THE STANDING SENATE COMMITTEE ON ENERGY, THE ENVIRONMENT AND NATURAL RESOURCES
EVIDENCE
SASKATOON, Thursday, April 11, 2019
The Standing Senate Committee on Energy, the Environment and Natural Resources, to which was referred Bill C-69, An Act to enact the Impact Assessment Act and the Canadian Energy Regulator Act, to amend the Navigation Protection Act and to make consequential amendments to other Acts, met this day at 8 a.m. to give consideration to the bill.
Senator Rosa Galvez (Chair) in the chair.
[English]
The Chair: My name is Rosa Galvez. I’m a senator from Quebec and the chair of this committee.
I will ask senators around the table to introduce themselves starting with my colleague from this province.
Senator Wallin: Senator Pamela Wallin from Wadena, Saskatchewan, about three hours that way. Welcome, and thank you for coming.
Senator Cordy: Jane Cordy. I’m a senator from Nova Scotia.
Senator Mockler: Percy Mockler, New Brunswick.
Senator Richards: David Richards, New Brunswick.
Senator MacDonald: Michael MacDonald, Nova Scotia.
Senator Neufeld: Richard Neufeld, British Columbia.
Senator Patterson: Dennis Patterson, Nunavut.
The Chair: I would like also to introduce from the Library of Parliament our analyst Sam Banks, and thanks to the clerk of the committee, Mrs. Maxime Fortin.
Thank you very much for being here today, colleagues. We are continuing our study of Bill C-69, An Act to enact the Impact Assessment Act and the Canadian Energy Regulator Act, to amend the Navigation Protection Act and to make consequential amendments to other Acts.
I would like to stress to witnesses that we are discussing Bill C-69. With the aim of being as efficient as possible, we want to address Bill C-69 issues, not other bills or areas not covered by Bill C-69.
Today we welcome, in panel one, from Whitecap Resources Inc. Grant Fagerheim, President and Chief Executive Officer. From Cameco Corporation, Alice Wong, Senior Vice-President and Chief Corporate Officer; and Liam Mooney, Vice-President, Safety, Health, Environmental Quality and Regulatory Relations. From Tamarack Valley Energy, Brian Schmidt, President and Chief Executive Officer, Honorary Chief of the Blood Tribe (Blackfoot).
Thank you very much for being here. You have five minutes for your opening statement. After that we will have a period of questions and answers.
Ms. Wong, you are first.
Alice Wong, Senior Vice-President and Chief Corporate Officer, Cameco: Thank you very much. Good morning, Madam Chair, senators, clerk of the committee.
My name is Alice Wong. I am the Senior Vice-President and Chief Corporate Officer with Cameco Corporation.
With me today is Mr. Liam Mooney, Cameco’s Vice-President, Safety, Health, Environment & Quality and Regulatory Relations.
We appear before you today to discuss amendments to Bill C-69 encompassing two key pieces of proposed federal legislation, the impact assessment act or the IAA, and the Canadian Navigable Waters Act or the CNWA.
Cameco safely and reliably produces uranium and nuclear fuel products to generate electricity at nuclear power plants around the world. In Canada, Cameco currently maintains uranium mining and milling facilities in northern Saskatchewan and refining, conversion and fuel manufacturing facilities in Ontario. All of these operations are regulated through their entire life cycle by the Canadian Nuclear Safety Commission or the CNSC and are recognized for their strong performance with respect to social, environmental, safety, and health impacts. At the same time, our company remains one of Canada’s largest industrial employers of Indigenous people.
Cameco has participated in the consultations led by the Canadian Environmental Assessment Agency with respect to the IAA and Transport Canada with respect to the CNWA. Our comments and recommendations have been and are based on our experience with applicable federal and provincial environmental legislation in Ontario and Saskatchewan, and the current and previous navigation protection legislation. This includes extensive experience conducting environmental assessments over 30 years and more than 20 proposed projects under every federal assessment regime since 1988.
As a result of Cameco’s engagement over the past year, some changes were made to the draft IAA in the House of Commons; however, our key issue regarding the assessment process for uranium projects remains unaddressed. We have also identified critical issues with the proposed CNWA. Our company is concerned that the adoption of the legislation as put forward in Bill C-69 without further amendments will merely serve to increase the administrative burden and project uncertainty in the uranium sector, making the path to developing good projects in Canada much harder and with no corresponding improvement in environmental outcomes.
Cameco is therefore focused on advocating for simple amendments to be made to the draft IAA and the CNWA to ensure these critical pieces of legislation are workable for our industry and the thousands of Canadian families that rely on it for a living. It is worth noting that these uranium-related amendments are supported by other stakeholders such as the Mining Association of Canada, the Canadian Nuclear Association, the Prospectors and Developers Association of Canada, and the Saskatchewan Mining Association.
The first change that Cameco is proposing to the IAA is that it should not treat uranium mines and mills differently than other mines and mills when there is no science-based foundation to do so.
Currently, the IAA automatically refers designated uranium projects to a review panel process, while other designated metal or non-metal mining projects are subject to the agency-led assessment process. This imposes a more complex and lengthy process for the uranium industry when the potential impacts and complexity of issues are the same as for other mining projects.
Not only is our industry already subject to continuous federal oversight by the CNSC through the life cycle of our projects, but our facilities also consistently have been the top performers with regard to the Metal and Diamond Mining Effluent Regulations. To be arbitrarily segregated into a more stringent and uncertain product assessment process isn’t supported by facts and science.
Cameco is therefore requesting simple amendments to section 43 and related provisions of the IAA to ensure that the uranium mining projects have an agency-led assessment available.
Second, it is difficult to assess the impact of the draft IAA without knowledge of what projects it will apply to. ECCC has been communicating that this legislation will apply to major projects, but stakeholders don’t exactly know what that means.
The second stipulation that Cameco is seeking is that the IAA project list should capture only major complex projects that are not fully regulated through provincial and other federal regulatory requirements. For our industry, this means new uranium mills with the tailing facilities only.
Third, Cameco supports simple amendments to the draft CNWA to clarify that the legislation only applies to works that may interfere with navigation and to broaden the scope of the emergency provisions to include situations that have or may result in social disruption or a breakdown in the flow of essential goods, services or resources. The CNWA as proposed in Bill C-69 doesn’t do this. We believe this will significantly increase administrative burden with no additional protection of the public right of navigation or incentive to avoid impacts on navigation.
Our proposed amendments are based on recent engagement with Transport Canada that confirms that they intend for the CNWA to apply to both new and existing works, including works that do not interfere with navigation. In our view, this is wholly outside of Transport Canada’s jurisdiction, and would substantially broaden the application of the CNWA to include things like culverts or clear-span bridges that are constructed entirely over navigable waters. This recent engagement also confirmed that the draft CNWA unnecessarily narrows the scope of emergencies by removing unexpected events that have or may result in social disruption or a breakdown in the flow of essential goods and services or resources.
Finally, we believe it will take a minimum of one year to conduct a thorough consultation necessary to develop clear regulations and guidance upon which the workability of both acts depend. We therefore recommend that the coming-into-force provisions of the IAA and the CNWA should be pushed out by at least a year following Royal Assent.
The increased uncertainty, cost and time delays that we foresee in the IAA as currently drafted will make it increasingly difficult for uranium mining projects to proceed in Canada. Without changes to Bill C-69, this could have a significant negative effect on jobs, investment and socioeconomic development in regions like northern Saskatchewan, already one of the most impoverished economic regions in all of Canada.
Cameco has therefore taken a pragmatic view to Bill C-69, pursuing simple amendments to the draft IAA and CNWA to ensure that these critical pieces of legislation are workable for uranium project proponents and stakeholders who rely on them without compromising the environmental protections that are an essential component of sustainable development.
Further background information has been included as an appendix to these speaking notes when they were shared with the committee. I’ll stop, and thank you very much for your time. We look forward to answering your questions. Thank you.
Grant Fagerheim, President and Chief Executive Officer, Whitecap Resources Inc.: Good morning to each of you, and thank you, Honorable Chair and Committee Members for allowing me to speak today.
My name is Grant Fagerheim, president and CEO and director of Whitecap Resources based in Calgary, Alberta. It is my privilege to represent my company and our entire energy industry.
Whitecap is a publicly traded Canadian oil and gas company with 433 employees including 156 in the office and 277 in various field locations. We produce approximately 75,000 BOE of light oil per day, approximately 58 per cent in Saskatchewan, 35 per cent in Alberta, and 7 per cent in British Columbia. Whitecap currently transports almost all of its production by pipeline; however, most recently we are being forced to consider railing our products as an option, which is less safe than pipeline transportation. The reason for considering rail as an alternative is as a result of the lack of pipeline capacity that exists in Canada today due to the insufficient pipeline infrastructure.
It is not possible today to support Bill C-69 in its current form, but with complete amendments, it may be a bill that can support economic and environmental protection.
We live in a country that is well-known to be rich in natural resources including our oil and gas assets. We also have sufficient pride in being recognized to have the strongest environmental records along with the most expansive and stringent regulations in the world while being protective of Canada’s diverse natural landscapes, coasts, waterways, and wildlife.
Canadian economic growth, including the very important Canadian oil and gas sector, is beneficial to all Canadian citizens and our nation as a whole. It is only functional if capital investment from countries outside Canada can invest to obtain consistent and growing returns. These capital investments provide job and career opportunities for our children while they apply their knowledge to advanced technologies for the future of our strong Canada. Our province and country has experienced massive job losses along with suffering and pain with dedicated workers not being able to get jobs nor provide for their families.
Canada, which has been known historically as a “Can Do” country has now become the “Can’t Do” country, which worries and actually angers me. Bill C-69 provides additional impediments to bringing investment capital back to Canada for infrastructure development of all types, not just oil and gas. Albertans should be proud to bring our resources to market and demonstrate the type of leadership in technology and innovation skills that we possess and not be shamed for the sector they work in.
Canada’s declining competitiveness has affected our ability to attract investment, not only foreign investment, but also from Canada’s own pension funds. While foreign investment in Canada has reached a low dating back to pre-2010 timeframes, alarmingly, Canadian investment outside of Canada or abroad has increased steadily since 2011. The principal reason that can be ascribed to the increasing number and intensity of regulations that have protracted final approvals and construction timelines for pipelines.
Global participants invest their capital where there is a credible and predictable regulatory system that can be relied upon with confidence of clarity and stability. Providing best returns for their shareholders can only happen when companies make investments with reasonable timelines and clear start and end dates.
There are numerous global energy companies that have reduced their footprint in our country or left Canada completely for more friendly and welcoming jurisdictions including Marathon, Chevron, Apache, Statoil, Total, just to name a few.
As for shareholders investing in Canada, we have experienced a significant loss of investment in the oil and gas sector alone, in excess of $100 billion of potential investment capital lost in the last two years. Much of this is a result of an inadequate pipeline capacity which can be attributed directly to our inability to approve and construct infrastructure projects. We just can’t get it done in Canada. This has become critically divisive for our country.
To repair this and bring the confidence of foreign and Canadian investors back, we require effective and efficient modernized regulations. There are areas in Bill C-69 that governments need to focus on and get it right in a timely manner.
My three recommendations are as follows. The legal purpose of the bill needs to consider the economic benefits of the proposed project. This will include financial, economic, environmental as well as employment opportunities for the project and longer term operations.
Number two, improve the clarity and certainty in approval processes by reducing the amount of ministerial discretion to make decisions, leaving the vast majority of decisions to the regulator who can and does follow public guidance as to what the expectations are and how the approvals are to be obtained.
Number three, focus on public participation to those who are only directly impacted by the development of a project. Use of meaningful and constructive voices to assist with the development versus allowing anyone to comment who is not directly or measurably impacted is key to advancing projects.
We understand the need for finding a balance between environmental protection while progressing to a low-carbon economy, job creation and our economy for the benefit of our children and future generations. We also know that the united fabric of our country is at stake. All of this can be corrected with clear and concise timelines for building infrastructure to enable our oil and gas assets to get to foreign markets and to retract best worldwide prices.
In conclusion, I am hopeful that you, along with all my fellow other Canadians, understand that this bill as currently presented is detrimental to the development of Canadian energy and to the reputation of Canada as a jurisdiction with strong, supportive regulations to our energy industry and economy. We cannot as a nation stand still. We must progress and move Canada forward. Time is wasting. Thanks very much for your time. I look forward to your questions.
The Chair: Thank you.
Mr. Schmidt?
Brian Schmidt (Aakaikkitstakii), President and Chief Executive Officer, Honorary Chief of the Blood Tribe (Blackfoot), Tamarack Valley Energy: Good morning, Madam Chair, senators of the committee. Thank you for the opportunity to speak today.
I wish to compliment the Senate on this tour across Canada. I very much appreciate the input that you’re gaining from it. I think that was a very wise decision. I commend you.
My name is Brian Schmidt. I am chairman and CEO of Tamarack Valley Energy, an intermediate oil and gas producer with light oil plays in Alberta and Saskatchewan.
I know you have heard extensively from the oil and gas industry in your study of Bill C-69. You have been told that capital is fleeing Canada, that production is being curtailed in the energy industry, largely due to government policies and the uncertainty and risk that C-69 imposes on the entire sector. Intermediate oil and gas companies like mine have been hit particularly hard. The intermediate and junior sector is being dismantled.
I can reiterate all these things. I hope you consider them very carefully in deciding how to amend C-69 and whether Canada will have an energy industry in the future, but today I want to offer you a different perspective.
I am a governor on the board of CAPP, Canadian Association of Petroleum Producers. I am former chair of CAPP. I currently chair CAPP’s Indigenous Policy Committee, and I volunteered my time on the board of Indian Oil and Gas Canada, the government regulator taking care of First Nations lands. I’ve been involved in volunteering with training First Nations on the fundamentals of the oil and gas industry. I have negotiated with oil and gas companies on behalf of First Nations. One of my proudest moments is being named Honorary Chief of the Kainai Blood Tribe by my friend and business partner Chief Roy Fox, whom you’ve heard earlier this week. My experience with First Nations is lifelong as I grew up on a ranch near a reserve where my father formed agricultural partnerships.
I can tell you from my perspective as an industry insider who works a lot with Indigenous producers that it is First Nations who are being hurt first and foremost by Bill C-69. Let me tell you why.
First you must understand that IOGC, the regulator, charges more royalty on reserve land than Crown royal rates. In times of downturn, capital leaves First Nations lands first in order to deploy to lands with lower royalty payments. According to IOGC itself, Nations leases are down 95 per cent over the last four years. Simply stated, essentially no one is exploring on First Nations land right now.
Secondly, when prices are low like they are now because of lack of pipeline capacity, First Nations must give back some of their royalties to the producer just to prevent the well from being shut in due to it being uneconomic. This is a standard arrangement, but it means they suffer more than the producer.
Thirdly, from a national perspective, investors and companies will simply move their capital from Canada to other jurisdictions. We already have seen that. We’ve seen investment fall by $40 billion a year or about in half. International companies have sold over $55 billion in assets to be deployed elsewhere. Capital can move, but First Nations cannot move their territory.
Fourth is the jobs being lost. I am sure, senators, that you are aware Indigenous people in this country have a higher unemployment rate due to a whole host of reasons. There is Stats Canada data that shows Indigenous workers are often the first to be laid off and the last to be rehired in a recession. They are more likely to be seasonal or contract workers, often with less education, less time with a company, and they don’t get massive severance packages. While this job loss from the sector downturn has really affected Alberta as a whole, it’s hitting our First Nations workers and communities the hardest.
Fifth, Aboriginal-owned businesses have made most progress and profits in subcontracting. They rely on new construction. They rely on growth. What C-69 does is stop new growth. Projects will go into caretaking mode. It’s the small businesses, the trucking, the catering, the construction trades, that will feel the pinch. They already are.
Finally, I want to address the perception by some, and I understand it arose during testimony in Fort McMurray yesterday, that oil and gas producing First Nations are somehow in the pocket of CAPP or the oil industry. First, that’s insulting to the Chiefs and Nations, the Indigenous businessmen and women who are working to lift their communities out of poverty. There is a stereotype in this country of the corrupt, greedy chief. It’s wrong, and it’s harmful.
Indigenous people have a right to economic development. That is enshrined in the UN Declaration of Rights of Indigenous Peoples, and they have a rightful place in the resource sector in particular. It’s also inaccurate and unfair of industry’s relationship with First Nations. I know there is history. There are many decades when energy and mining companies did not consider the impacts and didn’t share benefits with First Nations, but those days are long gone. With the duty to consult and Indigenous title to lands, we have to work together, and first Nations are not in a position to be told what to do. They have negotiating power. They have the upper hand in many situations.
Now we have started working together as partners. We’re getting pretty good at it. And if I say respectfully, senators, the energy and resource industries are better at engaging Indigenous communities than government by a long shot — 7.8 per cent of those working in the extractive energy industry are Indigenous versus 4.7 per cent in the federal public service. And our jobs are better-paying. Indigenous workers make double in the resource sector than what they make on average everywhere else, and those jobs are much more likely to be in rural or remote areas where most First Nations communities are actually located.
And we support Indigenous business. I think you heard earlier this week, but Suncor alone spent $1.7 billion more on Indigenous business procurement than the government of Canada since 1996, $5 billion versus $3.3 billion, one company.
We are working hard to consult and engage First Nations, not just on business development, but on the highest policy levels at CAPP. That was a call to action from the Truth and Reconciliation Commission, and we have taken that responsibility seriously. It’s frustrating when we get turned on both industry and First Nations that all of a sudden we are too cozy with them.
The industry already takes impact assessment processes very seriously. We don’t see the provincial or federal governments doing the same. These new policies are often imposed by the government without impact assessment or consultations with most affected First Nations. Bill C-69 is the most recent example. The Alberta curtailment is another. First Nations land were included in their quotas with no impact assessment, no consultation, and in that case, not even jurisdiction. Production is cut, investment is cut, and First Nations don’t realize what’s happening until it’s too late. Damage done. I have had to cut drilling locations from our venture with the Kainai, again, due to curtailment and lack of pipeline capacity. It disproportionately and negatively affects First Nations.
I will finish by saying that it seems like C-69 was drafted in part with this misconception in mind, that Indigenous communities have been victims of the resource industry, and they need the federal government to protect them. Well, from my perspective, that’s paternalistic and an outdated style of thinking. The truth is, we are more partners on projects, and now First Nations are looking to be owners themselves, and I welcome that, but if Bill C-69 becomes law the way it is written today, there won’t be any projects for them to be owners of.
Industry needs to do impact assessments on every major project we build. There has been little or no impact assessments on this bill that will impose sweeping changes. The government doesn’t even have an estimate of how much it will cost the country, but First Nations have the most to lose from this legislation. I know that’s not the government’s intention, but I am here to tell you today that’s the effect, and it needs to be fixed. I am aware of Chief Fox and IRC’s suggestions on amendments to the bill, and I support them. I’m happy to answer any questions. Thank you very much.
The Chair: Thank you very for your testimonies.
We are now going to proceed to question period. Deputy Chair MacDonald has asked me to give you his place for the first question, Senator Wallin.
Senator Wallin: Thank you. I would like to welcome Senator MacDonald to Saskatchewan too. Isn’t it beautiful?
Senator MacDonald: It is.
Senator Wallin: Mr. Schmidt, I think you have made an excellent point. Thanks for framing it this way, that what we hope this process is, is really the impact assessment study on this bill. I think it’s really a good way to capitalize it.
I would like to hear from each of you briefly, if I could. This whole notion of capital flight, I think, is very real. You have put the numbers on that, but I’m looking more at these knock-on effects as this comes down. I am from a small community in Saskatchewan where we have dozens of families that are directly impacted. Not only does the husband lose his income, but that means the kids don’t get to play hockey, and we’re not seeing that picture being painted, and it is already being felt.
You’re close to your employees, Mr. Fagerheim, you’ve got a small company.
Can you each give me some insight into how that’s happening?
Mr. Schmidt: Let me just start by the financial sector and just give you some numbers that frame things. The industry three years ago used to raise about $10 billion to $14 billion of equity capital per year, and that would go into various communities in terms of our capital budgets. Equity raised this last year with $600 million. That’s it. It dropped in half the year before, and now it’s down to $600 million. We’re basically not having any capital. We’re basically spending our cash flow, we’re not able to attract new capital into the sector. That has devastating effects because when you look at the capital deployment of — you know, we took $41 billion. I’m sure you’ve seen CAPP’s numbers out of the sector on spending; it just has ripple effects through, and it hits small communities last.
If you look at the curtailment that was necessary to put in place by the Alberta government to control differentials, that curtailment has devastating effects because now I couldn’t spend money even if I wanted to, I can’t grow the business because I am curtailed, and where that hits small communities is the service sector. Service industries, they rely on that growth, like I said in my notes. If there’s no growth then the service companies in the small communities suffer. Seeing that, I believe the second quarter this year will be the most difficult on the service sector.
Senator Wallin: Yes, and to be clear, you’re talking about trucking and catering and the subcontracting, but it goes right down to the grocery stores and the restaurants in town if you don’t have money to buy the groceries.
Mr. Fagerheim?
Mr. Fagerheim: It impacts the communities. I happen to live in Calgary, Alberta, and I sit on the Hockey Canada Foundation Board. I can tell that from a little bit different perspective because of the number of the children that are leaving our game of hockey, which we consider to be the best game in the world, is a direct responsibility of the number of job losses that we’re seeing, not only in Alberta, we’ve seen that in British Columbia, in Saskatchewan, and this is affecting the communities. Whether you’re a single-parent family or you’ve lost your job and now are on unemployment, this is what we’re seeing. We’ve seen a drop-off in the number of kids being able to play the game or coming for financial assistance to play the game and buy equipment and sticks.
From our perspective, it is about the small communities across, that’s what builds a nation, and when I talked earlier about being divisive, this is why we’ve got to get people back to work. A critical point to that, from our perspective, would be construction of pipelines, not just one pipeline, but numerous pipelines, to tidewater.
Ms. Wong: Thank you, Senator Wallin. I am from Quill Lake, so I know Wadena well. You are a city compared to Quill Lake.
In our minds, we’re in northern Saskatchewan. It’s remote, so there are fly-in camps, and workers are there either on a seven-day-in, seven-day-out, or they’re on a two-week-in, two-week-out schedule. The people that work at our sites are mostly — we try to attract as many people as we can from the area, almost half are from the communities around there, and most are Indigenous people.
Industry has had a very time tough time. We have had a series of shutdowns and layoffs because the market is tough. What you see is, the people who work at the sites, they often don’t just support their family, they support their relatives. You see a very tough knock-on effect when the jobs are gone. We know it’s hard on the workers, the employees. Also, over 75 per cent of our services for the mine sites are bought with Indigenous-owned businesses from the communities. In 2004, if you go back that far to when we really tracked it seriously, we procured more than $3.76 billion in goods and services from Indigenous-owned business in the north. There is definitely that impact as well.
There is the employee impact where they don’t have jobs, there is the impact on those businesses because you’re buying less from them because you’re not spending because the sites are shut down. When the cycle does come back, that’s part of the challenge, is the cycle will come back, it’s a commodity. When it comes back, you want to be positioned to able to get your mines going, expand those mines, or even get new mines if the cycle warrants it. This legislation is extremely important for the expansion of those mines or building new mines, that we’re able to do it. We are one of the only employers in northern Saskatchewan. That’s why it’s so hard on the communities. Thank you.
Senator Cordy: Thank you very much for being with us this morning on a bright sunny day. It’s great to be here.
I would like to start with Mr. Fagerheim. You spoke about focussing public participants. If you’ve been following our hearings, we’ve certainly heard that in the past, that it should not be unrestricted, in fact, it should be limited to those who have an interest in the project. Who should make that decision about who should be a participant?
Mr. Fagerheim: My perspective is that I think if you’re looking at a specific region — and Canada has a diverse regionality that we do have to it, but specific that within a certain distance from where there can be surface disturbance or whatever, I think that you can — we could potentially set up regulations that those that are within a 4-kilometre or 5-kilometre range — I don’t know the exact distance. We’ve talked about this a lot, but maybe there is a distance from a disturbance of what’s going to take place.
A disturbance is not only surface or sub-surface, but it’s also, you know, air quality. What we look at is something that could potentially be a distance from a specific change or construction project or long-term development. That’s the way we would think about that.
Senator Cordy: And who would make the decision?
Mr. Fagerheim: The decision maker would be the regulator. I think the regulator should make that decision. Then if there are clear, concise definitions, then everyone knows what the rules of engagement are.
Senator Cordy: Thank you. Ms. Wong, you spoke about the project list. That’s another thing that we’ve heard as we’ve been on the West Coast, and treating uranium mines and mill projects consistently with other mines. I wonder if you could just explain that in a little bit more detail.
Ms. Wong: I’ll try and tackle this at a high level. Other mines and other metal mines or non-metal mines have the agency-led option for an assessment; whereas for the uranium sector, any uranium mine would automatically go to a review panel process, which is more complicated than an agency-led assessment. I think that based on science that the mines, whether they be metal mines, non-metal mines or uranium, the effects are pretty similar. We are also regulated to the metal mines and diamond effluent regulation. Uranium mines are typically a top performer in that regulation. We don’t see the rationale for having them automatically go to a panel process.
Senator Cordy: You spoke under the navigable waters section. You said that the scope is far too narrow when emergencies occur. Could you also talk about that?
Ms. Wong: The scope of emergencies has been narrowed. What we talked about before was under emergencies and that there could be an impact on goods and services or socioeconomic factors. The old act would have allowed you to act on an emergency. Now what they’re asking for, to our understanding from Transport Canada, is that you’d have to ask for approval. For example, if there was fire across a river, and there’s a bridge, and then you drove some water tankers over the bridge, and you damaged the bridge. You’d want to go in and fix the bridge so that you could drive the water tanker over, but now you’d have to apply for an approval, which we’ve been told it would be quick, but in an emergency you want to be able to fix the bridge and get the water tanker over.
Senator Cordy: There’s quick and there’s quick, right?
Ms. Wong: Yes.
Senator Cordy: Thank you very much.
The Chair: Senator Richards.
Senator Richards: Thank you for coming. I agree with you wholeheartedly about the need for economic growth and infrastructure in our country and First Nations participation.
I grew up near three reserves in New Brunswick. My father, over his lifetime, was an honorary chief or two. Jobs are the main concern with the chiefs today down there. I agree wholeheartedly with what you’re saying.
My question to Ms. Wong is about uranium. Is it because there is a non-educated, and maybe I shouldn’t use that word, fear of uranium and nuclear power plant that all this regulation comes into play and is in these procedures? Is that really what’s driving this, do you think? If so, what can be done about it? As far as the uranium waste, does that stay onsite, or how is that managed, if you could tell me, in a nuclear power plant?
Ms. Wong: I’ll try to see if I can answer all the different questions that you asked. I think with regards to uranium mines being an automatic referral to a panel, I guess the easiest way to look at that is they seem to be treating uranium mines like a nuclear power plant. A uranium mine simply does not have the same profile, risk profile, does not have the same mechanics behind it, the same science. A uranium mine is simply like any other mine, and it has a life cycle regulator. We must remember that any different aspects of the uranium mine is that it has a federal dedicated regulator to deal with that aspect.
I think that partly it is the idea that people aren’t aware of how that works necessarily. If you looked at, for example, people in northern Saskatchewan, we do polling every year, the industry does, and last year’s polling showed that 82 per cent of the people supported uranium mines in northern Saskatchewan, 80 per cent across the province.
I think that if you live close to the mine, you understand what the risks may be, and you know how they’re managed, and they’re a part of it. We engage our communities, and they are aware, and they come, and they’ll voice opinions, they’re not always supportive, for sure. They feel very empowered and will tell you the truth about things that they don’t like about it and what they’d like you to do. I think it is partly just getting more awareness around uranium mining. Perhaps that would help with some of the stigma.
Uranium mining is like other mines in that the tailings are managed on site, I think that you’re asking about the tailings, it’s like any other tailings facilities. Ours is in pit, I think is how it’s described. It’s not above ground, it’s in-pit tailings that we have that manage it, which is very similar.
Senator Richards: This is maybe not your area, but I was wondering about the nuclear power plant and the waste from it and if it’s kept onsite, or would you know that? I mean, that’s why I think some people are concerned about it. I was asking if you know how much waste is there from a nuclear power plant over a given year, and is that kept on site? I’m not sure if you would be able to answer that, but I thought I would throw that in.
Ms. Wong: It is stored onsite. It’s safely stored onsite and measured. It’s a very small amount. That is one of the misunderstood things, is the amount is small, it’s contained, stored safely onsite. Unlike other emissions from different types of energy, it goes in the air, or, you know, it’s not tracked.
There are numbers I can certainly get you. The Canadian Nuclear Association publishes the amount of nuclear waste from a power plant in Canada.
Senator Richards: Thank you very much.
The Chair: Senator Simons?
Senator Simons: Thank you very much, Madam Chair.
Mr. Schmidt, that was an extremely important presentation to put into context the different way in which royalties are calculated on reserves. I didn’t know that, and I want to thank you. My question is for Ms. Wong. I want to follow up on the questions of Senators Richards and Cordy and confess I don’t know that much about the uranium mining industry.
One of the things that Bill C-69 does is sort of reduce the degree of control that the Canadian Nuclear Safety Commission has over life-cycle regulation and that when they put together the impact assessment panels, it’s explicitly stated that they can only have one member from the Nuclear Safety Commission on them. I wonder what Cameco feels about that. Do you feel that the bill curtails overmuch the traditional powers of the Canadian Nuclear Safety Commission?
Ms. Wong: Thank you for that question. I think that is one of our concerns, that the CNSC is the most experienced of all the regulators in understanding the risks and what the community concerns might be, and how we mitigate those risks. The fact that they can’t have more than one person on the panel is a concern because part of it is, then, after you get through the panel process, you have to go through the licensing process. If the CNSC has one person, they might say that panel process is not sufficient for the licensing process. Then you might have to go through another licensing process. You don’t get your licence after the environmental assessment. You get the okay that the impacts can be managed and can be mitigated, and they look at the socio, you know, and all that, all those things, which are good and needs to be done.
Under the current way it’s done, the CNSC would lead that assessment. To have that experience and expertise at the table that might let you go through the environmental impact assessment and the licensing process — you have the same review, but you have it with kind of the most experience and with the most expertise at the table. It is a concern that it lengthens the process without anything adding anything on the environmental or social side. That is one of the concerns that we have.
Senator Simons: I have another question. I think the navigable waterways section of the bill is like Cinderella — nobody gets to the third section of the act, but I think it’s really critical to understand, too. Because of my ignorance of the way uranium mining is done, is it necessary for the mines themselves to draw water from navigable waterways as part of the mining and refining process? At what point would you intersect with navigable waterways? I wouldn’t have thought that mines would have that as an issue.
Ms. Wong: I think it’s slightly more complicated than that, but I’m going to ask Mr. Mooney to answer that.
Liam Mooney, Vice-President, Safety, Health, Environmental Quality and Regulatory Relations, Cameco Corporation: In that space the issue would be that we have regional mills, and we pull from mines that are some distance from those regional mills. In doing that in northern Saskatchewan there are a number of bridge crossings that we would have to use in that regard. Similarly, these are remote locations. For our actual transportation of uranium ore concentrate, they would involve moving that material down roads that would themselves have culverts and/or bridges.
It’s really just a function of logistics. In the production we have a regional milling setup, that’s in accordance with some panel decisions that were made in the early 1990s to try and concentrate our milling facilities. In that regard most of the new mines have been regional mines that have been set up to deliver to regional milling complexes.
Senator Simons: You don’t build the bridges or the culverts. Your concern is that municipalities and counties might not be able to move quickly enough to repair in case of a breakdown?
Mr. Mooney: We build bridges on some of our roads, ones where they’re dedicated haul roads from a mill to a mine. I probably left out in my first answer, we also have exploration activities. As you move exploration activities further down the project pipeline, they require more and more equipment. You need more and more sturdy roads that you can use. Ice roads provide some ability to allow the front end of the exploration cycle to continue, but it becomes more and more onerous to use that, and so roads are the preferred method. You’re usually constructing them yourself.
Senator Simons: Thank you very much.
The Chair: Senator Patterson.
Senator Patterson: Madam Chair, I’m really glad we’re here in Saskatchewan. I’ve got to say, what an indictment we’ve heard of Bill C-69 this morning from all the panellists — a more complex regulatory process, needless review of projects, which don’t interfere with navigation, prejudice to the progress with Indigenous people and business, and no improved environmental outcomes from all these new convoluted regulatory processes.
Ms. Wong firstly, you have engaged with the drafters of this legislative labyrinth, and basically you got nowhere. What’s going on here? Do they listen and not hear? You made a very compelling case to us this morning. Why did you get no traction in your work interfacing in the consultation phase? We’re told it was a wonderful extensive consultation phase. It didn’t work for you. What went on there?
Ms. Wong: I think the best that we can describe it is that many stakeholders have challenges with lots of people who looked at the bill. They tried to address some of it. We didn’t get the main amendments that we wanted, particularly the automatic referral to a review panel. We are talking to some of the policy-makers with regards to the project list. That has been, I think, somewhat positive. I think they have so many stakeholders to satisfy, it’s probably challenging for them to look at all of the requests.
We think that our amendments were simple that we asked for, but perhaps, as one of the other senators mentioned, there is a lack of understanding generally with regards to uranium mining. We’ve been trying to provide some more awareness around that information. We just keep trying to do that.
Senator Patterson: You were drowned out by MiningWatch Canada. That’s what I read into this, that negative voices prevailed in the consultations.
Mr. Schmidt, thank you very much for your presentation. I think what you’re saying is that any bill which negatively impacts the competitiveness of Canada’s natural resource and energy industry will negatively affect the economic sovereignty of Indigenous people. Consultation goes both ways. We have a need to accommodate the Indigenous voices that don’t agree with the agenda of this current government, so would you agree that the adoption of amendments put forward by the various chiefs and the Indian Resource Council, and as we heard from Chief Fox, would the amendments responding to those recommendations represent a commitment to reconciliation that everybody’s talking about?
Mr. Schmidt: We have given that careful consideration. Let me use an example. When everybody gets a voice in a project, it drowns out the Indigenous voice on traditional lands. That’s a very important voice to be heard.
When you first talk to Indigenous peoples about Bill C-69, we want to give you a greater voice, we want to expand your opportunity to comment on projects, it all sounds good except when everybody gets a voice, and your own projects, Indigenous projects, are affected or your own voice is drowned out by the standing test, which Mr. Fagerheim referred to, then it takes away from the rights of Indigenous peoples. One of the recommendations was to put that standing test in, make sure only affected people are put in place.
You’re also aware there’s a period of time under Bill C-69 when the project proponent can’t talk to Indigenous peoples who are affected. That is backwards on reconciliation. Why would a process design a phase where you couldn’t talk to First Nations along a pipeline corridor? I think it takes us backwards.
What I found in my time talking with First Nations is once you try and put yourself in their shoes and look at Bill C-69 and the implications, there are some fairly negative connotations for them that they become aware of. That’s why I think you’re seeing some of the varied opinions that you’re seeing on your tour. I would recommend that the Senate focus on those Indigenous peoples who have experience with the oil and gas sector with projects and with involvement. Thank you.
Senator Neufeld: I thank all of you for being here today and making your presentations. I can tell you that, at least what I have heard since we started hearings both in Ottawa and on the road is similar to what we’re hearing here. That bodes well for me. There is not much of a difference.
Part of it also is we have heard a bit about issues with work camps and how that affects Indigenous Nations, First Nations, and I’m familiar with work camps. I am from a part of the province that relies heavily on the oil and gas industry. I’m familiar with them, but I am unfamiliar with that being a problem. Maybe you could comment on that for me, please, and then I have a couple other questions.
Ms. Wong: I think that I described briefly that our camps up in northern Saskatchewan are remote fly-in camps, they’re dry camps. There is no opportunity to go back and forth to the community. When you come in, you’re in the camp for the seven days or 14 days to work and then fly back home. We have a full-catering service, so food is provided, and there are recreational facilities. There is absolutely no tolerance for violence or disrespectful behaviour.
I can tell you that over the last couple of years I personally spoke to in small groups over 400 women to get their views on how camp life is in our camps. We found some things like making sure that we had better personal protective equipment like gloves that fit for women and overalls that fit for women. We have across the company reinforced our training on respectful workplace and ensuring that people understand that if you have an issue, you have several avenues to raise concerns, you can go to your supervisor, you can go to the site HR, you can go to corporate HR, and, we have an ethics complaint hotline that’s anonymous, and you can come through there.
What I’ve heard is there are some challenges, but it mostly was it’s like they’re family when they’re up there because they’re together for so long. You get to know them that way. I think that when you have a camp that’s remote, and it’s dry, and you have very clear policies and procedures in place that camp can be a very safe and enjoyable place to be.
Senator Neufeld: Thank you.
Mr. Schmidt?
Mr. Schmidt: There has been a huge change in the way oil and gas manages their camps in the last 20 years. Most of us have drug, alcohol and diversity policies in place. There is a whole lot of attention on that. If you went to camp 20 years ago and you went to camp now, it’s totally different.
Senator Neufeld: Thank you.
We heard some response to the Canadian Nuclear Safety Commission, also the NEB is another one, the offshore boards. I think the Minister’s letter said to modernize these types of approaches, not annihilate them. Maybe you could each speak a little bit to what happens when the NEB is gone and all the jurisprudence that we have over the last 50, 60 years is gone and how a new system can start out with just one person on a panel that is knowledgeable? Offshore boards are the same. Does anybody want to comment?
Ms. Wong: I think we can comment from the CNSC perspective is that in our case the regulator is not gone, they’ll still be there in full force. The challenge for the industry will be that you’ll have a panel process that has the one expert on the panel, one, you know, CNSC expert on the panel. The concern is that then you will go through an entire licensing process with your life cycle regulator and adding an additional amount of time without really adding much more safety or environmental benefit.
Senator MacDonald: Thanks to all of you for your testimony. I wish we had another hour, quite frankly.
I’m a big believer in nuclear power. I want to speak to Ms. Wong. When I was a teenager we built two heavy water plants in Cape Breton. I thought nuclear power was going to be a fantasy for some of the recognized problems, but it didn’t pan out. It seems to me that there is a real resistance in government circles in Canada to promote nuclear power. When I think of nuclear power and nuclear industry, I always think of uranium in Saskatchewan. Before these provisions would even come in, what’s the status of your industry in terms of your distribution of uranium? Do you think the growth of your industry has been artificially suppressed or depressed by inadequate support from government?
Ms. Wong: I think from a nuclear power perspective, there are challenges because of the lack of awareness and education, perhaps. I see that with the focus on climate change and air pollution that people are starting to understand, that the goals that we have set for ourselves on climate change are not achievable without some other emission-free energy source that can provide a base load power base that can provide kind of the base.
The renewables are important. You need a mix of things. What we’re seeing now is a bit of an understanding in Canada, particularly of the SMRs, the small modular reactors, that could possibly play a role in that. I think across the world we’re starting to see, and understanding China is building reactors as an example because they have a big emissions issue. If they can rely on nuclear power, they can reduce their emissions.
The picture of growth is spotty, I’d say, across the world. Certain countries are embracing it more and building more. Canada and Ontario itself, you know, over 50 per cent of the power is generated by nuclear power, so they have seen a benefit. When they closed their coal fire plants down, they did have, I believe, remarkably good air quality as a result.
There is growth. What we have to do is when we see that coming, you want the regulation to support and be able to — obviously it has to protect the environment and provide all the good things on the social impact and look at all of those things. It should not be adding so much burden that it doesn’t have the commensurate environmental protection. I’m not sure if I answered your question.
Senator MacDonald: You did. Thank you.
Senator Mockler: To the witnesses, thank you very much. You were very informative and also enlightening. Being a senator from New Brunswick and Atlantic Canada, the bill lacks clarity regarding regulatory timelines, enhanced ministerial powers to require a project assessment of an undertaking not on the designated projects list. We have also heard it offers multiple opportunities to delay the review process, and it represents duplication and regulatory oversight, oversight of provincial and federal levels.
As a public servant for the last 35 years in the Legislative Assembly of New Brunswick, in the Senate of Canada and as a parliamentarian, I’m concerned when I see that approximately nine premiers across Canada are concerned this bill. I’m going to quote from a letter that was sent by the four Atlantic premiers, and I would like to have your comments.
The Council of Atlantic Premiers wrote a letter to the Prime Minister of Canada on February 27, 2019, and are still awaiting an answer. The letter states “. . . that the Bill as drafted places final decision-making power in the hands of the Minister or Governor in Council and provides the opportunity to veto the results of thorough scientific assessment and review of evidence.”
By the way, congratulations, Mr. Schmidt, for your leadership with First Nations.
I would like your comments on what you think of this veto process.
The Chair: Mr. Fagerheim?
Mr. Fagerheim: Veto power — the challenge that you’ve got with anything, the regulator body in the provincial or federal jurisdiction who works with the regulations each and every day are the ones that ultimately should have the power. If we start going to veto or ministerial power where we’re calling in politics into final decision-making processes, that’s dangerous. It’s dangerous for our country. It protracts the timeframes that we have for approval, and I think it’s absolutely catastrophic if we do that for our country.
The people who work in the jurisdictions, whether it’s in New Brunswick, anywhere in Atlantic Canada or Western Canada, Central Canada, they work with these regulations every day, and they know how to apply them. As long as they’re clear, concise and people understand what they are — but to give ministerial power after everything has been reviewed by the regulatory bodies I think is catastrophic and very dangerous.
The Chair: Mr. Schmidt?
Mr. Schmidt: I’ll make this very simple. A pipeline project would have to spend half a billion to a billion dollars to get through the whole process, maybe five to 10 years. Who would ever invest if there’s a veto at the end for whatever reason you can cancel it after you’ve gone through everything? That’s why there are no pipelines. That’s why no one is starting any projects like this. Thank you.
The Chair: Mrs. Wong?
Ms. Wong: We believe any decision should be science-based, risk-informed, and recognize in our case the life-cycle regulator, the CNSC.
[Translation]
The Chair: Senator Carignan, you have the final question.
Senator Carignan: I read the Saskatchewan Mining Association’s brief. I’m particularly interested in the part on constitutional law as it relates to respect for provincial jurisdictions in local matters. I’m always surprised when the federal government interferes in provincial jurisdictions, especially when it comes to mining, which is more local by nature. You have proposed amendments, in particular to paragraph 60(1)(a). You want to remove the words “adverse direct or incidental effects,” and therefore make it broader.
In your opinion, is this enough to convey the message to the federal government that provincial jurisdictions must be respected? Should there be an additional interpretive provision that would specify that, for local matters under provincial jurisdiction — even if there may be some incidental factors under federal jurisdiction, such as endangered species — the assessment must be conducted by the provincial authority?
The Chair: Who is the question for?
Senator Carignan: It’s for all the witnesses, but I know that the issue has been specifically addressed by the mining association.
[English]
Ms. Wong: Mr. Mooney is intimately involved in the drafting of amendments. I’m going to ask him to reply.
Mr. Mooney: In that circumstance we’re somewhat unique because we are captured by federal and provincial regimes.
One of the changes that was made at the House of Commons that we were grateful for was to remove the prohibition against the cooperation between the province and the federal government that was in the first draft of the impact assessment act. In that regard, I think we’re somewhat agnostic because we currently are captured both federally and provincially. We look a little bit different.
I know the Saskatchewan Mining Association is planning on being here at the next session. Perhaps the question would be better situated with the SMA.
[Translation]
Senator Carignan: I still sense a willingness, but I’ll talk more about nuclear regulations. Is it more “expensive” for you to deal with the uncertainty surrounding the bill’s decision on the veto or time limits? Is this issue worse than the additional requirements for assessments or consultations? Because one is more harmful to the company than the other. Should both issues be addressed simultaneously because the cumulative effect can lead to an investment freeze?
[English]
Mr. Mooney: In regard to the proposed impact assessment act, our view is we understand the current assessment regime with the physical activities designation regulations that are there for us to digest. That provides a level of certainty in the risks, what we would see coming down the pipe, if you will, on the new regime because we don’t have the project list in front of us to accurately assess what projects are going to be swept up into the new federal impact assessment process.
The current regime with the CNSC being the lead in relation to our environmental assessments, and then that integrated with our licensing process is our preferred path. We see right now a process that has a great deal of uncertainty because we’re not sure what’s going to be picked up with the federal assessment requirement.
The Chair: Thank you very much for your testimony.
For panel two, we welcome from the Inter-Church Uranium Committee Educational Co-operative Reverend Michael Poellet, President; from Saskatchewan Mining Association, Pam Schwann, President; Jessica Theriault, Director of Environment with the Mosaic Company. Also continuing with this panel, Mr. Liam Mooney, Vice-President, Safety, Health, Environmental Quality and Regulatory Relations, Cameco Corporation.
Reverend, please go ahead.
Reverend Michael Poellet, President, Inter-Church Uranium Committee Educational Co-operative: I would like to thank the Senate committee for the opportunity to appear before you this morning.
I would also like to begin by acknowledging that we are on Treaty 6 territory in the homeland of the Metis. This is a fact which should permeate our discussion today and is imperative in the shaping and passage of Bill C-69.
“Insanity is doing the same thing over and over again and expecting different results.” This quotation attributed to Albert Einstein and often used by Alcoholics Anonymous to explain the practice of addiction is also a way of understanding the nuclear industry, the uranium mining companies, the Canadian Nuclear Safety Commission, and the politicians and bureaucrats within governments who support this way of either boiling water or blowing up the world.
The technology of nuclear power generation has not changed since the 1960s. The problematics of how to safely store, let alone dispose of high-level radioactive waste has not been resolved. The detrimental effects of uranium mining on human health, social well-being and the environment continue to be minimized and ignored. Yet the industry and government, particularly CNSC, continue to promulgate and promote the procedures for licensing, or more accurately, renewing the licenses for nuclear generation facilities, uranium mines, processing facilities, and decommissioning mine sites. The CNSC has never met a licensing proposal it didn’t like.
Current proposals for small modular nuclear reactors are simply the same technologies on a smaller scale; however, the negative outcomes of SMNRs cause radioactive waste, environmental degradation, health risks, and decommissioning is not on a smaller scale. Enabled by CEAA 2012, the CNSC continues to do the same things over and over again in its licensing procedures, which allow the nuclear and uranium mining industries to do the same things over and over again with the same deleterious results. Now they have the temerity to claim that SMNRs should be exempt from environmental impact assessment.
The Inter-Church Uranium Committee Educational Co-operative continues to make its case with respect to the deleterious, devastating, and disastrous effects of the nuclear and uranium mining industry in submissions to the CNSC and other governmental regulatory agencies. Of course, the effects are always the same: “We have received your submission; the licence for the project has been approved or renewed.” The harsh self-criticism is that if we expected different results from doing the same things over and over again, we have been engaged in an insane practice.
CEAA 2012 is broken. The CNSC has never had the expertise and competence to conduct impact assessments. Its procedures for environmental impact assessments were not best practices, but toxic practices. Practices of ad nauseam repetitive insanity with respect to the environment and the health, safety, and well-being of the people of Canada.
Bill C-69 is an opportunity to stop the insanity. To be sure, it is no panacea. It has many weaknesses, which our organization has addressed in previous submissions to this committee and other government agencies. However, Bill C-69 is a constructive proposal, reorienting us in the right direction. Issues and practices such as greater participation of Indigenous peoples and recognition of traditional knowledge, regional, strategic and sustainable impact assessments, greater attention paid to cumulative effects of projects in a region, and gender-based analysis are positive measures which should be passed and not die before this session of parliament adjourns.
The most significant factor in passing Bill C-69 is that it begins to address the most significant problem in our current environmental assessment procedures, public trust. From the expert panel’s report, Building Common Ground: A New Vision for Impact Assessment in Canada, they stated:
A frequently cited concern was the perceived lack of independence and neutrality because of the close relationship the NEB and CNSC have with the industries they regulate. There were concerns that these Responsible Authorities promote the projects they are tasked with regulating. The apprehension of bias or conflict of interest, whether real or not, was the single most often cited concern by participants with regard to the NEB and CNSC as Responsible Authorities. The term “regulatory capture” was often used when participants described their perceptions of these two entities. The apprehension of bias on the part of these two Responsible Authorities eroded confidence in the assessment process.
First and foremost to the goal of restoring trust and confidence in the process is a belief that the authority conducting the assessment must be free from bias and conflicts of interest.
Public trust and confidence is crucial to all parties. Without it, an assessment approval will lack the social acceptance necessary to facilitate project development. . . . The consequence of this is a higher likelihood of protests and court challenges, longer timeframes to get decisions and less certainty that the decision will actually be realized — in short, the absence of social license.
While I welcome the opportunity to go through line-by-line of Bill C-69 with you, time permits me only briefly to point out the eight general areas which we at ICUC want to see incorporated into the proposed impact assessment.
Multi-jurisdictional assessment. This involves federal, provincial, municipal and Indigenous jurisdictions functioning cooperatively. We want to avoid and eliminate substitution and equivalency by the provinces.
Structure of assessment regimes. This would be a new model whose institutional structure includes assessment authorities, co-governance boards, review panels, expert advisory committees, independent tribunals, and elimination of the NEB and CNSC as responsible authorities able to conduct environmental assessments.
Triggering and scoping. This includes early triggering, complementary, comprehensive and list-based triggering, decision-based triggering, and strategic and regional environmental assessment triggers and tiering.
Post assessment decision tracking, reporting and compliance assurance. This includes tracking of proponent commitments and federal obligations, tracking of predictions, mitigation and adaptive management plans, responses to tracking, evaluation and reporting, and harmonized monitoring methodology, data collection, and reporting.
Learning-orientated environmental assessment. Public participation, knowledge development and the implications entailed from the monitoring of effects.
A sustainability approach to environmental assessment. Sustainability criteria to predict the effects and risks of the project and to identify uncertainties, principles to guide project decisions in light of the range of positive and negative effects of the project. For example, maximum net gains, avoidance of significant adverse effects, principles of fairness, explicit and transparent justification.
Principles of meaningful public participation in environmental assessment and the essential steps to getting there. The participation begins early in the planning and decision-making process. Public input can influence or change the outcome of the project being considered. Opportunities for public comment are open to all interested parties, include face-to-face discussions and involve the public in the actual design of an appropriate participation program. Formal processes of engagement such as hearings and various forums of dispute resolution are specified, and principles of natural justice and procedural fairness are considered and implemented. Adequate and appropriate notice is provided and adequate time for response. Ready access to information and the decisions at hand are available and in local languages spoken, read and understood in places potentially affected by proposed undertakings. Participant assistance and capacity building is available for informed dialogue and discussion. Participation programs are learning-orientated to ensure outcomes for all participants, governments and proponents. Programs recognize the knowledge and acumen of the public. Processes are fair, open and understandable to the public.
Finally, incorporating climate change into environmental assessment. This includes developing pathways to decarbonization in multiple sectors, defining the climate effects of a project in terms of net GHG emissions, considering alternatives, incorporating the social cost of GHG’s, socioeconomic analysis and requiring security for climate damages.
Thank you for your time and attention. I look forward to your questions and discussion.
The Chair: Thank you.
Ms. Schwann.
Pam Schwann, President, Saskatchewan Mining Association: Thank you very much, senators and colleagues. Thank you for coming to Saskatoon today, and thank you for the opportunity to allow the Saskatchewan Mining Association to present our perspective on Bill C-69.
You have already introduced my colleague here. I’ll skip that part. The Saskatchewan mining industry is the voice of the mining industry in Saskatchewan. We have over 35 member companies that explore for and produce minerals. Our members operate over 20 active mine sites throughout the provinces and have corporate offices in both Regina and Saskatoon.
Mining and mineral exploration are important to Saskatchewan’s economy. Thank goodness we do things over and over again. We employ over 27,000 people in rural, northern and urban communities, purchasing more than $1.5 billion annually from Saskatchewan businesses and contributing over $1.7 billion annually to federal, provincial and municipal taxes.
Similar to the earlier presentation this morning, we have a particularly successful and important story we want to share with you about the importance of the mining industry in northern Saskatchewan. At the start of 2018, approximately one in every five jobs in this broad, but sparsely populated region of around 37,000 people was directly related to mining, predominantly uranium mining. During 2017, the northern mining industry purchased $261 million from Indigenous-owned companies. You’ll be hearing from some of those later this afternoon, I understand. At northern Saskatchewan mine operations, 41 per cent of all workers are First Nations or Métis heritage, one of the highest rates of Indigenous participation in Canada. The payroll for those workers is $89 million per year. The work of the mining industry in northern Saskatchewan, which is now extending into southern Saskatchewan, is a tangible example of economic reconciliation with Indigenous peoples.
Polling of over 1,000 Saskatchewan residents also consistently demonstrates that the Saskatchewan’s public is supportive of the mining industry, over 89 per cent, with 97 per cent indicating that it is very important to the province. This is not a one-off poll. We have done two over a six-year period. We’re doing another one this year. What is of most relevance to this committee is that our polling indicates that a large majority, over 75 per cent, are also confident in the federal and provincial regulatory system.
I would suggest that this level of support for and confidence in Saskatchewan’s mining industry and in our provincial environmental assessment process clearly demonstrates that Saskatchewan has the right approach to the environmental assessment and regulatory oversight of mining projects in Saskatchewan.
The SMA and our members have been actively engaged with the federal government during the review of and consultation both with CEAA 2012 and with the proposed IAA process over the past three years. It is extremely important for our industry that this is done correctly. Our continued concern has been the overlap duplication and lack of coordination between federal and provincial reviews of the same mining projects. To highlight this lack of federal/provincial coordination, we would point to only one equivalency fee agreement in all of Canada that was achieved under CEAA 2012. That was in BC.
As outlined in our brief to the committee, the SMA is proposing an amendment to the act regarding the treatment of uranium mines and mills as summarized as follows. The IAA must allow the impact assessment process to be scaled depending on the complexity of the proposed designated project. Currently, as Ms. Wong identified, the IAA would automatically refer uranium mines and mills to a lengthy review panel assessment process. Designated projects that are uranium mines and mills must have access to the same types of assessments as all other designated mining and milling projects, similar to all prior versions of the federal assessment legislation. There is no science-based evidence to subject these mines to a lengthier, more complex and costly panel process.
This requires an amendment to the IAA to ensure the agency-led process is available to uranium mines and mills with full access to provisions for cooperation with the CNSC, the provinces and Indigenous governing bodies.
The SMA has provided detailed comments in our brief to the committee on proposed minor amendments to the number of sections of the act, most recommending that the wording “other than a uranium mine or mill” be included in recognition that uranium mines and mills already have a proven track record with respect to the existing environmental assessment and regulatory processes.
With respect to Saskatchewan mines, the Government of Saskatchewan has a proven robust, effective and efficient process by which potential environmental and socioeconomic impacts of a project can be assessed. The Government of Saskatchewan also has jurisdiction over provincial mineral resources, and is in the best position to weigh the overall benefits of projects against any potential environmental and socioeconomic impacts and their proposed mitigation.
Unlike the environmental impact assessment, Saskatchewan assessments have long considered, in fact since 1980, sustainability factors which are also under provincial jurisdiction. Saskatchewan mines have life cycle environmental assessment and regulatory oversight for non-uranium mines and mills through the provincial Ministry of Environment. For uranium mines and mills there is already dual life cycle environmental assessment and regulatory oversight, as Ms. Wong alluded to.
Both the province and the CNSC have a long history of ensuring compliance with environmental assessment conditions through the life cycle of a mine and milling operation. From an efficiency standpoint, having a well-coordinated life cycle assessment and regulatory licensing system is critical to ensuring a seamless transition from the impact assessment to the regulatory licensing phase.
My comments now will be more aligned along the project list. In our brief to the committee, the SMA also provided comments on the yet-to-be-released draft regulations designating physical activities, more commonly referred to as a project list. I would like to highlight a couple of items, the first, that it is exceedingly difficult to understand the impact and consequences of the proposed IAA without knowing the content of the project list. We strongly believe that the concurrent view of the IAA with the final project list is crucial to fully understanding the impact that it will have on our industry. We remain concerned that without understanding what the IAA will apply to, a meaningful review is not possible.
The second item of concern with respect to the project list is that we continue to hear from the federal government that the list is intended to only capture major projects. This is an extremely ambiguous term. Our concern is that the threshold for what is deemed to be major will be set too low. We’re also concerned that there will be multiple hooks that are in the project list such as greenhouse gas emissions, railway access, pipelines, et cetera, that may result in the project being subject to a federal IAA, even when those individual items can be readily captured within a provincial assessment.
Saskatchewan has 40 years’ worth of a proven track record with respect to environmental assessment, life cycle regulatory oversight, and we’re a world leader in post mining, milling remediation and closure monitoring and management. We believe the federal IAA requirements should only apply to jurisdictions in which an established environmental process is absent. We believe the project list should be reflective of this reality and should exclude Saskatchewan mining projects that are already subject to provincial assessments such as potash. Layering on a cumbersome federal IAA process on an established provincial EA process does not add value.
I would also like to stress the importance of having an appropriate amount of time for federal officials, the provinces and the regulated public to understand the requirements for the new acts when they come into force.
The SMA would also strongly recommend, in line with what you heard previously from Cameco with respect to the Canadian Navigable Waters Act, that the amendments referred to occur and that the coming into force of the provisions for the impact assessment act and the Canadian Navigable Waters Act be no earlier than one year after Royal Assent.
I would like to close my address to this committee by thanking you for your efforts in coming to Saskatchewan. We appreciate the opportunity to present to you.
The Chair: Thank you very much for your statements. We are going to proceed to the question period.
Colleagues, please keep your preambles very short and keep in mind that the allocation time is three minutes per person.
Senator MacDonald: Thank you, panellists, for being here this morning. I’ll direct my first question to Reverend Poellet.
Reverend Poellet, I’m curious: What’s your doctorate in? Is it in the sciences or engineering or what field?
Rev. Poellet: No. It’s in systematic theology.
Senator MacDonald: When it comes to science, you have about the same background I have. It’s obvious from your presentation you’re a complete enemy of nuclear power generation. You’ve stated that the technology hasn’t really changed since the 1960s. You broaden that to include the proposed development of small nuclear reactors and equated the technologies as being the same. Again, I’m not a scientist, but my understanding is one of the great advantages of small nuclear reactors is that their core generators are rechargeable, so they’re not disposable.
Now, in the north of this country, every single community in the north of Canada is powered by diesel, dirty, filthy diesel. It will be a great panacea for all those northern communities if the successful development and introduction of small nuclear modular reactors could be introduced in the north and save them from all that filth and the cost of bringing that diesel up there. Why would you be against that?
Rev. Poellet: First of all, it would be the cost of bringing a small nuclear reactor up there. As well there are other alternatives.
Senator MacDonald: And what is the cost?
Rev. Poellet: Well, it’s been estimated that it would be anywhere from 1 to $2 billion initially, at least that’s the figures that have been given to CNSC, as they are engaged in design reviews of ten different proposals for small modular nuclear reactors.
Senator MacDonald: Yes, but like all technology, the more you develop it and the more of it that goes on the market, the costs will drop as it’s introduced.
Rev. Poellet: Certainly that hasn’t happened with regard to nuclear generation.
Senator MacDonald: That’s all.
Senator Cordy: Thank you very much for being here today.
Reverend Poellet, my questions are for you to start. You’re absolutely right when you spoke about the expert panel and their reports on the perceived lack of independence and neutrality because of the close relationship with both the NEC and CNSC.
We have heard from a number of witnesses about standing or public participation. We have heard that it should be more limited and that the regulator should actually limit the number of participants. When I asked the question earlier this morning, I said: “Well, how is it going to be limited, who is going to determine?” — and it was the regulator. But they said: “Well, depending on how close they are to a project.”
You feel that the standing clause or the public participation clauses that have been changed from 2012 to this C-69 will actually be better for Canadians if they will have — I won’t say why, and perhaps you can explain that. Why do you believe that this bill in relation to public participation is an improvement?
Rev. Poellet: I think with regard to public participation, when more are enabled to participate, there is a better opportunity for, first of all, understanding exactly what’s involved, and as the expert panel noted, if what is seriously lacking is trust in the procedures, one way to build that trust is to enable people to participate in the procedure.
Secondly, the impact of some of the projects that were there cross more than simply local bounds and boundaries, but have effects interprovincially and beyond. Again, a reason for greater participation.
Senator Cordy: You spoke about the early planning stage. Do you think that this is a good addition to the legislation?
Rev. Poellet: Yes. I think that the more involvement we have in the early planning stage will enable things to go through more quickly at later stages. I know people are concerned about timelines and all of that. If there is agreement at the beginning in terms of the assessment of the projects, the way it should go, when we get to the later phases of the project, there won’t be new questions raised and asked, like, “Why wasn’t this considered?” or “Why haven’t we done that?” — because that has already been looked at in the early planning stages.
Senator Cordy: What about you, Ms. Schwann? Do you think the early planning stage is a good addition to this act?
Ms. Schwann: I would say in theory it is. I would also say in practice the mining sector already is engaged in early planning, both within the communities that are affected by the mining industry and certainly with the regulators. I think that one of the big challenges in the early planning phase, though, is that is the timeframe in which the federal, provincial and Indigenous governments are to coordinate their planning and cooperation agreements. I think that would need to be tested. I think that’s a question mark.
Liam, do you have any further comments?
Mr. Mooney: Yes. As an industry and as a company, we have a long track record of engaging particularly with our near neighbours. I think part of the frustration in that regard was expressed on the earlier panel. That engagement and that dialogue has led to employment opportunities and has led to contracting opportunities, and then it’s turned back on our industry that we are now buying the support that we have. Frankly, nothing is further from the truth. The people who work for us are our strongest ambassadors in those communities. The contractors whom we hire are similarly seeing how we operate our facilities, the care we take with our employees, the environment and the public health, they take that back to the communities. It’s better understood within those communities.
The Chair: Senator Carignan.
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Senator Carignan: My question is for Ms. Schwann. In your brief, you address the issue of constitutional jurisdiction, which involves turning to the provinces for local matters. In any case, you seem biased in favour of assessments conducted at the provincial level rather than at the federal level. Am I wrong and if so, why? Sometimes, this leads to criticism from some people who say, “Ah, there’s a proximity.” We heard a little bit of it from the reverend. This isn’t the first time that we’ve heard this type of criticism regarding the proximity between the decision-maker and the industry. As a result, some people think that compromises are being made when it comes to environmental assessments. I want your insight on environmental assessments conducted by the provinces rather than the federal government.
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Ms. Schwann: The provincial government has been involved in environmental assessments far longer than the federal government including the inclusion of socioeconomic factors. They have had a robust system for 40 years on assessments compared to the federal.
Secondly, I think you’re always better to leave decisions in the hands of people who best understand the context of a project, who best understand the science behind the project and who best understands the communities. That would be a provincial government as opposed to a federal government which may not even understand the geography of the area.
I think what happens when you have a provincial government that has more experience is you end up with better decisions that are being made. I would not support that things are compromised. If you have a provincial government looking after things, they have the longer-term interests of the province at heart. It would not be in their interest to make a short-term decision that might compromise the long-time integrity of the provincial resource, the provincial communities and population.
The Chair: Senator Simons.
Senator Simons: Thank you very much, Madam Chair.
I don’t know if our witnesses today agree on very much. I think you both agree about the whole issue of a project list or what Reverend Poellet called triggering and scoping. It’s very frustrating for all of us to go forward without knowing what’s covered by the impact assessment act and what isn’t.
I was also very much interested in Dr. Poellet’s point about post assessment decision tracking and reporting. I hope that’s something that will be dealt with in regulations because I think that is essential.
I want to ask you, sir, about something different. Your organization obviously has grave concerns about the environmental impact of the uranium mining industry, but can you tell me, because this is a new field for me, have there been incidents, accidents, cases of toxicity, radiation poisoning for mine workers? Are there specific instances that trigger your concern, or is it more a philosophical issue about nuclear power in general?
Rev. Poellet: No, there have been some specific instances and some concerns. In fact, the most recent one in real time was this past Tuesday. There was a meeting at the English River First Nation with concern over the Key Lake mine and processing facility where it has now been detected that some radioactive material is working its way into the groundwater. The community is quite concerned about that for good reason. These are not incidents of theory. These are concerns, and certainly the concerns are there when it comes to the decommissioning of the facilities.
Senator Simons: I don’t know if Ms. Schwann or Mr. Mooney would like to respond.
Mr. Mooney: I would like to start by saying that I’m not insane. I’m actually very proud to be a representative of the uranium mining industry and the nuclear power that it helps to generate.
I think one of the things we keep circling around here is on public trust. Ms. Schwann earlier talked about the broader support, but Ms. Wong also detailed for you that we do regular polling, and this isn’t five people in a basement somewhere, this is a thousand people. We’ve got 80 per cent support provincially and 82 per cent in northern Saskatchewan. Public trust is not an issue for the uranium mining, the mining association or mining generally in Saskatchewan.
In relation to what we’re seeing play out in front of this panel, that is specifically one of the concerns that we’ve had with the project assessment process, that policy issues that have been made by the Government of Canada, by the Province of Saskatchewan continue to be revisited on projects. Without a sensible environmental assessment process that’s assessing the merits of a project, we’re going to continually have people appear who are staunchly opposed to nuclear power and to uranium mining and continue to make the same arguments as they have in the 2000s, the 1990s, the 1980s and on and on.
Ms. Schwann: I would like to add some further science-based evidence. We have had numerous studies done by a very well-respected individual, Dr. James Irvine, who used to be with Northern Health, conduct a number of studies on the health of the community, community people. We have had numerous studies on the wildlife and country foods including meat and berries that have been studied and waters. None have shown any adverse impacts related to uranium mining. We have decades of studies that would support that. We would be happy to file them with the Senate if you would like them.
The Chair: Yes, I will ask both of you, Professor Poellet and Mrs. Schwann, to forward us this evidence on the pollution or non-pollution. That will be very interesting.
Senator Mockler.
Senator Mockler: New Brunswick has a CANDU reactor in Point Lepreau. We have been a world leader when it comes to the reactor and transfer of technology across the world. I had the occasion two months ago of doing round tables precisely on the future of nuclear energy. I have been informed that New Brunswick and Quebec are becoming world leaders when it comes to the small modular reactor. We had scientists at the table.
Yes, we are leading the way and we have public trust. And, yes, we have heard many concerns from Canadians from coast to coast to coast on the fact that we are trying to define the social licence of projects with Bill C-69. Being in the industry, do you have a definition of what is social acceptance, social licence, when it comes to Bill C-69?
Ms. Schwann: I think that’s an interesting question because a lot of Bill C-69 has been framed in terms of lack of public trust. I’ve never seen a survey, by the way, to support that other than what’s on Twitter, which I don’t think is a real scientific analysis. We have studies and public polls that backup that the public, at least in Saskatchewan, is strongly supportive of the mining sector. We have social licence, significant engagement in rural northern communities, urban communities with respect to mining. Our companies are very active in their communities and community endeavours that support a higher quality of living for all residents of the province.
I would suggest we have a strong social licence. I would measure it on the basis of the public trust and the public support that we have. There are also national polls by the Mining Association of Canada that also show very strong levels of support for the mining sector in Canada.
Senator Wallin: I have two questions. I’ll pose them, and then we’ll try and save a little time that way.
Ms. Schwann, on the question of the so-called hooks, can you just walk us through one? You’ve given some examples here, emissions, railway access, pipelines, et cetera. You could have a project that’s underway that has been approved by the province, and you’ve gone through all that process with the long history you have. Then because you want to access a pipeline, all of a sudden you would now fall under the jurisdiction of this bill and then go through a whole other process?
Ms. Schwann: I could respond to that, but I think Jessica will give you a more detailed response.
Jessica Theriault, Director of Environment with the Mosaic Company, Saskatchewan Mining Association: Specific to the potash industry, some of the hooks would be the railway and our expansions with our railways at our site as we build pipelines specific for our industry on our facilities.
The other would be in regards to the multi-sector air pollutant regulations, which is a new federal regulation that involves the replacement of our boilers. That will reduce the amount of NOx at our site. The way in which we are concerned is that that could also trigger an environmental assessment.
There are multiple hooks, but those are just some examples specific to the potash industry.
Senator Wallin: We’ve been talking a lot over the last few months about the amendments that are being proposed and suggested, and the project list certainly stands out. Who is going to be affected and when and why, the vetoes, who gets to participate in the process, all of those issues. Let’s just imagine in some other world that all of these amendments are accepted and embraced. Would you still suggest the one-year delay for the actual coming into force of the both the impact assessment act and the navigable waters changes to give people time to understand the final product?
Ms. Schwann: Absolutely. We saw even with CEAA 2012 that there wasn’t sufficient transition time, and that was a narrower scope. Now there’s a much broader scope here, it will take a significant amount of time to inform and work with all stakeholders on what the pathway forward is in terms of guidance documents, of regulation. We would be looking for a minimum one-year period.
Senator Wallin: I just wanted to know if Mr. Mooney had a comment.
Mr. Mooney: I would wholeheartedly agree with that position. We had the misfortune during some legislative change that we were taking training at the same time as some of the staff who were charged with implementing the changes to the legislation. We feel that for there to be a practical and comprehensive implementation, there needs to be some time for training and for the necessary guidance documents to be produced.
Rev. Poellet: I would like to concur with that. If we’re going to do it right, we have to take the time to come up-to-speed on it. Indeed we need that.
Senator Wallin: Thank you for that.
The Chair: Last question, Senator Patterson.
Senator Patterson: Reverend Poellet, thank you for being here. We need to hear all points of view. As I understand your submission, you have pretty strongly denounced the CNSC and the NEB’s credibility for promoting projects. You condemn the provincial regulatory process and want to avoid substitution. I would like to ask you about the Government of Canada. They have published a roadmap on small modular reactors. By the way, the wind doesn’t always blow and the sun doesn’t always shine where I live in northern Canada. They call it on the NRCan website, small modular reactors, the next wave of nuclear innovation. Sounds like a positive endorsement of SMR’s to me. Now under Bill C-69, which you support, a federal minister will have the final sign-off. I’m wondering if you would agree that the federal government may be guilty of promoting nuclear, and therefore, in your opinion, a federal politician is not fit to make a final determination following a public and transparent assessment process.
Rev. Poellet: In my remarks, and again today, wanting to speak favourably toward Bill C-69, I said it has its weaknesses. Indeed one of the weaknesses, from our perspective, is precisely federal cabinet ministers signing off. If there is an amendment that would change the bill to change that understanding, we would be most in favour of it.
Senator Patterson: Thank you.
The Chair: Thank you very much. That concludes our second panel.
For panel three, from Mosaic, Sarah Fedorchuk, Vice-President, Public Affairs and Government Relations; from Nutrien, Mike Webb, Executive Vice-President and Chief Administrative Officer; and, as an individual, Dwight Newman, Professor of Law and Canada Research Chair in Indigenous Rights in Constitutional and International Law, University of Saskatchewan.
Thank you very much for being here. Each of you has more or less five minutes, after which a period of questions and answers will follow.
Sarah Fedorchuk, Vice-President, Public Affairs & Government Relations, Mosaic: Thank you for the introduction, and good afternoon to the chair and members of the committee. I appreciate the invitation and the time you are taking today to visit Saskatoon and hear directly from our community.
My name is Sarah Fedorchuk. I am Vice-President of Public Affairs and Government Relations for the Mosaic Company. For those of you who aren’t familiar with us, let me tell you a little bit about what we do.
Mosaic is the world’s largest combined producer and marketer of concentrated potash and phosphate fertilizers with over 16,000 employees globally and about 2,200 in Saskatchewan plus we have hundreds of Canadian contractors and vendors on our sites at any given time. Our operations and joint ventures span across nine countries, and all of our Canadian operations produce potash. We completed $9.6 billion in sales in 2018. In less than a decade Mosaic will have invested more than $5 billion into our potash expansion, which includes K3, the first new production shaft built in Saskatchewan in over 50 years.
All of these projects were stringently regulated by the Province of Saskatchewan, enabling Mosaic to be nimble and responsive to increased demands for high-quality products. Our mission is to ensure global food security by helping the world grow the food it needs. The United Nations estimates that the world population will climb to 9 billion people by 2050. The world’s farmers must produce more food and fuel. We need more fertilizer to do it. In fact, fertilizers are currently responsible for producing half of the world’s crop yields.
Potash is Canada’s largest mineral export both by volume and in economic terms. A reliable, safe rail transportation is absolutely critical to ensuring that exports can continue to grow. As it stands, 95 per cent of Mosaic’s potash is exported from Canada each and every year, almost half of which is shipped to offshore customers through Canpotex, the international marketing and logistics agency. Because so much of our product is exported outside the country, we are especially sensitive to difficulties we have seen with rail transportation across Canada over the last several years.
I would imagine that this committee has already heard about the serious strain felt by Canada’s rail network due to the inability of new oil and gas pipeline projects to get off the ground. We are seeing an environment in Saskatchewan where the supply and delivery of natural gas for industrial users is constrained. Our fear is that Bill C-69 in its current state will only make the construction of new natural gas pipelines more difficult. In a challenging economic climate, regulatory certainty is more important than ever for us to be able to compete on the global market. Any abrupt or negative changes to Canadian taxation, environmental regulations or other areas can and does cause investors to look for more predictable or efficient jurisdictions.
Currently Saskatchewan’s potash companies face stiff competition from the international competitors who pay significantly lower taxes and who also operate under much-less stringent environmental regime. Added to that, potash is a global commodity. We are price takers and not price setters. This means that mounting regulatory compliance costs aimed at improving environmental performance such as price on carbon can actually lead to unintended outcomes. These costs increase the risk of carbon leakage. They enable Chinese, Russian and other foreign potash competitors to undercut Canadian operations without reducing their global emissions. Our competitors in other areas of the world generally operate with lower standards for environment, labour and social responsibility. Our competitors gain a significant advantage on the world market where unfortunately the lowest-cost producer is rewarded, not the most environmentally or socially responsible producer. Saskatchewan’s potash mines are already leaders in innovation and sustainable development. They are best in class with respect to worldwide potash mining emissions intensity.
In the last year Mosaic has done research comparing greenhouse gas emissions from Canadian potash producers to greenhouse gas emissions from competitors around the world. The results are very good news for Canada. We are pleased to find that Canadian potash GHG emissions are only 29 per cent of the global average, leading the world in terms of low GHG output. While we are committed to continuing to lower these emissions, we must be mindful of the additional cost of doing so and the additional advantage that cost can give to foreign competitors who do not and will not have to pay a carbon tax or clean fuel surcharge, at least not for the foreseeable future.
Specifically regarding environmental or impact assessments, Mosaic firmly believes that the jurisdiction for the assessment of potash projects should remain with the Province of Saskatchewan, which has robustly regulated our sector for the last 40 years. Estimated GHG emissions and socioeconomic impacts for mining projects are already accounted for under Saskatchewan’s provincial environmental assessment process. Duplicating these efforts at the federal level would add an unnecessarily costly and time-consuming layer. While the proposed federal impact assessment process seeks to include upstream GHG emissions, assessing upstream emissions poses a number of challenges and overextends the scope of any assessment to which a proponent should be subjected. Our view is that the impact assessment should remain focused on areas of federal jurisdiction.
Speaking of the Bill C-69 project list, we would echo the concerns of others today regarding our inability to fully understand or plan for changes in environmental assessments in Canada if we are not offered a full and complete picture of the project list that will apply to Bill C-69 prior to passing into law. We encourage the government to finalize and make publicly available that list as soon as possible.
In closing, the potash industry has operated safely and successfully in Saskatchewan for 60 years without any major environmental incidents. We are proud of that record and work hard to maintain it. Over the past decade the potash industry has invested billions in expansion projects, again, without major incident. At the same time, the potash and mining industries in the province continue to have widespread public support as my colleagues from the Saskatchewan Mining Association discussed earlier today. Mosaic supports a robust and protective environmental regulatory regime in Canada; however, that system must be practical, pragmatic and balanced if our Canadian potash industry is to prosper. We strongly urge the government to balance its environmental goals with helping to protect the competitiveness of our industry. As mentioned, Mosaic’s future investment decisions will be based on the most cost-competitive jurisdiction. There is serious potential for regulations that are not deigned properly to erode Canadian competitiveness, the Canadian economy and to do more overall damage to the health of the global environment. We would encourage the government to help us celebrate the world-leading position of Canadian potash in terms of emissions, environmental performance, food security, safety, community investment and labour standards by ensuring that our industry remains as healthy and competitive as possible. Thank you once again for the opportunity to speak today.
The Chair: Mr. Newman.
Dwight Newman, Professor of Law and Canada Research Chair in Indigenous Rights, University of Saskatchewan, as an individual: Good morning. Thank you for inviting me to appear. My name is Dwight Newman. I’m a professor of law and Canada research chair in Indigenous rights in constitutional and international law at the University of Saskatchewan. Amongst other topics, I have written extensively on the duty to consult doctrine. I will be making comments focussed on Bill C-69 and issues on consultation with rights-bearing Indigenous communities. I have provided a written submission that sets out some more details. I will highlight and expand upon some points in my remarks today.
In general terms, the claims by the proponents of the bill are that Bill C-69 enhances Canada’s regulatory system and does so through such steps as improving consultation with Indigenous communities within the regulatory system. Every time I look again at the bill, I struggle with these claims in respect of Indigenous consultation. I would see Bill C-69 as increasing regulatory uncertainty in ways that cause some real concerns. That probably isn’t limited to issues on Indigenous consultation, though that’s where I will focus. Thinking specifically of those issues, I see Bill C-69 as struggling to live up to this billing that it’s improving consultation with Indigenous communities. When one considers the details on the bill, it promises, according to the proponents, more such consultation or more effective such consultation, but I don’t think it provides it. It doesn’t improve regulatory certainty, but probably tends to undermine it.
I’m going to refer to three characteristics of the statutory drafting that lie behind that claim in these brief opening remarks. First, Bill C-69 abolishes existing regulatory bodies where we have just started to get clarity from case law on judicial expectations on consultation in the context of those bodies’ operating statues. That’s not an all-determinative point, things are always up for reform, but it raises an onus on those advocating a new regulatory structure.
Second, Bill C-69 contains variable language within the bill itself on what is to be achieved in respect of consultation while also containing very little guidance on how that’s to be achieved or very little mechanism for the achievement of consultation. While the ERA part of Bill C-69 contains explicit mechanisms for consultations with the public, neither the IAA nor ERA contain specific mechanisms for the constitutionally required consultations with Indigenous rights-bearing communities. The term “the public” is actually used in varying ways within Bill C-69. Some principles of statutory interpretation might well read parts of the ERA part of Bill C-69 as implicitly excluding Indigenous consultation, clearly not the intention, but something that could follow from the drafting in light of how the words “the public” is used in various parts of the statute. I don’t know what exactly was operating in the drafting process on that particular dimension. I hope you will explore that further with those involved in the drafting.
Third, there may be in the minds of some that all of these issues will be addressed further through the development of the accompanying regulations. I want to highlight that if not to be exposed to further legal challenges that pose potential problems for projects and project analysis, development of those regulations needs to take account of the Supreme Court of Canada’s latest pronouncements on the duty to consult in the Mikisew Cree decision it released in October 2018. The headlines about that case are all about the determination by the Court that the legislative process does not trigger the duty to consult. A less-discussed part of the judgment is that five or six of the nine judges seemed to think that the development of regulations could, in fact, trigger the formal legal duty to consult. Relying on the development of regulations to fill in missing parts of Bill C-69 means either meeting the formal legal duty to consult in respect of those regulations or engaging in processes highly exposed to legal risks.
My view in summary is on Indigenous consultation, the present form of Bill C-69 needs some detailed statutory drafting work to increase consistency between different parts of the bill. There should be an attempt to avoid relying so heavily on the regulations for further details and the incorporation of more details into the bill itself if it’s to provide the kind of certainty that it’s billed as providing. I’ll leave it there and look forward to discussion.
The Chair: Mr. Webb.
Mike Webb, Executive Vice President and Chief Administrative Officer, Nutrien: Good morning, senators. My name is Mike Webb. I am Executive Vice-President and Chief Administrative Officer for Nutrien. I am responsible for human resources, sustainability and stakeholder and community relations, investments as well as government relations.
Nutrien is a global enterprise. We are the world’s largest provider of crop input services and solutions, including fertilizers. We are a proud Canadian company. We consider ourselves an important part of the business landscape in Canada and globally. Nutrien plays a critical role in feeding the future by helping growers to increase food production in a sustainable manner. We appreciate the opportunity to provide this global perspective. I’m particularly proud to represent our role in Canada as I recently received my Canadian citizenship at a ceremony in Calgary.
Nutrien is the result of a merger of two large agricultural companies, Potash Corporation of Saskatchewan and Agrium in early 2018. We have operated potash assets for approximately 60 years in Saskatchewan and nitrogen assets for over 50 years in the Province of Alberta. Nutrien supports the local communities in which it operates, and we work very hard to maintain the trust and social licence our operations enjoy around the globe. As a leader in our sector, we aim to balance environmental, social and economic factors in our business and across our value chain.
Our concerns with the proposed Bill C-69 and impact assessment act can be summarized very simply. It’s about competitiveness. The impact assessment act will hurt Canadian competitiveness, resulting in capital being deployed to other countries. This has the potential to impact Canadian jobs, social support systems and the economy generally. Nutrien competes in a global business environment. We deploy capital in regions where we have confidence we can develop projects competitively, sustainably and economically.
We have announced plans to deploy $10 billion in capital spending over the next ten years. As a proud Canadian company, Nutrien wants to continue building projects in Canada and continue supporting jobs and the social systems in this great country.
We have a long history of investing in Canada. Over the last decade we invested approximately $1.5 billion in our nitrogen facilities in Alberta. In addition, between 2005 and 2015 we made capital investments of more than $10 billion in our potash operations, the bulk of which was invested right here in Saskatchewan. Nutrien wants to continue to make investments like these in Canada; however, the regulatory landscape and related uncertainty are factors that significantly influence these business decisions with respect to where we and others make investments.
Nutrien is concerned that Canada’s competitiveness is being eroded by initiatives like Bill C-69 and the impact assessment act. While the US is simplifying and streamlining regulation, Bill C-69 is sending signals that Canada is moving in the opposite direction. Nutrien supports environmental sustainability and strongly believes that development can proceed in an efficient manner while ensuring prudent environmental protection. We believe that government should strive to achieve a balance of competitive business conditions and environmental protection.
We greatly value our relationship with Indigenous communities proximate to our sites and have developed cooperative and inclusive business models to increase Indigenous participation.
Nutrien seeks to grow its operations and build more plants in Canada; however, we require assurance that Canada supports economic growth and development. Initiatives like the impact assessment act provide a signal that Canada does not fully recognize the development requirements for large-scale industrial projects and does not value responsible economic activity and jobs to support employment and investment in the workforce.
Significant local knowledge exists today with respect to the regulation of our facilities, regulation that is effective today. Nutrien has undertaken the necessary environmental assessments and detailed permitting requirements for its facilities over many years, over 60 years in the case of potash and over 50 years in the case of nitrogen.
There is a constant battle with the US for capital and investment in our industry, particularly with the Gulf Coast states. Adding regulatory duplication in Canada hands the US states a competitive advantage that we don’t need to give them. It will not benefit Canadian workers or the Canadian economy. We have had recent experience in obtaining environmental regulatory approvals in the United States. In Geismar, Louisiana, an expansion of our ammonium nitrate plant required an application for an air permit which was processed and approved within six months. Also, prior to the construction of a new urea plant in Borger, Texas, we received environmental approvals within 14 months. This is the practical reality in which Nutrien and other global enterprises are making important capital investment decisions today.
Finally, if legislation like the impact assessment act will apply to a greater number of activities, Nutrien is concerned that critical manufacturing inputs such as natural gas may be less available to our business. By creating greater uncertainty with respect to project approvals and ongoing business requirements, the impact assessment act will chill investment, a chill that can have compounding effects throughout our economy. A proponent like Nutrien will be reluctant to commit capital into a process or region where it cannot reasonably predict a positive outcome over the life of its facilities.
I would like to thank the members of the committee for their time today and look forward to answering your questions.
The Chair: Thank you very much.
Senator Patterson.
Senator Patterson: Thank you, Madam Chair.
I’d like to thank Professor Newman for lending us his expertise. As a member of the Aboriginal Peoples Committee, I’m familiar with your expert opinions on consultation. I was very interested to hear your concerns about the effectiveness of the promise of the bill for more consultation with Indigenous people. We know that many First Nations want jobs, economic benefits and don’t want their voices to be drowned out by a more open standing test.
You have made it clear that the bill needs detailed drafting work to reconcile inconsistencies. Can you give us specific advice on how that could be fixed?
Mr. Newman: I try to be constructive when I visit a committee. If I could propose simple amendments that I could prepare in a reasonable amount of time, I would bring those. The difficulty here is that I think that there is a lot of further thought that needs to go into appropriate amendments. The purposes section of the bill refers to much broader aspirations in terms of achieving consultation than is actually expressed in the later parts of the bill that would have any room for any sort of a mechanism on consultation. The mechanisms provide for the possibility of public hearings. They don’t provide for the possibility in any explicit way for consultation with rights-bearing Indigenous communities as would be constitutionally required.
Could there be particular amendments that address that? Could be there be particular amendments that address the questions around achieving certainty of completing consultation? I think there could be a lot of useful work done there, but I also can’t come in and give you here are the three sections that you should add. I think that there needs to be a lot of further work done. I gather it’s the sort of thing that might be being done on the regulation side, but for certain reasons I don’t think that that’s the right place to do it. I think there could be further sections added to the bill that would better achieve this claim that the bill is furthering consultation as required, given that was one of the motives behind the bill, was the sense that the former system wasn’t always doing that with certainty.
Senator Patterson: Two specific questions, again, to Professor Newman. First of all, would you have any comments on the open standing test in C-69 and the threats to, as you’ve described them, Indigenous rights holders who are directly impacted by projects? Secondly, a lot of things have been left to regulations and guidelines outside the legislative process. Would you have any comments on what should be an appropriate time to develop regulations before the bill comes into force?
Mr. Newman: On the first of those points, I don’t see an open standing test as necessarily benefitting Indigenous communities. There is a real danger that the voice of rights-bearing communities could be drowned out by large numbers of expressions of activist opinion that isn’t necessarily in support of the real aims of Indigenous communities. There are dangers there. Obviously there needs to be public consultation around certain types of projects, and there is room for that. The bill actually provides more room for that than for meeting the legal requirements of consulting with rights-bearing indigenous communities. There’s an imbalance there in some ways, and the open standing type of test doesn’t really help or address that; it actually probably causes more difficulty.
In terms of when regulations could be developed, that’s a very challenging issue. It would be a lot easier to comment on the bill if there were regulations already accompanying it. On the other hand, if there are amendments still being made to the bill, regulations can’t really be developed unless they line up with it or the powers that are going to exist under the act. Of course, as I have referenced, there is the possibility that regulations need to go through a formal legal duty to consult procedure, and the government has many aspirations around the UN declaration on those fronts. There’s a very complex situation here in terms of the timing sequence that would be involved.
Those are just some reflections. I can’t claim to have an answer on when the exact moment is, but the meaning of the bill isn’t very clear without the regulations at the same time.
Senator Cordy: Thank you for being here this morning.
My first question is for Ms. Fedorchuk. Thank you for all your information about the potash industry. Being from Nova Scotia, I know a bit about it, but I have learned more this morning. Thank you for that.
I was interested when you spoke about the duplication of Saskatchewan or provincial assessments and federal assessments. I think your comment was something like they should only be dealing with federal jurisdiction. Could you give us a sense of what this assessment looked like under the province and under the federal government, and what is the overlap?
Ms. Fedorchuk: With the provincial environmental assessment process, there is the technical piece, but there is also the public outreach piece. Before we would do any sort of development — and we have just recently finished a big development progress in Esterhazy, Saskatchewan — we do a series of open houses and community outreach to ensure that the communities in which we operate are very comfortable with what we’re doing and to answer any questions they may have.
For the federal assessment, I think that remains to be seen, where the differences would actually lie. The Ministry of Environment for the Province of Saskatchewan has been so integrated with our industry for decades that they have a really good knowledge of what we do and how we navigate projects like that. There is a really great understanding when we’re being regulated or when we’re trying to get an environment permit to go forward.
Senator Cordy: Is there any discussion? The federal government also has a responsibility, they can’t just hive that off to the provinces. Is there consultation between the federal Minster of the Environment, natural resources, Minister of Finance? We have had it suggested that they should also be involved because of the economic aspect of these projects. Is there consultation between both bodies?
Ms. Fedorchuk: Between the province and the federal government now on our projects, no. We are regulated through the province right now. There could be some conversations that happen that we’re not aware of. When it comes to green-lighting a development project for a potash mine right now, whether it’s greenfield or brownfield, that goes through the Province of Saskatchewan.
Senator Cordy: Thank you.
Mr. Webb, you spoke a lot about competitiveness, and you want the industry to be competitive in Saskatchewan. I’ll ask a question that was asked earlier of somebody else, of Dr. Newman. What amendments would you propose that would give you more confidence that you’re not going to be losing your competitive edge?
Mr. Webb: We are very happy with the existing legislation. We do not believe that C-69 should exist at all. We’re regulated, as Sarah said, by the provincial authorities. It has worked very well for us. We don’t believe that C-69 as it relates to Nutrien specifically would be beneficial to our organization. Therefore we do not believe it should exist.
Senator Cordy: You think the bill should be killed?
Mr. Webb: Yes, ma’am.
The Chair: Senator Simons.
Senator Simons: Thank you very much, Madam Chair.
Professor Newman, I want to follow up on the excellent questions asked by my colleague Senator Patterson. The whole idea of duty to consult, getting it right in this bill, is, one, to move us forward on the path of reconciliation, and, two, to make sure that project proponents aren’t suddenly surprised near the end of the process by being told that the duty to consult didn’t happen on the part of the government. It would frustrate me immensely if we passed a bill that didn’t do either of those things.
I understand what you’re saying, that you don’t want to be put on the spot to come up with three magic amendments that instantly fix everything. The problem is that we don’t have months and months. In very short order, we’re to be proposing amendments and debating them. Could you give us a few more hints? Can I take you for coffee? Can you walk us through it? Saying that the bill is defective in this very critical area and then sort of teasing us with not telling us to fix it is a little frustrating.
Mr. Newman: I’m not trying to tease anyone. I’m saying that a multi-hundred-page bill, to put the correct kinds of amendments in, it’s a major legal enterprise to do that.
Senator Simons: We have about a week to do it.
Mr. Newman: It’s a very challenging situation for the committee and for Parliament.
Putting in some specific amendments around exactly how consultation is to work within particular sections, to actually provide for consultation with Indigenous communities in some way within the sections that refer to this consultation with the public generally, I think those might be constructive. I don’t think they’re really going to resolve the broader issues that the bill seems to have been constructed without a desire to lay that out within the bill, but trying do that through the regulation process gives rise to real challenges.
I’m trying to hint at the kinds of things that might be appropriate. To draft that properly and co-draft it in English and French at the same time is not something I could easily do for today. It would be something that would involve a great deal of work for someone to put those in.
Senator Simons: Are you saying that this should go where the outline is for public consultation? Because you’re right, the act dictates how the public consultation will happen, but it doesn’t specifically have language about how duty to consult is to be carried out. Would you want to see in the preamble a definition of duty to consult? Would you want to see — there is a list of conditions in section 18 that lay out all the different things that a proponent has to do. I don’t think that duty to consult in that language actually appears there.
I’m sorry to put you on the spot. I never went to law school — my mistake — and now I’m co-charged with amending this act. I really want to get this right.
Mr. Newman: Adding to the preamble isn’t going to help or adding more to the purposes section in section 6 isn’t going to help. I mean, the difficulty is that those parts actually promise more than what’s delivered later on in the bill. If the aim is, and I think you’ve outlined it well, to ensure that there is proper respect for the consultation process and the rights of Indigenous communities combined together with avoiding surprises in the context of projects around that issue — and Trans Mountain is a big example in that regard in terms of a proponent investing hundreds of millions of dollars and by surprise it all goes away. It is in the operative clauses of the bill that more would need to be added, that there are actually powers for these mechanisms to carry out consultation so that that’s not excluded implicitly by the fact that it’s not there. What detail could be put around how that’s to work, that would be a question of how much further can be done. I think there should be something in some of the operative clauses later that specifically authorizes a process of consultation with Indigenous communities rather than just an open standing test.
The Chair: Thank you very much, Professor Newman.
Senator Carignan.
[Translation]
Senator Carignan: I’ll ask my question in French. Do you think that the notion of interest or standing when it comes to participation in consultations should be structured based on other criteria, rather than on the people directly affected versus the general public? Obviously, there would also be another specific criterion for Indigenous groups. People have told us that a broad public consultation would somewhat “overshadow” the strength or weight of the First Nations’ position. I want to try to find a way to re-establish their position. I want to hear what you have to say about this.
[English]
Mr. Newman: That makes a great deal of sense to have a standing test for consultations that structure it around appropriate sorts of groups with whom consultations can occur. Those with whom there is a legal right to consultation such as Indigenous communities, those who are directly affected, obviously there is a stronger interest in public consultation. Those in the general public who might want to comment on a project, there would seem to be a lesser interest there and one that could indeed distract from the consultations that need to occur with those who are legally entitled to them or those who are directly affected. As a quick answer, I would say that that makes a great deal of sense, to adjust the standing test in some manner that’s responsive to legal rights and direct effects.
[Translation]
Senator Carignan: I have a slightly more technical question. It concerns the definition of “jurisdiction,” which takes into account the provinces or organizations that would be given a mandate to conduct an environmental assessment. This includes Indigenous groups that would have environmental assessment powers, duties and functions. At first glance, I thought it made sense. However, I then wondered about institutional bias or impartiality. The organization or body may need to make a decision where the rights of First Nations are concerned. It would then be in a position to have elements of institutional bias, and therefore to initiate challenges. Do you have any thoughts on this matter?
[English]
Mr. Newman: I’m not sure I understand what kind of bias you’re asking about. Could you clarify?
Senator Carignan: My question is about the definition of jurisdiction. We could have people from an Indigenous group, that they will have the mandate to make the assessment. They could be in a position where they will have to balance their rights or the impact on their own rights. Do you think that you could have a risk of impartiality and it could create a field of legal action?
Mr. Newman: You’re asking about Indigenous participation in some of the governing mechanisms?
Senator Carignan: More about the definition of jurisdiction where they could receive the mandate to make the assessment.
Mr. Newman: I would need to think more on that question, if there would be a risk that arises. I don’t immediately see it, but there would be something to think about there if an Indigenous governing body were in the position where they were assessing something and implicitly also acting in place of the Crown and subject to the duty to consult as a result.
Senator Carignan: Yes, you got it.
Mr. Newman: That could give rise to some great difficulties depending on which exact organization was empowered at that stage. I don’t know if I would call it so much a bias or partiality issue. There would be an issue raised with respect to that governing body being asked to play dual roles or having dual roles, I should say.
Senator Carignan: Yes.
Mr. Newman: It’s not something I had thought about on first looking at the act or various readings of the bill. It raises some interesting and important questions.
Senator Carignan: Thank you.
Senator Richards: Thank you for being here.
I have a comment/question for Mr. Webb. Congratulations on your citizenship. Now you know what kind of problem we’re in. You mentioned that this bill hands a lot to the United States. I tend to agree with that. I just want you to comment. I think the bill overburdens Canadian people with a great deal of expectation that they should agree to governmental ideas of how to achieve a subjective — there’s a worldwide condition of global warming in the environment, and that is implicit and rampant through this omnibus bill. It is going to impede almost every bit of structure that we want to produce in this country. That’s my assessment of the bill. I just want your opinion.
Mr. Webb: Thank you, senator.
Yes, I’m thrilled to be a Canadian. I’m thrilled to be a Canadian for a number of reasons, at least the fact that things work very, very well in this country.
The regulations that have existed for decades for Nutrien and the predecessor companies have created in the case of potash and nitrogen absolutely world-class assets whether it’s Nutrien, Mosaic, K+S or others. Preserving those world-class assets and our place on the world stage is very important for the country, for its citizens, for those who count on the tax revenues and royalty streams that come from our business activities. We believe that the regulatory environment that exists today works very well. Bill C-69 would insert a level of uncertainty that could compromise the very enviable position that we enjoy today.
Senator Richards: Thank you very much.
Senator MacDonald: I thank all of the witnesses.
Like many Canadians, when I hear “potash,” I think of Saskatchewan. My questions are for both Mr. Webb and Ms. Fedorchuk.
Mr. Webb, I want you to educate me here. What is a nitrogen asset and just how does that play in the marketplace?
Mr. Webb: We operate nitrogen plants in North America. We have nitrogen facilities also in Latin America and Egypt. The basic chemistry is that we convert natural gas into a nitrogen molecule that is used primarily for fertilizer. It also has other uses. When you buy a bag of fertilizer, and it has three numbers, N, P and K. The N is the nitrogen component. It is a critical, absolutely essential nutrient for plant growth. We wouldn’t have the food today that we have if it wasn’t for nitrogen.
Our nitrogen plants are very large installations where we take the basic feed stock of natural gas, and we convert it to a liquid or a solid form that is then distributed through our network and other networks and ultimately is applied, for the most part, at the farm level.
Senator MacDonald: You said you had assets in different countries?
Mr. Webb: Correct.
Senator MacDonald: Is this basically a domestic or an export product?
Mr. Webb: It’s an export product as well. We export nitrogen as well as potash.
Senator MacDonald: All right.
When it comes to the importance of potash in producing agricultural products, one would think that the sky would be the limit for this industry in a world with an ever-increasing population. My understanding from your testimony is that it’s very competitive out there for potash. I’m curious if you could give us an overview of what the industry has faced over the past, let’s say, decade and a half or so and how these provisions would impact on the industry and the building of Canada’s export?
Ms. Fedorchuk: Over the last decade, the major potash producers in the world have undertaken huge billion-dollar expansions. They weren’t just in Canada. Our Russian competitors have also expanded their facilities as well as new entrants have come in as well. It is a very competitive marketplace. In 2016 we had decade-low pricing for potash. We were very financially constrained. We have seen small increases in market demand and placing over the last two years, which has been great to see, but the market is still really volatile.
The potash that we make here in Canada goes to China, to India, to Brazil. Within those markets the farmers aren’t necessarily looking for a sustainably made product, although we’re very proud that we are world leading in our sustainability record. They’re looking for the lowest price. If we try to hold out for any kind of incremental pass on cost that we’ve had over the past few years, the Russians can just very easily transport their product into all of these markets, sometimes much more easily than we can, especially with the constrained rail system. We are price takers in the market. We don’t set the price globally.
Mr. Webb: I would add that Sarah is absolutely right; the Russians are our principal competitors from a price perspective, certainly from Nutrien’s perspective. We play by the rules. We have clear rules that we operate within. I dare say that the Russian producers have a different set of rules. It is a very competitive space. As Sarah said the lowest price will end up doing very well.
The Russians are also not nearly as disciplined as it relates to the Canadian producers. It creates enormous disruption in the market at times, particularly this time of the year during the spring planting season. Also given the fact that their cost of energy, it’s very energy-intensive in terms of producing potash, their cost per kilowatt-hour is about 40 per cent less than it is in the Province of Saskatchewan. We’re fighting an uphill battle as it is today to keep our prices at a competitive level and compete on the global stage.
Senator MacDonald: Thank you.
Senator Neufeld: Thank you all for being here today. I appreciate it very much.
Ms. Fedorchuk, you and Mr. Webb mentioned that you were nervous about getting the natural gas that you needed and getting the lines. Can you tell me where your natural gas is supplied from, where in Saskatchewan?
Mr. Webb: Yes, we’re in Saskatchewan. Our nitrogen facilities in Canada are in the Province of Alberta.
Senator Neufeld: Okay.
Mr. Webb: Our natural gas is delivered to us from natural gas producers in the Province of Alberta.
Senator Neufeld: You would talk, then, about pipelines within the Province of Alberta?
Mr. Webb: That’s correct.
Senator Neufeld: You talked about natural gas lines too.
Ms. Fedorchuk: Yes. Mosaic has a solution mine outside of Belle Plaine, Saskatchewan, which takes a great deal of natural gas in order to run. It’s a different form of potash mining. We source from Saskatchewan and Alberta. It’s really the transportation of natural gas for us, which is getting constrained, and more infrastructure is needed.
Senator Neufeld: Your organizations were obviously part of the — or maybe I should ask first. Were you part of the consultations that the federal government said they did over three years? As I understand, they said over three years that they consulted with everybody that they could across Canada as fulsomely as they could to develop Bill C-69. Were your organizations consulted? I’ll leave it there for now.
Ms. Fedorchuk: Throughout that process Mosaic was reaching out to Environment Canada and Natural Resources Canada on a pretty regular basis trying to get our voice heard. A lot of our feedback wouldn’t be reflected in the bill because our feedback is that the process for getting potash mines built isn’t broken, it’s provincially regulated, and that’s where we would wish to be.
Senator Neufeld: I’m not asking about reaching out. You were proactive. Did the federal government, this expert panel, actually meet with your organization? If it did, was it a long time that it met with — took a lot of your suggestions, and were you happy with the result of Bill C-69 that would have come out of that process? They said they had an expert panel for three years.
Ms. Fedorchuk: We did not meet with the expert panel.
Senator Neufeld: One of the largest industries in Canada, and they didn’t —
Mr. Webb: The same applied to Nutrien as well, we do not recall being reached out to.
Senator Neufeld: Well, I find that absolutely amazing.
The chair is going to cut me off, so — no? I’m so used to you saying you can’t ask another question.
The Chair: I didn’t say anything. You are imagining.
Senator Neufeld: I have one other question.
Mr. Webb, you compared a little bit in Canada to the US with construction of a urea plant in Borger, Texas. Sometimes that’s easy to put out there, but if that same plant were to be built here in Saskatchewan under Bill C-69, give me an idea how long it would take.
Mr. Webb: Our estimates on the most favourable scenario would be 2.1 years. The worst-case scenario 5.1 years.
Senator Neufeld: That’s amazing. It’s no wonder that industry is nervous about what’s taking place with Bill C-69.
Mr. Newman, we’ve listened to quite a number of First Nations groups. Almost all of them — I think there might have been one, if my memory is correct, that wanted a standing test and them to be the ones who are first affected and should actually be directly consulted. Now, under CEAA 2012 — in the NEB process there is wording that says those that are most affected, experts, and then if others want to comment, they can. It’s the board that makes the decision about how much other information they listen to. This bill says the whole world can come. The First Nations that we talked to are very nervous about that because they get shouted down. What’s your opinion?
Mr. Newman: I would say two quick things in response. One is there is an existing system that was developed without all of the latest duty to consult jurisprudence but that has adapted over time and has had engagement with the case law. There has been a chance to see where that gets to. Carrying out of full-scale reform puts things into a very uncertain situation. Now, that’s not determinative. There can be arguments for a full-scale reform at times, but going this route of an unlimited type of standing test de-emphasizes legal rights that are held under the Constitution compared to a test that refers to those most directly affected. It’s not surprising that Indigenous communities, whether First Nations, Métis or Inuit, would have concerns about that. There probably should be amendments that focus towards those groups who hold legal rights and others that are most directly affected as opposed to just a general standing test that anyone can enter into.
The Chair: Senator Mockler, and then the last question goes to Senator Wallin.
Senator Mockler: I believe that politics is the art of the possible.
Mr. Webb, I want to say that I believe that to kill the bill — like you’ve expressed, I’m one of those parliamentarians who believe we need to improve the bill or change it dramatically to permit Canadians to create wealth. Maybe with the proper changes to Bill C-69, you could reopen your potash mine to create or get back the 500 jobs that we’ve lost.
We have a lot of partners out there. Approximately eight, nine premiers in Canada are concerned with this bill. A letter dated February 27, 2019, was sent to the Prime Minister of Canada by the four Atlantic provinces. I will quote it and then ask a question and ask you to comment on their concerns. The four premiers of Atlantic Canada said “. . . that the Bill as drafted places final decision-making power in the hands of the Minister or Governor in Council and provides the opportunity to veto the results of thorough scientific assessment and review of evidence.”
I would like to have your comments on that specifically in view of the fact there are concerns that it requires cooperation between the impact assessment agency and life-cycle regulators — for example, the offshore petroleum boards, the Canadian energy regulator and the Canadian Nuclear Safety Commission — in assessing projects and allowing them to proceed under any of the process options in the act. They are very concerned. This letter has gone to the Prime Minister. What are your views on the veto and the life-cycle process?
The Chair: Your question is directed to Mr. Webb, I think?
Senator Mockler: To the witnesses.
The Chair: Who wants to answer the question?
Ms. Fedorchuk: The minister’s veto would have us concerned especially if we’re looking at a four-year timeline to get approval for a process that we’re submitting science-based research investigation, have community approval, have done our duty to consult, and then for it to be vetoed at the end. Those assessments are really costly and time-consuming for proponents to undertake, and to not have the certainty that if we do everything right, we would not be able to move forward in the end would be really concerning to Mosaic.
Mr. Webb: If I can speak to your earlier comments about our facility, as I hope you know, we are in the process of speaking with the government about restarting and mining salt that would be used for municipal services in the winter.
As Sarah said, our concerns about Bill C-69 come down to the uncertainty that it inserts into the processes of allocating capital, which is critical to our organization. We believe very strongly that the regulatory environment that we operate in today serves us very well.
The Chair: Thank you very much.
Last question, Senator Wallin.
Senator Wallin: Thank you very much, Madam Chair.
Mr. Newman, I will not ask you to spell out amendments to the bill because I think I understand your point, that it’s kind of woven into the DNA, and it needs a total rethink on the whole question of consultation. Putting on your lawyer and legal hat, we are seeing — not just in this bill in others — that there are bills presented without regulation, and they interact. We need increasingly to see those things simultaneously and that you can’t fix what’s in the legislation by cleaning something up in regulation because the legislation is the master; it’s the legal language. I think that’s where we’re at, that we need to see both things together if we’re going to clarify that issue of who is going to be consulted and when, in what order and what weight we will place on the open standing list.
Mr. Newman: If we could see the regulations at the same time with this bill, one might be able to say different things, as least in part. Obviously what regulations can be developed depends upon what clauses of the bill permit the development of regulations. In some ways the more that can be done in the legislation itself rather than in regulation, the better because that allows Parliament to have control over the decisions that are being made. The regulatory side — the regulation-making side, I should say, just to avoid ambiguity, gives rise to additional challenges, but not being able to see the whole scheme of how it’s going to work poses some real challenges to understand what’s going to happen under this bill.
Senator Wallin: On that question of the duty to consult, as complicated as that is, and now the expansion of the list, could we do it? I don’t believe so. I want your view. I don’t think we can do it until we see the regulation and see those two pieces together.
Mr. Newman: It would be highly desirable to see the regulations at the same time. The bill without the regulations is a little bit of a gamble of what that’s going to look like.
The Chair: With that, we conclude our third panel.
We now welcome for panel four, from the Saskatchewan Association of Rural Municipalities, Ray Orb, President; from SaskPower, Randolph Seguin, Resource Specialist, Environmental Assessment; and from Athabasca Basin Security, Ron Hyggen, Chief Executive Officer.
Each one of you has five minutes. We will follow with a question period.
Ron Hyggen, Chief Executive Officer, Athabasca Basin Security: Good morning, Madam Chair, senators and the clerk of the committee. Thank you for having me here. My name is Ron Hyggen. I am the CEO of Athabasca Basin Security. I appear before you today to discuss our perspective as a northern business that services clients in the energy sector in three Canadian provinces.
As we gather here today, I would like to acknowledge that we are on Treaty 6 territory and the homeland of the Metis. We pay our respect to the First Nations, the Métis ancestors of this place and reaffirm our relationship with one another.
I am here as a representative of Athabasca Basin Development, an investment company that is owned by the seven communities in northern Saskatchewan’s Athabasca region. Athabasca Basin Development owns 12 companies that have operations across Canada.
ABD has been able to employ many northern Indigenous people since its start in 2002. At its peak, Athabasca Basin Development and its investments employed over 200 Athabasca residents. As a transitional employer, many Athabasca residents started with an ABD company and moved on to other jobs at other mine sites.
Athabasca Basin Security is one of those companies. We provide security and medical services in Saskatchewan, Alberta and B.C. We began in northern Saskatchewan working directly with Cameco and Orano at their uranium mine operations at three mine sites. We currently have over 200 employees servicing mining and oil and gas industries. At our peak when the energy sector was doing well we employed over 300 people. We average 74 per cent indigenous employment at all levels, including over 70 per cent of our management team.
We are especially proud of our long-term employment success stories, and in an industry that typically has high turnover, we have many five and ten-year employees. Catherine Nagus, who lives in Wollaston Lake, has been working with us since 2006, and was honoured in 2016 with the St. John’s Ambulance Award for her bravery during a wolf attack. Christopher Catholic, from Black Lake, Saskatchewan, started with us ten years ago as a security officer and is now the site security manager at Cigar Lake. Their stories are featured in the background packages that was provided in advance of this meeting.
Through our success in northern Saskatchewan, ABS was able to expand into southern Saskatchewan and Alberta with potash operators such as Nutrien, BHP, Mosaic and K+S. In these projects we have employed many First Nations people and have established working partnerships with seven other Saskatchewan First Nations.
In 2017 we acquired another security firm, All Peace Protection, in Grande Prairie, Alberta. Our Alberta-based operation services northern Alberta and BC, primarily working pipeline and oil and gas projects. This includes the Enbridge Line 3 Replacement project, various TransCanada pipeline projects and the pending Keystone XL and Trans Mountain Expansion projects. Today we have partnerships with 16 First Nations across Western Canada. In short, our company does well when the oil and gas, uranium and potash industries do well.
The economic and social challenges experienced by many First Nations across Canada are well documented. There also exists some incredible opportunities for these communities. A significant number of these opportunities are in the energy sector. Much is at stake for Indigenous economic and social development, and as an Indigenous-owned business employing a significant number of Indigenous people, we are keenly aware of the importance of finding the right balance between environmental sustainability and economic development. As a member of the Lac La Ronge Indian Band in northern Saskatchewan, I strongly believe it is our responsibility as Indigenous people to continue our ancestors’ teachings of being stewards of the land.
The Athabasca working group was one of the first environmental monitoring programs to tie together traditional knowledge and western science. This is a government industry and community partnership that samples water and traditional foods and reports back publicly on its findings.
In 2016 the Yát Thi Néné Collaboration Agreement was signed by Cameco, Orano and seven Athabasca Basin communities. It establishes a long-term working relationship between all parties and ensures that northern business will continue to benefit from uranium mining activities in the north. Our company started almost 20 years ago with contracts in the uranium industry. We would be pleased to see this sector grow and flourish. We would also like to see the oil and gas and potash industries rebound as well.
In closing, we want to participate in a sector that ensures First Nations are consulted and the environment is taken care of. We also don’t want to have other regulations in place that prevent projects from moving forward. This will limit the availability for us and companies like us to continue to provide opportunities for Indigenous communities. Employee successes like Catherine and Christopher are examples of what can happen when projects move ahead.
I appreciate the opportunity to be here as part of this review process and to provide our perspective. Thank you.
The Chair: Thank you.
Mr. Orb.
Ray Orb, President, Saskatchewan Association of Rural Municipalities: Thank you. I would like to thank the Senate Standing Committee for the opportunity to speak to Bill C-69 and its implications for rural Saskatchewan. My name is Ray Orb. I am president of the Saskatchewan Association of Rural Municipalities known as SARM.
SARM represents all 296 of the rural municipalities that make up our province. We encompass virtually all of our province’s farmland. There are obvious challenges with the sheer number of roads and bridges compounded by limited financial resources to maintain this infrastructure. Bill C-69 will add additional challenges for RMs to overcome.
RMs play a vital role in providing services and infrastructure to ratepayers. There are instances where these works and services take place along or near waterways subject to the Navigation Protection Act. The feasibility, timeliness and economic sustainability of these projects are greatly impacted when federal regulations in the Navigation Protection Act inhibit the ability of RMs to carry out these projects.
Before the 2012 amendments, municipalities were often told by Transport Canada to redesign and alter their projects which resulted in delays and increased costs. The 2012 amendments narrowed the scope of Transport Canada’s oversight of the right to navigation on Canada’s waterways. SARM supported those amendments as they reduced the impediments to municipal projects near waterways affected by the Navigation Protection Act. The amendments offered municipalities more local autonomy over the construction and modification of workers over most of Canada’s waterways, but still ensured major waterways with a proven contemporary navigation purpose and continued to fall under federal oversight and regulation. Our members and their ratepayers now benefit from less red tape, faster project completions and improved service.
The bulk of water transportation today in Saskatchewan is recreational in nature and not a common means of everyday transportation as it may have been in 1882 when the legislation was enacted. SARM believes there must be more effort taken by Transport Canada to consult locally with municipalities to get a better understanding of the waterways and their relative recreational or commercial uses. Consultations will assist with the aqueous highway test as local knowledge will better understand if the waterway is used for transport.
We are also concerned about the duplication of environmental assessments. In Saskatchewan the Water Security Agency is a one-stop shop for all water-related issues, assessments and permits. Clarification is required if it is Transport Canada and/or Environment Canada that does the environmental assessments. An increased duty to consult and notification requirements of project proponents will increase administrative costs for municipalities. We are concerned that more municipal infrastructure projects will likely fall under federal review; therefore, likely delaying projects and increasing costs. We have a couple of examples of this occurring in our RMs that I would be pleased to discuss later in the question and answer if you are interested.
Another concern we have is with the new category of projects that are in-between minor and major works. We have questions on what projects this will include, what their requirements will be and who determines this. We figure this legislation is going backwards and could make road and bridge construction in rural Saskatchewan difficult if not impossible. We believe our voice should be heard, and we urge for amendments that will allow for municipalities to build and maintain bridges in a reasonable period while also protecting waterways that support significant navigation activity.
It’s important to note that we support the Federation of Canadian Municipality’s suggested amendments to bill C-69 specifically, number one, that the Canadian Navigable Waters Act is amended to explicitly state that the prohibition in section 3 and the obligations in sections 5 and 10 do not apply if there would be no interference with navigation; and, two, that the list of criteria in section 10.4 of the Canadian Navigable Waters Act is broadened to include social disruption or a breakdown in the flow of essential goods, services or resources in order to adequately acknowledge the hardship and complexity created by damaged infrastructure in an emergency.
SARM supports energy infrastructure. We understand the economic and environmental benefits that infrastructure like pipelines offer our RMs, the province and the country. We have partnered with our sister organizations AUMA and RMA for a resolution that was adopted by FCM to support energy infrastructure. I would be glad to share that with the committee.
Saskatchewan’s importance to Canada’s oil and gas sector is essential. Any changes to the development of resource projects need to reflect the concerns of those most affected. We feel Saskatchewan does not always receive the same level of attention from the federal government when it comes to the oil and gas sector even though we are home to multibillion-dollar resource projects. It is RMs that rely on those projects for jobs. It is imperative that the voice of rural Saskatchewan be heard on amendments that will affect our economic and sustainability.
On behalf of SARM, we thank the Senate Standing Committee for the opportunity to lend our voice to this important conversation. Thank you.
The Chair: Thank you.
Mr. Opseth.
Douglas Opseth, Director, Generation Asset Management and Planning, SaskPower: Thank you for inviting us to be here today. I would like to thank this Standing Committee for having SaskPower here to speak. Unfortunately our president, Mike Marsh, is unable to be here. I’ll be speaking on his behalf. My name is Doug Opseth. I’m the Director, Generation Asset Management and Resource Planning for SaskPower.
In 2015, SaskPower committed to a 40 per cent reduction in greenhouse gas emissions from 2005 levels by 2030. To achieve that we’re looking to go as much as 50 per cent renewable generation in that timeframe. These are ambitious goals that have implications for our customers and SaskPower’s employees.
At this time SaskPower would like to focus down from higher-level considerations to two important opportunities to enhance both the clarity and certainty of Bill C-69. First, with respect to the impact assessment act and its attendant regulations designating physical activities, it is SaskPower’s submission that the act and regulations should identify and capture only those projects of national importance, those which have potential to cause significant environmental impact.
With this in mind, three tests could aid in determining which class of projects to bring under the act and regulations. First, is it possible? Is the potential environmental and physical footprint of sufficient breadth and duration so as to rise to the level of Canada-wide significance? Two, is the management of waste understood, and do regulation thresholds already exist? Three, does the project positively or negatively contribute to Canada’s ability to meet its environmental obligations and its commitments with respect to climate change?
For example, we’ll use a SaskPower project that we’re looking at. Consider a SaskPower large combined cycle natural gas facility, which is needed by SaskPower to replace conventional coal and to allow us to add increasing amounts of renewable generation. If we apply these tests to that project, firstly, a facility like this is energy rich, occupies a small physical footprint for the amount of energy produced. The life of this plant largely determines the duration of any impacts it would have. Environmentally, the release of CO2 would be a federal environmental concern.
Two, this type of facility is understood, and the release of CO2 is already federally regulated through regulations limiting carbon dioxide emissions from natural-gas-fired generation of electricity. If this facility failed to meet these regulations, A, it would not be able to be built, nor would it be able to operate.
Three, the move to natural gas paired with renewable power sources reduces the total emissions of CO2 from SaskPower’s generation fleet. This contributes to both SaskPower’s and Canada’s goals with respect to climate change. Based on these tests, a facility like this, which is currently captured under CEAA 2012, would not rise to the level of national importance.
SaskPower submits enshrining within the act clear statements, and I’ll list off these statements, one, that the act is focussed on projects of national importance which have potential to cause significant environmental effects; two, a set series of tests of national significance that must be met prior to a class of undertakings being identified within the regulations’ designated physical activities; and three, that the test act acts as guidance to the Minister should the Minister be considering designating a physical activity that is not prescribed by regulations. If these tests were put in place, we’d view this as being very positive, promoting both clarity and certainty within the act.
Next I would like to talk a little bit about the Canadian Navigable Waters Act. Section 3 of the act provides that it’s prohibited to construct, place, alter, rebuild, remove or decommission or work in, on, over, under, through or across any navigable water except in accordance with the act. SaskPower supports these requirements for construction of new facilities that may impede navigation.
SaskPower has existing hydro facilities in waters that are not included in the list of scheduled waters per the Navigation Protection Act; however, under the Jobs and Growth Act and the Navigable Water Protection Act, these existing works have been designated and are deemed to be on scheduled waters and, in effect, grandfathered as compliant for the purpose of the Navigation Protection Act. Under the proposed Canadian Navigable Waters Act, this grandfathering would be lost, and many of SaskPower’s existing hydro facilities would subsequently be designated as occurring on navigable waters instead of scheduled waters and, therefore, be subject to the new section 10 of the act.
Section 10 requires an application that includes the publication of a notice inviting interested persons to provide comments on the proposal in attempting to resolve any navigation concerns. If these concerns are not resolved, the commenter may request the Minister to decide whether an application under section 7 is required for approval of that work. Thus, even simple work on a legacy structure that does not alter the current navigation situation could lead to a project application and review with its attendant costs and time demands. SaskPower submits that the act should be revised to explicitly state that existing facilities remain as deemed to be located on scheduled waters and are not subject to section 10. This would serve to add both clarity and certainty of the act.
In closing, SaskPower is committed to sustaining our shared environment and helping Canada achieve its climate change commitments and submits that these two amendments to proposed acts would assist in this worthy endeavour. I would like to thank you for the opportunity to speak.
The Chair: Thank you very much. We are going now to the period of questions and answers. Deputy chair has given Senator Tkachuk his spot for asking the first question.
Senator Tkachuk: Welcome to our committee hearings. I want to start with Mr. Orb if I could. We have had a number of meetings on Bill C-69 and my understanding is that the national organization also has amendments to the act that they’re looking at and considering. Are you satisfied with the amendment process that they have put together? Do you know if they’re having any success with the government and the Minister? And do you have additions to it?
Mr. Orb: Senator, are you referring to FCM, to the Federation of Canadian Municipalities?
Senator Tkachuk: Yes, the federation.
Mr. Orb: We met with the Federation of Canadian Municipalities last week when we were in Ottawa. We looked at the proposed amendments that they have. Those are the two that I mentioned today. I know that they appeared in front of the government. I don’t know what the progress is on that. We are not satisfied that the government is onside with us; however, we’ll hopefully get this message across to this committee. That would be one of the recommendations. These are things that we could live with because they further define what’s nav waters. They also dictate if it isn’t a navigable stream. I have some examples of that.
Senator Tkachuk: Could you give an example?
Mr. Orb: I can give one example. It’s in the RM of Meadow Lake. This goes back to 2012 when the rural municipality applied to Transport Canada for approval to construct a new road and a bridge across the Allcott Creek. They submitted an application on April 15th, 2010. Approval was not received until November 23rd of 2011, so it was over a year later, with extra costs. The construction seasons, if you’re aware of, in Saskatchewan are very short because of our weather. After finally receiving approval, the RM was required to raise the bridge above the existing road top elevation to accommodate canoe traffic. It put a hump on the road. To our knowledge, there has never been a canoe through that structure, and it seems to be an extra cost, a delay, and possibly a safety hazard. That’s just an example, senator.
Senator Tkachuk: Thank you.
To SaskPower, you mentioned Bill C-68, which is the other act, as part of this bundle of resource acts, Bill C-69, Bill C-48 and Bill C-68. We have been told by the national association that we’ll probably never ever build a hydro project under C-68. You brought up C-68 in your presentation. Of course, the Navigable Water Act part of C-69 is often ignored, but that’s the stuff that SARM is interested in and I know that you’re interested in. In your renewable energy program, I would assume hydro would be a major part of that?
Mr. Opseth: As we look to move towards 2030, we need to start looking at other sources of generation. Hydropower is one of the factors that we’re considering. We have looked at hydro projects in Saskatchewan. We are also looking at partnerships with our neighbouring jurisdictions, Manitoba and other jurisdictions. Clarity around this would help inform our decision around moving towards more hydro facilities in Saskatchewan.
Senator Tkachuk: Thank you.
Senator Cordy: Thank you very much for being here to help us as we study this bill.
Mr. Hyggen, you spoke about consultation and the need for consultation with First Nations. Did you have consultations in the development of C-69 as part of the expert panel or sending in suggestions?
Mr. Hyggen: No. We weren’t discussed with at all in northern Saskatchewan on this bill.
Senator Cordy: I’m also wondering what in C-69 might prevent projects from moving ahead?
Mr. Hyggen: From our perspective, in all the projects I have taken on in the nine years I’ve been here, the process has worked quite well. BHP came to the province, began their work. The first thing we did was meet with them. They met with all surrounding First Nations communities. The same thing with all the new projects in the area. Alberta, B.C., same thing, Trans Mountain and us have met multiple times in Kamloops regarding their project moving forward.
For us, we start this process a few years prior to try to get agreements because we’re not going to obviously walk into another First Nations jurisdiction or traditional lands and input our stamp saying we’re behind it. Our process is to basically make sure that as an Indigenous company ourselves that we’re not infringing on anyone else’s rights. We want to make sure they’re behind us. I mentioned we had 16 First Nations partners. It’s really them that consults with government. We support that process.
Senator Cordy: This bill brings in an early planning process. Is that helpful, or is that something that you’re already doing, and now it’s just been formalized in a bill?
Mr. Hyggen: I’m not sure if I’d call it helpful. Like I said, the current process for us is working quite well. We don’t see the need for this. We have been growing quite well. The only issue I’ve been having lately is most of the projects we work on is provincial-based, so something in Saskatchewan, something in Alberta. When it goes across borders is when we tend to have some troubles. That’s an area we would like to address.
Senator Cordy: Mr. Opseth and Mr. Orb, you both spoke about the Navigable Waters Act and bridges specifically in your presentations. We heard somebody earlier this morning speak about the challenges when there are emergencies when a bridge is not safe anymore, and you have to deal with it immediately to continue with your transport of your goods, and they want that to be excluded from the bill. When you spoke about repairing bridges or construction — because trucks have certainly gained in weight over the past 40 years. If you’ve got a 40-year-old bridge, then it’s probably better to stabilize it. What changes are you looking for specifically in this bill to allow for quicker turnaround time in emergency situations?
Mr. Orb: As far as Bill C-69, we’re happy with the process as it is now without any changes. We believe there should be less red tape. Repairing a bridge that is on a major road is a large project. We don’t feel that there should be any other impediments. We don’t think the Navigation Protection Act should interfere with that if it’s already navigable. That wouldn’t change anything. We simply don’t need duplication. We think that provincially we can inspect, and we are doing that already. We are inspecting those through our Ministry of Environment, water security in particular. We don’t think there should be any added red tape. This will do two things, reduce costs and expedite the process.
Mr. Opseth: I think for SaskPower, it’s mostly around work that we need to do to existing hydro facilities. We’ve got legacy hydro facilities in Saskatchewan that require maintenance and ongoing work, which does not impact the navigation on the water, but potentially with these proposed changes, they would become subject to extended timelines to get an uncertainty around whether we can proceed. It opens the entire project up for review with absolutely no changes to the navigation along the water.
Senator Cordy: Thank you.
The Chair: Senator Simons.
Senator Simons: Thank you very much, Madam Chair.
I’m really happy. I want to follow up with what Senator Tkachuk said, to see both Mr. Orb and Mr. Opseth addressing the navigable waterways, which, I think, sometimes those issues get drowned out by all the concern about energy projects.
My first question is for Mr. Opseth. At SaskPower you do transmission as well as generation. Are you concerned about whether this would make it more difficult to build interprovincial transmission lines? This is something that as an Albertan concerns me because although we produce a great deal of electricity, none of it is carbon neutral to speak of — well, there’s wind and there’s solar, but natural gas and we’re decommissioning coal. We can’t green our grid without interprovincial tie lines. I’m concerned that this might make that more difficult. I’m wondering if you would also share those concerns?
Mr. Opseth: I think as we look to the future for SaskPower, we’re looking at all the options to allow us to provide cleaner electricity here in the province, and one of the things that we’re doing in conjunction with Natural Resources Canada is looking at how can more of the energy in Canada flow east and west.
In Saskatchewan we are more or less a landlocked province. We have limited tie lines to our neighbours, to Alberta and to Manitoba, and if we look to go down the path of moving more energy, that’s going to require more transmission lines to be built. The uncertainty around the ability to get those transmission lines built could impact SaskPower’s ability to continue to bring our emissions down in a cost-effective way for our customers.
Senator Simons: I have a question for Mr. Hyggen. If you were doing security along Trans Mountain, you wouldn’t just be dealing with wolves and bears; you could be dealing with a lot of, you know, angry backlash from protestors and potentially from other First Nations. One of the goals of Bill C-69 is to try to get more social alliances and consultation with Indigenous communities along the way. I wonder what your philosophy is if you’re providing security along construction of a pipeline that is going to be contested no matter what?
Mr. Hyggen: Our position is basically to support the First Nations in the areas we work. If it’s their traditional territory, and the leadership group within that territory agree with the project moving forward, we support them. Those have some firm boundaries, so on that project we’re specific in 5A, 5B in that project, that’s it. If you go further towards the coast, it gets a little controversial, like you’re saying.
The way that Kamloops Indian Band and Whispering Pines Indian Band looks at it is that is their territory. They’ll address it and support any projects they see fit and that fit what they believe in as far as environmental impact, and for them it’s a large amount of job creation.
Senator Simons: Then you’re saying philosophically you wouldn’t contract to provide security in construction areas where there is not that kind of buy-in?
Mr. Hyggen: That’s correct.
Senator Neufeld: Thank you all for being here.
Mr. Hyggen, I have a question for you that I asked to another witness. You have obviously worked all across the three western provinces in providing security so the people who work in the companies that you have or that are attached to you, I guess — people must live in the camps, they access communities all along those routes. I’ll use Trans Mountain for an example. It’s been said that there’s a lot of uncertainty, there’s a lot of people being abused to a degree or something like that, not treated properly. Do you find that in your operations? Do you find that when you go to camps? You’re in some pretty big mining camps. Do you find that? Is that, in fact, true?
Mr. Hyggen: In our experience it hasn’t. We’re in a bit of a different role, of course. We also take care of the medical aspect of some of the sites. We have EMRs, EMTs and so on that kind of take care of the work as it goes.
We stay at camps a lot. I guess what’s a little bit different about us is we focus on those areas in the rural areas they’re working. We go directly to the towns, to the First Nations that surround projects and try to get our employees from there rather than have people coming from elsewhere. The problem is that they tend to turn over. You bring people from a large city who aren’t used to living, you know, on the side of the road at a campsite for two weeks at a time. They tend to leave us. We just focus on that area. It’s their backyard. They know the area, the threats, and we go that way.
Senator Neufeld: Thank you. That’s good.
The Chair: Senator Carignan.
[Translation]
Senator Carignan: My question is for the SaskPower representatives. According to your website, your goal is to reduce greenhouse gases by 40 per cent by 2030 compared to 2005 levels. You operate three coal-fired plants that constitute one of your major sources of electricity. I was looking at the production of wind turbines, where less electricity is generated. Could Bill C-69, as it’s currently written, present obstacles for your clean energy projects, in terms of your desire to move toward closing your coal-fired plants? To achieve your goal, you’ll likely need to consider closing coal-fired plants. Will Bill C-69 hinder your goal of reducing your greenhouse gases by making the timelines for approving new projects too complex and lengthy?
[English]
Mr. Opseth: Yes, I think the bill as currently written makes it more difficult and expensive for us to meet our targets. We’re looking beyond 2030. We’re looking at all the options we have to reduce our greenhouse gas emissions, and many of those options, things like significantly increasing wind penetrations and amount of wind generation in Saskatchewan, imports from other jurisdictions, Manitoba Hydro, and even technology still in development such as small modular reactors, are all technologies we’re considering for the future.
The challenge with Bill C-69 is that because of the lack of clarity and the uncertain timeline to get through that process, it requires us to make earlier decisions before some of those options are even available for us to choose. The default generation will then look to — as we potentially retire coal fire generation, is going to be combined cycle natural gas. However, if we had more time and clarity that would come from our proposed amendments to Bill C-69, we would have more time to look at other options as we go forward.
As we go to 2030, if Bill C-69 as currently drafted comes into effect, we will need to make decisions now for generation projects that may not be needed until 2027. However, if we had more time through the previous process, we would have more time to look at other options besides natural-gas-fired generation. It makes it more challenging for us, not even just the challenge of getting the generation there; it adds cost to our customers. We have right now one of the highest electrical rates in Canada. These types of regulations just add more cost to our customers as we go through this transition to a cleaner future.
[Translation]
Senator Carignan: My second question concerns the energy corridors. We’ve been hearing about this concept more and more often. Are you in favour of these energy corridors? Do you think that the corridors would help reduce the environmental footprint? The idea is to run some major pipelines and power lines through a certain area in the same space at ground level. This would reduce the proliferation of different networks and pipelines across the province, particularly in Saskatchewan.
[English]
Mr. Opseth: Certainly a greater interconnectedness to our neighbouring jurisdictions would be a benefit to SaskPower. We have been working quite actively with Natural Resources Canada and the four western provinces looking at how more of the energy that currently flows from north to south, from Canada to the United States, could move east to west within Canada. We’ve got British Columbia and Manitoba kind of on the side so of Saskatchewan, Alberta, with tremendous amounts of hydroelectric energy; however, most of that energy now flows south. To make it flow east-west and to provide that as an opportunity for Saskatchewan and Alberta, you need more tie lines to come into effect.
Having clarity and being able to build tie lines is one of the options we’re looking at. The challenge we’re facing right now is that it takes time to build tie lines, and it takes time to form the transactions that would go along with — in our case it would be with Manitoba Hydro. With the extended timelines potentially through Bill C-69 we don’t have time to wait for those types of projects to come in. We need to commit to other forms of generation such as natural gas.
If we had clarity through the old process and a timeline, we would have more opportunities to explore those types of generations. We’re actively working with our neighbour to the east with Manitoba Hydro and Natural Resources Canada, looking at how we could move more of that energy into Saskatchewan.
[Translation]
Senator Carignan: Could this be done in Quebec as well?
[English]
Mr. Opseth: Well, certainly if you had a national grid that goes from coast to coast such as the rail lines, you could see energy, all the green energy, in Canada flowing east-west. Hydro Quebec sells a tremendous amount of energy to the United States. Manitoba does the same. BC Hydro does the same. A lot of that energy could stay in Canada. What’s stopping a lot of it moving between the provinces right now is just a lack of transmission lines between the provinces.
The Chair: Senator Patterson.
Senator Patterson: Madam Chair, thank you.
You know, Mr. Orb and Mr. Opseth, this is all déjà vu, this talk about the Navigable Waters Protection Act. We heard complaints in a previous government about the burden on municipalities, the delays and the costs of having to do environmental assessments for minor projects that don’t affect navigable waters. We heard about people who had to get environmental assessments to build a dock for their summer cottage, ditches, and farms that were held up by these overly stringent regulations, legislation that did nothing for the environment. We changed the Navigable Waters Protection Act I believe in 2012, somewhere in that area.
Why are we now going back to a problem we already fixed? After the act was amended by the previous government, were there problems with the water quality and the environment? Were there issues that arose that caused problems, to your knowledge, that have led us back to making this mistake again? How did it work out when those amendments were put in place?
Mr. Orb: The answer is, no, there weren’t any complaints. The system was working very efficiently. I can just give you one more example. If you know in Saskatchewan, in the Moosomin area there was a recommendation for a major road. There was a culvert installed. There was an idea that they needed to have access for a canoe. There was a proposal to put a telephone on either end of the culvert. You think this is fiction. It’s not fiction. They actually had to call each other if there was somebody coming. There was only room for one canoe. Those kinds of things don’t make sense. That’s why we pushed the federal government before 2012 to make this. Member of Parliament Larry Miller, if you recall, was one of the huge proponents of scrapping this ancient legislation, so, no we don’t want to go back to this. However, obviously the federal government wants to look at this. That’s why we’re proposing some kind of amendment that we can live with.
Mr. Opseth: I think from SaskPower’s perspective, I think we’re fine with the process that’s there right now. I think the concern we have is with the proposed amendments which eliminate grandfathering of existing hydro facilities. Right now if that amendment takes place, then we would have to go through this process for minor work on existing hydro facilities. We’re fine with the previous process; it’s just we’re looking for that grandfathering provision to show up in the new amendments.
Senator Patterson: I don’t know why we do this to ourselves in this country. I just do not know why. Thank you very much for that answer.
Senator MacDonald: Thank you, witnesses.
Mr. Opseth, I am going to put you on the spot. You want to meet those targets by 2030. We talked about small modular reactors. You have a uranium industry here that you want to keep going. You have fairly stable geology, I believe, in Saskatchewan. Correct me if I’m wrong, but there’s not much chance of tsunami taking down a nuclear reactor like it did in Japan. Has SaskPower considered nuclear power for this province. If not, why not? Is there no political for it, or did the numbers not work? We have successful nuclear reactors in Ontario and New Brunswick. It would seem to me this would be a natural place to put a large-scale nuclear reactor.
Mr. Opseth: I think SaskPower is interested in exploring nuclear power here in Saskatchewan. Historically, based on the size of our utility, the large reactors as you see in Quebec and Ontario, just wouldn’t fit within our system. However, with the new generation of small modular reactors, which is in development, the size fits well with SaskPower. That’s one of the reasons why SaskPower, along with OPG, NRCan and a number of utilities — New Brunswick Power partnered with NRCan on the SMR road map document which was prepared recently. It’s a technology of interest to us. The challenge is it’s still in development. When you start adding timelines proposed under Bill C-69 it makes it more difficult for us to wait for that technology to mature, and it forces us to make decision on gas.
We remain very interested in SMR technology. We think it’s potentially a good fit for SaskPower, and it’s one of the potential pathways we’re looking at into the future to help us meet lower emissions.
Senator Patterson: Well, that’s great to hear. I’m glad to hear that, but I’m still curious why a larger nuclear facility like exists in New Brunswick or in Ontario or Quebec, why you wouldn’t consider that as an option.
Mr. Opseth: We have looked in the past. Bruce Power was out here a number of years ago looking at that. I’ll try not to get too technical, but we’ve got limited tie lines to neighbouring jurisdictions. We need to be able to maintain our system within the borders of Saskatchewan. The challenge of those large reactors, which are typically 2,000 megawatts, that would be close to 50 per cent of the generation in our system. For us to take one of those units down for maintenance would require us to have backup in place for that which would not run most of the time. The economics would be channelling for us. If we had more tie lines there would be the potential for that.
The nice thing about SMR technology is that the size of them being somewhere between 100 and 700 megawatts, it’s a very nice for our coal facilities. Right now our Poplar River power station, for example, is about 600 megawatts, which is about the size of some of the SRM technology that’s currently being looked at. We remain very interested in exploring that as one of the potential pathways for SaskPower in the future. The larger ones we have looked at, I think just the nature of the SaskPower system just wasn’t a good fit for them at the time.
Senator Patterson: I guess one of the big challenges, then, is the lack of the proper infrastructure within the province in connecting to other infrastructure?
Mr. Opseth: It would be one of the things. If we had larger tie lines, it would allow us to do things like that, allowing us to move more of that energy elsewhere. I think our focus right now is not so much on the larger reactors, but more of a focus on the emerging SMR technologies.
The Chair: Last question, Senator Wallin.
Senator Wallin: Thank you.
I have two quick points for Mr. Hyggen. You seem to me to be an entrepreneurial success story. You are a provider, a service provider, for the mining and energy sector. When their investment slows or growth slows, their investment dries up. As we’ve heard multiple times this morning, everybody is a little skittish not knowing the rules and what lies ahead. I fear for the future of companies like yours. Do you?
Mr. Hyggen: Absolutely. Over the last few years we’ve had major projects announced even by SaskPower, hydro work pending in northern Saskatchewan to support the need for more energy. But if you’re slow or prices drop, demand decreases, unlikely, but, you know, if demand is there, but we can’t provide it because we can’t start new projects, it affects everybody down that whole chain.
We put a lot of time and effort into understanding each project we support. For a smaller company it’s a great deal of effort to understand and make sure we support what we should be supporting, and they’re not all in our backyard. We travel a lot. It’s a small group. Yes, we’re entrepreneurs, and we go after the work that’s out there, so jobs, like, with SaskPower, Hydro up north. When things stopped for us, it was a difficult thing to take because that was going to mean a lot of jobs for a lot of people in the north. As it is right now, we just focus on where we see the work. That’s why we’re out in BC right now.
Senator Wallin: Thank you.
To Mr. Orb, if you want to — I have some other comments for Mr. Opseth. I live in rural Saskatchewan. The infrastructure in these small towns in rural areas is in very bad shape. It needs to be dealt with. The municipalities are having a harder and harder time funding it because the number of taxpayers are going down as the farms grow and whatnot.
Is it your belief that Bill C-69 would subject infrastructure projects — whether it’s bridges, highways, waterlines, whatever — to this review process, or you simply just can’t get an answer to that question?
Mr. Orb: Of course, we’re concerned with the definition of minor. We’re concerned with what lies between the definition of minor and major works. We don’t know what that is. We’ve asked many of the senators, many of the MP’s. There isn’t really a clear definition. That’s something that we were asking, but we think a lot of our projects, would come under federal review.
One example, perhaps, is in your area, the Quill Lakes. We’re concerned about that. We saw that there were several groups of people — when the consultation was done, when the Province of Saskatchewan wanted to divert freshwater into the Qu’Appelle system. There were many groups that were opposed. We think there is, of course a duty to consult, we are already doing that with our First Nations neighbours, and all our other neighbours that we live beside. We don’t think that projects that are for the good of the province, and sometimes the good of the country, should be unnecessarily held up.
Senator Wallin: The issue is you don’t know? Until we get the project list, until we get definitions of major and minor, everybody’s in limbo?
Mr. Orb: Yes. I know there was reference made to Bill C-68, and we have the same concerns about that. We met with the Minister last week, and we were given some comfort that the regulations will deal with this. I’ve heard this several times this morning, that is a big concern when the Minister actually has some power to be able to do that rather than actually putting it through the system in the House of Parliament.
Senator Wallin: Believe me, we can’t fix in the regulations post facto.
Senator Richards: Thank you for being here.
If you want to see the future of no industry, just come to New Brunswick, come to the Miramichi. You want to try to get a doctor on the Miramichi. Our forestry is gone, our fisheries are dead, the mills have gone, the mines are closed. If that’s what the intent of this bill is, it’s going to work really well because you can’t get — we can’t get a doctor there that’s going to stay there more than two years, and half our nurses are going down to Florida to work, and I don’t blame them.
As I mentioned earlier, my father was the honorary chief of two reserves, and he was one of the first men in Newcastle to hire First Nation men and woman. It’s not a big thing, but it was a good thing. Much of the focus on First Nation participation — and this is directed to you, sir — has been on the terrible detrimental effects of industry on the First Nations no matter what these industries are. That’s what we’ve heard, but many of the chiefs who have taken the time to speak to our committee this week have stressed their absolute need for industry and the benefits their reserves and nations have by it. But their voice seemed to be drowned out in Ottawa. I’m wondering if you could comment on that, sir.
Mr. Hyggen: The first thing that comes to mind is a project that happened in northern Saskatchewan within the last six years. SaskTel brought up cell towers to service the north. In the north that was a brand new thing. People had cellphones down here for a lot of years, smartphones. All of a sudden they connected all the north. It opened things up for them a lot. You try to live in a small community that’s basically fly-in, it’s hard to connect with the world and understand what’s going on. It’s hard to get a job. It’s hard to move your kids into a future that they can be proud of. A small project like that is a major impact for them, and that couldn’t happen without industry being in the north.
Senator Richards: Thank you very much.
The Chair: Thank you.
(The committee adjourned.)