RNNR Committee Report

Supplementary Opinion of the New Democratic Party

The oil and gas sector continues to face significant challenges due to low commodity prices, with many hard working Canadians from coast to coast to coast being adversely affected. New Democrats recognize this challenge and have faithfully worked in this study to ensure the long-term sustainability of our resource sector and the well-being of those who work in it.

We have approached our work during this study with some guiding principles in mind that we believe are important to the future of our energy sector and natural resource development. Sustainability is crucial which includes ensuring the application of the polluter-pay principle so that costs are not left to future generations. Partnership is required to make sure that communities, provinces and Indigenous peoples all benefit from resource development and that we create value-added, well paid jobs here in Canada. Long-term prosperity must be our goal in leveraging our natural resource wealth to invest in modern, clean energy technology to keep Canada on the cutting edge of energy development and ensure affordable energy rates into the future.

Testimony from the majority of witnesses, representing diverse backgrounds, agreed that oil and gas will continue to be a part of our energy mix for the short and medium term as we transition to increased investment in renewable sources of energy. As a result, it is important that we address the challenges facing the sector in order to improve environmental performance and ensure benefits for Canadians.

Professor Stewart Elgie compared the state of the oil and gas sector in Canada today to that of the forestry sector in the 1990s. He noted that changes to environmental practices and processes within the forestry sector helped to improve the price companies received for their product, not simply greater access to market. This comparison holds potentially useful lessons for the oil and gas sector to ensure the viability of the industry in Canada.

The Committee heard clearly that the oil and gas sector is seeking increased market access for Canadian products and that companies place significant importance on new pipeline capacity to tidewater. It is also clear that new pipelines cannot be built without proper consultation and social license, and that market access depends on more than just physical transportation infrastructure. Public opposition to pipeline construction and trade measures like the European Fuel Quality Directive highlight the need to restore public trust in the regulatory review process and to improve environmental protection and innovation within the sector. Witnesses put forward compelling testimony that underlined to the committee that we must face the challenges of the high production costs and the environmental footprint of oil sands projects head-on to ensure the health and prosperity of the industry in Canada. Testimony from various witnesses highlighted important new developments in the management of environmental impacts and the work of groups like COSIA, where industry itself is recognizing these challenges and working towards solutions. We welcome their initiatives but also note that we need greater federal leadership to support technological advances, enforce environmental standards, and address water, climate and other environmental impacts. Improving the environmental performance of the oil and gas sector has the potential to improve its market access and the value of our exports.

We believe that innovation in the oil and gas sector is needed not only with respect to technology, but also in how projects are developed, assessed, consulted upon and ultimately approved or rejected. We believe it is essential that the lack of public confidence in the current environmental assessment process be addressed by permanent, meaningful changes to the National Energy Board process as soon as possible. New Democrats believe that the proposed interim measures introduced by the government are inadequate to address the results of a decade of Conservative dismantling of our environmental protection regime. We share the concern expressed by witness Professor Monica Gattinger that if the process goes ahead without the existing gaps being meaningfully addressed, the end result will further erode public confidence in the entire assessment regime.

We are disappointed that the majority committee report fails to recommend a speedy review of the NEB process as this had been a clear electoral commitment of the new government. We are disappointed that the newly announced review panel process contains no timeline for actual legislative changes leaving the Conservatives inadequate process in place and creating uncertainty for all stakeholders. We recommend that the government move faster to make the necessary permanent changes to the NEB assessment process to restore public confidence and ensure that it is fair, neutral, science based and designed to meaningfully engage communities.

The Government must also act quickly to honour its obligations to a Nation to Nation relationship with Indigenous peoples including proper consultation and accommodation on all energy projects and the protection of Indigenous rights. During testimony, industry representatives were clear about the importance of fixing the consultation process sooner rather than later. The Government of Canada, as representative of the Crown, is responsible for these duties and while proponents of projects should be a part of this process, we believe these responsibilities should not be devolved to proponents to fulfill, as was too often the case under the former Conservative government. The Government must take a much larger, hands-on role in creating the environment in which meaningful consultation can take place. The Government has made many commitments to Indigenous Peoples and we believe that now is the time to start meaningfully fulfilling them.

One of the new government’s key commitments to a new relationship with Indigenous peoples is the implementation of the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP). New Democrats believe that the UNDRIP should be fully implemented as soon as possible. We believe it does provide a path forward and are concerned that the majority committee report makes no mention of the UNDRIP. We therefore recommend that the Government support Bill C-262 and work with the mover of the bill, Mr. Saganash, to start the process of the proper implementation of the UNDRIP as soon as possible.

In the course of this study, we have been disappointed by the lack of focus on or inclusion of clean, renewable energy sources. We feel that the exclusion of other forms of energy from the scope of the study does not help committee members to fully appreciate the energy sector at this moment, nor does it help us fully appreciate its future potential. We did hear during testimony that many energy companies are investing significantly in these energy sources, as they see the value and potential in them. It is therefore particularly disappointing that the committee did not see fit to include them within the scope of this study. Regardless, we do recommend that the government look at ways to increase investment in clean energy development and in the clean tech sector, and continue to increase that investment in the years to come.

During testimony before the committee, Gil McGowan, President of the Alberta Federation of Labour stated “we should prioritize value-added development, because these kinds of investments not only create jobs directly in upgrading, refining, and petrochemicals but also create other jobs”. We agree with Mr. McGowan’s statement, as building this value-added capacity here at home will be beneficial to the long-term viability of the industry. We especially believe this to be true in regards to the petro-chemical industry, as it creates jobs that are not as subject to the volatility of global oil prices and creates products from petroleum based fuels that will be needed even following a transition in our energy generation.

Canada has significant natural resources which, if managed properly and sustainably, can be an important driver for our economy. We must ensure that these resources are managed in the best interests of all Canadians with a focus on protecting the environment, ensuring meaningful consultation with affected communities and Indigenous peoples, and maximizing economic benefits. We believe tackling these challenges has the potential to not only allow Canadian producers to fetch a better price in the market, but will better ensure the viability and success of the oil and gas sector to the benefit of all Canadians.