians when it comes to the environment. Is that
Mr. Thomas: Thank you for the question. If I understand it correctly,
I do not consider myself the spokesperson on the environment for Nova Scotia. I
am only here today representing the Ecology Action Centre and its members.
Senator Boisvenu: However, on your website, it clearly says: Ecology
Action Centre. That's you, isn't it, the spokesperson for Nova Scotians on the
environment? Does that mean that the position you express today represents the
position of all of those who work in the environmental area in your province?
Mr. Thomas: No. I am confused about where you are getting that I am
claiming to be a spokesperson for all Nova Scotians or all folks who care about
the environment in Nova Scotia. I don't pretend to represent all people or all
views in Nova Scotia. I am only here and can only be here as Stephen Thomas from
the Ecology Action Centre.
Senator Boisvenu: I am trying to understand. Your position makes me
very confused. Are you speaking on your own behalf or on behalf of your
Mr. Thomas: I am here on behalf of my group, the Ecology Action
Senator Boisvenu: I'll reformulate my question. If you are speaking on
behalf of your group, and your group claims to be the organization that speaks
for Nova Scotians on the environment, does that mean that your position reflects
the position of all those who work in the environmental area in your province?
That is what your website tells us. I am simply trying to understand, because we
heard another environmental group in another province, and on its website, there
were statements that were false. That does not help us very much to have a
dialogue with environmental groups.
This morning we welcomed Aboriginal groups, people who have very legitimate
claims, and who are rather open in discussing the file. With environmental
groups, my approach has always been based on sustainable development.
Sustainable development means economic development that is not unbridled, but
takes into account the concerns of environmental groups. I understand that your
group positions itself elsewhere, by stating that it is against all types of
development. Is that correct?
Mr. Thomas: No, and I apologize for being confused about from where
exactly you are getting those statements or that idea. Again the Ecology Action
Centre and I do not feel as if the way to get ourselves out of the trajectory
toward the climate crisis is to shut down oil and gas development or all
extraction today or tomorrow.
What I am concerned about is not seeing a plan to phase it out or have a
managed decline of those industries at all. What I see are plans like the ones
being proposed here today that facilitate further expansion of those industries
and resources. That is the point that I don't agree with.
I think we have industries that we need to support and certainly workers in
those industries that we need to pay a lot of attention to in supporting as we
transition to a low carbon economy.
Senator Boisvenu: Mr. Thomas, do you follow the development of the
electric automobile industry, among others?
Mr. Thomas: Yes, I am.
Senator Boisvenu: So we know that that type of completely electric
automobile is the vehicle of the future. The chair said it earlier; we are
currently doing a study on the transition from gas-powered vehicles to electric
vehicles. However, to be realistic, we know that that transition will not happen
in the short term. It will take one or two decades. Currently less than 1 per
cent of the energy people use is what we call green energy, that is to say wind,
solar or electric energy. But electricity has an impact on the environment.
Quebec developed a lot of rivers and this had an impact on the environment.
To the extent that this transition has begun, is it possible that groups like
yours, whose positions I would describe as radical, may adopt a sustainable
development approach, while being aware that oil and gas energy may be used to
develop new energies, but also to improve conditions for certain communities?
This is the example we heard this morning with the Aboriginal groups, who feel
this can represent an interesting tool for social development that could allow
them to have access to new energy, which will be considerably more expensive
than conventional energy. Do we agree on that? A gas-powered vehicle today costs
between $10,000 and $15,000. The electric car costs $100,000. So if your group
states that tomorrow morning it wants us to put an end to the use of oil, this
will prevent part of society from having access to new energies, because of the
costs associated with it today. You are aware of that? You are going to create
social inequity between the haves, who will have access to that more costly
energy, and the have-nots who will not have access to it. So you are condemning
people like Aboriginal groups with whom we talked this morning to greater
Mr. Thomas: Wow, I intend to answer the question with respect, but I
think you are putting an awful lot of words in my mouth here today and I think
it is difficult for me to know where to begin here.
First of all, nothing of what I have said condemns Aboriginal peoples or any
sector of Canadian society to lower standards of living. I don't intend to say
that and I feel I never have said that.
Senator Boisvenu: That is not what I said.
Mr. Thomas: Pardon me, if it was translation.
Senator Boisvenu: What I said was that by neglecting the use of
conventional resources now, such as energy —
Mr. Thomas: I am not insisting on an immediate end.
Senator Boisvenu: In that case, I apologize. I thought that was what I
Mr. Thomas: Pardon me. It must have been a mistake in perhaps my words
or the translation. I do not intend to suggest an immediate end to oil and gas
resources. I understand and I support a measured, controlled and supported
decline over time of oil and gas and extraction resources in a way that in fact
supports First Nations and low income Canadians first in our considerations of
how we are moving toward that low carbon economy.
Senator Boisvenu: I am grateful for the nuance. Thank you.
Mr. Thomas: My apologies.
The Deputy Chair: I have a few questions for you, Mr. Thomas.
Refineries in Eastern Canada are presently fed by rail and ship bottoms, ships
bringing in crude from places like Saudi Arabia. All the ships that go through
to New Brunswick or to Quebec come through Nova Scotia's water. A pipeline of
course would replace or give us the opportunity to replace all this imported oil
with domestic oil and with a safer delivery system.
These refineries are still operating. They are not going to be shutting down
in the next 5, 10, 15 or 20 years. I am just curious. Why do you think it is a
better idea for us to bring oil in through our water from other countries and to
bring it in by rail from other countries like the United States when we could
provide a safer, more reliableand probably less expensive source domestically?
You have to accept the premise or the fact that oil is getting there now
through conventional means. Whether it is the highway, by rail or through ships,
it is not going to stop. The lack of a pipeline is not going to stop oil from
getting to these facilities. What is your rationale?
Mr. Thomas: Again, for clarity, my biggest concern here is not the use
today of oil and gas or even coal resources and fossil fuels. It is the
continued and expanded use of those resources past what science tells us is the
safe limit, what science tells us is our fair share of that safe limit.
The Deputy Chair: With respect, that is not the issue here. These
refineries are receiving petroleum anyway. We are looking for a solution, a
safer, more reliable and less expensive solution, which would create more wealth
in this country that would be used to help communities and to help people. The
oil is going to get to these refineries any way. It is getting there now.
Mr. Thomas: Right.
The Deputy Chair: Why would you deny the country a better, more
efficient, more cost efficient, safer and cleaner way of getting petroleum to
Mr. Thomas: If there were a project being proposed to bring Canadian
crude oil to Canadian refineries, especially here on the East Coast of Canada, I
would be in a position to discuss that project.
The Deputy Chair: That is what it is. That is what the project is.
Mr. Thomas: Speaking specifically about the Energy East pipeline,
greater than 80 per cent of the diluted bitumen in that pipeline is for export
raw through the Bay of Fundy. That is my issue. My issue is that 1.1 million
barrels a day will facilitate the expansion through what I think is the unsafe
limit of the Alberta oil sands.
The Deputy Chair: Now we are getting somewhere. One of my
disappointments today with your being here is not your political rant at the
start of this. We hear lots of political rants in Ottawa. I can live with that,
but I am a Conservative and one of those people who are willing to listen to the
Ecology Action Centre because I think they do some good work.
Mr. Thomas: Thank you.
The Deputy Chair: I was hoping to hear a constructive analysis of the
handling of bitumen in the Bay of Fundy and through pipelines. I was hoping that
we could get some sort of a broad assessment of the impact of this from the
Ecology Action Centre today, but you did nothing of that. You gave us nothing to
digest or to discuss.
I think it is a missed opportunity for you, a really missed opportunity,
because we are willing to listen to reasonable, well-backed arguments. You
didn't go near this at all. In fact it wasn't even on your radar screen.
You talk about helping low income people. Do you know in Ontario they spent a
fortune transitioning from coal- fired plants to gas? They didn't build their
gas plants. They subsidized solar and wind power. Now the Auditor General of
Ontario said that the consumer in Ontario has spent $38 billion more than they
had to for their power and people are going into energy poverty.
What people are doing, people in low income, is that they are going off the
grid and burning coal instead of using electricity to heat their homes. How is
that a good idea? Why does that work? Is that what you want to see happen? This
is going on. Low income people are being pushed into energy poverty. It is
happening all over Europe. Germany, the forerunner of clean energy, is now
reopening its coal-fired plants because the wind power and the solar power can't
meet with demand during the peak hours. There are huge issues. You just can't
blind yourself to them.
Again, I don't mind your taking a hard political stance on something, but I
really wish that you had used the great opportunity to come here to lay out the
science-based arguments you have for us. You didn't take the opportunity to do
that today. I find that very disappointing as a committee member and as a Nova
Scotian, quite frankly. We have a lot of oil going through our water. I wanted
to hear the Ecology Action Centre's opinion on it and you gave us nothing to
Do you disagree or agree with that? I mean you didn't give us anything to
work with. You finally touched upon the Bay of Fundy and the bitumen going in
the Bay of Fundy after our prodding you and prodding you.
Mr. Thomas: I don't remember being asked a question about the Bay of
Fundy until right now. I am happy to speak about it.
The Deputy Chair: Well, please.
Senator Mercer: You talked about the pipeline coming to Saint John,
New Brunswick, and then being exported.
Mr. Thomas: Yes.
Senator Mercer: Currently the only item on the public's agenda, not on
the committee's agenda, is the export of the bitumen through the Bay of Fundy.
If we have to follow every gallon of bitumen from Fort McMurray to the shoreline
of the Bay of Fundy for you then we will have to do that, but it is logical that
is what was going to happen.
The Deputy Chair: We are trying to be transparent here. We are trying
to invite people to the table. If we were afraid to speak to the Ecology Action
Centre we wouldn't have invited you here today. In fact I was one of the people
that made sure you were invited, but you squander your opportunity to make a
We listen to people say we want to use all kinds of nebulous arguments
because basically we want to leave the oil in the ground. We hear that all the
time, using things like social licence or different arguments. The oil is coming
in anyway. If it doesn't go by pipeline, it is going to come by ship, it is
going to come by rail or it is going to come by truck. Right now there is
nothing to stop people from moving this oil with those three methods into this
country across the provinces. That is the fact.
Mr. Thomas: Again, if there were a project on the table with Canadian
resources to Canadian refineries for Canadian consumption I would be willing to
discuss that. I don't think that the Energy East pipeline is that project. I
think primarily it is an export pipeline and that is one of the biggest things
of my concern. The size of the project and its 1.1 million barrels per day
capacity I feel facilitate the expansion of our oil and gas resources past safe
I am happy to provide the IPCC AR5 report outlining a sort of carbon budget,
so to speak. The levels of carbon dioxide that we can continue to put into the
atmosphere before we as a global community blow past—
The Deputy Chair: That is not for the transport committee.
Mr. Thomas: I think you should consider it. I think you should
consider the other processes that are taking place.
The Deputy Chair: No. We have the energy committee to consider those
things. The transport committee does not consider those things. That is not our
mandate. It is like my asking you about considering the price of eggs in this
country. It is not the mandate of the Ecology Action Centre. It is not your
mandate and it is not ours.
You were invited here today to speak to the issues directly of transportation
of this crude through pipelines and through water. That is what we were hoping
to hear some informed opinion on.
Mr. Thomas: Right. I do consider my opinion informed and I do consider
my opinion informed by science.
The Deputy Chair: We have to know it. You have to give us information,
Mr. Thomas: Great.
The Deputy Chair: Instead of giving us a political statement we need
an environmental and ecological information assessment.
Mr. Thomas: Perhaps one of the frustrations here in the room is that I
consider this conversation, the frame of this conversation, very limited in the
frame of we are going to expand oil and gas resources; we are going to expand
the Alberta oil sands; and in the frame and conversation that we as the Senate
of Canada are going to facilitate.
The Deputy Chair: Again we are not saying any of that. You are putting
words into our mouths. We are not saying that. We are not saying we are going to
We are talking about petroleum coming east to our refineries. All this
petroleum is coming into the country anyway through ship bottoms and through
rail. It is not going to stop the usage. Stopping the oil sands from moving
petroleum is not going to stop the movement of petroleum in the country or the
importation of petroleum. It is still going to come in. Apparently it is okay to
burn Saudi Arabia's oil but not good enough to burn our own. That is the
position you put the country in.
Mr. Thomas: Senator MacDonald, I count that as the eighth time here
today that I have had words put in my mouth and I don't appreciate that. Perhaps
I should apologize for starting on the wrong foot. I don't know what to say.
I agree with you that the conversation really isn't constructive at this
point. I would like to continue it but I don't appreciate your saying that I
support the import of oil from anywhere.
The Deputy Chair: You have to begin in good faith. When you come to
the table you have to come to the table in good faith. We were accepting you
here in good faith. I was really keen to hear what you had to say about the
management of the bitumen going through pipelines, through communities and in
the water. We were very interested in hearing what the Ecology Action Centre had
to say. That is all.
Senator Mercer: I would like to put a straightforward question to you.
We are importing oil from Saudi Arabia and from some countries in Africa. I
don't think we import much from Venezuela any more, but we do from Nigeria and
other places around the world. We are doing that now.
Part of the job of the Energy East pipeline is to replace those imports.
Let's just talk about that for a moment. Is that a good thing?
Mr. Thomas: I think it is dangerous to talk about the Energy East
pipeline as a pipeline that is for Canadians and for Canadian resources. I think
that most of the bitumen in that pipeline is for export. Again I think that if
there were a project on the table that were about using Canadian resources here
I would be in a position to talk about it. I would be in a position to in some
worlds support it depending on what is happening.
Senator Mercer: We agree that we are importing gas and oil from other
Mr. Thomas: That's right, certainly.
Senator Mercer: Certainly.
Mr. Thomas: And I agree that—
Senator Mercer: Is it a good idea that we stop doing that and replace
it with a Canadian product?
Mr. Thomas: I think you won't be surprised that I have some conditions
to my response, but I think that the use of Canadian oil in Canadian refineries
can be a good thing. I think that it can be a good thing if it doesn't
facilitate the further expansion and further dependence on those resources.
I think what I have tried to make clear is that I think we need to be headed
toward a managed decline of the use of those resources. I appreciate and accept
the reality that we use these resources now and depend on these resources now.
We have a huge part of our economy that does and a huge number of Canadians who
are employed in it.
In the interim until we get to that decarbonized economy using Canadian
resources is a good idea. Using Canadian resources depending on the project is
something that we would be in the position to talk about.
I think that I don't see a project being proposed here yet that does quite
that without setting off those other red flags in my analysis in terms of that
further expansion and dependence on the resource.
Senator Mercer: You are a young man. I will not see this day but you
may live to see the day when we move away from a carbon based economy. You will
also see the day of massive unemployment in Alberta and massive unemployment in
Saskatchewan where you as a taxpayer in Nova Scotia will be called upon to pay
taxes so that there will be equalization payments going from Nova Scotia to
Alberta for support.
We all want to diversify. We all want to make sure that Canadians are
prosperous, but we can't do it in isolation of what is going on in the world.
Yes, we want to get to the next level. At the same time we have great resources
in this country that the world wants to buy. Yes, some of them are not the most
known. We produce uranium too. We all know what uranium can be used for but we
still mine it.
Our frustration is that we are not against where you want to go. I think we
are just confused as to how you want to get us there so quickly and what happens
in the interim. How does the government respond to the massive unemployment and
the massive poverty that will result from getting to the point the Ecology
Action Centre would like to get to as quickly as the Ecology Action Centre wants
to get there?
If we do, we are in big trouble. If we go that way, we are in big, big
The Deputy Chair: Mr. Thomas, I want to thank you for your time today.
We appreciate your taking the time to come and meet us and talk to us.
Honourable senators, I wish now to welcome the Honourable Michael Samson, a
friend of mine and Minister of Energy, as our next witness. I have to confess I
have never voted for Michel but then he is not in my riding. We will have to see
how his campaign is. He is accompanied by Kim Himmelman, Director of Regulatory
and Strategic Policy. Mr. Minister, please make your opening statement and then
the senators will have some questions for you.
Hon. Michel P. Samson, Minister of Energy, Nova Scotia Department of
Energy: Thank you very much, Senator MacDonald. With the last riding
redistribution I am getting closer to your hometown all the time. Now I am
making my way down to East Bay and all the way down to Huntington on the Grand
Members of the committee, thank you sincerely for the opportunity to meet
with you to discuss an issue of national and local importance. I am very pleased
to have Kim Himmelman, Director of Regulatory and Strategic Policy from the
Department of Energy; Michelle Perry, Director of Communications; and Adam
Langer, Executive Assistant, are joining us here as well.
I know that you are studying the transport of crude oil by pipelines,
including how to share risks and profits in an equitable way.
I believe I can best speak to the transportation of crude to Eastern Canadian
points and refineries. However I hope you will find my comments useful in the
Crude oil plays a significant role in our everyday lives. It is used in the
production of the electricity that lights our homes. It helps make the products
we rely on. It allows us to travel and trade goods freely. It keeps our homes
warm in the cold Canadian winters. Crude oil is ubiquitous in the lives of most
My province is leading Canada in making the switch to more renewable energy
sources. Nova Scotia is the national leader in greenhouse gas reductions.
Already we have reduced our total emissions by almost 30 per cent from 2005
We are currently national leaders in matters of efficiency, renewable energy
and reducing greenhouse gases emissions.
We are committed to continuing to do our part to ensure renewable that energy
sources have an increasingly central role in our energy mix. We also live in a
world where the overall demand for energy continues to grow. Today, oil is the
world's leading fuel, accounting for about 33 per cent of consumption. By 2040
demand is expected to rise by around 32 per cent. As a result the need for crude
oil as well as renewable energy will continue to climb.
Canada is one of a few countries with the resource capacity to help meet that
demand. In addition to contributing to an improved outlook for our region wealth
created from the responsible use of our nation's natural resources could help us
make important investments in the infrastructure we and other provinces need to
continue our transformation to a low carbon future.
Today my province can only meet its domestic oil needs in one way. Nova
Scotia does not have pipeline infrastructure. All our crude comes via the ocean
and tanker ships. As such we are subject to world oil prices. After 95 years in
operation in 2014 the Imperial Oil refinery in Dartmouth stopped processing.
For over 10 years, Nova Scotia has counted on a regional refinery, in Saint
John, New Brunswick, which does present challenges regarding safety and supply.
The closure meant inventories for our province were much lower. On the Labour
Day weekend in 2015 local crude supply ran so low that Nova Scotia gas stations
and residents ran out for several days.
After an absence of more than 10 years Irving is reactivating its marine
terminal and fuel storage facility. New pipelines are being installed so
petroleum brought in by ship can flow to tanks until it is needed. The official
opening took place yesterday in Woodside. This is expected to improve the supply
chain for petroleum products in Nova Scotia although it is unclear if it will
eliminate all future disruptions.
NuStar Terminals in Point Tupper, my home riding, provides petroleum storage
and can load and offload tankers. NuStar has an excellent safety record for
bringing in oil and taking it out without any significant incidents. In fact
from my home in Arichat, Isle Madame, I can see tankers pretty much on a daily
basis just outside the harbour.
Nova Scotia has been clear about our position on pipelines. We have vocally
supported Energy East despite the fact that it would end in Saint John. We see
it as nation building and good for the economic health of our region and
country. We believe in the importance of regional co-operation particularly in
the energy sector.
The Maritime Link will be the largest addition to Canada's national grid in a
decade. It will connect Nova Scotia to energy from Muskrat Falls, Newfoundland
and Labrador, give us access to more renewables, help us further cut greenhouse
gas emissions and stabilize electricity costs. The project will create a new
transmission loop through Atlantic Canada and New England and with it new import
and export opportunities. It is an excellent example of how regional
co-operation in this sector can produce benefits for all.
We would also welcome pipelines to Nova Scotia.
We would be happy to see investments to extend that infrastructure to the
Strait of Canso, in Nova Scotia.
We believe crude can be safely transported and that stringent regulations are
in place to ensure Canadians and their environment are well protected. Nustar's
record is an example of this. The world market needs the resources Canada has
and Nova Scotia's access to tidewater is a phenomenal opportunity to facilitate
export. We consider our ocean access a natural and comparative economic
advantage. We also recognize our domestic market is relatively small. Increased
exports must be a considerable part of building a more vibrant future for all
In this regard, we have some important advantages. Nova Scotia has ice-free
ports that are the furthest north on the North American east coast, and we are
able to load Canadian crude on large oil tankers there for export. Our proximity
to the markets of northwest Europe, eastern South America and western Asia is
useful from a strategic standpoint.
Up to this point my comments have focused on moving oil west to east. I would
also like to bring to the committee's attention the strategic opportunity to
move not only western Canadian sedimentary basin oil but natural gas as well to
Eastern Canada in amounts far greater than what we currently receive today.
Nova Scotia has three proposed liquefied natural gas export projects. All are
making very good progress in the regulatory approvals. If only one goes ahead it
would require 800 million cubic feet of natural gas each and every day. This
could be sourced from Western Canada. This new liquefied natural gas is needed
and could provide cleaner energy sources for Atlantic Canada and the rest of the
In addition to bringing much needed employment opportunities to our region it
would also help the Alberta oil and gas industry recover. Access to pipeline oil
and gas would bring significant economic development opportunities from pipeline
construction and maintenance to the operation of export terminals, to the
servicing of vessels.
The new jobs and wealth generated from developing Nova Scotia's export
capacity could be transformative. It could also help Canadian producers fetch a
better price for their product. The increased energy security would help ensure
shortages like those in 2015 remain isolated incidents.
In exploring this issue I strongly encourage the committee to consider not
only oil but natural gas as well. It is an economic driver and it provides
reliable backup energy for renewable sources.
The support of Canadians to safely transport our resources is very important.
Good regulatory processes informed by science that balance the values of our
society, including respect for our environment, a desire for meaningful work and
economic vibrancy, are critical.
The public cannot be expected to support projects when they have not been
told what they entail or how our responsibilities to the environment and each
other will be addressed. They need information on the context in which they are
being asked to form opinions. The benefits they bring to workers, communities
and our country should be readily shared. Canadians want development to be done
in a way that respects the rights of those affected and ensures that the
environment, our lands and waters are protected. The strong regulatory processes
and enforcement that ensure this takes place must be known. More awareness that
Canada sets the global industry standard for best practices in regulation would
be helpful and those that do not follow our standards need to be held to
A relationship among industry, government and the people must be built with
each party not only saying but doing the right thing. The proof as they say is
in the pudding. Words and actions must be aligned. While we may not always agree
on the action we can trust that the laws of our land and our moral and social
responsibilities are upheld.
Responsibility for this work is shared equally among governments at all
levels, industry and related organizations. It is not an effort that has a clear
beginning or end. The impacts of natural resource projects in our country have
far- reaching effects. When one project fails in this regard it paints all with
the same brush and breaks the trust.
Consistency is essential, and so it is important for this industry and other
Canadian industries to adopt and apply the best practices to engage the
In terms of public confidence in the federal pipeline environmental
assessment process increasing its accessibility would help. Accessibility is
about more than transparency. It is about presenting the information in a way
that allows quick and easy access to key points in a world filled with infinite
information. Educational initiatives, comprehensive consultations and awareness
of the benefits will help the public reach an informed decision.
In order to move this important file forward, we have to collaborate and show
flexibility. All of the Canadians who are affected must also participate
All governments in Canada have an interest in economic growth in a way that
balances stewardship of our environment and the needs of the people we are
privileged to serve. There is a need to bring the provinces together to discuss
shared and regional concerns and to develop solutions that pave the way forward.
There is also a need to define the ways in which all provinces would benefit.
How that manifests may be different but equal.
The benefits to First Nations must in our eyes be a priority. A fresh look at
mitigation of environmental concerns on land and at sea is mission critical. An
opportunity to engage in a national discussion based on evidence would be
created should we move toward something akin to a national strategy.
Thank you again for having given us this opportunity to meet with you.
I now welcome questions from senators on this matter of clear importance to
Senator Mercer: First of all, minister, we appreciate your being here.
Prior to the start of the meeting we mentioned that we did spend a few moments
in your riding yesterday. As always it was a pleasure to be there as beautiful
as it always is especially in the fall with the trees ablaze with colour.
Anyway, you mentioned some interaction that you had with TransCanada. I am
interested in that. One of my criticisms on this committee and in this study has
been of TransCanada's late arrival at the table in talking to Canadians to seek
their approval and their interest in allowing the pipeline to go ahead. What was
your reaction from your meetings with TransCanada?
Mr. Samson: Thank you for that question. Basically the Government of
Nova Scotia in support of the NuStar terminal made the proposal to TransCanada,
which I delivered personally, that any excess refining capacity in Saint John
should be sent directly to the NuStar terminal for storage and shippage from
that facility in light of its long history in this industry and its strong
environment and safety record. We saw it as an opportunity for Nova Scotia to be
participating in this project as well.
It was made clear at that point in time that the business case being put
forward would see the pipeline end in Saint John. Any excess refining capacity
would be dealt with by the construction of new tanks over in Saint John to be
able to handle that prior to shipping out the excess.
Obviously our intent as a province was to put that proposal forward. At the
end of the day we respect that there is a business decision to be made. When we
left there the door wasn't closed but for the time being it was not part of the
business case being put forward by TransCanada.
I also have had the opportunity to raise this concept with my colleague, the
Alberta Minister of Energy to make sure she was aware of what Nova Scotia was
proposing. We also want to make it clear, both via the premier and all of
cabinet, that regardless of whether the decision was going to be made to have
the pipeline extended to the Strait of Canso we still remained firm supporters
of the project. We have made that very clear to the proponents, to Nova Scotians
and to other Canadians that our province still supports the project.
Senator Mercer: I have two other questions. One is on the
environmental aspect. You have talked about NuStar's environmental safety
record. I want to talk to you about the environment in the Bay of Fundy.
We were in New Brunswick earlier this week for a couple of days. We have had
some discussions with people there. We have had a look at the facilities there.
We also are familiar with the geography of the Bay of Fundy and the world's
highest tides, et cetera. I don't need to educate you on the risks: it being the
summer home for right whales and their declining population and the admission
that the change in management of the travel of the ships through the bay in the
last few years has had a positive effect on the right whale population.
I would still consider it an environmentally sensitive area with the high
tides, with the right whale and with a very healthy fishery that takes place on
both the New Brunswick side and the Nova Scotia side of the bay.
I would like your opinion on the effect of a catastrophic spill of bitumen
from a tanker on the environmentally sensitive aspect of the Bay of Fundy.
Because of the force of the tides it is likely that a fair amount of it would be
washed out of the bay, but it would then become an international problem for us
because it would probably be washed into American water. Could you offer a
comment on that? Where I am going with that is suggesting that the Strait of
Canso is environmentally a much safer place to go than the Bay of Fundy.
Mr. Samson: Thank you for that question. We are certainly aware of the
debate that has taken place. It places us in a difficult position in that while
we have heard those concerns we deal with those concerns as well in our
offshore. Whether it be the current exploration program taking place by Shell or
some of the upcoming drilling programs that are going to take place by British
Petroleum and Statoil, we face the same concerns which we do our best to
mitigate. It is challenging for us as a province, in the spirit of regional
co-operation to be actively pointing out these concerns to New Brunswick when we
have similar concerns raised in different parts of Nova Scotia as well.
Again our approach has been to indicate that we would be fully supportive of
seeing that pipeline extended to the Strait of Canso. We wish to put that
forward as a business proposal rather than in any way trying to diminish what
New Brunswick has put forward at the Saint John terminal.
Senator Mercer: We are playing the good guy again. I agree with you
that it is a business decision. That is one of the driving forces behind it. It
seems to me that we can also make a good business proposition to them in that we
already have a gas pipeline that goes from the Sable field down through New
Brunswick to our customers in the northern United States.
It would seem to me that pipeline already has approval. All the environmental
T's have been crossed and I's have been dotted. It would make it a fairly
attractive way for them to do it. I don't know the specific regulations in Nova
Scotia. I rely on you for that. I assume that new studies would not be required
if it were decided to twin the gas pipeline with an oil pipeline along the same
Mr. Samson: I can't give you a specific answer on that, but I know one
of the topics we raised was whether it was even possible with the proposed
Energy East pipeline. As you heard in my presentation we are not only interested
in seeing the crude oil coming east. We are also interested in natural gas.
My understanding is that there are some concerns about putting a pipeline for
both crude oil and gas in the same corridor. Again I am not an expert on this
and would not want to give a definitive answer, but I know when we proposed that
as a possible option and asked whether this was something that could be done,
some significant concerns were raised as to whether it was even possible. I
would have to go back and ask staff to review the very point you raised to be
able to confirm whether that would be a possibility or not to have them running
in the same corridor.
Senator Mercer: Because your discussion of natural gas terminals is
more about natural gas coming from Western Canada as opposed to natural gas
coming from the Sable field because the Sable field will run out shortly.
Mr. Samson: We realize that with every well there is an end date.
Obviously with the production levels that are taking place now in our Sable
project we are aware that the lifespan of those wells will come to an end at
some point. That is why we look for other opportunities to be able to bring gas.
I have had opportunities to speak to my colleague in Alberta. The fact is
that Nova Scotia wants Alberta gas. Alberta needs to move its gas. We see this
as an opportunity to be able to address their need to move gas and our desire to
be able to receive it not only for our own purposes but for export opportunities
via LNG. This is why we have put forward a proposal to them. Those are
discussions we will continue to pursue because for our LNG projects here to be
successful we need a secure source of gas.
There are discussions among the proponents not only of Western Canada but as
well with the Marcellus shale gas in the United States. There are various
discussions taking place but we still see western gas as an opportunity to meet
their needs of moving their product and to meet our needs of having a secure
supply to make that LNG industry work in this province.
Senator Mercer: My final question is with respect to training. This
morning we had a chance to talk to Regional Chief Morley Googoo about the
involvement of Aboriginal people in the process and obviously the approvals that
would need to come from many of them as things cross their land.
What is the aspect of training? I know you are not the minister of higher
education but you are her colleague. It was very interesting. The chief was
interested in the engagement of the community college to prepare, if indeed we
were ever to get this done, a training process that would be aimed at young
Aboriginal men and women to have them trained to be able to help construct
anything that needed to be constructed and to manage.
I would encourage you to perhaps have a chance talk to Minister Regan and
encourage her to put that on her radar. Even though it is not immediate it
should be something that they should be considering because as Chief Googoo
mentioned this morning it was something they were interested in.
I always use as a reference point when the Federal government announced the
shipbuilding contract for Irving Shipbuilding in Halifax. We all know that
within 24 to 48 hours Nova Scotia Community College was retooling some of their
programs to fit the needs. The community college is able to do this but we need
to be able to make sure that they have it on their radar.
Mr. Samson: I certainly appreciate that point. I am glad that Chief
Googoo was here to speak to you this morning. I have known Chief Googoo for many
years when he was chief in Waycobah over in Cape Breton and had the opportunity
to work on numerous files.
There is no question that for us as government we have had a very successful
and respectful negotiating mechanism with the 13 First Nation communities in our
province through the KMK initiative which has worked well. At the same time we
are very proud of the fact that not only is it at a matter of respecting the
rights of our First Nation communities. It is getting them involved, allowing
the training to take place and having them as active participants, which is of
vital importance to us.
I had the opportunity in January to visit the Stena IceMAX, the ship that is
drilling for Shell in our offshore. I was extremely pleased to see the company
that has the catering contract aboard the vessel is part owned by a First
Nations community. I actually had the opportunity to meet a lady from the
Potlotek First Nation in my riding who was working that day. There were a few
others that were from First Nations in Cape Breton. It was great to see that not
only is there respect for rights but there is an economic benefit that is coming
from that as well.
I will certainly pass those comments along. We remain very optimistic in the
growth of our offshore, which will require significant training in that aspect.
We see there is certainly a synergy that is developing. Obviously we want to
make sure that people are trained and that they are ready to provide what the
workforce requires. Certainly having our First Nations being part of that is
One of the facts that people might not be aware of is that in Nova Scotia the
fastest growing population is in our First Nation communities. That is an
opportunity for us to be able to work closely with our First Nations communities
to make sure that they are trained for the opportunities that exist in our
province. Knowing the growth that is taking place, that is a tremendous
opportunity for us and for their communities as to seize on.
Senator Greene: Thank you very much and thank you very much for that
excellent opening speech. I hope the next presenter is as good as you. Too often
in the past when faced with an opportunity the Atlantic region or the Maritimes
in particular have lost that opportunity because they have not had a united
position. Often they have fought against each other with the result that the
opportunity never materialized.
I was very pleased to hear your position on potentially including the Strait
of Canso. In any event you support the New Brunswick option in Saint John. I
think that was excellent. I congratulate you and I congratulate the government
I have a totally different question, though. It is a term that we have run
across every now and again that is put forward by different groups. You are the
first practical politician that has been here that I can ask this question of.
Does the term social licence mean anything to you? If it does, what does it
Mr. Samson: It certainly does. As governments you need to have the
confidence that the regulatory framework in place is one that not only allows
business and entrepreneurs to know what the rules of the game are but also
allows the community as a whole to understand what the rules of the games are.
You run into problems when confusion exists or if there are not proper
We have worked very hard as a province. Certainly we have a very dedicated
civil service that does its best to address any of the issues. We have seen some
mega projects take place in Nova Scotia and even some smaller projects. The
regulatory framework is there. Regardless, when you refer to social licence you
also have to realize that you will never get 100 per cent support.
We are seeing that in a number of projects that are taking place in our
province now. At some point you need to look at whether the rules of the game
were followed. Were the rules clear to everyone involved? Did everyone have a
proper opportunity to be able to participate in the debate and discussions
around it? Did everyone have their questions answered in a timely fashion by the
appropriate individuals or organizations? Then government needs to make a
Senator Greene: Right.
Mr. Samson: When we talk about social licence it is that combination
of making sure the rules are in place, that people have had an opportunity to be
engaged, and that you then need to make a final decision.
I have had the opportunity as minister to be involved in a couple of files
where at the end of the day a decision had to be made. I was convinced that the
proper steps were taken. There was proper opportunity for any questions to be
answered. At the end of the day a decision needs to be made and I stand by the
decisions I have made on those projects.
Some are being appealed through the courts; others are still being pursued.
You will never get 100 per cent support, but the question is: Was the framework
in place to allow that to happen and did the process follow the proper route? If
the provincial government in this case and the municipalities have the sense
that the rules are clearly in place and that the public has an opportunity to be
engaged, at the end of the day a decision will have to be made one way or the
Senator Greene: Great, I like that answer too. Write that down, you
guys. Thank you very much.
Senator Boisvenu: Good afternoon, Minister. I do indeed appreciate my
stay in your magnificent province very much. I have two questions to ask. My
first question, if I understood your presentation correctly, regards whether the
province of Nova Scotia is satisfied with the route proposed by Energy East,
which would end in New Brunswick without being extended to Nova Scotia. Is that
Mr. Samson: The proposal Nova Scotia submitted to TransCanada and the
Government of Alberta suggested that rather than stopping in Saint John — with
additional capacity, daily — the line could be extended to the Port of Canso,
where the NuStar terminal is already. We proposed that to them, since that
business has been there for years and its record when it comes to protecting the
environment and safety is well-known. But at the end of the day, we had to
propose a business plan that was in their best interest, which was to extend the
line to our area, to Cape Breton. As it was said at a certain point in their
business plan that the line was to stop in Saint John, we indicated very clearly
that even with that route, we would consider the project a national project. It
would generate economic benefits for our province, even if the work was done in
Saint John and other parts of the country.
By the same token, this project would ensure the security of our access to
oil in Nova Scotia. That is why we made that proposition. They answered at a
certain point that that route was not part of their business plan, and so we had
two choices. As a province we could have decided under the circumstances that we
would not support the project. It was to us more of a national issue, a regional
issue, and that is why our province indicated that even if the line stopped in
Saint John, we would consider all of the advantages of this project in any case
and fully support it.
Senator Boisvenu: We also visited NuStar yesterday, I believe. I think
the province has to be very proud of that enterprise, not only from the
environmental perspective, but also from the social viewpoint and the engagement
of the community. I think it is a model enterprise, and so I wanted to say that
to you. It was a very good visit.
The other question I would like to ask you — and I don't want to put you in
hot water, Minister — concerns the National Energy Board, which will soon be
resuming its hearings. Four new members were appointed yesterday. I also know
that you meet with your colleagues the ministers of Energy of the other
provinces, once or twice a year. I expect that the pipeline is central to your
Mr. Samson: Yes.
Senator Boisvenu: The strongest resistance right now is coming from
Quebec. We saw this yesterday in Gatineau where the municipal council voted down
the route or the project in its current form. Do you think you could have a
political role to play to further the social acceptance of this project in
Mr. Samson: That is a very good question. I think the ministers'
meetings are an opportunity for Nova Scotia and myself, as minister — and even
for the premier of the province, when the premiers meet — to communicate the
message, which I heard several times in Quebec, as to how Quebec can benefit
from the pipeline going through its territory, since the line would no longer go
through Montreal, as had been envisaged.
Why should they approve the project? I think that Nova Scotia is a good
example. Of course, we would have wanted the line to be extended as far as Nova
Scotia, but that is not the plan as this time. However, we see how the project
is going to benefit the country, nevertheless. Alberta needs to move its oil, it
needs new markets, and this will benefit Alberta and Nova Scotia, among other
Yesterday when I took part in the opening of the new quay, the Irving
terminal, Mr. Irving spoke of a six-week construction period for the refinery.
There were 27,000 people, 27,000 workers. I can assure you, senator, that many
of these 27,000 workers came from Nova Scotia. There were many from our area,
Cape Breton. I know workers from our province who have worked all their lives
for Irving, in Saint John. And so we can see the economic benefits of that
project, and that is the message we want to deliver to Quebec.
On another topic, when you ask us what role we can play to advance this
issue, I spoke earlier of the Maritime Link project, which will allow the line
to go from Newfoundland to Cape Breton, in the context of the Muskrat Falls
project. We see an opportunity to have a system to transmit hydroelectricity to
eastern Canada, to Quebec and to all of the Atlantic provinces, and not only to
our provinces, but also as far as New England. These are discussions and a type
of cooperation that have never happened before.
I proposed this at the last ministers' meeting, for Nova Scotia, and as we
know, sometimes there have been policy differences between Newfoundland and
Labrador and Quebec. But I think Nova Scotia has a role to play because it never
took part in those discussions and the old wars that took place. So the time has
come for us to work together. This project will be beneficial for us, and it
will also benefit Quebec, Newfoundland and Labrador, New Brunswick and Prince
Moreover, in addition to the economic aspect, the protection of the
environment has to be considered. Nova Scotia is too dependent on coal. We have
coal plants, and coal is the most important source of electricity in Nova
Scotia. And so it would be beneficial for us and the whole region to have access
to hydroelectricity and renewable energy in our province. Consequently I would
be very happy to meet my Quebec colleagues to convey the message to them that we
have a decision to make in Nova Scotia: either we keep what benefits Nova
Scotia, or we take part in a project that will be good for the region and for
the country. It was for this reason that we made the decision to fully support
Senator Boisvenu: Thank you, and congratulations on your French!
Mr. Samson: Thank you very much.
The Deputy Chair: Before going to the second round I would like to
pose a few questions to you to get some clarification on a few things.
I state for the record that of course we support the Government of Nova
Scotia and its efforts to reinforce our support for the pipeline project in
principle. We know it is important for the country, for the production of wealth
and for the generation of revenue so that we can meet our social needs. Like you
we want to be able to maximize the potential benefits for our own province.
I am pleased to know that you made some representations to the Government of
Alberta and to TransCanada directly on the availability of Point Tupper. The
initial business plan that was put together called for two terminals: one in
Cacouna, Quebec, not far from Quebec City on the St. Lawrence River, and one in
Saint John. The same volumes they would be exporting or moving would still exist
except the terminal in Quebec is no longer going to be built.
I am curious. When you spoke to the Minister of Energy, the Government of
Alberta and TransCanada, was that before or after they announced that the export
facility in Quebec was not going to be built?
Mr. Samson: Thank you for the question. I should correct something. I
think in my last answer I mentioned about the pipeline stopping in Montreal. You
are right. It was Quebec City, not Montreal. It would have been after that
decision had been made which is why we felt that being there was going to be
Based on what we had seen of the project we knew that the refinery in Saint
John has a maximum it can handle per day but the capacity of the pipeline
exceeds that. It was a question of what we do with the excess because a refinery
can only handle so many barrels per day.
That was where we saw the opportunity, as did NuStar, to say rather than
build expensive tanks to hold it until it could be shipped out or refined why
wouldn't you extend it to Point Tupper?''
Our approach was from a business and economic benefit sense. At the end of
the day TransCanada is a private company and obviously they need to make a
decision in their best financial interest.
We were certainly aware of some of the concerns that Senator Mercer raised
regarding increased shipping activities in the Bay of Fundy. It was an
opportunity for us to promote the safety record and the history of the Strait of
Canso and the NuStar facility. We wanted to present this in a sense that a
business decision could be made. We were not going to take the approach of
taking our ball and bat and going home if we did not get what we were proposing.
For us it was a decision on what is in the best interests of the region and
what is in the best interests of the country. The message I left was that the
offer was on the table: For today you are telling me that this is not part of
your current business plan but the message from us is that the offer is still
there. Our government would be supportive of it should they decide at some point
that it is in our best interest to maybe send it over to the NuStar facility in
the Strait of Canso. That offer is on the table and we will certainly be
prepared to work with them should they make the decision that is how they want
The Deputy Chair: I have another question. It goes back to something
you referred to earlier in reference to Senator Mercer's questions. You pointed
out, and rightly so, the managing of potential of international concerns with
the loss of petroleum. We have those concerns with the Sable Island offshore. It
is very accurate to say that but it is also accurate to say that when we
introduce risks on Sable Island domestically it only affects our offshore. Any
time something of this nature is introduced, let's say by our sister Province of
New Brunswick in the Bay of Fundy, it automatically introduces risk to us. We
have to deal with risks that they don't have to deal with in our independent
We heard from the head of the Atlantic Pilotage Authority today. We went over
the tanker volumes in the various ports in Eastern Canada. Last year the Strait
of Canso handled 330 tankers and Saint John handled almost four times that or
I know you will remember that years ago a lot more tankers were being handled
in the Strait of Canso. Is there not some environmental argument in terms of
managing risk that instead of doubling the number of tankers in the Bay of
Fundy? There is a strong environmental argument for moving some of that tanker
activity to Point Tupper and giving this province the opportunity to manage the
Mr. Samson: My response to that is that we have gently raised that
very issue but again at the end of the day we understand there needs to be a
business decision made. The numbers need to work. We didn't think it was the
right approach for us to be trying to promote Nova Scotia by knocking down New
Brunswick or by creating a level of fear to the benefit of our province.
As we try to manage our offshore we are faced with the same questions. Part
of the new parcels that have been bid on will have drilling activity. There are
those that would argue that should there be a worst case scenario it may end up
going into other jurisdictions as well. It is a difficult position for us to be
promoting our offshore as being very safe, environmentally friendly, and then to
be pointing to another province and saying we are concerned that they have an
increased risk they have to address.
Any time the movement of petroleum products takes place on our coast it is
something that is of concern to us. We want to ensure that safety mechanisms are
in place and that we reduce risk. In this case there is no question that it has
to be based on a business decision that makes sense.
This is why we have put our best foot forward. We continue to make it clear
to the Government of Alberta and to TransCanada that this still is an option for
them. Again I remain optimistic that we may see at the end of the day a decision
made to have it come to the Strait of Canso, but that is a decision they will
have to make.
The Deputy Chair: We are talking about the export of petroleum, but of
course we import a lot of petroleum as well. I would like to point out to my
colleagues that you cannot import petroleum to refineries in either New
Brunswick or Quebec without coming through our water.
We see some of the resistance coming out of certain sections of Quebec. Has
the Government of Nova Scotia made any representation to the Government of
Quebec or the concerned parties in Quebec to let them know that at the moment we
are managing risk on their behalf to provide petroleum to their refineries?
Mr. Samson: That is a very interesting point. Based on some of the
points raised by Senator Boisvenu, I think that is an opportunity for us. I
certainly hear the message you are giving today. We will certainly take that
back to our premier and to our colleagues to see if there is a more active role
that we can play as an Atlantic region, not only Nova Scotia but our other
colleague provinces, to be able to make representations to Quebec on that very
I was at the opening of the terminal yesterday and speaking to the captain of
one of the tankers there. They are leaving Saint John, coming to Halifax, going
to P.E.I., going to Newfoundland, and then making their way up to Quebec via the
St. Lawrence year round. Via the St. Lawrence through ice is not always an easy
thing to do considering the type of product they are shipping, but they have
been able to do that. I certainly hear the proposal you are making and I think
there is an opportunity.
As I mentioned we are certainly having those types of discussions on the
whole electricity transmission loop on hydroelectricity and renewable energy. We
have started the discussions now. We have raised it with the federal government
that was very interested in hearing how we could make that happen. It could
certainly see the benefits not only from an economic standpoint but from a
reduction in greenhouse gases and more renewable energy for us.
There is an opportunity on this topic to possibly make representations to the
Government of Alberta and to the affected municipalities to understand how we
have been able to do this. There is risk involved. It is not always to the
benefit of our province but we realize that sometimes the risk is to benefit
other provinces. We do that. We accept that. We see it as part our duty to
ensure fuel supply to other regions around us.
The Deputy Chair: I have one more question before we go to the second
round. I made the point of making this clear to our colleagues in Western Canada
when we held our hearings out there. People speaking to us about the Energy East
pipeline were telling us that the pipeline went through six provinces and that
there were all kinds of benefits to these six provinces. I pointed out to them
that yes, it went through six provinces but once it goes in the water it goes
through our water and we want that to be recognized.
At any time in the process did the province consider asking for intervenor
status with the National Energy Board? I know we didn't. I am just curious if we
considered it and if not, why not?
Mr. Samson: I think there were some discussions through the premier's
office on that very question but I don't have the specific details as to why the
final decision was made not to seek intervenor status. I am unable to give you a
specific response on that.
Senator Mercer: I have just one question. Thank you for being here and
your excellent presentation. I want to go back to the environmental aspect. I
see us being boy scouts again. We are the good guys. We like our neighbours. We
don't want to disrupt their getting this opportunity but we have to take care of
I want to go back and draw your attention to the Bay of Fundy. We have to be
concerned that incidents in New Brunswick, either at the terminal loading or
with ships coming in or out of the Bay of Fundy, affect us just as much and
maybe even more because of the size of our shoreline and the size of our fishery
in the Bay of Fundy. It seems to me we should be a little more aggressive in
talking about it.
I agree that if we are not going to get what we want, a pipeline to Point
Tupper, good on New Brunswick for getting it. However we should be a little more
aggressive looking from the environmental side. If something bad happens, and
hopefully nothing will happen, it will have a huge effect on our shores in the
Bay of Fundy. I can't measure them but in my recollection of a map of the Bay of
Fundy we probably have more shoreline affected by the bay than they have.
I would urge you and urge the government to consider being a touch more
aggressive with the federal regulators in trying to get the pipeline to come to
Mr. Samson: Thank you, senator, for that question. We have great
confidence in the ability to be able to ship crude by tankers. In fact all of
the products that arrive in Nova Scotia for our domestic use come via tankers.
If we have success in our offshore due to the distance they are from land, more
than likely any oil or natural gas found will be shipped via tankers.
We believe in the safety record that exists in the industry. We believe in
the safety of the vessels themselves. This is something we have had in our
shores, whether it be in the Strait of Canso or elsewhere in the terminals in
Halifax where all those products have been delivered. We have had a great safety
record. In the future we will continue to have tankers coming to our shores for
our own domestic needs. We are quite confident of the technology and the safety
record out there.
Certainly I will pass that on to my colleagues so that those concerns can be
raised in discussions with the Government of New Brunswick and we can have them
addressed to our satisfaction.
Senator Boisvenu: Once again, thank you very much, Minister. I
appreciated your presentation very much.
Without wanting to get into your communication strategy with your Quebec
counterpart, I think that the point Senator MacDonald has just made — the fact
that Quebec withdrew support for a future terminal for environmental reasons —
is a good argument, but I would add another argument, Minister, with your
permission, and that is the fact that this route will have an effect on a number
of trains that circulate in Quebec and are full of oil. Considering the events
in Lac-Mégantic, which you undoubtedly followed in the media, the population is
still traumatized about that disaster. The pipeline could represent a type of
security to reduce that trauma. I think that is an additional argument you might
use in your talks with your Quebec counterpart. That is a suggestion I am making
to you, Minister, but I think it is an important element in the current debate.
Mr. Samson: Thank you very much, Senator. All of us here were indeed
well aware of the tragedy that took place, and that is one reason we have had
pipelines for many years to transport our natural gas. It is one way of
transporting oil and natural gas which we trust.
I had the opportunity of going to the United States, to Pennsylvania, to
study their natural gas industry. If you look at the map of their lines, it is
incredible; they are everywhere! It is almost difficult to find land where there
are no underground gas lines. That is their reality, and this has existed and
been entirely safe for years.
We are convinced that this is the best way to transport oil from Alberta and
the western provinces to our coast. That is why we are also at the same time
trying to obtain a natural gas line. We think it is still the best means of
transport, and that it also generates economic advantages for our province. In
short, I take into account the points you raised, and these are issues we will
broach with our Quebec colleagues.
Senator Boisvenu: Good luck!
Mr. Samson: Thank you.
The Deputy Chair: I would like to thank both you and Ms. Himmelman for
taking the time to come and visit us. We had a great conversation with you. We
have learned a lot.
I would like to introduce our final witness for this afternoon, the
Honourable Jamie Baillie, Member of the Legislative Assembly (Cumberland South)
and Leader of the Opposition, Legislative Assembly of Nova Scotia.
We ask you to begin your presentation, Mr. Baillie, and afterward the
senators will have questions.
Hon. Jamie Baillie, Member of Legislative Assembly (Cumberland South),
Leader of the Opposition of the Legislative Assembly of Nova Scotia: I
welcome everyone here, senators on the committee and people who are travelling
with your committee across the country, to the wonderful city of Halifax.
I believe I am the last presenter today. I may be standing between you and a
glass of wine or a beer. I encourage you to try many of our fine downtown
establishments if you have a chance before you rush back to the airport.
For four years, my family and I went to Sainte-Anne University to take part
in a family activity in French, the family French camp. It was a good idea for
my young daughters, but especially for me.
Having said that, that is about the extent of my ability in Canada's other
official language so bear with me if we end up with questions in both languages.
I will do my best.
First, I think I am showing you something relatively unique. I believe that
our Minister of Energy a few moments ago came to your committee to express the
support of the Government of Nova Scotia for the Energy East pipeline. I am here
to do the same. As Leader of the Official Opposition, Progressive Conservatives,
we are strongly in support of the construction of the Energy East pipelines for
reasons that I will outline briefly to you.
I hope by being here we are sending a pretty strong message to you and your
committee and to our fellow Canadians about the importance of that pipeline not
only to our entire country but also in particular to the part of the country we
are responsible for here in Atlantic Canada.
Canada has already constructed and is using over 800,000 kilometres of
pipelines. If those pipes did not exist it would require 4,200 rail cars and
15,000 tanker trucks to move roughly three million barrels of oil a day around
our country. This is a nation that has great experience with pipelines, that has
a great safety record with pipelines, and that has great private companies with
the knowhow to design, to build and to operate safely pipelines. In fact our
pipelines are more cost effective, more energy efficient and more reliable than
any other above-ground alternative for the transport of crude oil.
In 2014, 611,000 barrels of oil were transported by rail, which are both a
more expensive and a less efficient way of moving oil around the country. In
2015 our pipeline industry in Canada invested $1.3 billion in pipeline safety.
We have great confidence in the ability of the private pipeline companies of
Canada to develop, build and maintain a safe pipeline network from west to east.
Here in Atlantic Canada we have only a few refineries, as I am sure you know.
Those refineries are unconnected to the pipeline network. As a result almost all
of the crude oil that enters Atlantic Canada arrives by tanker ship from the
Atlantic Canada imports our oil from the United States, from Algeria, from
Saudi Arabia, from Nigeria, from Angola and from Iraq, but we do not have a
direct connection by pipeline to the oil sands or to the producing parts of our
country in Alberta or out west.
As some of you know, if not all of you, Atlantic Canadians have played a key
role in developing the oil resources of Western Canada for generations. At its
peak there were an estimated 30,000 Atlantic Canadians working out west in oil
exploration and development. Many of them are now home because of the downturn
but we know these are cyclical events. Atlantic Canadians are very proud of the
role they have played in enriching our country through the development of
We have before us with this Energy East pipeline an opportunity for us to
further participate in the development of our resources to our mutual benefit
including by taking new jobs that would be created in our home part of Canada.
To me the ongoing Energy East pipeline debate across our country is very
directly tied to the way that wealth is created, distributed and redistributed
across Canada. In this part of Canada all four Atlantic provinces are known as
have-not provinces, a term by the way that I hate, that I despise. If I am ever
elected premier of Nova Scotia, which I intend to be I will personally pass a
bill to ban the word have-not from The Webster's Dictionary.
Nova Scotia alone is on the receiving end of a little over $1 billion in
equalization transfer payments every year. I want you to know that we don't want
it. We want off it. We want to build our own wealth in our own part of the
country here. Our request of the rest of Canada and to the national government
through the Senate and through your committee is not that you continue to
enhance, enrich or enshrine equalization as it is already in our Constitution.
Rather it is that you give us the tools to get up on our own two feet, to earn
our own way, to develop our own resources and to participate in the development
of our natural resources by working here at home. That is what the Energy East
pipeline means to me. It is what it means to the Progressive Conservative Party
in official opposition here in Nova Scotia and it is what is in the hearts of
many, many, many Atlantic Canadians.
I am here today to speak strongly in favour of Energy East first as an
Atlantic Canadian, including the terminus in Saint John where we have a
wonderful opportunity to then refine the bitumen that arrives there and then
pipe it as finished product to the United States. That is great for Saint John,
for New Brunswick and for Atlantic Canada, and I support it.
I also want to add that there is a unique economically right and
environmentally sound opportunity to extend the pipeline beyond Saint John, to
bring it into Nova Scotia and to terminate it at Point Tupper, a natural harbour
with natural storage and the ability to then be transported to tanker ship and
safely exported overseas.
I will finish with that because as a member of the legislature my
constituency of Cumberland South is on the Bay of Fundy. It has a unique
ecosystem in the world. It is a wonderful and pristine place with vibrant
fisheries including a lobster fishery and a scallop fishery. It has some of the
best natural wonders of the world and a huge tidal power potential.
The environmental argument I want to make is that it is far better to have
the unrefined bitumen that arrives at the Irving facility in Saint John piped
past Saint John to Point Tupper, Nova Scotia, where it can then be safely put on
appropriate oceangoing tankers and sent overseas. In that way we get both the
benefit of refined product going to the United States by pipe from New Brunswick
and unrefined product being exported to Europe. I say that because I believe it
is the most environmentally sound way to proceed with the European-bound
product. I am sure as you do your research you will see the economics of doing
so are strong as well.
To me, and this is not meant to be a pun, it is no pipe dream to terminate at
Saint John and then build a lateral to Point Tupper. It is actually economically
and environmentally the best way to proceed. With those few remarks thank you
very much for your time today. I am happy to answer questions as long as you
The Deputy Chair: Mr. Baillie, thank you very much for your
presentation. It is very much appreciated. We will start with Senator Boisvenu.
Senator Boisvenu: Welcome, Mr. Baillie. You have a name that is quite
famous in Quebec. Jean-Maurice Bailly was a sportscaster on Hockey Night in
Canada. He died several years ago, but he was a star in Quebec. So if you
come to Quebec, you will surely be asked whether you are related to Jean-Maurice
I have a specific question for you. We know that the National Energy Board
will soon resume its consultations. We know what has been going on recently.
Four new members were appointed yesterday. The question I would put to you is
this one: are you going to go before the National Energy Board again to submit
your point of view, which you shared today, and which is that you would like the
pipeline to be extended to Canso? What would your argument be to change the
position of Energy East, which already replied to the Government of Nova Scotia
that it did not intend to extend the pipeline to the Strait of Canso? It is a
two-part question. Are you going to return to the National Energy Board, and
what arguments would you present to Energy East to try to sway it in favour of
your recommendation to prolong the pipeline?
Mr. Baillie: Thank you very much for your question. I appreciate it.
The short answer is yes. I would be delighted to speak to the NEB and any other
body that has a role to play in approval or non-approval of the pipeline
I will absolutely stress that I am in favour of the current proposal which
terminates in Saint John. I still believe it is a good project on that basis
alone. As an Atlantic Canadian I believe it is good for our region of the
country if that is the entire project. I also believe as many people do that it
is a very good project for our entire country.
I am in favour of, on its face, linking our country by pipeline from west to
east to allow for the freeing up of the economic value of the oil resource in
Western Canada by bringing it for refining to Atlantic Canada and its most
efficient export methods.
I believe there is a strong economic environment case for also adding a
lateral to Point Tupper and I will make that point to the NEB. I assure you that
this is not an either/or proposition as far as I am concerned. My main objective
is to be supportive of the Energy East pipeline proposal as it currently exists.
If extension is not granted I am still a supporter of the project as it is
envisioned. Those of us who want to see a vibrant industry built here and
exports overseas originating from the safest environmental ports on the Atlantic
coast can also make the case for Point Tupper.
Senator Boisvenu: Mr. Chair, I apologize. I need to leave in a few
minutes. Rest assured, Mr. Baillie, that I'll accept your invitation to spend
the weekend in Halifax, since I'll be coming back to the city soon.
The Deputy Chair: Thank you, Senator Boisvenu.
Senator Mercer: Mr. Baillie, thank you for being here. It is
interesting that a fair amount of your presentation was very much like the
minister's presentation. Again we Nova Scotians as good neighbours are
supporting what is supposed to go to Saint John.
I want to go back to your constituency of Cumberland South. It is bordering
on the Bay of Fundy. I know my brother happens to be a constituent of yours and
lives in Apple River. I am familiar with the bay as it comes up that far into
The Atlantic Pilotage Authority told us today that in 2015 there were 1,116
piloted ships into the Port of Saint John. We are talking about increasing it
significantly when this terminal is complete and we start exporting a product
out of there. Then I went over to the Strait of Canso to look at the numbers he
told us for there and there are 320 piloted ships in there. The pilotage is not
just tankers. There are all kinds of other vessels that get pilotage into both
The environmentally sensitive Bay of Fundy is the summer home of the right
whale and many other eco sensitive things. We should all be concerned about the
ecological balance of the Bay of Fundy. While I too support the pipeline coming
east I am very concerned that we are to have the terminus in Saint John, New
Brunswick. If we were to put it in the Strait of Canso we could use the NuStar
terminal that is there already. We toured the NuStar Terminal yesterday and saw
where expansion could very easily take place. We saw their loading and unloading
facilities and their ability to do it very quickly and very safely. They have a
great safety record.
I hope we would go back to that table. I would encourage, as Senator Boisvenu
did, going back to the National Energy Board and saying that the pipeline should
go to Saint John, New Brunswick. They need to feed that product from out west to
the Irving refinery. We need to get product to tidewater in a safer manner, and
the safest place would be Point Tupper.
The sales pitch to get that change would be the environmental one. Are you
prepared to talk about the environmental aspect of that?
Mr. Baillie: Sure. Senator Mercer, you made some great points. I am
delighted to hear that you have a brother that lives in my constituency. It is a
little Nova Scotia moment. I had asked you about your sister Colleen earlier and
now you are telling me you have a brother who is a constituent. Next time I am
in Apple River I will look him up.
For those of you who are unfamiliar with the Bay of Fundy it really could
officially be one of the Seven Wonders of the World. The tidal power potential
is something we are just beginning to explore. The highest tides in the world
are in the Bay of Fundy. It has the electrical potential to power to 30,000
homes. It is renewable and it is forever. It is also predictable unlike the wind
because we know the tide comes in and out every six hours. Modern technology
will allow us to harvest that and build a great electric grid across Atlantic
Canada in combination with our sister provinces.
You are correct that there are 1,000 or more piloted ships of all kinds
coming in and out of Saint John on the New Brunswick side. Because of the bottom
formation of the Bay of Fundy and because of the tides those ships actually go
up and down the Nova Scotia side of the Bay of Fundy before they enter or exit
the Port of Saint John. They are not doing that to be unneighbourly. They are
doing that because the geology of the area forces them to do that.
Many of my constituents like your brother and others make their livelihoods
on the Bay of Fundy. Many of them have summer homes or family homes going back
generations on the Bay of Fundy. They are supporters of jobs and supporters of
pipelines like this one. They have a legitimate concern about the environmental
risk of running supertankers, no matter how safe they are or no matter how many
hulls they have to hold bitumen, up and down such a sensitive environmental
They are right about that and we have a solution. We have another terminus
point that would be a safer one. This is partly good risk management or risk
mitigation. The effect of an incident on the Bay of Fundy would be devastating.
To move bitumen safely by pipeline to Point Tupper and then to ship it both
reduces the risk of an incident ever occurring and makes for a much easier
cleanup in the unlikely event that we had an incident to deal with.
I believe the NEB will consider risk factors and risk mitigation to our
environment in other ways. The Point Tupper terminus will look very good when
they factor that into their deliberations. Thank you for raising that.
Senator Mercer: My final point, Mr. Baillie, is that you are right,
but one of the things we don't talk about enough is the fact that if there is an
incident in the Bay of Fundy it is not just an incident in the Bay of Fundy.
With those extremely high pressure tides, guess what it does? It is going to
wash that out and it is going to become an environmental incident in the state
of Maine, in Rhode Island in the state of Massachusetts, and in New York. We
don't want to have an accident anywhere, whether it be in the Bay of Fundy or in
the Strait of Canso, but if it happens in the Bay of Fundy it becomes an
international incident as opposed to something that we contain and manage
Mr. Baillie: You have described that very well, Senator Mercer. I
didn't want to dwell too much on what an incident might look like. You are
entirely correct. It would be an incident that would affect the Eastern
seaboard. We do not need to take that risk because we have alternative terminus
points for the export of bitumen overseas. Thank you for raising that so
Senator Greene: Thank you very much for your presentation. I
appreciate it as a Nova Scotian, as a Maritimer, as an Atlantic Canadian and as
a Canadian. You hit all the bases for me. I have one question and it is on a
There is a term that various delegations use in their presentations to us and
that term is social licence. From your point of view what does that means or
does it have any meaning at all?
Mr. Baillie: That is a great question. Let me counter it with another
term that we are looking for from our national government and that is
leadership. We are looking for leadership. You are showing leadership as a
Senate committee by coming to our part of Canada already favourable to the
Energy East pipeline and looking to hear from people on their views. I
This is in no way meant to be a partisan comment, but I worry that social
licence in the political world means we will do something if it is clear every
possible person agrees with it and nobody disagrees with it, and that is the
absence or the opposite of leadership.
I hear you on social licence. I am not saying that there is no value to the
term social licence. There is, but when it replaces leadership we have a
political problem. I want to be clear about the consequences of that political
problem while I have you. When there is no leadership on great national
initiatives like this one what it means for Atlantic Canada is that we cannot
get ahead, we cannot earn our own way, we cannot stand on our own two feet, and
we are forever indentured to the rest of Canada for our transfer payments.
I reject all that. I need leadership from our national government on this
project and others like it to give me and my fellow Nova Scotians the tools to
build our own way, to stand on our own two feet, and to contribute to Canada on
an equal basis with every other region. I know we have it within us to do it.
I am asking you as the Senate committee to take the message back to Ottawa
that we see Energy East and some other ideas that we have as our way of actually
dealing with the debate over equalization in a positive way, which is to get on
our own two feet instead of to argue over how much more or less those transfers
should be. I would love to take that last equalization cheque that comes here,
rip it up and then say thanks, we will take it from here. Because it has been a
generous part of our country I don't want to run the program down. We need
energies to do that. We need leadership to do that. If our national government
stands behind the cloak of social licence to do nothing that is the effect it
has on Atlantic Canada in my opinion.
I want to quickly say that the discussion that Senator Mercer and I just had
about the environmental impact and the best ways to mitigate it are acceptable
in dealing with social concerns and generating social licence for an economic
project to proceed. I think that is a fair point in that area.
Senator Greene: Great, I am fine with that. Thanks.
The Deputy Chair: Mr. Baillie, I have a couple of comments and
questions I want to run by you. You mentioned the need for leadership on these
issues. I think we all agree that responsible levels of government have to take
their jurisdictional authority and apply it and do what is required of them.
I was googling names and googling for information on the project, and whose
name popped up? It was Colleen Campbell from West Nova. Colleen was a Liberal MP
for many years. Those of us who have been around politics remember when she and
Charlie Haliburton traded their seat back and forth for it seemed like decades
because it was the biggest swing seat in the province. Colleen is an older lady
now but she is still pretty sharp and she was quoted in the local newspaper down
She was flabbergasted really that there was an effort or initiative to export
large amounts of heavy petroleum out of the Bay of Fundy and that no public
hearings were held in the province or down in that area about it. She made a
very legitimate point when she said, "When I was the MP here at the time when I
was involved in politics there is no way that this would have occurred without
involvement and discussion about this with the communities that border on the
Bay of Fundy.''
I don't want to be too partisan about this, but as a Nova Scotian we have to
look after our own backyard here. I say to people, "If we are not prepared to
stand up for ourselves, don't expect other people to stand up for us.''
Has the provincial government done enough in terms of having this matter
discussed with the people around the Bay of Fundy? Do you think they have?
Should they be doing more? Is there something you think we should be doing that
we haven't done in terms of engaging the public on this issue?
Mr. Baillie: Thank you, Senator MacDonald, for those questions. I am
here in agreement with the Government of Nova Scotia on the importance of the
project proceeding. I want to stress that.
To answer your question directly, our provincial government, which is of the
political stripe as the national government at the moment, has not been a strong
enough advocate of the project overall. Notwithstanding the presentation that
was made to you today, and I was delighted to see it, there has not been a
strong statement of support by our provincial government or by our premier in
the public domain. I wish to see that. I will stand beside him if he chooses to
say that. I hope he does.
It is important that consultations take place in affected areas, whether they
are affected positively like Point Tupper, for example, or potentially would be
at some environmental risk like the communities that border the Bay of Fundy. Of
course there should be consultation and that consultation in my opinion should
be focused on risk management, on risk mitigation, on how best to proceed and
not on whether to proceed or not. I guess that is the difference between
appropriate social licence and social licence as a shield.
If a consultation means that our government leaders show up in your community
and say what we should do, yes or no, that is never going to get us anywhere.
That is an absence of leadership. If our provincial government and our national
government show up and say that they great economic value in this and asks what
concerns environmental or otherwise are there in your area and how they can best
mitigate them, to me that would be a very appropriate process. That process has
not yet happened.
I would like to conclude my answer by inviting you to take your committee to
Apple River in Cumberland County, which is one of the communities that you
mentioned, and hear from the people directly themselves. You can all stay at
Senator Mercer's brother's house.
The Deputy Chair: Yes. As a point of illustration we can look at the
wildlife in the bay. We have mentioned the right whales. The hump back whales
feed there for four or five months of the year. It is quite diverse. When the
number of right whales really started to bottom out we realized there was a real
risk. It was not just a risk. Collisions with tankers and large vessels going
through the bay were occurring. Those that were involved to their credit sat
down and negotiated or determined a new route for the tankers that pushed all
the tankers west and south of the normal route.
It is a price we have to pay. It is one that is worth paying, but it shoved
all the tankers much closer toward the Nova Scotia shore. The point that Senator
Mercer was making earlier is that two-thirds of that shoreline is Nova Scotia
shoreline. Not to be hard on New Brunswick, but the truth is they cannot make
any decisions in the Bay of Fundy that do not impact upon us. That is just the
geological and geographical fact.
I encourage you to speak to the provincial government, to maybe hold some
hearings in that area and to get people's opinion. We are pro development but
risk management is just responsibility. It is just being responsible with the
issue. We not only owe it to all Nova Scotians not only to maximize the
potential benefit of this project for Nova Scotia. We owe it to ourselves and
future generations to ensure that risk mitigation and risk management is
properly addressed in one of the most sensitive marine ecosystems in the world.
I would encourage you to put a little heat on the provincial government. I have
spoken to them today about the same thing because I think the public of Nova
Scotia would be in favour and would support it.
Mr. Baillie: Thank you. If I could just react to that very quickly, I
want to add to my earlier answer that I believe the outcome of proper public
consultation would be a routing of an extension of the pipeline to Point Tupper
to avoid the Bay of Fundy altogether. Not to mitigate risk in the bay but
actually avoid the bay would be the outcome of those discussions.
Much like when they are routing the pipeline over land across the country
there will be routes picked for environmentally sensitive reasons and
appropriately so. That should also be the same as the pipeline makes its way
into Atlantic Canada and the bitumen itself makes its way across Atlantic Canada
and out to open ocean. That is a very good point.
The Deputy Chair: I just want to finish up with this point. The
National Energy Board has hearings stalled for a number of weeks as it had to
reconstitute itself, but I understand that as of yesterday the full complement
of the board was reappointed. They should be calling for more hearings soon. I
would encourage you to apply for intervenor status on behalf of the people of
Nova Scotia so you could bring these concerns forward to the appropriate
You are our last witness, Mr. Baillie. We like to think sometimes that we
save the best for last. I hope so. On behalf of the Standing Senate Committee on
Transport and Communications, thank you very much for your presentation today.
(The committee adjourned.)