FOPO Committee Meeting

STANDING COMMITTEE ON FISHERIES AND OCEANS

COMITÉ PERMANENT DES PÊCHES ET DES OCÉANS

EVIDENCE

[Recorded by Electronic Apparatus]

Tuesday, June 5, 2001

• 0911

[English]

The Chair (Mr. Wayne Easter (Malpeque, Lib.)): We'll call the meeting to order. I know we're still waiting for members, but I believe there are 18 committees meeting, so our numbers are likely going to be somewhat low. The matter will be on the record and people can turn to the record in any event.

Today we have with us, from the Canada-Nova Scotia Offshore Petroleum Board, Jim Dickey, chief executive officer, and from Natural Resources Canada, Duncan Smith, an adviser on hydro-carbon issues.

Welcome, gentlemen.

I think you're probably aware of the fact that we've been holding some hearings on the Oceans Act. We had some concerns raised by a number of groups at our meetings—in Halifax, Nova Scotia, and elsewhere—on the Canada-Nova Scotia Offshore Petroleum Board, on how you make your decisions, etc., so we felt the best way to proceed was to have the CEO in, have a bit of a presentation, and go to questions.

So the floor is yours. Welcome.

Mr. Jim Dickey (Chief Executive Officer, Canada-Nova Scotia Offshore Petroleum Board): Thank you very much.

I thought it might be useful, Mr. Chairman, if I just opened with a few introductory remarks, maybe about a 10-minute presentation on the role of the board. Then we could take it from there in any direction you like.

What I would like to do is give a few opening remarks on some of the background on the board's mandate and also explain how the board interacts with the two levels of government—the federal government and the Province of Nova Scotia—the various government departments, particularly the Department of Fisheries and Oceans, other agencies, and the public in general.

The Canada-Nova Scotia Offshore Petroleum Board is the independent joint agency of the governments of Canada and Nova Scotia. It was established through a political accord that set aside jurisdictional or ownership questions between the two levels of government. Each government passed mirror legislation, which we refer to as the accord acts. That legislation was proclaimed in January 1990.

Through that legislation the board is mandated with the responsibility for the regulation of petroleum affairs and safe practices offshore Nova Scotia. The board's principal responsibilities include: ensuring the safe conduct of offshore operations; protection of the environment during offshore petroleum activities; management of offshore oil and gas resources; review of industrial benefits, employment opportunities, and plans; issuance of licences for offshore exploration and development; and resource evaluation, data collection, and distribution. Those are the primary functions.

Mr. Sarkis Assadourian (Brampton Centre, Lib.): Can you go over the functions again, please?

Mr. Jim Dickey: Yes, I can—and they're in no particular order. They are the primary functions the board has under the accord legislation.

The first would be ensuring the safe conduct of offshore operations; protection of the environment during offshore petroleum activities; management of offshore oil and gas resources, which would be the subsurface resources and oil and gas conservation; review of industrial benefits and employment opportunities and plans, as submitted by the various operators; issuance of licences for offshore exploration and development; and resource evaluation, data collection, and distribution of that information.

• 0915

A lot of our information, I might add, on all of the things I'm about to go into here is found on our website, which is certainly open to the public. There's a great deal more information than what I will be able to go through today on our website, which is www.cnsopb.ca.ns.

Under the legislation there can be five board members, including the chairman. The are currently four, including the chairman. The board is supported by a staff of 28 professionals and support persons in such areas as health, safety, and environment; rights and resource management; and industrial benefits and employment.

My comments today are intended to focus on the environmental practices of the board. I should say that notwithstanding the views expressed by some, it has been a longstanding policy of this board to have extensive consultations with other agencies and departments and the public when considering environmental aspects of offshore oil and gas activities.

One of the areas where we have the greatest interaction is with the Department of Fisheries and Oceans.

In 1994 the board established the Fisheries and Environmental Advisory Committee, whose membership includes government agencies and departments, fishermen and fishing industry representation, and non-government organizations. This committee is a focal point for obtaining environmental and fishery advice on proposed offshore activities and board environmental policies. Through this committee we receive valuable advice from fishing groups and from DFO. This advice is taken seriously by the board.

For example, the board has prohibited any oil and gas activities in an area known as “the Gully”, based on notification from DFO that it was being considered for a marine protected area. The board has also rejected several applications for seismic activities when DFO advised they could interfere with an ongoing migratory stock survey or a spawning area.

The board is also involved in initiatives led by the Department of Fisheries and Oceans related to integrated management planning under the Oceans Act. The board and DFO have developed a draft memorandum of understanding, which is now out to our advisory committee and the public for comment and will be finalized in 2001.

A part of this MOU is a work plan that will be developed each year. Some of the joint initiatives for the 2001 include: joint priority setting for collaborative work; developing a coordinated approach to address emerging issues associated with marine conservation and impacts of oil and gas activities; updating the oil and gas waste-discharge guidelines; having a joint review of environmental effects; monitoring for offshore projects; participating in the DFO process for the development and implementation of integrated management plans for the offshore area; and environmental assessment and input on potential licence areas. These are all important areas for the board.

In particular, we support DFO's initiative in the development of integrated management plans for the offshore area. We see this as a key development to address government policy on offshore oil and gas activities in the marine environment. We consider that we have an excellent working relationship with DFO, particularly on the regional level. As indicated by the work plan, we have significant areas of mutual interest that we are jointly pursuing.

The board also has a similar memorandum of understanding with Environment Canada, and has a work plan for 2001. The MOU provides for cooperation while conducting environmental monitoring and auditing of offshore operations.

The board has also been designated a federal authority under the Canadian Environmental Assessment Act. At this time the only activity that can trigger the CEAA process is development. Changes are being made to the regulations to include exploration activity, and those amendments are expected early in 2002.

I want to note that we consider the environmental assessments we now require as being comparable to those under CEAA.

Another part of the board's job is rights issuance, commonly known as the licensing process. I'd like to just take a moment of your time to go through this process and explain how the public can contribute throughout that process.

• 0920

The rights management or licensing process is based on the Canada Petroleum Resources Act. The board's administration of the licensing process supports and is consistent with the goals and objectives set out in the board's strategic plan. It's reviewed annually by the federal and provincial governments. This is a plan that sets forth anticipated fundamental decisions for the upcoming year. It is provided to both ministers at the beginning of the year for their information.

Issuing an exploration licence begins at the nomination phase. At any time during the year, industry may nominate offshore parcels of land for petroleum exploration. There are presently two areas where nominations will not be accepted—the Georges Bank moratorium area, and the area I referred to earlier as the Gully.

I should also comment that it's board policy that the board itself does not nominate lands, as is the practice in some other areas. These nominations are generated exclusively by industry.

Board staff review nominated parcels to determine whether they will be included in a future call for bids. In this internal assessment, a high priority is placed on identifying known environmentally sensitive areas and fishing concerns.

Mr. Peter Stoffer (Sackville—Musquodoboit Valley—Eastern Shore, NDP): I have a point of order, Mr. Chair.

Sorry to backtrack, sir, but can you repeat the part where you talked about industry nominating?

Mr. Jim Dickey: Yes. It's board practice that the board itself does not nominate lands. In some jurisdictions, that is a practice, but our policy is that all nominations are generated by industry. So when the the public sees a nominated parcel of land, you can be assured it's an area of interest to industry—unless we change our policy, in which case they will be advised.

Mr. Peter Stoffer: Thank you.

Mr. Jim Dickey: The board also consults with the appropriate federal and provincial government officials to receive public policy input on these nominated parcels.

Approximately 30 days from the close of nominations, the board makes a decision on whether there will be a call for bids, taking into consideration the views of staff and the federal and provincial governments. Nominations can be, and have been, modified or excluded at this stage.

Notice of the board's decision is then sent to the federal and provincial energy ministers responsible for the accord acts. This is an example of a fundamental decision when there's an intention to have a call for bids.

The ministers, after being advised by their own staff on the potential issues surrounding the board's decision, may jointly veto, suspend temporarily, or reject the decision. If no joint veto or suspension is received from the ministers within 30 days, the board issues a call for bids.

I'll cover it later, but these fundamental decisions are critical areas for elected representatives to be given an opportunity to shape public policy. It's why they're in the accord. The board has the responsibility for day-to-day administration of the accord, but a lot of the fundamental or essential policies are generated, of course, in consultation with the elected representatives.

The call is advertised at this point, once a decision has been made to allow. The board then advertises. It's left open for 120 days. During this time, the general public is invited to comment and make written representation to the board and the two governments.

It's important to note that the general public has an opportunity to participate in the process before a licence is issued. This is the first stage where the general public would be brought into the process. In our calls, we ask the public to make written representation.

It is also a time when the advisory committees, the environmental and fisheries advisory committees, have an opportunity to comment on the parcels being offered.

As I mentioned before, this committee is made up of people from government departments, fisheries organizations, and non-government associations. It should be noted that there is no representation from the petroleum industry on these committees.

The process is open and transparent. Any company may bid on a parcel of land, and any person or group may comment. The board welcomes written submissions from the public on the specific parcels up for bids.

• 0925

During this period the board also undertakes and publishes on the board's website a strategic environmental assessment. This is an initial overview that identifies potential issues and provides a basis for future more detailed assessments. A minimum of 120 days after the call for bids the board reviews the bids. The board considers its environmental assessment, any fisheries concerns, comments from the public, and the views of the provincial and federal government departments and agencies.

Based on that information the board makes a decision on whether to issue new exploration licences. The board is not bound to issue a licence for every parcel in the call and there have been occasions when it has decided not to do so.

Once again, the provincial and federal ministers of energy are given notice and may jointly veto the board's decision. This is the second fundamental decision opportunity in the licensing process.

It is important to note that an exploration licence does not give an operator the right to conduct oil and gas activities. What it does do is give them a right to make an application to the board for activity authorization. Licence-holders must get separate board approval for each activity they plan, and the public has an opportunity throughout that process to make written representation and participate in the activity review.

An example of an activity would be a seismic activity, a drilling program, or a diving program. Any of these types of activities require a full application from a proponent.

Work authorization must be obtained for, as I said, every seismic project, exploration well, delineation well, development project, diving program, and production activity. When applying for board authorizations, companies must file comprehensive documentation, including an environment impact statement and an environmental protection plan.

In addition to that, of course, they have things like financial responsibility requirements that they have to meet, declarations of the operator that it's followed all the provisions and requirements of the accord and regulations, and a certificate of fitness from a certifying authority that the equipment is fit for purpose. There are a number of other requirements, but from the environmental aspects it would be the environmental impact statement and an environmental protection plan that are of primary importance.

Our process mirrors that followed by the Canada-Newfoundland Offshore Petroleum Board, which regulates petroleum activity offshore Newfoundland, including the west coast of the island where both the fishing industry and the petroleum industry have found a way to co-exist.

The existing licensing and activity review process recognizes the need for balance among interested parties. The environment must be protected, fishing livelihoods preserved, and a competitive climate offered for oil and gas investment. Under the existing regulatory regime it is possible to achieve all of these objectives. The board's licensing and review process has been developed to take into account differing views and to advance the overall public interest.

The process provides ongoing opportunities for fishing interests, other ocean resource users, the academic community, government scientists, and the general public to comment on proposed exploration licences and exploration activities. We consider this to be an open and fair process for all stakeholders, a process that is governed by the legislation and regulation set out in the accord acts.

I think that completes my opening remarks, Mr. Chairman, and at this point I'd be pleased to respond to any questions your committee may have.

The Chair: Thank you, Mr. Dickey.

Just before we start with questions, could you give me an idea of what your jurisdiction is? When we were in Moncton they were saying that you're responsible also for up in the gulf area. Just give us an idea geographically.

Mr. Jim Dickey: Could I get up and point it out to you?

The Chair: Yes, that would be the best way to do it.

Mr. Jim Dickey: Under the accord acts, which is basically what we go by—I have no choice on that matter—it's very well defined on the map. It's right down here between P.E.I. and Nova Scotia, up along the coast of Cape Breton, just outside the parcel here, down through the Laurentian Channel. Of course, this is the one for which the boundaries are being discussed at the moment, but under our court legislation we have legislative authority over to that line as it exists.

• 0930

On the continental margin, which is well beyond the 200-mile limit, there's a treaty that provides for jurisdiction of resources out to this margin, and along the Georges Bank area, the international boundary, which is developed by—

The Chair: And then straight up to the middle of the Bay of Fundy.

Mr. Jim Dickey: Straight through, right up through the bay.

So it was an international treaty that developed this line. I don't believe there are any difficulties with any of these lines. Of course, this is the one that's been in the news.

The Chair: I have a question while you're there. Those are permits for exploration that are on there?

Mr. Jim Dickey: Georges Bank?

The Chair: Yes.

Mr. Jim Dickey: These are permits, and there's a moratorium on that area until 2012. These are permits over here, and nothing is being done on those until the boundary situation is resolved. Eventually if there's a decision by the government to proceed on either of those areas, those permits will be converted to exploration licences with terms and conditions negotiated.

The Chair: So what's happening on the American side?

Mr. Jim Dickey: As far as I'm aware, there's a moratorium on the American side.

The Chair: That's what I thought.

So thank you very much, Mr. Dickey. We'll go to questions.

Mr. Cummins.

Mr. John Cummins (Delta—South Richmond, Canadian Alliance): Thank you, Mr. Chairman.

I think “offshore” petroleum board is a bit of a misnomer given that not all the waters you are responsible for would be classified as offshore.

Mr. Jim Dickey: That's correct. Under the accord the jurisdiction goes to the low water mark, and then after the low water mark it converts to provincial jurisdiction. There is also a number of bays and enclosures that are provincial jurisdiction.

Mr. John Cummins: Have you already issued a licence for seismic activities on the west shore of Cape Breton?

Mr. Jim Dickey: No, we haven't. There are three parcels on there. Of course, on the west side there's one parcel. We have not issued a licence because there has not been an application submitted to the board.

Mr. John Cummins: Are you in the process of issuing a licence or are you aware that proposals are imminent?

Mr. Jim Dickey: We're not in the process. As a matter of fact, with the joint directive that was received in the issuance of a public review process the board issued a prohibition on that area for any activities until such time as that process is complete.

Mr. John Cummins: Until the review process is complete?

Mr. Jim Dickey: That's correct.

Mr. John Cummins: Are you talking about the review process that Ms. MacNeil is undertaking?

Mr. Jim Dickey: That's correct.

Mr. John Cummins: Is that process Ms. MacNeil is undertaking liable to lead to an environmental assessment?

Mr. Jim Dickey: I don't know what that's going to lead to. It's a unique situation in that we have never had a public review that didn't focus on a planned activity. There is no planned activity. There's no application in, so it's a generic public review and of course the terms of reference are fairly specific and there have been a lot of environmental assessments on it to date.

What comes out of that public review, I couldn't answer until it's over.

Mr. John Cummins: For the record there is a moratorium on Georges Bank, and perhaps you might advise the committee and others as to why that moratorium was put in place.

Mr. Jim Dickey: That moratorium was put in place pursuant to a government review, which didn't involve the boards at all. There was a review associated with that for whatever reason the government thought appropriate, and as a result of that review they've decided they would like to have a moratorium in that area due to the fisheries concerns.

Mr. John Cummins: Was there not an environmental assessment on that area?

• 0935

Mr. Jim Dickey: I don't know. There was nothing our board would have been involved in.

Mr. John Cummins: Yes. Given the nature of the concern on the area west of Cape Breton, would it not be prudent for the board to ask that an environmental assessment be conducted of activities? I'm thinking now in particular of the seismic activities, because that's where it starts. As I'm sure you're aware, a number of studies relating to seismic activity have been done elsewhere in the world, and they suggest, at least in my reading of it, that there are short-term impacts on the fishery when seismic activity takes place. Would it not be prudent for the board to at least recommend that an environmental assessment be taken now, given that I'm sure there must be some interest by the petroleum industry in that area?

Mr. Jim Dickey: The board always does environmental assessments when there's an activity application submitted. In this case, as a result of the joint directive, the board didn't get an opportunity to undertake a detailed environmental assessment, because there was no application filed... as a directive to hold a public review in the general sense. So in every parcel we've dealt with where there's been an activity application, we have done our environmental review and environmental assessment, and we would have done this, and continued to do it, on that parcel as well.

Mr. John Cummins: I'm curious about this notion that there hasn't been an application so you don't have a public review. There were no applications in Georges Bank, and yet there was a public review, and it did contain a study of the environmental impact of exploration and drilling activities. So that was done without a project being on the table.

And I heard around this table a comment last week, and I understand it was when the committee was in Halifax, that without a project having been named it's impossible to do an environmental review of it. But as I say, my understanding of it was that this wasn't the case in Georges Bank.

Mr. Jim Dickey: Oh, that's correct. The governments can undertake a public review whenever they think it's appropriate. But under the accord acts, the boards—

Mr. John Cummins: You're limited.

Mr. Jim Dickey: Yes. The areas we have traditionally had public reviews for relate to development plans. We had a public review for the Cohasset-Panuke development plan, because it's a much longer-term activity and it's something that, of course, the public is extremely interested in. So we had a public review for Cohasset-Panuke, we had a public review for the Sable project, but we've never had a public review for any other kinds of activities, because they're much more minor in their scope. But we do environmental work on every activity.

Mr. John Cummins: There doesn't seem to be a whole lot of acceptance of this review that Ms. MacNeil's about to undertake. Part of the problem is that, as I understand the mandate as she described it, there isn't a fisheries expert involved in it. She can hire one if she needs to, but it's not seen as the definitive review. And I think there's some suspicion out there in the public that somehow or another something is going to be rammed ahead. That suspicion may not be well founded, but it's there. And I think that's the problem: there's a distrust of government's intentions here.

Given the mood in the public, and given the kind of comment I'm sure you receive on this issue, again, would it not be prudent to at least advise government that some sort of an environmental assessment should be done of the impact of seismic activity on fish and fish stocks? Don't you think that would be helpful, not only to you, but don't you think it would satisfy the public's concerns?

Mr. Jim Dickey: It's very difficult for us, as a board, to go too far in any direction. It's certainly beyond the terms of the joint directive we had.

• 0940

Our board, if it had followed its normal course of events, would not be having a public review on those three parcels, because there was a plan for some seismic work. There's been lots of seismic work done in the area in the past. We had done some initial environmental work in the area and don't really see that the area is significantly different from any other area or has different concerns from what we get on any of the other parcels. We have a system that deals with those concerns.

We have a lot of consultation, and the public would have been consulted extensively on any seismic work that was planned. Our board has the ability to restrict activities in geographic parts of a licence. We could easily have put a limit or a cordon for no operations within 20 kilometres or 30 kilometres of the land. We could have restricted the activities to certain times of the year. Those things would have all been done in consultation with the fishing groups and the communities in the area. What we would be trying to do is to find a way that would allow the planned seismic work to go ahead and that wouldn't interfere adversely with the fishing communities in the area. We really didn't get to that stage.

Mr. John Cummins: But isn't that the issue here? If you want to go ahead with that seismic activity, you're going to have to conduct an assessment of the impact. The information I've received from fishermen in the area—and I grant that it's anecdotal information—is that, when seismic activity has been conducted in the past, it's had a negative impact on the fishery. I referenced last week an article that appeared in a National Research Council Canada publication. It was an article based on seismic activity in Norway, which suggested there were problems with seismic activity, that it did impact on fisheries. As well, in Australia proposed seismic testing was triggering an environmental assessment in that country.

So why is it that you or your board doesn't see fit to suggest to the powers that be, if it's not within your mandate, to conduct an environmental assessment of the impact of seismic activity? Isn't that likely to clear the way or to give you some guidelines to operate on? Wouldn't it be of value to you?

Mr. Jim Dickey: Well, I guess the answer to that is, as I said, that if we had been continuing on the course we were on, we would have been doing that type of work. We would have consulted with the public. We would have consulted with the scientific experts at DFO and Environment Canada. We would have tried to determine whether there were any adverse effects to seismic work, and, if there were adverse effects, how they could be mitigated. And if they couldn't be mitigated, then our board would have been in a position to say, well, we're not going to authorize seismic work.

We've done it in the past. We've put those kinds of conditions on. I expect we'll end up doing the same thing even after this public review is complete, because the commissioner is going to come back with a report to the board, which is a non-binding report. It'll be basically recommendations on what she has discovered from her meetings with the public in the area. The board then will take that into account, along with its own internal environmental assessment work, and the scientific evidence and information we generate or get from DFO and Environment Canada.

So to answer your question, I think there will be a lot of that work done before there's any seismic activity approved in the area.

The Chair: Thank you, John. We're considerably over time, but we'll have time for questions this morning.

Mr. Assadourian.

Mr. Sarkis Assadourian: Thank you very much.

I'd like to ask you to simplify the process, because we're getting different points of view from MacNeil and you and others. Let's assume I am the oil company and you are the board. I have interests in offshore areas x, y, and z there. Before I invest my money, I have to ask some companies to do some research for me—seismic activities, whatever. Now, can you take us step by step, when I am a company, through what I would do before you grant me a licence to explore in the sea for the future? That's my first question, if you don't mind.

• 0945

Secondly, Ms. MacNeil said that she doesn't have the authority to call a public hearing or environmental assessment of the lot. She can only recommend based on public input.

I suppose—and correct me if I'm wrong—that recommendation comes to you, and you decide if there will be an environmental assessment or not?

The third and final question is, how long have you been the chief executive officer of this board? How many years?

Mr. Jim Dickey: Okay. Well, I'll certainly clear the first—

Mr. Sarkis Assadourian: No, answer that question first.

Mr. Jim Dickey: I've been the chief executive officer since 1995.

Mr. Sarkis Assadourian: So for the last six years you've been working with this accord, right?

Mr. Jim Dickey: Oh, I've been working for it before that. I was with the board in 1990.

Mr. Sarkis Assadourian: Okay, say 10 years.

Mr. Jim Dickey: So here's my accord hat.

Mr. Sarkis Assadourian: Would there be any improvement that you could suggest to the federal or provincial governments, or changes that will improve the accord? If you can do that now, I would appreciate it.

So you've got three questions. Thank you.

Mr. Jim Dickey: Well, I guess I answered the first one. I've been with the board since 1990—

Mr. Sarkis Assadourian: Oh, I have one more point. You mentioned to the chair's enquiry that on the American side they have a moratorium. Why is it that they have it and we don't have it on this side?

Mr. Jim Dickey: You'd have to ask George Bush that. As I understand it, he's having a look at that right now. But in the past the U.S. government has decided they wanted a moratorium in that area.

Mr. Sarkis Assadourian: On what grounds?

Mr. Jim Dickey: I have no idea how the U.S. does...

Mr. Sarkis Assadourian: Okay.

The Chair: Do you want us to invite George Bush up, Sarkis?

Thank you, Sarkis.

Mr. Dickey.

Mr. Jim Dickey: Well, let me see if I can remember these. First, I could go into the exploration licensing process. Again, I have a sheet here. It's a 14-point form. It's on our web page, but I also have it here. I hadn't intended to table it because I haven't had an opportunity to get it into the two official languages yet, since I was asked to appear on Thursday afternoon, and I had a few things going on between then and now. But I'd be happy to have that done and table it with your committee if that would be useful.

The Chair: That would be useful, yes, if you could. In fact, if you can leave it with the clerk, he can get it translated.

Mr. Jim Dickey: Okay. I have a number of copies, and I'd be pleased to do that.

What that does is go through, point by point, how we issue a licence, and it also is colour-coded so it shows you the points where the public is involved in the process—where there's significant public consultation—and also where the federal and provincial energy ministers are involved in terms of fundamental decisions, and the rest is board work.

It's essentially this process that I just read to you in my opening statement. Once you make a nomination—and I went through days and the fundamental decisions and how we take it to the governments. I don't know if you want me to go through that again, or would you prefer to... Because I did read it into the record.

The Chair: Yes. I think I've made note of some of it here. If you can just table the document, we'll get it translated, Mr. Dickey, and that'll be fine. I think that'll be adequate.

Mr. Jim Dickey: Now, let's see; there was a question on the environmental assessment, I think. I want to make it very clear that environmental assessments are done in these areas. We have an internal environmental person who does nothing but these internal environmental assessments and coordinates the activities with DFO and the Department of the Environment.

There's a misperception here that no environmental work is being done. We gather all the scientific evidence and information that's available worldwide, as was mentioned here, to try to determine the effects on the fishery of seismic activity. It's a large job, and we rely extensively on the advice we receive from DFO in some of these areas, particularly when it comes down to sensitive fishing areas.

Mr. Sarkis Assadourian: How many times have you said no, for a sensitive fishing area not to be included? How many times in the past? Have you ever said no?

Mr. Jim Dickey: Oh, yes. Many times, when we get a nominated licence, when it comes in we will reconfigure that nominated area to take sensitive fishing areas into account. For instance, you'll see that some of these licences have little corners out of them. That's because they're in sensitive areas, like the Gully.

• 0950

As a matter of fact, there are a few on the map right now. I can see from here that we reconfigured the nominated parcel. Then we went back to the companies and said, here's a sensitive area; we think you should stay away from that. Does this affect your nominated area? Are you still interested in going ahead, because we've reconfigured your licensed area? Sometimes, if you are not careful, of course, you'll cut out the very thing they were looking for in the first place in the subsurface geological area.

In most cases, though, we've not had any difficulty in getting the cooperation of industry, because they appreciate it up front. We did this with the Cape Breton parcels. On the ones on the east coast, the two Hunt ones, we never had any concerns whatsoever expressed. On parcel one, on the west coast, when we put it out for public comment after the nomination, we never received anything. We never had any kind of feedback on it until there was some talk about Corridor Resources doing some seismic work there. Then some people began to look at it. They had some concerns and began to express them to us, and they began to express them to the governments. Then it just picked up steam from there and it became quite an issue. In the process, we were carrying on with our normal process until we received the joint directive to hold public review.

Mr. Sarkis Assadourian: The final question.

The Chair: Which was what, Sarkis?

Mr. Sarkis Assadourian: What improvements would you suggest on the accord acts, having been there for 10 years?

Mr. Jim Dickey: Well, that's a big question. If there's one improvement I could suggest to the accord acts, and only one—there are many areas we deal with where we have challenges—I would say some kind of amending formula for the accord acts that would allow the two governments to incorporate amendments they think would be appropriate to the accord acts. It's difficult when you have two different governments, because as soon as you open up the accord acts everybody has a shopping list. And it makes it difficult. If there was an amending mechanism that could be developed for the accord, that would help it retain its current applicability.

Mr. Duncan Smith (Adviser, Hydro-Carbon Issues, Natural Resources Canada): If I could amplify on that, through the system of joint management, we cannot amend the accord acts unless we have absolute agreement between the proponents or the signatories of that accord act. As well, from a federal perspective, we like to keep consistency on all areas of frontier lands. So if we were going to amend the Nova Scotia accord act, that would also include bringing in the Newfoundland government.

So the bottom line is, we cannot proceed one step, in terms of amending those accord acts, unless we have agreement. If we don't want to do something, it's not done. If Nova Scotia doesn't want to do something, it's not done. If Newfoundland doesn't want to do something, it's not done. Therefore, this is a very slow process to amend the accord acts.

Mr. Sarkis Assadourian: Okay.

The Chair: That wouldn't be new in terms of dealing with government for it to be a slow process. You should try dealing with the Canadian Food Inspection Agency.

Mr. Stoffer.

Mr. Peter Stoffer: Mr. Dickey, thank you for your presentation today.

When a lease is granted, is there an environmental assessment done prior to the granting of the lease?

Mr. Jim Dickey: Yes.

Mr. Peter Stoffer: Okay. In 1997, what did that map look like in terms of parcels that were given out?

Mr. Jim Dickey: In 1997?

Mr. Peter Stoffer: Not very much.

Mr. Jim Dickey: We've been putting out parcels since 1992. I'm just going by recollection now, but there was a big call, I think, in 1997. There was a large number of parcels that went out.

Mr. Peter Stoffer: So you're saying that, when Corridor Resources comes to you and says, “We're interested in the Cabot block, we'd like to apply for a lease for that”, there's an environmental impact statement done prior to the granting of that lease.

Mr. Jim Dickey: No, I didn't say that. I said there's—

Mr. Peter Stoffer: That's what I asked.

Mr. Jim Dickey: You asked if there was an environmental assessment done.

Mr. Peter Stoffer: Prior to a lease being granted.

Mr. Jim Dickey: Yes. We do our internal environmental assessment. It's an internal... That's why we have environmental people. When we get a nominated area—

Mr. Peter Stoffer: From industry.

Mr. Jim Dickey: —yes, from industry—our internal environmental people do an assessment based on the knowledge they have and on the knowledge they acquire from their dealings with DFO and Environment Canada.

So that's what I mean by an environmental... It's an environmental screening, I guess, an initial test for us.

Mr. Peter Stoffer: But the reality is, the leases are granted prior to an independent environmental assessment being done. Correct? You do a review of the information you have, but there is not...

• 0955

If I went to you and said, “I'd like to go around Digby”, and you said “Okay, Peter, we have to check our information that we have from DFO and Natural Resources, and we'll get back to you in 120 days”... Is it 120 days?

Mr. Jim Dickey: It's something like that, yes.

Mr. Peter Stoffer: Then, based on your information, I can get the lease. Then I have to do other concerns afterwards for activities and everything else. Is that correct?

Mr. Jim Dickey: In our rights management process, we would give it sort of a... I can tell you exactly the words here, if you can just bear with me for a moment on this, because you'll find it right in our 14-point process. Maybe I should just look at that particular point, since you're raising it.

There's an annual review by the provincial and federal energy ministers with respect to the CNSOPB strategic plan for calls. What we do is we give them a heads-up on any calls that may be coming that we're aware of, or on issuance of licences and the terms and conditions. Then our board does an identification of sensitive areas with general environmental safeguards. It's an internal assessment done by our people in association with DFO, but we do not go out and do a...

When you say “environmental assessment”, I'm not quite sure exactly what you mean. A lot of people use those words, and—

Mr. Peter Stoffer: I asked that question because, in Holland, prior to the polder system, where they reclaimed the land from the sea, they did a seven-year environmental assessment on the area about the size of Halifax harbour—seven years. Prior to one shovel or one thing going in there, they did a seven-year environmental study on that system. So I find it very, very difficult, because when I speak to fishermen in their communities, you're the Canada-Nova Scotia Offshore Petroleum Board. You're not the Canada-Nova Scotia Offshore Fisheries Board. Fishermen believe wholeheartedly that your board is there in the interests of the petroleum industry.

The fact is, from 1997 to now—we saw the maps in Halifax—there's been a rapid expansion of the granting of the leases out there, and it's impossible to say or to admit that there have been proper environmental assessments to protect the interests of the fisheries, with the exception of Georges Bank or the Gully. I suggest to you that the reason those two are protected or at least not touched right now is political pressure. It has nothing to do with anything else. It's strictly political pressure.

If the United States didn't put the moratorium on their side of the Georges Bank, we wouldn't have one on our side. It's as simple as that. And the Gully is protected because agencies like the World Wildlife Fund for years have been pointing this issue out. Now, when someone like Corridor Resources comes in and gets a lease, all of a sudden it's only that area, I believe, that Ms. MacNeil is going to study. Is that correct?

Mr. Jim Dickey: That's correct.

Mr. Peter Stoffer: But there were no other separate people like Ms. MacNeil to study any other areas, were there?

Mr. Jim Dickey: Not that I'm aware of.

Mr. Peter Stoffer: Exactly. And I put it to you, sir, that the reason for that is the fact that the Maritime Fishermen's Union, the PEIFA, and the Save our Seas Coalition really rallied around big time and put the pressure on in order to get this type of individual there, even though they're not happy with that process.

My question, sir, is that, in reality, there is no environmental assessment work done prior to a lease being granted to a particular company when they come to you. You said yourself that industry says, “We want this parcel of land, or we'd like to look at it”, and nine times out of ten, they get it.

Mr. Jim Dickey: If they meet the commitments, that's right.

Mr. Peter Stoffer: The commitments that you have in terms of your studies from DFO, etc.

I'm going to go back to an issue off Sable that was in the paper last week, about the fact that there's really no environmental monitoring on the rigs by independent people or by the Canada-Nova Scotia Offshore Petroleum Board. Is that correct?

Mr. Jim Dickey: Well—

Mr. Peter Stoffer: I'm referring to the glycol that's being dumped into the ocean. At least to my understanding from the comments we received in the provincial legislature in Nova Scotia, the Canada-Nova Scotia Offshore Petroleum Board does not have anybody on that rig monitoring the environmental effects of glycol and how much is out. Is that correct?

Mr. Jim Dickey: That's correct. Internally, we have developed guidelines that are conditions of their authorization, and we would audit against those guidelines. We definitely would not have people, nor do we have safety people there on a regular basis all the time. We're an agency of 28 people, so we set out the guidelines, and we audit against them. That is the same thing Revenue Canada does for you and your tax return.

• 1000

Mr. Peter Stoffer: Mr. Dickey, I just want to assure you that I'm not pointing my questions against you in any way. You didn't set up this board; you're part of the board. My problem is with the federal government and the provincial government, in how the board was set up and the lack of detail to the protection of fish and fish habitat.

The reality is that DFO's main objective in life—the reason they get $1 billion of our tax dollars—is for the protection of fish and fish habitat. There isn't one fisherman that I've spoken to, at least in the four years that I've been here, that believes DFO is doing that, and this example of the map that you show is a classic example of that.

You talk about environmental work. It's tokenism. There is no real, hard environmental work being done. You're saying Ms. MacNeil's report is due for you when?

Mr. Jim Dickey: The end of March next year.

Mr. Peter Stoffer: The end of March. So in one year you're able to do a complete environmental assessment of the entire gulf region?

Mr. Jim Dickey: Well, no. She's not doing that at all.

Mr. Peter Stoffer: No, underneath—the Corridor Resources and all that area. You can do a proper environmental assessment in one year?

Mr. Jim Dickey: She's not doing an environmental assessment. She's doing a public review.

Mr. Peter Stoffer: I know. I realize that. That's why she's not doing an assessment.

Mr. Jim Dickey: No. I mean, her mandate is simply a public review to find out if, based on the public's input, there are any adverse effects associated just with seismic and exploration drilling—nothing more—on those three parcels.

Mr. Peter Stoffer: But how can that be done without an assessment? If I come to you as a fisherman in P.E.I. and say, “I believe seismic work is going to affect the lobster grounds”, okay, you write that down—

The Chair: Just for a point of clarification, I guess, Mr. Dickey, once these areas or parcels are granted, what activities can take place in those parcels based on them being granted?

Mr. Jim Dickey: Zero. None.

The Chair: Okay.

So why would you need an environmental review, Peter, before you grant those leases?

Mr. Peter Stoffer: Well, the fact is—

The Chair: You need protection later on if activity is going to take place.

Mr. Peter Stoffer: But, Mr. Chair, he had said himself that it's industry that comes to them and identifies a certain area. Within a certain period of time—a very short period of time—they're granted the lease. They're not granted anything else. They're just granted a lease.

Mr. Jim Dickey: It's a right to make an application.

The Chair: Yes. So they have rights to that area.

Mr. Peter Stoffer: But why would you grant the lease to someone, because the chances of them not exercising that lease down the road are slim to none?

The Chair: I don't want to get into a debate, but it's the company's risk if they can't exercise their right. They're taking a risk in terms of whether the environmental review and all the other activities that take place will allow them to exploit the resources that they assume they're going to be able to exploit by getting the lease. But all the safeguards have to come in after the lease is there.

Mr. Peter Stoffer: Mr. Chair, my point is just that—DFO is putting the risk of the fishermen and their communities at stake. The fact is, you cannot do an environmental assessment—a proper one—once the lease is granted. Once the lease is granted, there's an extremely good chance they're going to carry on, and there is no validation that a proper, independent assessment will be done. Look at the rapid growth from 1997 to 2001.

The Chair: Yes, but nothing happened.

Mr. Peter Stoffer: No, but the fact is, they can't tell me they've checked and figured out every area.

The Chair: Peter, all they are at the moment is pretty colours on the map.

Mr. Peter Stoffer: I realize that, but the reason for that, Mr. Chair, and I put it to Mr. Dickey as well... The fact is, fishermen want to know, prior to any lease being granted, prior to the process even starting, that the main role of DFO, Natural Resources, and Environment is to protect the fish and fish habitat. And they don't believe that now.

One of the difficulties—and he said it himself—is that there is none done prior to the lease being granted. There is afterwards, but even that is not properly done.

I mean, he just said they look at information from DFO and everywhere else.

Mr. Jim Dickey: Perhaps I can just interject there, because there are quite a few things being said about what I said.

Mr. Peter Stoffer: Yes. Exactly. We do that a lot. We argue with each other.

Mr. Jim Dickey: I think the first thing I would say is that when the licences are issued, right in the terms and conditions, there's a stipulation to companies that you may never be able to do an activity on this parcel, and you have to take that as part of your risk in submitting your bid.

• 1005

Secondly, the board puts a great deal of emphasis on the activity application. The fact that a licence was issued... We have lots of licences that are issued and revert to the crown after five years—nothing done. They don't meet their financial commitments to expend money.

So when an activity on an application actually comes in, then we have something to work with. That's the problem with the Cape Breton parcel. We don't have an activity with an environmental impact statement and an environmental assessment done by the operator around which we can focus a review. It's a generic thing at this point.

Mr. Peter Stoffer: So you're saying the operator has to supply that.

Mr. Jim Dickey: Absolutely. They do have to supply an impact statement and an assessment.

Mr. Peter Stoffer: Exactly. And this is the fishermen's concern. You're saying that industry identifies a parcel of land, they get a lease, and then they have to supply their independent assessment to you.

Mr. Jim Dickey: Then we look at what they've submitted, and we will assess it with third-party experts. They also use third parties to develop these things. Just because they have a third party involved doesn't mean they haven't done it on an objective basis.

In any event, it comes to the board, and it's something for the board to focus on. Then we will go out and seek other sources of information to check what they've submitted.

You want to put the onus on the industry to do that, because it's a cost that taxpayers shouldn't have to bear. They want to do the work. They should provide the information and scientific evidence to support their application. Then we can audit against that. We can go out and do our own if we think that's appropriate, and we cross-reference it with other organizations. At the end of the day there's a very detailed environmental assessment done prior to an activity authorization.

The Chair: Peter, we'll come back to you. We're five minutes over your time.

Mr. Cummins.

Mr. John Cummins: You mentioned a minute ago what Ms. MacNeil's objective was. Would you mind repeating that?

Mr. Jim Dickey: The objective comes right from the joint directive. The words in the title are probably the best we can do. It's to look at “the effects of potential oil and gas exploration and drilling activities”. We've defined that to mean seismic and exploration drilling within those licences, 2364, 2365, and 2368. It's restricted to those three licences. It's restricted to the effects of potential oil and gas, because we don't have anything except potential seismic and exploration drilling.

Of course, it doesn't talk about development plans, because we have a full public review and environmental review of development plans anyway, if it ever gets to that point.

We're right at the very front end of the process with regard to the Cape Breton parcels. Maybe a 30-day seismic shoot would have been proposed, but we don't know because we didn't get an application. Corridor will not put in an application, of course, until this public review has completed its work.

Mr. John Cummins: You're talking about the effects of potential oil and gas exploration. When she talked to us, she suggested that her job had something to do with socio-economic impacts and so on but nothing to do with the environmental impact. It seems to me that the major concern is the environmental impact. She's certainly not in a position to evaluate environmental impacts. She's a two-legged stool at best, isn't she?

Mr. Jim Dickey: Under the terms of reference she has responsibility to look at the socio-economic impacts and the effects on the ecosystem.

Mr. John Cummins: She admitted that she doesn't have anyone who could be classified as an expert on fisheries, both shellfish and finfish. That seems to me to be the key potential environmental impact of this exploration work.

Mr. Jim Dickey: She's out there seeking the public's input on it.

Mr. John Cummins: But how does she evaluate it if she doesn't have an expert?

• 1010

Mr. Jim Dickey: She has the ability to retain people if she needs somebody to help her do that. There are provisions in the terms of reference for her to bring in an individual or group with the ability to assist her in that area.

Mr. Sarkis Assadourian: She mentioned she has no money in the budget.

Mr. John Cummins: She mentioned she could hire somebody temporarily to provide that sort of expertise, but that was all. Her budget was very limited, as we understand it.

I referred you earlier to the requirement in Australia where seismic activity is carried out only as a precursor to further exploration and production activity, such as drilling. Before the government in Queensland will grant authority for seismic work, a strategic environmental assessment has to be done.

If somebody applies for a licence, essentially what they're saying is, we're considering undertaking seismic activity and exploratory drilling, the whole bit. Why wouldn't you also require an environmental impact study? There are plenty of precedents for that around the world.

Mr. Jim Dickey: We certainly would require an environmental impact statement and an assessment prior to any activity going forward, but we wouldn't require a formal environmental assessment prior to issuing the lease.

Maybe it would be helpful to go back to when the accord was put together. The policy direction to the offshore board with the defined limits and the jurisdiction has basically been subject to good regulatory practice. That's pursuant to the accord, your associations, your MOUs with the Department of Fisheries and the Department of Environment, and whatever other mechanisms you have in place. Subject to good regulatory practice, the offshore area is to be open for oil and gas exploration except for the Georges Bank area and now the Gully. That's the fundamental policy behind it.

There has never been an overall screening of the whole offshore area, but about two years ago our board started an internal project where we're trying to do an environmental sensitivity study on various areas contained within the offshore. We managed to get some way along on that. I don't deny for a moment that there's a need to look at the whole offshore area in a much more general environmental and fisheries sense and to try to fit it into the oil and gas activity that's proposed for the area.

As I understand it, that's exactly what is being done now under the Oceans Act with DFO and their integrated management plan for marine waters. We're working with them on that. They will be the lead, and they'll coordinate the development of it. We will be cooperating in any way we can in terms of giving them information on the oil and gas industry.

But at the end of the day I think it would certainly be to the advantage of everybody—the boards, the petroleum industry, and the fishing industry—to have a sense from the policy-makers of what areas are open for business and what aren't.

Mr. Duncan Smith: If I could amplify on that, the fact is, we have a two-level process going on right now. The board authorizes any specific activity a company wants to undertake. They do that by undertaking an environmental assessment in full conformance with the Canadian Environmental Assessment Act. Also ongoing right now is a much broader policy-oriented issue, which is the responsibility of the Department of Fisheries and Oceans. It is this integrated coastal zone management, where they're looking at the broader scheme, marine protected areas and things like that, which will ultimately result in restrictions for industry to take place in. The board will conform with that, but that is the responsibility of Fisheries and Oceans.

• 1015

Mr. John Cummins: I appreciate what you're saying, because I think what we have here is the fact that we're shooting at you when probably we should be shooting at government for not being more clear.

Let me just give you my rationale. In Norway, my understanding is they don't allow seismic activity in areas where fishing is going to be conducted. They don't allow seismic activity on spawning grounds and migration routes. That's known in advance, and it seems to me only fair that industry should know what the guidelines are before they apply for the licence.

So I guess that's not really your problem, but it's the problem that you or industry has to deal with. It's really a problem of government and the regulations you have to work with.

Does that make sense to you?

Mr. Duncan Smith: You make a very good point. When they apply and pay out money for a licence, the industry is taking a risk. They do not know whether they will be allowed to undertake a certain activity, and perhaps they should—

Mr. John Cummins: Yes.

Mr. Duncan Smith: —and ultimately, they probably will.

Our offshore is a vast area, and we frankly don't know very much about it. This whole process of integrated coastal zone management is what we're trying to accomplish here. But they understand that risk, that they may not be allowed to undertake a specific activity in a specific area when they apply for it, because there will be an environmental assessment, in full conformance with the Canadian Environmental Assessment Act, that may preclude that activity.

Mr. John Cummins: Yes. I think that's the issue, or that's what you have to live with, the fact that there aren't guidelines out there by government, and I think there should be. That may be the key point that has come out of this, that government should establish some broad-based guidelines so that industry knows what the limitations are prior to applying for a licence.

If that were to take place, I think that would satisfy a lot of people and certainly calm some of the anxiety that's out there in the fishing community.

Mr. Duncan Smith: I agree 100%, but that's going to take a lot of money and a lot of time.

Mr. John Cummins: Then we should spend it.

Mr. Duncan Smith: I agree.

Mr. John Cummins: That's good. You know—

The Chair: The Canadian Alliance wanting to spend money... now that's a new development.

Mr. John Cummins: You have to protect the environment if you're going to save the investment that people have in the fishing industry. I think that's money well spent.

The last comment I'd like to make is that we did hear some concerns from people about the review process under way, and its limitations. From my point of view, their concerns are well taken. But I think, in a sense, after our discussion, their concerns should be directed probably more at government and this lack of broad-based regulation.

I would suggest that the difficulties you may encounter in your review process may come about largely because there is a lack of broad-based government regulation that establishes some limits for this, and those should be put in place.

Mr. Duncan Smith: I think there really is a lack of a lot of specific information with respect to the environment and the fishery in particular, and Fisheries and Oceans Canada is working to overcome that with their integrated coastal zone management approach.

The fact remains, as Jim pointed out, we or they in all likelihood would not have gone through this public review process if there had not been an uproar. We at Natural Resources Canada received over 60 letters, and that is mainly why we moved to get this public review process up and going.

We are fully confident that at the end of this process there will be all sorts of information out in the public domain that is available to industry, non-government organizations, and government alike, but it will not preclude an environmental assessment or a solid look at any activity that's required in that area. So for any activity that a company wants to undertake, we will still have to go through the process, and that process will be rigorous.

Mr. John Cummins: And it will include an environmental assessment?

Mr. Duncan Smith: Yes, it will.

Mr. John Cummins: That's good to hear, and I appreciate that. Thank you.

The Chair: Thank you, John.

Alan or Andrew, maybe we should check with DFO on where they're at in terms of the integrated coast zone management approach, and maybe consider a witness sometime, but at least get the information and provide it to the committee.

Mr. LeBlanc.

• 1020

Mr. Dominic LeBlanc (Beauséjour—Petitcodiac, Lib.): Thank you, Mr. Chairman, and thank you, Mr. Dickey and Mr. Smith.

I think my colleagues, Mr. Cummins and Mr. Stoffer, have made some very good points about concerns we're hearing from commercial fishermen about this process. I want to add my voice to what they said about the importance of understanding. Mr. Smith's comments confirm what I suspected—and are worrisome at the same time—that there in fact is not a great understanding, or as great as we would like, or need, of some of the issues or questions that need to be understood before certain activities could endanger traditional fishing grounds.

The economies of small communities in my riding are dependent on some rather fragile ecosystems. I know you appreciate that, and it's something I think this committee will want to look at.

Mr. Dickey, when you went over to the map, following up on a question the chairman asked, I saw there weren't many pretty colours—to use his phrase—in the Northumberland Strait between the coast of New Brunswick and Prince Edward Island. That's an area that's of obvious interest to me. Maybe it's conjecture, and I understand the role of the board versus people asking for a lease, or proponents of a particular project, but why are there no colours in the Northumberland Strait? Is there a geological reason? It's a scientific question, I guess—a layman's question. Is there a lot of interest in that particular area of the Northumberland Strait, or has there not been? And if not, can you conjecture as to why not?

Mr. Jim Dickey: The area you're referring to is between Nova Scotia and P.E.I., off the Amherst area?

Mr. Dominic LeBlanc: It's between New Brunswick, Nova Scotia, and P.E.I., the Northumberland Strait in the gulf.

Mr. Jim Dickey: It's geological, essentially. As I said before, the companies spend years looking through the data they have, that they can get through the core lab we have in Halifax, assembling the areas, and they're very private about this. To them, it's information that has a high value, and they're secretive about it. So they don't come along until they're ready to make a nomination, because it's a competitive thing. With those extra few days, if they get a 30- or 40-day jump on the competition, it's important to them. They know what areas they're interested in, but the fact of the matter is, since I've been with the board, there has been very little interest expressed in development in that area, at least at this point.

There have been some wells drilled north of P.E.I. and just west of that parcel on Cape Breton—as a matter of fact, there's a discovery there—but nothing really through the Northumberland Strait.

Duncan, you may have some comments on that.

Mr. Duncan Smith: Perhaps I can elaborate a little bit. I'm a geologist by trade.

It's interesting to note the very first offshore well drilled in Canada was off the northern part of P.E.I., in 1943 to 1946, at a cost of $1 million at the time. So there is potential there. In fact, there is well drilling currently on the northeast corner of Prince Edward Island, onshore. There is potential there, but it's much older rock and it's much more contorted, which means it has undergone a thermal and tectonic history that makes big fields much more difficult to find. That's why they're not going offshore in that particular area.

The coloured area you see to the south of Nova Scotia is much younger sediment. It's fairly simply structured. The reservoirs are demonstrated to be very continuous, and the potential there justifies spending $35 million to $40 million on a well, whereas certainly in the offshore areas around P.E.I., it's pretty difficult to justify that, because at best you're going to find probably a small field.

The field that Jim alluded to between Prince Edward Island and Cape Breton is called East Point. It has an estimated recoverable gas reserve of 30 billion cubic feet, which is very small.

So that gives you an idea of what's there. But in certain instances, when you can drill onshore, there is potential for this particular basin.

Mr. Dominic LeBlanc: Thank you very much.

Thank you, Mr. Chairman.

The Chair: Thank you, Dominic.

Last questions, then, Peter.

• 1025

Mr. Peter Stoffer: I agree, gentlemen, with my colleague Mr. Cummins that our problem is not with you. Our problem is with the government.

Even you, Mr. Smith, said you don't know much about it, and you, Mr. Dickey, said you go to the government for their information, and the government officials say they don't know much about it.

So if I were a fisherman, I'd be very nervous right now. You don't know much about what's out there, yet your decisions are based upon information... that they don't know much about it. That's quite frightening.

Also, sir, you said—and I say this with all respect, Mr. Dickey—you want to be open for business. We've heard that from the Liberals and Tories provincially in Nova Scotia for a long time. But the fact is, the fishermen have been fishing the business side of fishing for hundreds of years, so their perception is that while you're open for business, all they really want to know... I guess I'm going to ask you this one question. The fishermen have asked me time and time again... Not one fisherman has ever said to oil and gas, “Go away and get lost, we never want to see you again”. What they've said very clearly is that done correctly, fishing can be here for another 400 years. Oil and gas, what—fifty years maybe, and then it's done.

They want to be certain—I know there are no guarantees in life, but they want to be assured. And Mr. Dickey, I give you the opportunity to assure them. Will you do everything possible—and I know you have certain limitations within your mandate of the board, Mr. Smith—to assure them that if oil and gas can co-exist with fishing and along with marine protected areas, you can assure them that the people you have with you will do everything possible to ensure that the safety and security of fish and fish habitat is paramount in all decisions you make in the future?

Mr. Jim Dickey: Well, I can certainly assure them that we will do everything we can do within the context of our regulations and the accord to protect their industry. I'm not going to say that it's going to be paramount, or it's going to take some preference over another industry. That's not for us to decide.

We're actually tasked with a responsibility to see that all the users of the resources are protected to the extent possible. You don't go and authorize something that you know is going to have some adverse effect on one or another of the users. So what we're looking for at all times is a balance to this thing. As you said, there are no guarantees in life. Everything you do, there is a risk and a reward attached to it.

There's no question, when you're conducting offshore oil and gas activities, there's a risk involved. There's a safety risk. There's an environmental risk. The key is how do you manage the risk and look at the reward side of the equation? Are you getting enough reward to justify the amount of risk that is necessary to be involved to allow this thing to go ahead, or is it something you should not be doing at all? Our task is to come to that balance, and every person has a different judgment of that.

Mr. Peter Stoffer: Right, and the reason I say that is because of the glycol off Sable, for example. There are tonnes of it going into the ocean on a daily basis almost, whereas before, when those rigs weren't there, that wasn't happening. We don't know the long-term effects of glycol when it dissipates in the ocean, what effect it will have on fish stocks. We simply don't know.

So you're doing risk management on the best information you have available. Is that correct?

Mr. Jim Dickey: That's correct.

Mr. Peter Stoffer: Okay, and that's the difficulty fishermen have. We don't know the long-term effects. If you have x number of rigs out there, you're going to have x number of tonnes of glycol from those rigs on a daily basis going into the ocean.

If I dump glycol into the Halifax Harbour I'd be fined, but if I dump glycol offshore here I'm not fined, because there is a certain amount that is allowed. Yet there's none allowed in the Halifax Harbour. That's the difficulty fishermen and environmental groups have in terms of assessing the long-term effects of oil and gas exploration on fish and fish stocks.

Mr. Duncan Smith: If I could elaborate on what Jim said, I think he made a very good point. There are risks involved here. We operate on the concept of sustainable development, which gives equal weighting to social, environmental, and economic aspects here.

When you talk about what's going on at a rig, yes, a big operation is going to sometimes cause products to be thrown into the ocean, but they are very strictly controlled. You look at Halifax Harbour, for instance, with the amount of raw sewage that is going in—that's not allowed.

Mr. Peter Stoffer: We're working on that.

• 1030

Mr. Duncan Smith: Well, okay. I think fair is fair.

The other interesting thing I'd like to point out is that if you look at the offshore coast of Louisiana, where they have a tremendous infrastructure of oil and gas, they have hundreds of platforms and they have thousands of kilometres of pipe, and they have a very prolific fishing industry there. Now, I'm not saying they're equal—you know, shrimp versus lobster and warm water versus cold water—but I think our basic concept here is that the two can co-exist. I think that's fair.

But I do take your point: we have to be vigilant. I would like to make the point that I think our two offshore petroleum boards, with respect to environmental assessment and protection, are as vigilant as any regulatory authorities in the world. I think we're right up there. You can look at Norway, fine. You can look at the U.K. You can also look at Angola. You can look at offshore Louisiana.

I think what you have to do is try to achieve a balance. There are lots of people in Newfoundland and Nova Scotia who are making very good money off the oil industry, and by the same token there are lots of people in Newfoundland and Nova Scotia who are making very good money off the fishing industry. You have to achieve a balance. And we are fully prepared: if there are indications that we are harming the environment or harming the fishery, we will take action.

The Chair: Thank you, Mr. Smith and Mr. Stoffer.

Just two quick questions. You said, Mr. Dickey, that there are five members, including the chair, on the board. There are currently four. Is there a vacancy, or is the board only up to five?

Mr. Jim Dickey: No, there is a vacancy. We've had a vacancy for about two or three years on the federal side. I believe it's a couple of years, at least.

The Chair: So there is a vacancy.

Mr. Jim Dickey: We have a vacancy there, yes, that's correct, at this point.

The Chair: You talked also about the fisheries and environmental advisory board, which advises you, and which was established in 1994. How many people are on that? I assume that includes practising fishermen, etc.

Mr. Jim Dickey: Yes. Actually, there are two advisory committees. We have an environmental advisory committee and a fisheries advisory committee. They were established by the board to get some feedback on these issues. There are quite a number. If I look at the list here for the advisory committee, it looks like about 25 or 30 people. There are people like the Maritime Fishermen's Union, the Nova Scotia Swordfishermen's Association, Area 19 Snow Crab Fishermen's Association, Nova Scotia Department of Fisheries, of course, Atlantic Canadian Mobile Shrimp Association... There are quite a few. There's a whole list of them.

The Chair: So do these advisory boards meet regularly with the board, or on the call of the board, or once a year, or what?

Mr. Jim Dickey: Well, they are committees established by the board. It's not a board itself, it's a committee.

The Chair: Yes.

Mr. Jim Dickey: They meet on a regular basis. I have all the details here on them. I think they meet something like on a quarterly basis and they keep minutes and the membership changes occasionally.

They have a set of guidelines here for the committee. I have it right in front of me—terms of reference, I guess you'd call them, for the committee work.

The Chair: So that is an avenue for concerns from the fishing and environmental industry to pursue those concerns through the advisory committee with the board.

Mr. Jim Dickey: It's a very significant avenue for information for us as a board. As a matter of fact, on the environmental end, I know the Ecology Action Centre was a member of our committee, but they withdrew from the committee. I thought it would be useful if they would stay in the committee and try to work within the process and help us understand some of their concerns, but they did advise me that they couldn't stay in the committee because their mandate is essentially against hydrocarbon development. They felt that by participating on our internal committee it was undermining the overall goal their organization had.

• 1035

Notwithstanding that view, I would have liked to see them stay in our committee and share their views with us, because we're not going to solve these problems if we're not putting our heads together and trying to come up with solutions. For everybody to go off on their own way is not going to provide a solution for some of the challenges we have.

The Chair: Thank you very much, Mr. Dickey and Mr. Smith. I think we did have a good hearing. It's certainly opened up all of our views to hear more concisely from you directly. I know there was some discussion whether or not we should have you before the committee. We certainly appreciate your coming. I think it was a good hearing. Thank you very much.

Mr. Cummins.

Mr. John Cummins: There are a couple of items that haven't been provided by the government yet. Have you any indication of when they're coming?

The Chair: What are they?

Mr. John Cummins: The legal opinion and those sorts of things.

The Chair: I might mention that Minister Nault, don't forget, is before the committee at nine o'clock on Thursday on Marshall.

As to the legal opinion, wasn't that responded to by the minister during discussion? Didn't he provide you with everything he could provide there?

Mr. John Cummins: No, there are other things.

The Chair: What are they?

Mr. John Cummins: I haven't got the list here, but there are other things he promised to provide that we haven't received yet. I can get a list to you.

The Chair: Get a list to me.

Mr. John Cummins: The other thing is, I was wondering whether the committee should recommend to the government that someone from the fishing industry be appointed to fill that vacancy on this offshore petroleum board.

The Chair: Why don't you draft a motion to that effect.

Mr. John Cummins: I'll give notice of motion now.

The Chair: Okay. Is that agreeable?

Some hon. members: Agreed.

The Chair: Meeting adjourned.