:
We can talk about it then. To answer your question simply, all of the members mentioned in the motion have been contacted, as have most of the other witnesses, but not all.
I'll go back to the order of business on the agenda for today and the first panel.
I'd like to thank you all for being here today. We have Jeff Lehrmann, president of Chevron Canada Resources. Welcome, and thank you for coming today.
By video conference from St. John's we have the Honourable Shawn Skinner, Minister of Natural Resources and Minister Responsible for the Forestry and Agrifoods Agency, Government of Newfoundland and Labrador. Thank you very much for being here, Minister. Welcome.
We'll start with Mr. Lehrmann, from Chevron Canada Resources.
Go ahead with your presentation for up to seven minutes, please.
Mr. Jeff Lehrmann (President, Chevron Canada Resources):
Thank you for the opportunity to appear before the Standing Committee on Natural Resources.
On behalf of Chevron Canada, I am pleased to share with the committee details of the deepwater exploration program that we successfully executed during the summer of 2010 in the Orphan Basin off the coast of Newfoundland and Labrador. We completed this drilling program without incurring a single lost-time incident.
Before I talk in greater detail about the Lona 0-55 well, I would like to explain how Chevron’s commitment to uncompromising standards of operational excellence gave us the confidence to proceed with this well, despite the uncertainty that followed the Deepwater Horizon incident in the Gulf of Mexico.
Chevron Canada Limited is a wholly owned subsidiary of Chevron Corporation, one of the world’s leading integrated energy companies. Chevron employs 60,000 professional men and women who are committed to delivering safe, efficient, reliable, and affordable energy sources to the communities and economies around the world.
We have been operating in Canada since 1938. Headquartered in Calgary, with an office in St. John’s, our upstream arm is focused on exploration and production activities in Atlantic Canada, Alberta, and the Canadian Arctic. Chevron’s corporate vision is to be the global energy company most admired for our people, our partnerships, and our performance. Protecting people and the environment is one of our seven shared values, along with integrity, trust, diversity, ingenuity, partnership, and high performance. Ensuring the health and safety of our employees, contractors, and the communities in which we live and work is a foundational value I and the employees of Chevron Canada commit to daily.
Chevron’s global systematic approach to ensure safe, healthy, environmentally responsible, reliable, and efficient operations is our operational excellence management system. The constant corporate-wide application of this system has created a step change in our performance and our ability to manage risks. Chevron’s commitment to operational excellence is summarized in our ten tenets of operations. The tenets are prefaced by two principles: do it safely or not at all, and there's always time to do it right.
I'd also like to share with you one important aspect that characterizes our overall approach to ensuring safe and incident-free operations. It’s called “stop-work authority”. It obligates any employee, contractor, or business partner to stop work if they suspect an unsafe condition or are just unsure of what is happening. During the Lona drilling program, more than 400 stop-work authorities were exercised. In each case, work was halted until the operations staff confirmed that no unsafe work conditions existed.
Chevron drilled the Lona O-55 exploration well approximately 430 kilometres northeast of St. John’s in a water depth of 2,600 metres between the months of May and September of 2010. This was Chevron’s second well in the Orphan Basin. The Lona well underwent two levels of environmental assessment. Regulatory approval was in place for all aspects of the program.
In response to the Deepwater Horizon incident, the Canada-Newfoundland and Labrador Offshore Petroleum Board, C-NLOPB, instituted a number of additional regulatory oversight measures on the Lona operation. Chevron complied fully with all of these measures. In appendix III of our submission, you will also see a detailed list of additional steps taken by Chevron in this well program to ensure safe and incident-free operations. In some cases, these additional steps had already been built into our well plan, while others were implemented by us as a result of the April 20 Gulf of Mexico incident. Allow me to highlight a few of those measures.
From February 8-10, 2010, Chevron management hosted a three-day safety leadership workshop in St. John’s involving all Orphan Basin project contractors and observed by the C-NLOPB.
In April, Chevron led a risk assessment meeting facilitated by an external deepwater organization to review step-by-step well design and contingencies.
On May 1, prior to commencing operations and after taking possession of the drill ship, Chevron conducted two seven-hour safety sessions, one for each of two crews on board the Stena Carron, to deliver Chevron’s commitment to an incident-free operation.
Chevron added additional functional tests to the secondary well control systems.
The blowout preventer was fully pressure-tested on surface and after subsea installation in the 2,600 metres of water. Prior to drilling into the potential hydrocarbon zone, Chevron conducted a second emergency response exercise to ensure that all the emergency protocols were in place and functioning. The C-NLOPB was witness to this exercise. The well abandonment technique was reviewed upon final casing configuration when total depth was reached, to adjust for any new information gained while drilling the Lona O-55 well.
Prior to drilling the Lona O-55 well offshore Newfoundland and Labrador, Chevron Canada had expressed a high degree of confidence in our ability to safely execute this challenging deepwater exploration well. As I indicated in my opening remarks, we succeeded in this endeavour, completing the Lona well without a single lost-time incident. This performance was achieved by our adherence to Chevron’s uncompromising safety standards in all aspects of our drilling program, and by our compliance to all special oversight measures instituted by the Canada-Newfoundland and Labrador Offshore Petroleum Board. Indeed, throughout the planning and execution of the Lona well, our steadfast focus on ensuring safe and incident-free operations was underscored by our operational excellence tenets “Do it safely or not at all” and “There is always time to do it right”.
Thank you for your time. I will now be pleased to answer your questions.
:
Thank you very much, Mr. Chair. I appreciate the opportunity.
As you've indicated, my name is Shawn Skinner, and I'm the Minister of Natural Resources for the Government of Newfoundland and Labrador. I appreciate the opportunity to appear before your committee today.
My opening remarks will touch briefly on the impact petroleum development has had on Newfoundland and Labrador. I will talk about deepwater drilling offshore, the potential for natural gas development, and the emerging unconventional plays in western Newfoundland. I will finish by relating how Newfoundland and Labrador's energy resources contribute greatly to Canada's energy security.
The challenging economic realities of the past in Newfoundland and Labrador have been replaced with a robust and expanding economy full of opportunities. This is largely due to the Atlantic Accord, which gives our province control of its offshore petroleum resources and ensures that we are the principal beneficiary of these resources.
In the decade after first oil in 1997, nominal GDP in the province increased by 170%. In 2005 our province's nominal GDP per capita surpassed the Canadian average for the first time and is now at nearly 130% of that average. This economic turnaround can be almost exclusively attributed to petroleum development. The petroleum industry is the largest contributor to the provincial economy, accounting for up to 40% of GDP in recent years, and it makes a significant contribution to our employment.
Our province typically produces approximately one-third of Canada's conventional light crude oil. In 2009 about 35% of this oil was shipped to Canadian refineries. The remaining 65% was sold into the United States. Our substantial crude resources form a steady supply of domestic crude oil for Canada and North America as a whole.
Employment associated with petroleum investments in our offshore, including the pending Hebron development, is expected to be 284,000 person-years of employment. Direct employment will rise to more than 104,000 person-years. These significant industrial benefits have led to a growing and maturing petroleum industry in Newfoundland and Labrador that is now being recognized around the world for its expertise.
Benefits are not just accruing to our province. The rest of the country is estimated to see $64.5 billion in total business revenues and over 206,000 total person-years of employment from the development of our resources. Given that over 90% of our discovered oil resources are either in production or in the approval process, it is critical that we continue our quest to discover additional resources.
While all of our current and pending offshore developments are found in relatively shallow water depths, there are promising deepwater basins being explored. It is incumbent on us to ensure that this exploration is done responsibly, particularly in the wake of the Macondo disaster in the Gulf of Mexico last year.
As you heard earlier, we have had some deepwater drilling experience in recent years, but the most relevant to this discussion is Chevron's Lona well, which was drilled in some 2,600 metres of water just last year. The Canada-Newfoundland and Labrador Offshore Petroleum Board required the operator to comply with additional oversight measures specific to deepwater drilling. In the end, the well was drilled safely, without incident.
We also committed to undertake a detached and objective review of offshore safety issues, and the province has commissioned a study on offshore spill prevention and remediation.
Drilling for oil in deep water represents a new frontier for petroleum development and will be necessary to ensure that Canada's, and indeed the world's, demand for oil and gas is met into the future. We are confident in the offshore safety regulatory oversight provided by the CNLOPB and are supportive of further responsible deepwater drilling in our region.
The offshore is also home to significant gas resources. To date, over 11 trillion cubic feet of natural gas and 500 million barrels of natural gas liquids have been discovered, and an undiscovered volume of 60 trillion cubic feet has been estimated. While the North American gas market is currently impacted by a strong supply of unconventional gas, this major east coast resource has great promise as a secure energy supply.
This provides a great segue to mentioning the resources of western Newfoundland, which are being actively explored, and the involvement of the provincial energy corporation, Nalcor Energy.
There has been an increase in exploration activity in the past couple of years, including a trend toward drilling deeper wells, that has provided valuable information and data for the region. This is promising activity, and we look forward to future opportunities in our western region.
This brings me to the final area I wish to talk about, Newfoundland and Labrador's significant contribution to Canada's current and future energy security. Our province is an energy warehouse. In short, we have energy and we have lots of it. We have discovered oil reserves of more than three billion barrels and natural gas reserves of more than 11 trillion cubic feet. It is thought that future exploration will discover an additional six billion barrels of oil and over 60 trillion cubic feet of natural gas.
Additionally, the province boasts over 18,000 megawatts of developed and potential renewable hydro and wind resources. With respect to renewable electricity generation, our contribution to national energy security is potentially even greater. We currently produce over 5,000 megawatts at the Churchill Falls generating station in Labrador, one of the largest underground powerhouses in the world.
Last November the province's energy corporation, Nalcor Energy, announced a partnership with Emera Inc. of Nova Scotia to launch the development of the Lower Churchill River via the 824 megawatt Muskrat Falls generating station—a transmission link to the island portion of the province and a subsea maritime link that will connect the province to Nova Scotia.
The Muskrat Falls phase of the Lower Churchill project will facilitate the development of additional renewable energy in the whole of the Atlantic region, including the estimated 5,000 megawatts of wind potential in Newfoundland and Labrador alone. Developing these vast renewable energy resources will be an essential element of Canada's national energy security in the future.
In closing, I hope that I've adequately described the importance of the petroleum industry in our province and the tremendous economic and employment benefit that it has brought to our people. I also want to reiterate my confidence in the regulatory oversight provided by the Canada-Newfoundland and Labrador Offshore Petroleum Board with respect to deepwater drilling and the need to continue exploring for petroleum in deeper waters. Continued exploration is critical to adding to the scientific knowledge of our basins and unlocking the significant potential that is awaiting. The contribution of our province to Canada's energy security, both now and into the future, cannot be underestimated.
I hope my remarks have been helpful for the committee's deliberations and I thank you for the opportunity to address you. I would be pleased to answer any questions you may have.
Thank you for your time.
:
That's a very good question.
As part of our management and leadership policy, we encourage the use of stop-work authority. Before any of our operations, any task we need to perform, we assess the task, we plan it, we identify the hazards, and we identify the role for each of the participants. In many cases, the work is stopped because one of the workers is not clear on the task duties, the responsibilities, or the coordination. Sometimes we identify an additional hazard that was missed during the first job safety analysis. Doing that throughout our operation over three months ensured that we delivered the Lona well incident-free.
I have a story I'll share with you. In offshore operations we deal with a lot of heavy equipment that we have to get from shore to our vessels and onto our drill ships, and we use cranes to lift the equipment. Before we do any lift, we look at the manifest, we do a job safety analysis, and we ensure that everyone involved understands what we're going to do before we do that lift. We verify the equipment and the certification of that equipment. On one such occasion, as they went through all of the standard processes, the crane operator was uncertain. As he looked at the load and as he looked at the manifest, he was concerned. So he stopped the work. The crew re-measured the load, recalculated it. In fact, the weight of the load was a bit over. For that instance, it was well within the weight capacity of the crane, but the operator was uncertain. Because of his actions, they reassessed the load, repositioned it, did a safe lift, and everyone involved with that operation went home safe. We recognized that man within our corporation for that behaviour.
:
You are telling us, and I'm sure you're quite right, that oil industry development in the province of Newfoundland and Labrador has been extraordinary and has brought great wealth, many jobs and significant economic benefits. I am very pleased to hear this and I hope everyone will be able to do the same one day.
My question is very general in nature. If we look at the way Canada has evolved historically—I believe there were no other ways for it to happen—we see that it has mostly happened through major investments from the central government. For instance, the east to west railroad. We often refer to Americans as having invented "Go West", but we came up with it before they did. The St. Lawrence Seaway was another major investment involving the movement of people and capital and the creation of wealth. There was also the automobile industry, as well as the Hibernia project out your way. There was also Atomic Energy of Canada Limited that received billions of dollars in government investments. And, in the coming years, there will certainly be investments in new energy to meet Canada's energy needs.
For the entire time when these economic developments were taking place, it was mostly outside of Quebec, but with a good proportion of Quebec money. In fact, since the beginning of Confederation, we have been providing between 20% and 30% of Canadian revenue. We are currently at 20%. So, any time there are major developments of this nature, Quebec pays 20%.
There were never any investments in electricity in Quebec, which was the form of energy we decided to promote in our province, and nothing is expected in the coming years either. That is what led Lucien Bouchard, in 1993, to say that in Canada—this is why he was a sovereigntist—any time Canadian interests…
:
I understand that, and I understand that the resources may be vast. The question I have....
You speak proudly of Chevron's record, but there of course have been blemishes, if we can say...the Ecuadorian experience, what's happened in New Jersey, Salt Lake City, the Shetland Islands, Angola, California, the Louisiana gulf itself. There have been problems. The company is not without blame in cases of spilling many millions of barrels, in some cases.
I don't understand, though; if you're committed to environmental stewardship and protection of the environment, we know the importance of at least having the capacity of the same-season relief well, which is currently on the books in Canada. Your company and others argued against this regulation, partly because same-season relief wells are impossible to drill in an Arctic environment. The U.S. presidential panel came down and said that there's no ability to deal with blowouts in Arctic conditions, and warned against issuing any permits on the U.S. side. This is not a panel struck by Greenpeace; these are folks who work in the industry. They were set up by the President.
Shell has scrapped its plans to drill in the Arctic this year. You folks are going ahead.
:
As we shared, among many of the incremental requirements with the CNLOPB was a review of the termination program before we were to execute it, based on the information that we gained through the reservoirs, the pressure, and the conditions that we had.
We worked with the regulator to review that. The regulator then approved it, as well as was on site to observe the operation. What's involved with an abandonment or well termination program is once you're completed to TD, you've got a well bore in the well where you've installed a series of, in this case, four different sets of pipe or casing. It is then secured and placed with cement that both holds that in place as well as holds back the pressure and the fluids there. Below that, you have an open-hole section.
The program is designed to set cement plugs across those intervals to contain the pressure or the migration pathways of those fluids as you move up the well bore. In this case, we set four cement plugs in the open-hole lower section.
Then in the casing section, we set mechanical devices—packers, cement retainers—that then sealed that part of the well bore, set a cement cap on top of that, pressure-tested each one of those plugs to ensure it would hold and had integrity, and then on the last cap on the top of the surface, near the sea floor, we set that final plug. It is tested, both positively and negatively, and we take the pressure off to make sure that it holds back that pressure.
Once all of those conditions are met there, our philosophy is to keep at least three different barriers to flow in the well bore at all times and in the final abandonment.
:
The project you're referring to is Muskrat Falls, or the Lower Churchill. The Lower Churchill is really two projects, Muskrat Falls and Gull Island.
We are currently proposing to do the Muskrat Falls portion. It's a $6.2 billion project. It will for the first time ever allow Newfoundland and Labrador to be connected to the North American energy grid. It will allow us to have security of supply. It will allow us to get rid of diesel generation, to help Canada, and to help the region reach its greenhouse gas emission targets. It will be a major construction project. Quebec will benefit, being right next door to Labrador. This project is occurring in the Labrador portion of our province. So Quebec workers and companies will benefit. We also believe that Ontario, because of its manufacturing base, will benefit. We know that the Atlantic region is going to benefit. There is surplus electricity that will be generated. Some 824 megawatts are being generated. Forty percent of that we need for our own purposes. Twenty percent is going to Emera down to the maritime link, and forty percent of it is available as surplus for development in Labrador, for development in the province, or to sell into the northeastern market.
Basically, we're going to create a construction project, we're going to make sure we have green energy, and we're going to get rid of what we call dirty Holyrood. Holyrood uses diesel fossil fuels and is sending thousands of tons of pollutants into the air every year, and we can get rid of that with this project. It's a great project all around—Atlantic, Quebec, Ontario—and will bring us markets in the northeastern U.S.
:
Thank you, Mr. Chairman.
I want to say a few words in my own official language before I speak to the presentation.
(Witness speaks in Gitxsan language)
First of all, I want to thank the committee for inviting me. It's an honour to be here to make a presentation on behalf of the chiefs, the simgigat, of the Gitxsan Nation.
I would like also to thank Nathan Cullen for taking time in our community a couple of days ago. He took the opportunity to have some dialogue on economic opportunities with a number of people in our community.
I don't want to be disrespectful of the meeting here because I was taught as a young fellow to respect those who invite you to meet on their turf, but it's important for me to be straightforward. I'll try to do that without any disrespect to the committee, and to your House, to Parliament.
What I want to do is to offer some challenges. The challenge we offer from our nation is fairly straightforward; it has to do with the honour of the crown. I know that the crown does its best, and I know the committee or Parliament holds up its role to make sure the crown lives up to expectations.
Part of what I'm going to ask all of us around this table to do is reflect a bit on what this committee is dealing with. I know the topic of energy security is important, and I know that the topic of energy security has to have a long-term focus.
I'm going to ask all of us to step back a bit and think about 50 years or 100 years down the road—the short term. I reflect back on the way this country was formed, the way this country was developed a bit more than 100 years ago. The perspective that we bring to the development of this country goes back several thousand years. It's important for us to sit back a bit and try to focus on what can be done to build a better country for all of us.
From the perspective of our people, from the perspective of the leadership at home, the country has not been kind. A lot of our people live in an impoverished state. We have a lot of suicides because a lot of young people don't see any future for them. Our member of Parliament, Mr. Cullen, knows how suicides affect most of the villages in our area. We look forward to better days, and better days can be planned for all of us if we focus on the long term.
Part of what we're looking at is to have a set of legislative objectives that firmly direct what may happen to this country over the next 50 to 100 years. If you think back to what the Supreme Court of Canada spoke about on the Delgamuukw decision, it said that the crown has to pay some attention to certain things.
The document I'll be circulating deals with title and rights. When you fall back into a position of how the crown can deal with title and rights, it has to be done through the establishment of legislative objectives. Legislative objectives set goals, such as what happened when the national policy was able to create Confederation. When you go back to that process, it's quite easy to see the process that the Fathers of Confederation looked at to create this country we live in today.
So it's important for all of us to think long-term. I know it's mighty difficult at times when you run for political office to think beyond the terms of four years, but I think it's important for us to consider setting up legislative objectives that focus on energy security. And part of that process will enable aboriginal communities to become engaged in the consultation process, which we now can't seem to get engaged in too well.
Part of the weak side of that engagement process has to do with attitudes of people within government, where a defensive approach is taken to having dialogue or the necessary consultation with the aboriginal title holders at the community level.
So it's important, first of all, for the crown to set up legislative objectives. It's also important for the crown to accept its responsibilities in recognizing the title that we have. It's also important for the crown to be ready to have meaningful dialogue with the people at the community level, which it does not do now.
Without that dialogue leading to consultation, projects like the Enbridge Northern Gateway Pipelines project cannot proceed, because no dialogue can seem to take place. There is nothing to focus on. All I'm saying is that the crown has to step up to the plate and look at legislative objectives and really come onside with what the Supreme Court of Canada and the other courts have ruled upon in terms of the title that we do have.
That is the message I wanted to give.
At the outset, the hereditary chiefs of the Gitxsan Nation do fully support any development activity that happens. We've been familiar with this particular project for quite a while, and we'll die on the hill to protect our food supply. We rely primarily on salmon that returns into our river systems. We rely on keeping the water clean to protect our food supply, and we will die on the hill to protect that food supply.
:
Thank you, Mr. Chairman.
Thank you for the opportunity to appear before your committee and to contribute to the study regarding energy security in Canada.
I am pleased to be able to provide you with an update on the Northern Gateway Pipelines. It's a project that has the potential to provide a fundamental and long-lasting boost to the economies of not only B.C., Alberta, and Saskatchewan, but all across Canada. It is a project of national strategic importance and significance.
Our country enjoys both a Pacific advantage and a world-class energy resource advantage. It is time for us to translate that competitive edge into increased market diversification and security, and stronger economic growth and opportunities.
Canada has an undeniably strong history of delivering on visionary projects that improve our security and position us for growth. From canals that connected industries to key markets, to the railway that linked the east to the west, or the Trans-Canada Highway that brought communities together across the nation, we have built infrastructure that has strategically positioned our country for long-term prosperity. Now the Northern Gateway Project is set to diversify energy markets and boost Canada's economic and global stature.
As you may be aware, the National Energy Board data from 2009 shows that less than 1% of Canada's petroleum exports went to any country other than the United States. Sole reliance on one market does not, cannot, and will not effectively position our country to capitalize on our world-class energy resources. Northern Gateway provides much-needed large-volume capacity to deliver Canadian energy to our Pacific trading partners.
In terms of some background on Northern Gateway, the proposal comprises two parallel pipelines extending nearly 1,800 kilometres from Edmonton to a marine terminal at the port of Kitimat in British Columbia. The projected cost for the project is $5.5 billion.
The port of Kitimat itself offers a safe and protected harbour to grow trade with Asia. I would like to share some key facts with the committee regarding the port and traffic off the north coast.
The project would add about one tanker movement a day to the existing shipping on the north coast. Northern Gateway will install what is among the most modern and sophisticated marine safety infrastructure in the world for this project. As a result, the status of our project will be similar to that adopted by Norway, which has had an excellent safety record for more than 30 years. The stringent technical infrastructure we will install will raise the safety bar for traffic on the north coast.
Our project will increase the potential volume of trade with our Pacific partners and generate an additional $2 to $3 of benefit for Canada for every barrel produced. In other words, the port of Kitimat is a key strategic component of Canada's Pacific advantage.
Last May we filed the regulatory application for the project with the National Energy Board. The application will be reviewed by the NEB as well as the Canadian Environmental Assessment Agency. Our filing began the formal public discussion and consultation regarding the project through what is known as the joint review panel. The JRP will consult with stakeholders and study the application to address key issues, including those related to aboriginal, marine, and environmental consideration.
I want to report to you that since 2002 we have been in dialogue with every first nation community along the right-of-way of our project. I am confident that when we have had a chance to present the marine and environmental safety records of our project and the benefits to their communities and to Canada, we will gain the support of most of the first nations communities involved.
I recognize that there have been debates and discussions in the House of Commons around introducing tanker bans off the north coast of British Columbia. It is important to remember that tankers currently safely call on Canada's ports from east to west, including Kitimat, and have done so for decades.
I would also like to take the opportunity to respectfully request that the work being conducted by the NEB and CEAA, two institutions created by Parliament, not be ignored in the rush to come to judgment without the benefit of reviewing or testing the evidence on the matter.
In conclusion, I would like to thank you for the opportunity to share a brief update with you today highlighting the importance of the Northern Gateway Pipelines, a project that will build on Canada's Pacific advantage to help ensure our nation's long-term prosperity and strong global standing as a responsible, sustainable, and ethical energy superpower.
The benefits for Canada are substantial, including a $270 billion increase in gross domestic product over 30 years. And the legacy of local investment, tax revenue, and jobs for the north further supports the significant opportunities from our project.
Thank you.
Good afternoon, gentlemen. Welcome to our committee.
I am a substitute member of the committee. I find your presentations very interesting.
Mr. Derrick, I listened to your presentation. As you know, I represent a constituency in Quebec, which is also recognized as a nation, so I do somewhat share your concerns. I do not know your nation very well, but I think that I understand that you have some demands, some criticisms, regarding the project. However, they do not seem very well presented. I would like to give you the floor so you can tell me how you are being affected by this project. I have a map of the pipeline in question, but I do not know what land belongs to your nation.
Will the pipeline go over your land? Are you located on the coast; does that make you concerned by the potential pollution that the wreck of an oil tanker would cause? Could you explain that to me? I would also like to know whether you were consulted at all when this project was being developed.
:
It's an important issue, because take what happened in the Kalamazoo River this past year as an example. You spilled 3.2 million litres of oil into that river. It was 14 hours after the first signs of problems that the pipe was finally turned off—14 hours. Residents were forced to sign liability waivers in order to access the $650 compensation on air filters, and you're being sued for that right now.
The chairman of the House Transportation and Infrastructure Committee, Jim Oberstar, who I'm sure you know, has dispatched investigators in to see how residents in Michigan were treated unfairly by the company. You've seen the testimony in front of Congress of people of very low means, modest means, signing these waivers to gain access to some of these air filters in order to regain access to their homes, because their air and water were polluted.
It seems to me that with 750 pipeline failures in Alberta alone every year, your inability to guarantee there won't be a spill, and the likelihood of a spill over a 50-year timeline.... You had inspected this pipe in Michigan five days before it started leaking and issued a report to the Environmental Protection Agency in the United States that the pipe was safe. You had just investigated it because the Americans asked you to after the disaster of the BP spill in the gulf.
It seems to me that the project you're proposing has inherent and significant risks for the people of British Columbia and the coastal waters, with relatively little benefit.
The point is this. In your proposal to the joint review panel, you don't have responsibility for the tanker traffic. Is that correct?
:
No, I'm not guaranteeing safety or that there won't be a spill. You've said a lot of things in there, Nathan, some of which would be questionable.
But the key part of that is the process we're about to go through, where we've filed significant information. So we've filed almost 20,000 pages of information such that people can make an informed assessment of whether the project can be built and operated safely, of our track record, and of what we're going to do to ensure the chance of an incident is remote.
Certainly, again, I think the tanker issue is a very key one. We'll need to ensure that those ships can come in and out of Kitimat safely, and certainly with what we're doing we would expect that.
Many people think of Norway as a coast that's not unlike British Columbia in terms of its beauty. Today, on an annual basis, you'd see something like ten times the number of ships going in and out of Norway safely, and they have done for 30 years. Again, that's the type of project we're going to replicate in terms of world-class safety.
:
I very much appreciate the opportunity to speak to that.
Pipelines have proven to be the safest way to move large volumes of oil over time. They are very safe, and we continually learn how to improve them. Over time, compared to pipelines that were built before, you will have seen stronger steel, better coating, and improved construction practices, such that actually 100% of the welds themselves are X-rayed to ensure they meet the standards set by the National Energy Board. Certainly the steel, the process of building the pipe, and all the materials have been enhanced very much, such that there has not been any significant incident in terms of moving products safely through a pipeline that has been built within the last 35 years. Clearly, history has shown that pipelines are safe and are continually getting safer.
Of course we'll apply all of that learning to this one when we look at the country we are going through to ensure it can be built safely, since we will be crossing many world-class waterways. Certainly we'll go to the extreme to make sure it can be built safely and so that there's a good record about how that can happen.
With respect to the ships, the first thing we did was to model VLCCs--very large crude carriers--going into the Kitimat harbour using experienced B.C. pilots. That proved that the VLCCs could actually go unaided into the Douglas Channel safely. Notwithstanding that, to ensure safety we will make sure the ships are modern. They need to be double-hulled. The ships and crews will have to be vetted by independent agencies. As well, they'll operate under restrictions in terms of the speed they can travel in the normal course and whether they can access the channel if there are any wind, visibility, or wind-wave disruptions. Again, we're putting in operational procedures that will enhance safety.
The biggest thing we're doing is that notwithstanding that ships can go in unaided, we will tether the loaded ships to a tug. Those tugs are very powerful. They can change the course of a ship or stop it if it loses power. So that's the biggest one that reduces.... It takes a safe operation and makes the chance of an incident remote. There will also be a second tug in association with the ships travelling in and out, which will have first-response capacity in case there is ever an incident or to help the first tug. Again, we've gone to great measures to ensure we have a world-class safe operation.
Thank you.
I would have been concerned about not seeing any representatives on the list from the Quebec Union of Municipalities. This morning, I spoke to the mayor of Salaberry-de-Valleyfield, Mr. Lapointe, and it is to our advantage that I did so. Not only does he participate in the Great Lakes and St. Lawrence Cities Initiative, but he is also the chair of the Environmental Policy Committee for the Quebec Union of Municipalities. So there will be a representative from the Quebec Union of Municipalities in addition to Mr. Ullrich.
I think those two days will be enough, but I cannot say that I would automatically rule out adding a third day. We have to wait to see how it all unfolds. I must admit that it is always somewhat frustrating to hear from the representatives of the CNSC and Bruce Power one day, and to have to hear a whole series of witnesses thereafter. We approve of what has been agreed to, that only two days will be set aside, the 8th and the 10th. I am sure that, in light of our discussions, we may need to delve more deeply into the issue. For now, I think that the normal process should run its course.
I would like to point out one thing. We did receive a comprehensive briefing from the CNSC, and we should thank them for that. Given that we are a standing committee, I am sure that the CNSC representatives could have been here for two hours. When we only have one hour to hear from a group of witnesses, we can only fit in one round of questioning, and each party has a mere two or three minutes to speak. What has occurred is no small potatoes. A lot of people and municipalities have signed the petition. It is important to take the time to clarify the situation to avoid any problems with perception. Personally, I would have preferred to see the last day allocated in its entirety to the CNSC. I would have liked to start with the representatives from Bruce Power, and then to hear from witnesses who are opposed to the project, so that they can explain their reasons. We need to find out if they are simply afraid, if they have questions relating to the facts, or if they are afraid of setting a precedent, and so on. I don't think that one hour with the CNSC is enough, even if we did have a briefing. I would have preferred to devote an entire day to the topic, and that is why I want to keep the possibility of adding a third day. We can ask the Canadian Nuclear Safety Commission to present at the beginning, and then we could listen to what the representatives of Bruce Power have to say. Finally, we could meet with representatives from the municipalities and groups on nuclear safety, specifically the people from Ontario and Quebec. After that, we will be in a position to determine whether or not we need to add a third day.
Managing the perception of the project will be very important on this file, just as important as the facts.
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I'll be short and quick.
I agree with Denis. I would actually like to see CNSC's hour given to them, presenting, rather than our even having a round, because that presentation is important. I think it needs to be made and I think it needs to be publicly presented. So I'm going to make that suggestion. I'd like to see more time with them. I don't know what Bruce Power is going to say, but I think you're right there.
The other problem is that, again, as we usually have here, we have 25 or 30 witnesses. So we limit ourselves to one day. We have to have the discipline, again, or we're going to be here for three, four, or ten more days. We ask the witnesses who come back.... We try to find a priority mix from the four parties. We have one day to see what's going on, and then decide if we want to go further.
We have individuals writing us now who want to appear. Are we going to bring every person in who requests now? If so, we'll be doing this for a month, and our main report gets put off another month. It has gone on pretty much long enough, I think.