NRGO Committee Meeting

STANDING COMMITTEE ON NATURAL RESOURCES AND GOVERNMENT OPERATIONS

COMITÉ PERMANENT DES RESSOURCES NATURELLES ET DES OPÉRATIONS GOUVERNEMENTALES

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, April 2, 1998

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[English]

The Chairman (Mr. Brent St. Denis, Algoma—Manitoulin, Lib.): Just before I call this meeting to order, following up on our business meeting of yesterday, I just want to mention to members that we'll be having the second part of that meeting, if you like, on the Thursday we come back. On the Tuesday Minister Goodale will be here, so future business will be on Thursday, when we'll discuss the issues that Pierre raised, along with other matters.

Also at that time we'll be discussing— our researcher is going to the climate change conference in Calgary in the first part of May, and there may be at least one member of the committee— Dave has mentioned that he has planned to go to that. So we might want to consider a similar arrangement, that for those who are volunteering to use their travel points—it's a very important conference—we offer to assist with the hotel and per diem, and in that case maybe a conference registration fee for Dave and maybe one other person as well.

I'll raise that at the future business meeting on Thursday, and I'm sure there'll be good support for that. To the extent that we can educate ourselves as parliamentarians on the issues of importance to this committee, the better we'll be able to do our jobs.

You've been handed a copy of the forestry expo conference. I'll send all members a memo asking for volunteers. I know now that we have Darrel Stinson, and likely Roy, myself, and Yvon Godin who want to go, and I think you mentioned maybe René. Now, we won't be providing translation there. Is René bilingual? We're not going as a committee; we're going as volunteers.

Mr. Pierre de Savoye (Portneuf - BQ): I understand. I'll ask him. I think he'll probably be able to understand. Understanding is easier.

The Chairman: Yes, okay. We will certainly try to do a program together even though it is a voluntary trip.

So we'll call this meeting to order now, the April 2 meeting of the Standing Committee on Natural Resources and Government Operations. We are continuing our study of the knowledge-based and technology-based sectors, which have evolved over time in the natural resources sector. We have heard from the energy people and the forestry and wood people. We have had government officials here who talked a little bit about geomatics and geoscience.

We believe that if knowledge is the future, it is important that governments—the federal government in our case—do what they can to complement the efforts of private industry to continue Canada's leadership in many areas of knowledge and science and, in our case, the natural resources sector.

So we're pleased to have with us today, from the Geomatics Industry Association of Canada, Ed Kennedy, its president; and from the Canadian Geoscience Council, Robert McNutt, president.

You may have others with you who you wish to introduce, gentlemen.

So I may as well ask Mr. Kennedy to start. We thank you for coming to visit us today.

Mr. Ed Kennedy (President, Geomatics Industry Association of Canada): Thank you very much for the opportunity.

I do have some overhead transparencies that I'd like to use. Perhaps I'll move to the front of the room and set up our technology there.

The Chairman: By the way, we heard some good things about geoscience and geomatics from our officials. It seems that Canada is certainly a leader in this area.

Mr. Ed Kennedy: Thank you again.

Bonjour, tout le monde. Unfortunately my French is very limited so I'm going to be making my remarks in English only.

As you said, Mr. Chairman, you have received a bit of a primer on the subject of geomatics from my colleague in government, Dr. Marc Denis Everell, about a month ago, I think. I understand he appeared before the committee and talked a little bit about the government activity in this sector.

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I won't say a lot, then, in terms of definition except to say that geomatics, in lay terminology, is a technology used for gathering information about resources and about land, using satellite technologies, mapping technologies, and surveying technologies.

What I'd like to do is talk about the private sector perspective on how this knowledge-based industry is related to the resource sector and share with you a few success stories of companies in our sector that have been as a result of partnership between government and industry.

To put what I have to say into perspective, I'll give you some statistics about the private sector in geomatics in Canada. We have approximately 1,500 companies in the geomatics sector in Canada. This is an SME sector. Probably over 95% of the companies in our sector are smaller than 50 employees in size. The total industry employment is approximately 21,000 people.

Right now we're generating in the neighbourhood of $1.8 billion in total sales per year, of which export sales account for approximately one-third of that number, or in round terms, $500 million Canadian. Our industry is heavily and increasingly involved in international business, with experience in over 100 countries worldwide.

I'll say a few words about the evolution of this sector. We have a very strong tradition and a very long history in the geomatics sector. We trace our roots back to the earliest exploration and settlement of this country. In fact, Samuel de Champlain was a surveyor, an explorer, so he's one of the founders of what we now call geomatics.

I'll hit a few of the highlights in terms of the evolution of the industry. After the Second World War the industry really came into its own and blossomed and grew very rapidly during those post-war years to become a world-class industry. That's when the export activity really started in our sector, in the late 1940s and early 1950s.

Canada is credited with the invention of a driving or fundamental technology that is the backbone of our industry—namely, geographic information systems, or GIS. That is a computer-based technology that specializes in managing very high volumes of geographic or spatial or location-related information.

This was invented by Dr. Roger Tomlinson, who was in fact an employee of the Government of Canada. This technology was first used for the Canada land inventory done in the early 1960s. That technology has been pivotal to the subsequent development and growth of the geomatics sector.

The focus today, in the late 1990s, is on the development of the Canadian geospatial data infrastructure. That consists not only of the technology that's required to make use of this geomatics information—that is, the basic telecommunications and computer infrastructure—but it also consists of standards that allow the sharing of information between government agencies, the private sector, between different levels of government, and the use of the information to develop business applications and revenue in the private sector.

There is a new and exciting intergovernmental initiative of the federal government that also has links into the provincial governments across Canada to develop this backbone or this on ramp, if you like, to the information highway for our sector.

Geomatics is a very small sector of the economy, as the statistics demonstrate, but it is a strategic sector. One of the first things that happen in the development of any resource base, in the planning and construction of infrastructure, transportation, and telecommunications infrastructure, or in the development of major energy projects, is gathering of basic information about the land and the resources that exist. That's the role played by geomatics.

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So geomatics is an entrée into a much larger wealth of business opportunity in the international marketplace. It's an early warning, if you like, of much larger projects in engineering, construction, energy development, forestry, mining, and so on. So it's a strategic sector. It's a sector that's required at the very early stages of many other types of projects.

Competitiveness is a key issue for our sector, as it is for all other sectors of the Canadian economy. It's absolutely critical to the future of our industry. The worldwide market in this sector is in the range of $15 billion, and it's growing at quite a rapid rate. It's at a 15% to 20% annual growth rate, and Canada is an important player in that marketplace.

It's absolutely essential, in order to penetrate the international market, to use strategic alliances and partnerships. These alliances are not only between Canadian companies. We've done a lot of work in our sector in that area. We have a lot of experience with our small- and medium-sized companies working together in strategic alliances, partnerships, and consortia, but we also have experience in working in partnership with companies in other parts of the world, which is absolutely essential to the development of international business.

What's very important for our sector is the relationship between the private and public sectors in Canada. So industry-government partnerships are essential for market penetration, because approximately 70% of the international market, particularly in the developing world, is public sector business, which is work for governments. So our government partners in Canada are very important players in working with us to help open the doors for the private sector. We've had some great success in that area. Marc Denis may have spoken about that when he made his presentation.

It's not only that, though. There's the role the government can play with experts or specialists within government in project delivery. A lot of the opportunities we're pursuing internationally with the public sector in the developing world require institutional development and technology transfer, and a lot of the experts we need to bring into project teams are government personnel. Again, we've had a lot of experience in putting together teams of experts from both the private and public sectors.

We can't compete on the international world stage on the basis of cost alone. Our cost structure is too high. Our wage structure is high. The value of the Canadian dollar is obviously a significant advantage for us in today's marketplace, but it's extremely competitive.

A couple of disadvantages that we have in addition to the cost disadvantage is the fact that many of our major competitors—these are some of the key European countries, particularly Australia and some of the Scandinavian countries—are bringing project financing to bear on some of these opportunities that we're not competitive with. They're using their foreign aid programs to lever into opportunities with which Canada is just not on the same scale in terms of being able to bring some of that supplementary financing.

So the way we're competing is on the basis of our superior technology and expertise. Being at the leading edge, sometimes at the “bleeding” edge, of technology is absolutely critical for our success internationally. That's where government has an important role to play as well.

How can government help? What's the role of government in working with our sector?

There are four areas that I'd like to focus on particularly. I mentioned the initiative that we have under way in Canada now, which is the partnership initiative between the public and private sectors called the Canadian geospatial data infrastucture. One of the important roles that government can play is in the development of that infrastructure.

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The infrastructure for the knowledge economy is not unlike the infrastructure for the post-industrial economy—the transportation infrastructure, for example. In order for modern transportation systems to develop, we had to move from very fundamental road networks to national integrated modern highway systems, to allow the movement of goods and services. We need the same kind of telecommunications infrastructure, the same kinds of standards, the same kinds of easy access in the knowledge economy to allow this technology to be exploited and used.

One of the barriers we have for the development of the industry in Canada that this initiative is focused on is permitting easier, quicker, more convenient access to data that exists in the public sector in Canada. We have a tremendous wealth of geomatics information in the public sector in Canada, and there is a tremendous opportunity in this country to develop business applications on top of that basic data infrastructure, if we can get access to it.

The Canadian geospatial data infrastructure is aimed at providing that access, looking at the policy impediments to access to that information, and so on. So that's a major role that government can play, working with the industry to liberate that data so that we can develop business in Canada that can be exported around the world.

Government is a partner in the advancement of science and the development of technology. We have within our sector an initiative under way under the networks of centres of excellence program, a federal government program. Geomatics is one of eleven sectors that is in a run-off to set up a new network of centres of excellence. Three will be selected in September of this year. Geomatics is one of eleven that are under way to compete for that NCE funding. That's a very important contribution to the industry's competitiveness, because we are trading on our technological excellence.

Also, technology development within government has been very instrumental in the development of the private sector in Canada. A well-known example in our industry is a company called MacDonald Dettwiler and Associates Ltd., which is based in Vancouver, a large systems engineering company that grew out of support from one of the organizations that Dr. Everell is responsible for, called the Canada Centre for Remote Sensing. MacDonald Dettwiler and Associates is now a world-class company. They grew out of support and technology transfer from the government lab in the 1970s.

Another example is a company in Toronto called PCI Enterprises Inc. It's the world's leading supplier of software that analyses and creates information products out of space imaging technology. Again, a lot of technology transfer from the Canada Centre for Remote Sensing has put that company into a world leadership role.

I mentioned the role of government in helping industry to gain access to opportunities internationally. The government-to-government relationship-building role is critical to that access.

Finally, government can continue to be a demanding user of the products and services of our industry. We've had excellent support through contracting out and technology transfer. That's a very important role. One of the reasons we are among the leaders in the world technologically is we've had very demanding clientele in Canada, and the Government of Canada is one such client.

I want to say a few words about three of the initiatives that demonstrate the power of the partnership between the public and the private sector.

The first one is RADARSAT International. You may have heard, again from Dr. Everell or elsewhere, of one of the real successes of the Canadian space program, a satellite called RADARSAT. It's an earth imaging technology that images the earth 24 hours a day and is very useful, for example, in the tropics, because this technology penetrates cloud cover, which is a real problem in gathering information in tropical regions.

RADARSAT International is a private sector company that was formed two years ago by four other companies to develop a partnership with the Government of Canada to commercialize that technology. It's a very good success. It shows the power of government and the private sector working together.

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RADARSAT brought equity into the development of the satellite program and, in exchange for that, has distribution rights for this technology around the world. There is a growing worldwide market in resource development in the environment, so this technology is being used, for example, in mineral exploration to identify the potential areas of mineral development that geologists and geophysicists can zero in on to explore.

The technology was widely used in two recent natural disasters that we've had here in Canada, the flood in Manitoba last spring and the ice storm here in January. The technology is used to monitor, to measure and to help disaster recovery organizations plan their activities and project where the water is going in the case of the flood example.

How am I doing for time, Mr. Chairman?

The Chairman: You're quite a bit over.

Mr. Ed Kennedy: All right, I'll speed up.

The second example is a partnership between another group of companies and the Government of Manitoba called LINNET Geomatics International. They have a mandate to develop this infrastructure in the province of Manitoba. It's again an exclusive partnership. The government in fact is a shareholder in LINNET Geomatics International, and they've used that development in the province to springboard into the international marketplace. So they're successfully exporting now into the U.S. and Latin America particularly.

The last example is a company in Toronto called TERANET Land Information Services. This is quite a unique partnership. This one is a 50-50 partnership between a large group of private sector companies and the Government of Ontario to automate the property registry system for the province of Ontario. Again, they've set it up as a partnership. TERANET is an information utility to disseminate this information and to develop value-added products. Again, they've turned that backbone of success in Canada into international business throughout Latin America, the Caribbean, in several countries in Europe and in Asia.

To conclude, Canada is well known as a world leader in the geomatics sector. We can provide total solutions to problems in a wide range of business applications in the resource sector, in forestry, mining, and work around the world, working with Canadian companies in those sectors.

We're working hard to improve our international competitiveness and our partnership with the Government of Canada and particularly with Dr. Everell's organization, the earth sciences sector, which is crucial to that work. The government has a number of roles to play in support of the industry, which I've touched on. We've used some fairly innovative partnerships, I would say world-leading approaches, to partnering between the private sector and the public sector in Canada to advance the use of this technology and to develop the expertise to market it around the world.

Again, I appreciate the opportunity and apologize for going over time a bit.

The Chairman: Thank you, Mr. Kennedy.

We'll ask Robert McNutt from the Canadian Geoscience Council to introduce your auspicious guest.

Dr. Robert McNutt (President, Canadian Geoscience Council): Thank you, Mr. Chairman.

Indeed, I will before I go any further. This is Dr. Denis St-Onge. Dr. St-Onge is the past president of the Canadian Geoscience Council. He's also still the president of the Royal Canadian Geographical Society and he's one of Canada's most distinguished scientists working in the terrain science area, particularly in the Arctic. He comes in two formats to make sure I present the view of the CGC properly and to bring certainly his own expertise to bear here this morning.

The Chairman: He's also an Order of Canada.

Dr. Robert McNutt: He's also an Order of Canada, that's right.

Dr. Denis A. St-Onge (President, Royal Canadian Geographical Society): Thank you, Mr. Chairman.

Dr. Robert McNutt: The Canadian Geoscience Council is an umbrella organization that represents many different societies: societies that are professional, scientific societies, organizations more centred in the mining sector or the petroleum sector or in the environmental area. And so, as such, we cover a broad range of earth science.

In terms of my own background and present employment, I'm a university professor at the University of Toronto. I hold an administrative position; I'm a geologist by training with a specialty in geochemistry. It may cloud or bias some of the comments I have to make, so I warn you beforehand.

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I would like to give you some success stories, and one of the greatest ones that we've experienced in the last decade in Canada is called Lithoprobe. This is a joint effort of the federal government, the industry and the universities. It has mapped over 10 very detailed transects of the crust of the earth in Canada, into the third dimension. It has been going on since 1984. It has involved over 750 scientists, a number of companies from the private sector and more than 900 scientific publications, and has provided, and is still providing, an amazing data set for Canada and for the world. Denis was going to give you some background material on this organization.

Admittedly, in the beginning it is an academic endeavour to understand the basic knowledge of the crust of the earth, but it has given the mining sector a real context in which to do future exploration across Canada. And in terms of environmental hazards, we have a much better understanding now of the hazards on the west coast for plate tectonics, for movements and for earthquakes, and this understanding comes from this tremendously detailed study.

It has been recognized internationally as one of the greatest earth science projects that has ever taken place, and Lithoprobe is held up as a model around the world for how to approach a megaproject involving all sectors of our society. The data that has been gathered, and will continue to be gathered should the government choose to fund the last proposals now in, is an amazing data set for the world to use, and in particular for Canada to use, in trying to better understand our earth and how we can extract the resources from it.

A second project, an international one that Canada takes part in, is the ocean drilling project—ODP—for global marine science, which means studying the ocean floors and the continental shelves. As you all know, we are a major marine nation with marine coasts on three sides. Once again, this project is the beginning of understanding the basic knowledge, but the outflow from this, like all knowledge, begins with the basic research that's flowing out now into the private sector, and companies are starting to understand things better, particularly if they're wanting to drill on continental shelves for oil and gas areas.

A second area, I think, where Canada has been and continues to be a leader is the area of water resources. I sometimes think Canadians don't pay enough attention to water as a resource. That is because we have a lot of it on the surface of our country, but, still, we do have problems in our urban areas, of course, with the quality of our drinking water.

I'm going to give you one example, and that's at the University of Waterloo, where they have now spun off a couple of companies into the private sector based upon some research on how to treat organic waste in situ below the surface of the earth. Rather than trying to bring this material out of the ground and remove it that way, they've now developed a method for breaking it down in situ. We've formed a company and the technology is being extracted around the world. This organization now has major contracts in the United States and in Germany.

The other factor about water resources is the very complex nature of this type of area. This requires extremely complicated mathematical modelling, which then draws upon the most powerful computers available. And still, some of the models will tax these most powerful computers, so this is an area of very high-tech work that is only going to expand and grow and will cause a need for more investment. We need to be paying attention to this very high-tech area.

In the area of exploration geophysics, Canada has been a world leader for a long time. The private sector industry has been located primarily in the Toronto and Calgary areas, reflecting, respectively, the mining sector and the petroleum sector. If one were to attend the prospectors and developers convention that is held every March in Toronto and see the large number of small companies that are Canadian based and Canadian owned and have developed all kinds of techniques for mineral exploration and for other areas of exploration, one would see it's very high-quality work from individuals who have been trained in Canadian universities and have taken that technology and moved it into the private sector.

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However, within the last decade, we have started to lose that lead. Australia seems to have taken up the lead in the area of geophysical exploration. We are still in a comprehensive sense the leader in this area, but we're losing it slowly but surely. It seems the Australian government has decided as a national policy to put some emphasis on the natural resource sector.

My colleague here talked about the national centres of excellence in geomatics in Canada. In Australia, there are three or four centred around the natural resources area, so the government is working with the private sector down there in a major way.

Finally, let me give one more example, and again I will come back to the area of geophysics data set gathering in the marine science area. Some of the techniques now developed by geophysicists in this country at Memorial University, in Calgary, and in other places has produced some amazing, complicated data sets. The thing we see that's coming in the future in all these areas within the earth science sector is the ability now to get a very large number of very complicated data sets that have to be analysed. This requires very high-end computing and sophisticated mathematical modelling and visualisation.

I think you're going to hear more and more about how to handle the data sets so that we can understand it. That involves not only the mathematical models, transformed into a working computer program, but visualisation and animation. Often in regard to the word “animation” we think of cartoons on Saturday morning, and so on, but animation is how to bring this data to the human eye, because the human eye connects to the brain and that's the context for understanding what's going on.

Those are two or three examples of what is happening in Canada. I agree with you entirely, sir, that Canada has been a world leader in natural resources. I would say that the Geological Survey of Canada, for example, in the past has been recognized as probably one of the top two or three geological surveys in the world for the quality of the work it has done and the way it has generated data for the use of the Canadian people, and when Canadians attend international symposia in the earth science area we're amongst the leaders. You'll see our people giving many papers and being sought for their advice.

These are some of the things I'd like to bring to you. I'd now like to ask Dr. St-Onge to add to that with some of his observations.

[Translation]

Mr. Denis St-Onge: I will be speaking in French and I will give you three examples.

The first follows on what has just been said about the role of the Geological Survey of Canada and shows its impact on the industry. Recently, during three summers, the Geological Survey of Canada had a project in the south of Baffin. The geological map that was made by government scientists and that had been designed simply to give us better knowledge of that part of Canada created such great interest among companies that last year and this year many millions of dollars have been invested to explore the mining potential in the Iqaluit region.

Two other recent examples are certainly of interest to all of us, the discovery of diamonds that everyone has heard about and of gas hydrate. Gas hydrate is essentially frozen gas. It's like ice. However, it is generating enormous interest. A report of the United States Geological Survey published a year ago had this to say:

[English]

The worldwide amounts of carbon bound in gas hydrate is conservatively estimated to total twice the amount of carbon to be found in all known fossil fuels on earth.

[Translation]

That's a conservative estimate; the quantity may be higher. This interesting discovery was made as a result of prospecting for oil in the Mackenzie delta. I'm generalizing from what happened, but that's about it. When drilling for oil, gas hydrate was considered a nuisance. We discovered that there was a lot of it and it might be an interesting alternative to natural gas.

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As we speak the Japanese, who, as everyone knows, are lacking in hydrocarbons, are extremely interested in this discovery. Gas hydrate is found in areas where the ground is frozen, essentially in the Canadian North and in sea bottoms where it is also very cold. The Japanese hypothesis is that their sea bottoms may contain gas hydrate. However, it would be extremely costly to go drilling for it there. Since the technology has not been developed, they decided to come and drill in the Mackenzie delta in Canada. This project is financed by an extraordinary consortium that include the Canadian government, many Canadian companies, 10 Japanese companies and the United States Geological Survey. Essentially, Japan is paying the expenses. We want this exploration here because it is easier to drill from the surface. We want to see under what conditions this gas is found and what would be the best way to extract it. This is a current and extraordinary example of Canadian technology transfer in the world.

I will speak briefly about another technological transfer in the context of the discovery of diamonds. The discovery of diamonds in Canada is something bizarre. We looked for them for a long time. We had found some in the south of Ontario in debris that had been brought down by glaciers, but we didn't know where they came from. It was a problem we had to solve. Canada had once been covered in ice; the debris and the rocks from the glaciers had been carried here and there. We have known for some time, thanks to the studies of government scientists and those in Canadian universities, the directions in which the glaciers moved. We can therefore ascertain if the debris we find contain interesting minerals. We can trace them back to the source. It's what we call mineral tracing. These studies were done for purely academic reasons whether in universities or by the Canadian government.

One individual who was a little smarter that the others reasoned that if there were diamonds in Canada he could find them using this method. The problem was that the diamonds are in a very brittle rock that was eroded by the glaciers, that diamond kimberlites are always found beneath lakes and that we don't see them on the surface. This individual therefore did the tracing from mineral indicators north of Yellowknife. He finally narrowed down what he had found and determined that if there were diamonds anywhere, they had to be in the Gras Lake area. And that's how the diamonds were found.

Once again, it's a technological transfer that stems from efforts of the Canadian government and the research done in universities, and, to a large extent, to go further than my colleague, by graduate students.

Since I have spent ten years of my career at the University of Ottawa, I would like to take this opportunity to underline the important contribution of graduate students in the field of research.

I would also like to underline that research in the Canadian Arctic has only been possible thanks to one organization: the Polar Continental Shelf Project, or the study of the polar continental plateau, a project that was set up in 1959. I participated in the first year of that research and I went to the Arctic. The aim of that organization was to provide logistical help for research in all areas, in universities as well as in governments. Unfortunately, because of budget cuts and perhaps because of poor management, this study is dying on the vine.

If Canada wishes to continue to maintain responsibility for its territory in the Arctic, it will only be able to do so if that organization continues to be effective. If that organization cannot continue to exist with its present structure, we will have to think about restructuring it. Thank you, Mr. Chairman.

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[English]

Dr. Robert McNutt: This is just a final word to wrap up. I think, as Canadians, we own a big chunk of the world. We have a huge country, yet we have a small population, so we have a mandate and a stewardship to continue to use our resources wisely and to invest in them as a nation.

Thank you.

The Chairman: Thank you. There were some fascinating comments by all of you.

We'll start questions with Mr. Chatters, please.

Mr. David Chatters (Athabasca, Ref.): Thank you, Mr. Chairman.

I'd like to come back to an area that I've brought up many times before in this particular study and others. It's the topic of intellectual property rights and the return on investment for intellectual property.

I don't dispute in any way the value of this kind of technological development in Canada and what it's done for our resource industries in Canada and continues to do. But when this technology is spun off into the private sector, and private sector companies then take it around the world and use it for profit, because that's what the private sector's about— You even suggested that part of your team in the private sector is made up of bureaucrats, civil servants if you will, from Canada.

So I still think this issue needs to be addressed. Taxpayers pay for the development of this technology, which then spins into the private sector. What about some return to the taxpayers of Canada for that investment when it goes offshore or international? I'd like you to comment on that.

Mr. Ed Kennedy: I'd be pleased to start the response. In fact, there is a fairly well-developed, I would say, policy and practice of the licensing of intellectual property that's been developed within government to the private sector.

The two companies I mentioned are in fact two key examples of that. Both MDA and PCI have licensing agreements with the Canada Centre for Remote Sensing. Royalty streams coming back from the use of the technology that's been developed in government go back to the government.

That department has a mechanism called a revolving fund. In fact, some of the money that's coming back from the royalty stream and from the use of government personnel on teams for projects—in fact, they charge market rates for the use of those people—is coming back into this revolving fund and being reinvested in new technology development. So we think it's an excellent model.

We agree with you—I'm sure my members would argue—that the royalties are too high and the revenue streams are too great. They always try to make that case in the negotiation process, but I think they acknowledge the point you raised that it is an investment by the taxpayers of Canada, and there should be some return on that investment.

Mr. David Chatters: If that's in place, then what are the hindrances to accessing the government data bank or government knowledge that you spoke about in your presentation? What's the problem there?

Mr. Ed Kennedy: Okay. This is to make the distinction between the software and the data. The software is being licensed and is being used to create business. As for the data itself, I guess there's an issue of the cost for the data, so that's an issue. In our mind, that's a matter of economics. I think it's a volume issue. The real problem now is just technical restrictions and bureaucratic restrictions to accessing the data.

Part of the problem is that the standards have not been put in place in order to allow private sector companies, and in fact government agencies, to exchange and easily pull data from different sources, put it together, and use it for a particular application.

So part of this initiative I mentioned is working on the standards to make sure that data is compatible so it can be used. So that's a problem of access.

There's quite a variety of practices in terms of how the private sector gets access to the government data. So again, it's about the contractual relationships under which data will be provided to the public sector and how it will be used. I would say that hasn't advanced as quickly as the policy and practice on the licensing of rights to software. But, again, that's another thrust in this initiative, to harmonize the basic contracts in terms of contracts so that when a company goes to Statistics Canada, Natural Resources Canada or Environment Canada they're facing the same basket of conditions and they can treat all of the data in a uniform manner and make it easier and more convenient to access it and use it.

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Mr. David Chatters: Which would include the issue of copyright and—

Mr. Ed Kennedy: For sure. The private sector advocates the American model, which is unique in the world, and it is that public sector data that is freely accessible to anybody in the private sector. So that in fact has given our U.S. competitors an advantage in the marketplace.

But I think we have acknowledged that copyright is the practice in Canada. So that's not so much an issue now as is how much is the data going to cost. And if we can get the other access issues sorted out, I think the volume of usage will go up dramatically and the cost per byte of data will go down dramatically.

The Chairman: Do you want to add something, Mr. McNutt?

Dr. Robert McNutt: Yes. I appreciate your concern that there's quite an investment on the part of the Canadian taxpayer in getting this data. But our private enterprise system is a complicated system in which to figure out what is gained back to the taxpayer in the long term. My view is that if the data is made available to companies to take advantage of, to develop whatever they want to do, the spin-off back for our society will work in the long term. But I'm not an economist and I can't demonstrate that.

We also have to remember that we have access as Canadians to databases from other nations that we can incorporate into our studies, and we can take advantage of this. I'm a supporter of the American model, which he's just talked to, because I think if we get some economists together to really work on this, and see what the real benefits are back to us, I think the taxpayer should be pleased with it.

Mr. David Chatters: It would be interesting to see that.

Dr. Denis St-Onge: Yes, I have a word to add. In the earth sciences sector, the payback is not organized in the same way as it is in geomatics. It tends to be upfront rather than at the back end. Lithoprobe is a good example of where the Canadian government, the private companies, and the funding agencies such as NSERC got together before to form a consortium where the information would be shared by all and everybody paid into the pot right at the beginning, upfront.

This is true also in airborne geophysics. This is the way it's worked for many years. And companies have been remarkably good about this. For instance, a few years ago Canadian geophysical companies, the private companies, the oil exploration companies, gave to the Geological Survey of Canada all the geophysical data that they had gathered over decades in the Arctic, so that everybody—academics, the private sector, everybody—can have access to it. So that's the model that tends to be the case in the earth science sector rather than copyrights and stuff like that.

Mr. David Chatters: Thank you.

The Chairman: Carmen, then Pierre.

Mr. Carmen Provenzano (Sault Ste. Marie, Lib.): I have a number of questions but I'll limit them, Mr. Chairman, naturally to the time.

Thank you, Mr. Kennedy and Mr. McNutt, for your presentations. You represent two groups that are very involved in this geoscience area.

Mr. Kennedy, would you be aware of whether there are entry-level people available—geoscientists, geoscience technicians, geotechnicians, I'm not sure what you call them. Is there a sufficient supply of these people available at entry level? Would you be aware of that?

Mr. Ed Kennedy: There's not an easy answer to that question. I would say generally across the country we don't have a supply problem at this point, but in some areas of the country—and I guess until fairly recently, with the downturn in oil prices, Calgary and Edmonton were two such centres—there was an extreme shortage of people, and not only at the entry level but at other levels in the industry as well.

• 1155

Generally I think we have a good supply into the industry. Part of the problem we're starting to experience now, not so much at the entry-level, technical-technologist level, but certainly at the university level, is that we're getting a lot of our best and brightest people going south of the border. That's not a problem that's limited to our sector, for sure. That's a problem in the whole high-tech sector. There are lots of reasons for that, but in the last two or three years, at least, there are four key universities that are graduating people who are coming into our industry, and all of them are having significant recruiting from the U.S. They're world-class educational facilities. They're generating excellent people. The U.S. industry knows that and they're recruiting heavily in Canada, and so we have witnessed some outfall of our best intellectual assets, to the U.S. particularly.

Mr. Carmen Provenzano: So I suppose what you're saying is we're leaders in the geoscience/geotechnical education field.

Mr. Ed Kennedy: We are.

Mr. Carmen Provenzano: I have a related question, and maybe you'd want to respond.

We've had a number of presentations on geomatics and geoscience, and they've all been really interesting. As a committee member, I just wasn't aware of the scope of this, and now that I see the scope, I can see that this science has developed to a point where there are specialties within the science.

Mr. Ed Kennedy: Absolutely.

Mr. Carmen Provenzano: My question then would be, are we providing education for the specialties within the science in an adequate fashion? If our young people want to educate themselves in the science, and particularly in the specialities, are they able to do that now, or do we need to respond somehow in the post-secondary education?

Dr. Robert McNutt: You've now asked a university professor something near and dear to his heart, and my colleague has been a university professor as well.

About a year ago, the Canadian Geoscience Council wrote a brief to the mines ministers' meetings expressing our alarm about what's happening to the downsizing of earth science departments in Canadian universities because of budget cuts that all the universities have suffered across the country.

At the same time, we also published another document called Future Challenges and Trends in the Geosciences in Canada, and in that we talk about how the training has to expand and become broader based. So we have this conundrum right now where we need to improve this training, but there has been downsizing and we haven't had enough infusion of new faculty members to train the students.

The enrolment in geological and geoscience programs has dropped. It has flattened out and is starting to climb now because the job market is improving, and it's improving in particular for those geoscientists who have a strong math/computer science background. That's where the demand is rising. The people with this type of training are those the Americans are taking as fast as they can.

So it has been a tough time in the last few years in this area. We are still concerned, and we made the brief. We'd be glad to give you a copy of the brief if you want to have it.

The Chairman: I'd ask you for that.

Mr. Carmen Provenzano: I think that information is very relevant to the work of this committee, Mr. McNutt, and I personally feel that those are the kinds of things we should be focusing on and, if we can address them, providing some kind of response to.

Dr. Robert McNutt: I will send it to you later, because it should be updated. This is a year old, and I think I could get some more information.

Mr. Carmen Provenzano: Both papers— You referred to two.

Dr. Robert McNutt: Yes, absolutely. The other one is a publication of Geoscience Canada, and it discusses these issues in some depth.

Mr. Carmen Provenzano: I have another question. Do I still have time?

The Chairman: Yes.

Mr. Carmen Provenzano: This question is sort of related. It's on the level of R and D funding. Can you talk about that at all? Where was it? Where is it now? Was it adequate? Is it adequate now? Where should we be going in that area?

Dr. Robert McNutt: No. No.

Mr. Carmen Provenzano: Well, let's hear from you. This is the committee you should be putting that information to, as far as I'm concerned.

Dr. Robert McNutt: The university-level research and development relies very heavily on NSERC, which is a federal government agency, for its funding. NSERC's funding has been cut in past years. Just recently, this year's budget has been lifted again to its 1994 levels.

• 1200

The ability to properly fund our young scientists— My main concern is the young scientists, because our more senior scientists have the ability to gather money elsewhere, from the private sector and so on. It's the future in which the young people have to rely quite a bit on NSERC funding.

Compare us to the other G-7 nations. I'm talking about research overall, including earth sciences. We don't fare as well at all in that area. The disparity between us and our neighbours to the south is growing steadily in terms of the level of support that the U.S. government is putting into NSF and we have been putting into NSERC and NRC.

As I say, the latest budget has turned the corner. You brought it back up to what it was a few years ago. I encourage you to keep on going. This is my issue.

Mr. Ed Kennedy: I have a couple of statistics in our sector. We did a sector study at the end of 1996. The average investment in R and D in our sector is about 8% of revenue. We're significantly higher than the national average, which I think is around 3% to 4%.

I think absolutely that technology development, as I said, is our key to survival in the global economy. As for public funding support, absolutely, I agree with Professor McNutt that it's encouraging to see the turnaround in the NSERC program.

We have high expectations of the NCE process that we're engaged in now. It's a very tough, competitive environment that we're in to go after that money. If we're successful in getting it, that's going to be a real shot in the arm, not only for the educational system in our sector but for the private sector, because private sector money is being pooled to leverage that funding.

Yes, absolutely. It's critical that more needs to be done.

The Chairman: Go ahead.

Dr. Denis St-Onge: The comments I made earlier about the polar shelf should be put in this context of support for research, because that's really what it is for all of northern Canada.

The Chairman: This is my last question.

The Canadian Geoscience Council is involved certainly in the area of education. Is it involved to the extent that if a university, community college, or some post-secondary institution wanted to fashion some courses in geomatics or geoscience technology, they could look to the Canadian Geoscience Council or to your organization, Mr. Kennedy, and ask for your help with the design of the course, the content of it? Is that kind of help available; if not from you, would you know where it might be?

Dr. Robert McNutt: It's hard to answer. It's quite a complicated question.

We asked a colleague of ours to help us write a position paper on the issue of professional accreditation versus the need to develop curricula in universities. Sometimes these come into conflict.

To specifically answer whether a college or university could come to us for help, the answer is no. We don't have that mandate.

But one of our affiliate organizations is a group of all the chairs of all the earth science departments across Canada. These are the people who wrestle with this daily. In one of the documents I'm going to give you, they talk about the future needs of education.

We certainly try to promote that and help it, but no, we're not a licensing or approval body in that sense. We certainly would try to help them, but it's going to have to come from the universities themselves.

Mr. Carmen Provenzano: Is your association any more active than that?

Mr. Ed Kennedy: Yes. In 1993, we had an extensive consultation with the three sectors, industry, government and the academic sector, in geomatics. We did a lot of work on future skills assessment and looking at the demand and supply issues. We published a report at that time. I personally was very involved in that.

Our mandate is business and business development. It wasn't a primary initiative for us to carry on.

We have a sister organization called the Canadian Institute of Geomatics. I think that's more comparable to the Canadian Geoscience Council. It's a learned society with individual members, as opposed to our organization, which is corporate membership. In fact, we have just signed an agreement with Human Resources Development Canada, between the CIG and our organization, to do a complete sector analysis of the geomatics sector of human resource issues, to look at all the issues in HR.

• 1205

A second project is to upgrade the material to be used, right down to the primary school system, about our sector. This will be telling the story of the opportunities in our sector and encouraging students to take the necessary science and math. That's a problem in our sector as well.

There's a requirement, obviously, for a strong science and math background, and we think we need to be promoting our sector and the opportunities in it right at the level of primary school. We have an initiative under way to develop a range of new media, including print, Internet-based media, and video that will help to encourage the ongoing supply of students into the universities and colleges.

Dr. Robert McNutt: I just have a clarification on Mr. Kennedy's take on the CGC. We're an umbrella group of organizations that are scientific and academic, but we're also organizations from industry and government. So the three sectors meet around the table every time we meet to discuss these issues and when the issue of education comes up.

One of these organizations is called CGEN. It's very much involved in the very same thing that Mr. Kennedy was talking about. It's education for people, such as lay people and young students in the university, about earth science. CD-ROMs have been developed and booklets have been published to be sent to high schools, and so on.

It has been an extremely successful endeavour. We feel the impact. This is one of the areas.

The Chairman: Thank you.

Is that okay, Mr. Provenzano?

Mr. Carmen Provenzano: Excellent.

Dr. Robert McNutt: We'll send you a CD-ROM so you can have a look at it.

The Chairman: Excellent questions. The folks at Algoma University College and Sault College will be proud of you.

Mr. Carmen Provenzano: You unmasked me.

The Chairman: We're all interested in education. I'm a U of T engineer, by the way, Mr. McNutt.

Pierre hopes there are diamonds in his riding up on the St. Lawrence.

[Translation]

Mr. Pierre de Savoye: You know we have to be leery of Canadian diamonds. You remember the old saying?

Mr. Denis St-Onge: Yes. I believe it was mica at the time.

Mr. Pierre de Savoye: That's it. It is always interesting to talk about geomatics, geoscience, because it is a science and a technology that is at the leading edge of our understanding of the planet we live on.

I have a few questions, first for you, Mr. Kennedy.

You mentioned earlier that there were about 1,500 small and medium businesses in Canada that make about $1.8 billion. Could you tell us how they are distributed across the country? I believe the oil and drilling and mining operations are mainly in Toronto and Calgary. As for forestry, agriculture, fisheries and perhaps other things, how are they spread out across Canada?

[English]

Mr. Ed Kennedy: The industry is fairly well distributed with the population of the country. Understandably, we have heavy concentrations in Toronto and here in Ottawa because of the influence of the federal government not only as a partner, as I've suggested, but as a client.

Vancouver is another concentration area. Again, that's because of the economy there, particularly the resource applications. We have a large concentration in Calgary primarily because of the oil and gas industry. We have some very solid, progressive, and world-leading companies down on the east coast and in Quebec that are active around the world.

I would say the industry is pretty uniformly distributed, and pockets of expertise exist right across the country.

[Translation]

Mr. Pierre de Savoye: What are the main areas of activity, other than oil and mining operations?

[English]

Mr. Ed Kennedy: A key application area of this technology, in addition to the resource sector, is agriculture. One of the really exciting applications of geomatics and agriculture is a technology called precision farming.

The way that technology works is that satellites are used for navigation purposes. So there are actually computer systems on board tractors and combines that monitor the location of the vehicle and bring in data on crop conditions to help, first of all, to economize on the application of fertilizer, pesticides and herbicides, but also to mitigate the environmental damage by over-application of herbicides and pesticides. It's an integration of navigation technology, of the satellite imaging technology and information gathering right on site to do variable application of these agents to maximize the efficiency of farming.

• 1210

That's an area of application. Infrastructure development is another, and therefore transportation and telecommunications. An application in telecommunications, for example, is with the widespread use of mobile telephones and cellular telephones, especially in the developing world. As you may know, the developing world is leapfrogging right over the developed world in telecommunications by going to cellular and avoiding the expense of infrastructure for land lines.

One of the applications is the optimal siting of transmitter stations for cellular, again bringing in geographic parameters and site distances and so on.

[Translation]

Mr. Pierre de Savoye: And what about forestry?

[English]

Mr. Ed Kennedy: Yes, forestry. Another application is monitoring from space harvesting activity, actually measuring the amount of forest that's been harvested. A lot of the government agencies in Canada are using this technology to monitor harvesting by the private sector. The private sector is using the technology in clear-cut applications, for example, to minimize the esthetic damage that's caused by clear-cutting. They actually model before clear-cutting starts, or before forestry harvesting starts, the visual impact of a forestry operation in three dimensions, using animation technology as well.

[Translation]

Mr. Pierre de Savoye: You talked to us about RADARSAT, which is a great Canadian success. I believe the data collected by RADARSAT is available and sold all over the world. Could you give us an idea of the world market? Who are our clients? For what applications is the data bought? What income does it generate?

[English]

Mr. Ed Kennedy: I'm sorry, I don't have statistics on the revenue gathered. I know that RADARSAT International was well ahead of their revenue projections in their first year of operation last year. The applications around the world are similar to those in Canada.

One of the primary applications, in fact the foundation application, of RADARSAT in Canada was ice monitoring for shipping in ice-infested waters. That application is being developed in other polar region countries in Europe, Russia and the Scandinavian countries.

The technology is being used, for example, in Southeast Asia in connection with the forest fire and smoke problems that they are experiencing there. The technology is being integrated with this geographic information system technology, and with climate and wind prediction, to try to predict where smoke problems are going to be and to monitor the fires and measure the area of damage.

It was used in a recent oil spill off Japan about a year and a half ago. That particular application demonstrated the value of very quick gathering of data. With the higher satellite technology, we're talking of a period of days, to weeks, to months, in fact, to get an image back. But because RADARSAT is set up to gather image on demand—it's programmable—they had an image on that oil spill back and in the hands of the agencies that were monitoring it within about five hours.

It's a very quick-response technology, in addition to having the cloud penetration and all-weather capability.

[Translation]

Mr. Pierre de Savoye: That's very impressive.

The Chairman: Mr. St-Onge.

Mr. Denis St-Onge: If you will allow me, I will give you another example of the usefulness of RADARSAT. It will be very brief. RADARSAT allows us to finally have a complete image of the Antarctic and to monitor the state of the glaciers.

The current hypothesis is that if there is global warming, as everyone predicts, the flow of glaciers in the Antarctic will increase. There will therefore be more water in the oceans and their levels will rise. Before, there was no method that allowed us to have real global monitoring of this possibility.

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Last week I saw a truly extraordinary image of the Antarctic transmitted by RADARSAT. Therefore it will now be possible to monitor closely the water flow from the glaciers into the ocean.

Mr. Pierre de Savoye: RADARSAT is really an amazing piece of technology.

Mr. Denis St-Onge: There is no doubt about it.

Mr. Pierre de Savoye: My last question is for Mr. Kennedy. You have talked about no-cost access to American databases for American users. I imagine that Canadian users would have to pay. What you are suggesting is that the Canadian government also give Canadian users no-cost access to databases. I imagine that Canada would then charge foreign users. Is that what you are saying?

[English]

Mr. Ed Kennedy: I don't have a lot of optimism in fact that we will see free data from the Government of Canada, but should that happen—and we would welcome it obviously because of the competitive situation we're in—I would expect that same kind of policy to apply, yes.

[Translation]

Mr. Pierre de Savoye: Fine. Mr. McNutt and Mr. St-Onge, we spoke of gas hydrates and diamonds. You tell us we find gas hydrates in frozen soil or sea bottoms. However, I would like to know exactly what gas hydrates are. How are they different from natural gas or petroleum?

Mr. Denis St-Onge: Essentially, it's frozen gas. When you look at it, it looks like ordinary ice. But when you melt it, instead of getting water you get mostly methane. It can therefore be used much like natural gas. It's an enormous energy source just as we consider natural gas an energy source.

Mr. Pierre de Savoye: If I understood you correctly, you were saying a while ago that there are considerable quantities of gas hydrate imprisoned in frozen soil. Now soil only freezes to a certain depth. At a certain depth, it stops freezing because of the heat from the interior of the earth counterbalances the effect of the cold outside. Does that mean that these gas hydrates are found in the superficial layers? Where are they in the earth's crust?

Mr. Denis St-Onge: In the Arctic, Mr. de Savoye, in certain places the soil is frozen for up to 1,000 meters in depth.

Mr. Pierre de Savoye: Yes, but in terms of the earth's crust, that's still relatively on the surface.

Mr. Denis St-Onge: In a depth of 1,000 meters, you can find a lot of gas hydrate, and that is in fact the case. We find it in areas where the ground is frozen, therefore in the North of Canada in general, especially in regions where there is a lot of peat. We also find it in sea bottoms for the same reason, because the temperature is so low that the gas hydrate can remain in solid or semi-solid state. It sometimes looks like gelatin.

You are identifying the correct problem. There are a lot, but their geographical distribution is not well known. In that case, is commercial exploitation viable? That is what we are trying to determine with the work north of the Mackenzie.

Mr. Pierre de Savoye: Do you have the preliminary results of that work?

Mr. Denis St-Onge: No, I don't. I met someone who was coming back from there just as I was preparing to come here. I didn't have time to speak to him. If there is anything new, I guarantee you I will make it known to the committee.

Mr. Pierre de Savoye: If I understand you correctly, there is enormous potential there.

Mr. Denis St-Onge: That is correct.

Mr. Pierre de Savoye: It may or may not be there, but if it is, it is considerable.

Mr. Denis St-Onge: That's right. Now for Canada it is a potential that does not meet an urgent need since there are a lot of natural gas reserves in the Arctic. There are dozens of wells that are closed when then they could be supplying vast quantities. It's simply a question of transportation. Natural gas, in the coming decades, will certainly be a cheaper resource for Canada than gas hydrate. For the Japanese, however, it's another story.

Mr. Pierre de Savoye: We will close by talking about diamonds. Mr. St. Denis spoke about them at the beginning; I would like to talk about them as we finish. Can we find diamonds elsewhere?

Mr. Denis St-Onge: There are some in Quebec.

Some voices: Oh, oh!

Mr. Pierre de Savoye: I know. I read that in the papers. But what is the distribution of diamonds here in Canada?

Mr. Denis St-Onge: It's very erratic. It depends on where we find pits. These pits are the result of explosions that occurred in relatively recent geological times, that generated a lot of heat and very great pressures. We call them kimberlites. There are some in South Africa and elsewhere. There are some in the region north of the Mackenzie and north of Ville-Marie, in the Témiscamingue Lake region. It's very scattered.

• 1220

We generally find them, which is not surprising, in the Precambrian shield, in the Precambrian rocks, in very old rocks, even if the phenomenon is relatively recent. That's where the contradiction lies. Since Canada has a vast expanse of Precambrian rocks that covers two-thirds of the country—we are sitting on some at the moment—the potential is obviously enormous, which DeBeers didn't fail to notice long ago.

Mr. Pierre de Savoye: I want to end with this question: do the diamonds have a commercial or industrial value, or are they simply of the type like beautiful diamonds that last forever?

Mr. Denis St-Onge: Diamonds are forever. Both are there. The tests being done at the mine we want to exploit north of Yellowknife, in a region that has a beautiful name, Gras Lake, show that it has both. It is obvious we need a lot of industrial diamonds to make it work, but that is the case.

Mr. Pierre de Savoye: Thank you, Mr. St-Onge, Mr. McNutt and Mr. Kennedy.

Mr. Chairman, I will go back to the House, where I have another duty.

[English]

The Chairman: Merci. I just wanted to comment that we're honoured to have such a high-level, distinguished session, a seminar with leading geoscientists in the country. We should have all parliamentarians here.

We're going to move to Reg Bélair. Thank you, Pierre.

[Translation]

Mr. Pierre de Savoye: Thank you.

Mr. Réginald Bélair (Timmins—Baie-James, Lib.): First, I must confess my ignorance of geomatics and geoscience. And since no practical questions have been asked on this subject, I would like to address Mr. Kennedy.

First, who owns RADARSAT?

[English]

Mr. Ed Kennedy: Who does RADARSAT belong to? That's a good question. The satellite is owned by the Canadian Space Agency, so it was launched by the Canadian Space Agency, but the private founders of RADARSAT International contributed—I think I'm correct—$80 million towards the cost of the launch of that satellite. So I guess from that perspective it's a jointly held asset, but I think, legally speaking, it is the property of the Government of Canada.

Mr. Réginald Bélair: Of course, this leads to my second question. You've mentioned that there are some 1,500 small businesses associated with geomatics. How does one access RADARSAT? In other words, are they charging you a fee?

Mr. Ed Kennedy: Absolutely.

Mr. Réginald Bélair: You are renting.

Mr. Ed Kennedy: In exchange for that $80 million investment the companies made, they are recovering that cost through the sale of the data worldwide. So, yes, there is a charging mechanism, and it's quite a flexible system of charging because there are a lot of options in terms of the type of data, the resolution or quality of the data, and also the timeliness of acquiring the data. I gave the example of the five-hour turnaround. So there is a sliding scale of fees for the data, depending on what's required.

Mr. Réginald Bélair: So once you've acquired the data, how do you transfer it to the industry? Does the industry buy the data from your businesses?

Mr. Ed Kennedy: Yes, in addition to geomatics companies, certainly natural resource companies—oil and gas companies and mining companies—are buying data directly from RADARSAT. In some cases they are buying a solution, which is a package of data along with software that can solve a particular problem, in which case the intermediary would be one of the value-added services companies in the geomatics sector.

Mr. Réginald Bélair: Once the data has been sold—and this follows Dave's initial question—what happens then? Who does the data belong to once you've bought it?

Mr. Ed Kennedy: When the data is sold by RADARSAT International to a third party, again there is a licensing arrangement there that specifies how the data can be used. So it's sold for a particular application. If the data is then used for another application, there'll be an additional charge, like a royalty, back to Radarsat International.

• 1225

Mr. Réginald Bélair: So from what you're saying, the system works well.

Mr. Ed Kennedy: I think it does. I think there was some apprehension initially in the smaller industries about how the system would work and about the charging mechanism, but I certainly haven't heard much complaint about that in recent months since the technology has really matured and the applications have matured. I think it's working quite well.

Mr. Réginald Bélair: Thank you, Mr. Chairman.

The Chairman: Thank you, Reg.

Before we go to Yvon, just for the members' information, this is not a stationary satellite; it's an orbital satellite.

Mr. Ed Kennedy: Exactly.

The Chairman: So you can actually have data for almost every square inch of the earth.

Mr. Ed Kennedy: Yes, except for very, very limited areas of the earth, it is global coverage and you can re-image any particular area on the earth every three days. So there's a very quick repeat cycle.

The Chairman: The sales potential for data is virtually endless.

Mr. Ed Kennedy: Yes.

The Chairman: Yvon Godin, please.

[Translation]

Mr. Yvon Godin (Acadie—Bathurst, NDP): First, I would like to thank you for coming to meet with us. I think all the questions have been asked, so I won't get into that. I don't like repeating things.

[English]

The Chairman:

[Editor's Note: Inaudible]

[Translation]

Mr. Yvon Godin: No, there are a lot of questions about that issue. One thing is certain; a lot of us have been informed.

[English]

The Chairman: You won't be last. I think Ovid's going to be last.

Mr. Ovid L. Jackson (Bruce—Grey, Lib.): I said one of the last ones.

The Chairman: Oh, okay.

[Translation]

Mr. Yvon Godin: You mentioned a while ago that some of our people specialize in this area, who go to university for training and development, then leave for the United States. You also said there were many factors related to this. One of those factors that immediately comes to mind is the fact that they are better paid. It's the same for our doctors. They went to university here in Canada, and then they went to the States because they were better paid there.

But you mentioned that there were other factors. Could you tell me about them? If pay is one factor, what are the others?

[English]

Dr. Robert McNutt: In the earth science fields in university, the students react rather quickly to the job market, and the natural resource sector has always had this cycle of ups and downs. Unfortunately, when students realize that the job is up they start to enrol, but it takes them four years to graduate, so sometimes they are out of phase, and this becomes discouraging over the years. It is the lack of being able to have long-term employment in the sector that has caused people to move off to other fields.

Part of the problem for earth scientists has always been that it's not really taught in high schools, so many of them come to university with no real knowledge of earth science. That's why we're working so hard in geomatics to get this information to the high schools and junior schools about the importance of resource science and earth science.

But the cyclical nature has always been a major problem—and the long-term employment prospects.

In universities today, in the science area, there is tremendous concentration in the life sciences, in biology, psychology, botany, zoology, these areas. Some of that is actually driven by pre-medical students who plan to go on to medical school, but for some it's a real interest in the environment. And the public perception is that the environment means the organic world—plants and animals and our effect on them—whereas, in reality, to really be successful in the environmental industries you need other than life sciences. Life sciences are important, but the mathematical skills, the chemistry skills, the earth science skills are equally important. This is a message that is difficult at times to get out.

There are a number of these factors that come into play, but if students perceive that the employment is not good at the end of their four-year degree, they will not move into it, and since the mid-1980s the resource sector has been, I'd say, largely an area of retrenchment in the sense of growing, in terms of the complement of people. There's been a lot of activity, but they haven't been growing in terms of complement.

[Translation]

Mr. Denis St-Onge: Mr. Godin, to emphasize even more what has just been said, it's that the budget cuts in Quebec universities—

Mr. Yvon Godin: Of Canada!

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Mr. Denis St-Onge: No, no, in Quebec, in this case. They were made at a time when there was a recession. As a result the Université de Montréal, the largest francophone university in Canada, has not had a geology department for two years. Then we ask why there are not enough geoscientists.

Mr. Yvon Godin: Another question I would like to ask, since we are among experts that can inform us— You may not be exactly the right experts, but you can certainly inform me about this anyway.

We talk about diamonds, about this and that. In fact, we are talking about industry. Did you work on something like that, in university for example, or do you have data in this area? I know someone in Nova Scotia that I could easily meet and who has done expert work in this area.

In mines, for example, the only thing we have available in the case of a disaster or a fire is what we call stench gas. They have developed a technology that allows waves to penetrate the earth and get depth information and not just surface information.

I don't have all the information but I could get it, as well as all the documentation. I just want to give you a quick example. I think it is important and I think it is within the purview of this committee. That's why I wanted to ask you if you had worked on something similar. As I was saying, this is really high tech.

For example, a person who uses a lamp underground could be warned, thanks to the battery in his light, when there is a fire starting. The people who stayed on the surface could warn him and he could receive their messages. In a disaster such as the one at Westray Mine, we could know where each person is. That's all thanks to technology. I don't know if one of you could explain that to me.

Mr. Denis St-Onge: Yes, in fact that technology does exist. I don't think any of us has any direct experience with it.

All I can tell you is that when I was chairing the committee that awarded postdoctoral scholarships for industry, an NSERC committee, there was a lot of research being done in that area by private industry. The National Research Council of Canada also subsidized it. That exists. Part of the equipment that a miner carries includes a system that indicates his position and that allows him to communicate with the surface. That's true.

Mr. Yvon Godin: I will close by stating that according to the information I have, the technology exists but industry does not want to buy it.

Mr. Denis St-Onge: It's the same thing for all high technology. In the beginning, it's always very expensive. But after Westray, I'm not so sure— Finally, all I can say is that I'm not in the know and I can't tell you where they are today. But I do know that it exists and that the industry has subsidized it to a great extent in cooperation with the NSERC.

Mr. Yvon Godin: Exactly.

The Chairman: Thank you, Yvon.

[English]

Ovid, we'll conclude with you.

Mr. Ovid Jackson: Thank you very much, Mr. Chairman. I have some questions, but I'm not sure they're relevant.

I have a problem in trying to figure out how the Canadian university differs from the American. Could you guys let me know? I have an image of some of the ivy league schools. The way in which they renew themselves seems to be a better structure. There's the fact that they do so well that the rich people want to send their kids there. They then just go right across the world, grab the smartest kids, and give them scholarships in order to get their research and development done. I wonder if our own universities, our structures, are different from theirs in terms of how they recruit, how they get enough money and resources.

The other question is how we transfer a lot of that information back for the public good. For instance, in my riding of Bruce—Grey, at the University of Western Ontario, I know that we've had some scientists there who were good at mapping. The Americans, when they went into space, were using their qualifications. You also have, for instance, a lot of people who get into energy from light sources and so on. I wonder how that information is transferred back to the community. What kind of synergies do you have there in order to foster that transfer and to keep it going?

Dr. Robert McNutt: Well, I'll talk first about universities in Canada and the States. In terms of our best versus their best, I would say we compete on a world scale. There's no doubt about it in terms of the quality of what we do.

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The United States has a two-pronged system. They have the private university system, which is the ivy leagues; you talk about Harvard and Yale and so on. But they also have some superb state-run universities such as University of Michigan, Virginia, Wisconsin, and the California system, Berkeley and so on. It's a question, quite frankly, of the level of support that comes from both the student, who pays the tuition, and the government, which is willing to put the money into it.

Universities are expensive operations to run at a world-class level because you need to attract the very best people you can, and you're right, the Americans do have a track record of going across the world and getting the best people they can. Immigration does not seem to be a problem into the United States if you really have the talents. Canada does this as well. We bring many people from offshore to our Canadian universities.

But it comes down, quite frankly, to the level of funding between the two nations. The Americans are really number one when it comes to this, and they have created a university system that is the envy of the world in terms of some of their first-class state universities and the private universities such as Harvard. On the other hand, as you know if you have ever sent your son or daughter to Harvard, it's very expensive, and so they have to build up a very large endowment for scholarships and bursaries to help the students go there.

I attended such a university; I went to MIT for my graduate work in Cambridge, Massachusetts, and it is tremendous to see the amount of money that comes into that university from the U.S. government agencies—not just NSF but all the various departments of the U.S. government—to support it.

That really is the issue. Our best is as good as their best, but we could stand to have a lot more of them here. That's the issue.

Mr. Ed Kennedy: I have a quick comment on the transfer of information, technology and research results. The philosophy, the context of the national centres of excellence program, in fact, is to facilitate that kind of immediate transfer. In the case of the geomatics NCE proposal that's now being developed, I think 10 private sector companies are part of this network, and in fact there's a requirement for a minimum amount—I'm not sure what the percentage is—of private sector investment into the national centres of excellence to complement the money that's coming in from the universities and from the federal NCE program. The philosophy there is to set up these networks so that there is direct collaboration between the private sector and the academic sector to ensure that the research results are transferred into marketable products and technology.

Thank you.

The Chairman: Thank you, Ovid.

I have a short question, and then we'll adjourn and thank you for your participation today.

Comparing us to the U.S., does the U.S. manage their science— I mean from the federal government level? You mentioned the NSF. I assume that's the National Science Foundation. Is that a government agency?

Dr. Robert McNutt: Yes, it is.

The Chairman: Do they attempt to coordinate their—

Dr. Robert McNutt: NSERC is our closest comparison to that.

The Chairman: How is the efficiency of the NSF relative to NSERC, or it is just a matter that we haven't evolved to a level of coordination that we need?

Dr. Robert McNutt: I can't answer that, but I think the NSERC is an extremely efficient operation in Canada. I think they have a very small overhead for the amount of money they give out. It is really a well-run organization. Dr. St-Onge, as grant selection committee chair, can tell you that it relies a lot on volunteer work and a small staff that really pulls it off. The NSERC system of giving grants is a good one.

The Chairman: So we're moving in the right direction with those granting councils.

Dr. Robert McNutt: More money in it— but the granting councils are good.

Dr. Denis St-Onge: Mr. Chairman, I'll send you a report. The fundamental difference between the two is that if you look at the curve for the last 15 years, the curve of NSF in terms of amount of money available has been going up this way and the NSERC has gone up this way, with a peak in 1986 or 1988 that has come back down. In a presentation to another committee in this place a few months ago, I said that if you were a skier you would use the Canadian curve but if you were a researcher you would prefer the NSF curve.

The Chairman: With that, on behalf of the committee, I want to thank you for your participation today. We're honoured to have such high-quality witnesses. We reserve the right to want to speak to you again as we evolve and improve our understanding of knowledge and technology in the natural resources sector.

With that, we'll adjourn. Again, thank you. Thank you, colleagues.