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37th PARLIAMENT, 3rd SESSION

Standing Committee on Aboriginal Affairs, Northern Development and Natural Resources

EVIDENCE

CONTENTS

Tuesday, April 27, 2004

0835

The Vice-Chair (Ms. Nancy Karetak-Lindell (Nunavut, Lib.))

Hon. R. John Efford (Minister of Natural Resources)

0840

0845

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. David Chatters (Athabasca, CPC)

Hon. R. John Efford

Mr. David Chatters

0850

Hon. R. John Efford

Mr. David Chatters

Hon. R. John Efford

Mr. David Chatters

Hon. R. John Efford

Mr. David Chatters

Hon. R. John Efford

Mr. David Chatters

Hon. R. John Efford

0855

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Serge Cardin (Sherbrooke, BQ)

Hon. R. John Efford

Mr. Serge Cardin

Hon. R. John Efford

0900

Mr. Serge Cardin

Hon. R. John Efford

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Serge Cardin

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Larry Bagnell (Yukon, Lib.)

Mr. George Anderson (Deputy Minister, Department of Natural Resources)

0905

Hon. Larry Bagnell

Mr. George Anderson

Hon. Larry Bagnell

Mr. George Anderson

Hon. Larry Bagnell

Mr. George Anderson

Hon. Larry Bagnell

Mr. George Anderson

Hon. Larry Bagnell

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Larry Bagnell

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. David Chatters

0910

Mr. George Anderson

Mr. David Chatters

Mr. George Anderson

Mr. Richard Tobin (Acting Assistant Deputy Minister, Corporate Services Sector, Department of Natural Resources)

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Andrew Telegdi (Kitchener—Waterloo, Lib.)

Mr. George Anderson

0915

Hon. Andrew Telegdi

Mr. George Anderson

Mr. Richard Tobin

Hon. Andrew Telegdi

Mr. Richard Tobin

Hon. Andrew Telegdi

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Andrew Telegdi

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Rick Laliberte (Churchill River, Lib.)

0920

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. George Anderson

Mr. Rick Laliberte

Mr. George Anderson

0925

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Serge Cardin

Mr. George Anderson

Mr. Serge Cardin

Mr. George Anderson

Mr. Serge Cardin

M. George Anderson

Mr. Serge Cardin

Mr. George Anderson

0930

Mr. Serge Cardin

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Serge Cardin

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. David Chatters

Mr. George Anderson

Mr. David Chatters

0935

Mr. George Anderson

Mr. David Chatters

Mr. George Anderson

Mr. David Chatters

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Larry Bagnell

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. David Oulton (Acting Assistant Deputy Minister, Energy Technology and Programs Sector, Department of Natural Resources)

Hon. Larry Bagnell

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Serge Cardin

Mr. George Anderson

0940

Mr. Serge Cardin

Mr. George Anderson

Mr. Serge Cardin

Mr. George Anderson

Mr. Serge Cardin

Mr. George Anderson

Mr. Serge Cardin

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Andrew Telegdi

Mr. George Anderson

0945

Hon. Andrew Telegdi

Mr. George Anderson

Hon. Andrew Telegdi

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Rick Laliberte

0950

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. David Chatters

0955

Mr. George Anderson

Mr. David Chatters

Mr. George Anderson

Mr. David Chatters

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Rick Laliberte

Mr. George Anderson

Mr. Rick Laliberte

Mr. George Anderson

Mr. Rick Laliberte

Mr. George Anderson

1000

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Serge Cardin

Mr. George Anderson

Mr. Serge Cardin

Mr. George Anderson

1005

Mr. Serge Cardin

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Larry Bagnell

Mr. George Anderson

Hon. Larry Bagnell

Mr. George Anderson

Hon. Larry Bagnell

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. David Chatters

1010

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Irwin Itzkovitch (Assistant Deputy Minister, Earth Sciences Sector, Department of Natural Resources)

Mr. David Chatters

Mr. George Anderson

Mr. David Chatters

Mr. Irwin Itzkovitch

Mr. David Chatters

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Rick Laliberte

Mr. George Anderson

Mr. Rick Laliberte

Mr. George Anderson

1015

Mr. Irwin Itzkovitch

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Serge Cardin

Mr. George Anderson

Mr. Serge Cardin

Mr. George Anderson

Mr. Serge Cardin

Mr. George Anderson

Mr. Serge Cardin

Mr. George Anderson

1020

Mr. Serge Cardin

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Andrew Telegdi

Mr. George Anderson

1025

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Larry Bagnell

Mr. George Anderson

Hon. Larry Bagnell

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. David Chatters

Mr. George Anderson

1030

Mr. David Chatters

Mr. George Anderson

Mr. David Chatters

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Rick Laliberte

Mr. George Anderson

1035

Mr. Irwin Itzkovitch

Mr. Rick Laliberte

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Rick Laliberte

Mr. Irwin Itzkovitch

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Larry Bagnell

Mr. George Anderson

Mr. André Plourde (Associate Deputy Minister, Energy Policy Sector, Department of Natural Resources)

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Andrew Telegdi

1040

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. David Chatters

Mr. George Anderson

Mr. David Chatters

Mr. George Anderson

Mr. David Chatters

Mr. George Anderson

Mr. David Chatters

Mr. George Anderson

1045

Mr. David Chatters

Mr. George Anderson

Mr. David Chatters

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Ovid Jackson (Bruce—Grey—Owen Sound, Lib.)

Mr. George Anderson

Mr. Bryan Cook (Director General, CANMET Energy Technology Centre, Energy Technology and Programs Sector, Department of Natural Resources)

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. George Anderson

The Vice-Chair (Ms. Nancy Karetak-Lindell)

1050

Mr. George Anderson

Mr. Irwin Itzkovitch

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Rick Laliberte

Mr. George Anderson

1055

Mr. Ken Pereira (Vice-President, Operations Branch, Canadian Nuclear Safety Commission)

Mr. George Anderson

Mr. Ken Pereira

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. David Chatters

The Vice-Chair (Ms. Nancy Karetak-Lindell)

CANADA

Standing Committee on Aboriginal Affairs, Northern Development and Natural Resources

NUMBER 011

3rd SESSION

37th PARLIAMENT

EVIDENCE

Tuesday, April 27, 2004

[Recorded by Electronic Apparatus]

¾ (0835)

[English]

The Vice-Chair (Ms. Nancy Karetak-Lindell (Nunavut, Lib.)): I'd like to call the meeting to order, please.

Good morning, Minister. I'm sorry for being a few minutes late. I know you have a tight schedule this morning, so we will get the meeting underway.

This meeting is pursuant to Standing Order 81(4), main estimates 2004-05, votes 1, 5, 10, 15, 20, 25, 30, and 35 under Natural Resources, referred to the committee on Tuesday, February 24, 2004.

Appearing before us is the Minister of Natural Resources, John Efford. I understand you will have to leave by 9 o'clock for another commitment. So good morning, and please get the meeting underway.

Hon. R. John Efford (Minister of Natural Resources): Thank you, Madam Chair.

Yes, I do have to leave at approximately ten minutes to 9. I will take the time necessary to first give some opening remarks. Hopefully, we'll have some time for some questions, but after I leave, my officials will remain and indulge the committee in whatever questions they need to ask about my department.

I'll begin by saying thank you, Madam Chair and members of the committee. I am very pleased to be here this morning to talk about the portfolio I assumed last December. I am joined by some of my officials, who will help me answer your questions.

With me at the table is my deputy minister, George Anderson, as well as Richard Tobin, acting assistant deputy minister, corporate service sector. I trust you can see, in the background, there are quite a number of officials with expertise in different parts of my department.

I've spent a very busy and productive five months getting to know the department and travelling the country to hear first-hand the perspectives of the provinces and territories and resource industries. Four messages have emerged loud and clear during my travels.

The first message is the need for a sustainable approach to resource development. No one appreciates the need for sustainable development more than I do, Madam Chair. As Minister of Fisheries in Newfoundland and Labrador, I saw the impact of unsustainable practices first-hand. Canadians must never allow the depletion of our resource base in the way that unsustainable practices led to the collapse of our cod fishery.

I am happy to report that in my travels I have seen and heard about some of the leading sustainable practices for any resource industry anywhere in the world. We see it in the forestry sector, where Canada is a world leader in certified sustainable managing of forests. We see it in the mining sector, where companies are spending billions of dollars on emission control technologies and environmental improvements. We see it in energy, where investments in efficiency have reduced the energy intensity of the Canadian economy by 20% over the past 20 years.

Last March, for example, Memorial University announced it would take advantage of our department's program to help institutions plan their building renovations to achieve energy efficiency. Enerplan Consultants will develop an energy master plan for the university and look at possible energy improvements to all 49 buildings on campus.

That same month, the Government of Canada signed a memorandum of understanding with the Government of Manitoba to explore opportunities for renewable energy development. This is the third federal-provincial MOU signed towards implementation of Canada's climate change commitments.

Canada has taken the sustainable development message to heart, Madam Chair. Canadians expect a very high performance from the resource industries. Canadian businesses have become experts at balancing the three priorities of environmental protection, economic development, and socialstability.

The next point is a strong social foundation. In urban Canada, people tend to emphasize the environmental protection aspect of sustainable development. But in the communities of theresource-producing areas of the country, people know that sustainable development also means building an economy where they can create opportunities, wealth, and choices for today's population, as well as future generations.

This brings me to the second message that I have heard in my travels, Madam Chair. Natural resources remain the lifeblood of Canada's communities. They are vital to a strong social foundation.

As Canada becomes more urbanized, we sometimes lose sight of this fact. But travel to the hundreds of communities across every region of this country, where the local economy is sustained by mining, forestry, or energy production, and you begin to see the magnitude of the resource economy. In fact, the resource sectors directly employ a million Canadian sand sustain the vitality of some 650 communities across the country. The health, the vitality, and the sustainability of these communities is affected by the policies and programs that affect resource development.

Let me give you an example from our first nations communities. Many of these are found in areas where the forest industry drives the local economy. We have a first nations forestry program, in partnership with Indian and Northern Affairs Canada. We help first nations build their capacity and technical skills so there are more opportunities for people to work on sustainable forest management projects, both on the reserve and off. In fact, over the past seven years, this program has worked with over 350 communities and has given valuable work experience to some 5,500 people. You can imagine how important our program is to these people and these communities.

We have also developed model forests with first nations. One of them involves the Innu Nation in Labrador. They are piloting a co-management and ecosystem planning initiative, which, if it proves to be successful, could be a model for other communities right across this great country.

Next is the 21st century economy. The third message I have heard loud and clear in my months as Minister of Natural Resources is that the natural resources industries are innovative industries, thriving in the 21st century economy because of their ability to apply knowledge, science, and technology. Our goal is to foster that knowledge-based resource economy, one where Canadian technology and know-how translate into prosperity at home and the environmentally sustainable development of resources both at home and around the world.

Canada is at the forefront of geomatics and geoscience technologies, for example. Our expertise not only provides tools for mineral and oil and gas exploration, but we are also leaders in applying these technologies to environmental assessments, land use planning, and the assessment and mitigation of natural hazards.

We have a program called geoconnections, which is truly unique in the world, Madam Chair. It puts geospatial information on the Internet for anyone to use. It is managed in such a way that the partners who are closest to the source of the information can keep it current and accurate. The result is up-to-date computerized maps that can be used not just by geomatics experts but by anyone who uses maps, such as policy-makers, administrators, and deliverers of front line services.

My department is also a leader in research and development, Madam Chair. At CANMET, often in partnership with others, our researchers apply their unique expertise in solving some of the major challenges of the mineral and mining industries. For example, they developed a rock drill that is powered by high-pressure water rather than compressed air. That means less dust and vibration and no oil mist emissions, and it drills twice as fast.

CANMET has also been an early pioneer in the development of hydrogen fuel cell technology, which could soon become a multi-billion dollar industry, with Canada a world leader. In fact, earlier this month the Prime Minister announced funding for the world's first hydrogen highway. Visitors to the 2010 Olympics will be able to travel in fuel-cell-powered vehicles between the Vancouver airport and the Whistler ski resort. My department is contributing $5 million to help showcase Canada's leadership in fuel cell technology.

Next is partnerships. Madam Chair, the fourth message that I heard repeatedly during my travels across the country has been the need for partnerships.

You can see an example of the federal and provincial governments working together effectively in the implementation of the forest 2020 plantation demonstration and assessment initiative. This is part of our $1-billion climate change plan for Canada. The Canadian Forest Service demonstrates the potential role of fast-growing plantations to offset greenhouse gas emissions. We will work with the provinces as well as the forest industry, various associations, and rural landowners to establish the plantation sites.

Another example of cooperation and partnership involves the east coast, where, as you well know, we have abundant oil and gas reserves. We are involved in a major exercise in cooperation and partnership with the Atlantic provinces, industry, and labour to develop our oil and gas resources. It's called the Atlantic Round Table. It is resolving some of the outstanding challenges to oil and gas development, issues such as reducing the costs and the risks to offshore development and building the local capacity so that jobs and economic growth come to the communities of Atlantic Canada.

One of the most important issues, Madam Chair, is smart regulation. Let me put this in context. To obtain a permit to drill in the United Kingdom takes about 180 days, and in the Gulf of Mexico about 300 days. How long does it take to jump through the regulatory hoops and get permission to drill in Atlantic Canada? About 650 days. That's getting close to two years. It's hard for oil and gas companies to plan when there is regulatory uncertainty for nearly two years about whether or not they're even going to be allowed to drill.

No one is saying that we need to relax the environmental and other assessments before the companies drill. But surely there is a way we can regulate smarter. That is one of the big issues that the federal and provincial governments are examining at the Atlantic Round Table.

¾ (0840)

I am happy to report that this Atlantic Round Table has made significant progress on these issues. It speaks well for the spirit of cooperation and partnership that will bring prosperity from the resource industries.

We build partnerships at the international level as well. Two weeks ago, for example, we received the report of the Canada-U.S. Power System Outage Task Force.The fact that we need to create a binational task force to examine the power failure of last August demonstrates how the resource industries in general raise international issues. Both countries are looking at mandatory standards and joint Canada-U.S. studies to make sure such a power failure does not happen again.

The task force represents one of the finest examples of cooperation between Canada and the U.S. to address an issue of common concern. My department is very pleased to have participated in that exercise.

In conclusion, Madam Chair, in the months since I assumed my portfolio, I have seen excellent examples of how natural resource industries have responded to the challenges of sustainable development, and how they provide a strong foundation for hundreds of communities across Canada. I've seen examples of how the resource industries are knowledge-intensive industries that will thrive in the 21st century economy. I'm very pleased to be able to do my part in building the partnerships that will keep the resource sectors at the forefront of the Canadian economy and help make them globally competitive for generations to come.

Thank you, Madam Chair. I would now be pleased, along with my officials, to answer some questions in the short time that I have left.

¾ (0845)

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you very much.

We'll start with Mr. Chatters from the official opposition for nine minutes, please.

Mr. David Chatters (Athabasca, CPC): Thank you, Madam Chair.

I'm disappointed, Mr. Minister, that you wouldn't see fit to be able to stay longer with us. I think there are some very important questions that need to be answered here. Many of them, in my view, are of a political rather than a departmental nature.

I guess, overall, I have to make my observation that I've made for the 11 years that I've been part of this committee, and that is that the form in which these estimates are brought to committee and presented to committee is completely unacceptable. In this day, when we talk so much about transparency and accountability, and in the midst of the sponsorship scandal--I don't know how many times I've heard in the House that there's nothing secret, it's all right there in the estimates--this format is unacceptable.

When I see phrases like this one, for example--“Grants to support non-profit organizations which are furthering the development of nuclear safety standards”--I ask, how in the world would anybody on this committee or any other committee know what that means? “Contributions for the Cost-Free Manpower Assistance Program and to procurerelated goods and services required to execute the Canadian Support Programfor the International Atomic Energy Agency”: again, how in the world would anybody ever know what's being talked about here or whether or not it was a good use of tax dollars?

I expect, when the department comes and reports to committee, that the format of the report will allow us to determine where the money is going, where it's being spent, and who's receiving it, whether that's Liberal-friendly ad firms in Quebec or anybody else across the country. So I don't find this acceptable, particularly when you bring--

Hon. R. John Efford: The issue here has nothing to do with the sponsorship program.

Mr. David Chatters: Well, of course it doesn't. I was using that as an example of misuse of taxpayers' dollars. My point is, how would I know who these non-profit organizations would be—particularly when you bring in your main estimates with a 34.6% increase in spending in the department? I think this committee deserves a more comprehensive explanation of where that money is going.

That being my rant, there are a couple of things I would like to ask you specifically about, before you have to leave. One of them was the $1,130,000 contributions in support of aboriginal consultations on the long-term management of nuclear fuel waste in Canada. Not very long ago, we passed a bill through the House of Commons transferring responsibility for coming up with a plan for the long-term management of nuclear waste to the people actually producing that waste. So I would wonder why the taxpayers are spending $1,130,000 on that one.

The other one that I'll ask you about, and then I'll let you respond to it, was the $1,363,000 in support of the regulation of the Alaska Highway pipeline. Yet there is not a single mention of the Mackenzie Valley pipeline or of any expenditure in the main estimates in support of the regulatory process on the Mackenzie Valley pipeline.

With that, I'll stop and let you answer.

¾ (0850)

Hon. R. John Efford: Thank you, Mr. Chatters.

I've been around politics for some 19 years—actually, I'm going into my 20th year. I've been before estimate committees for 13 years, as a former minister in Newfoundland and Labrador. The one thing I've done is that I've always made myself available to answer questions in a public format, in a format such as this, before a standing committee, or in the House of Commons. Let me deal with the House of Commons first.

In my short tenure as minister in the House of Commons, in question period, you have not yet asked me one question on such important matters as resource development from one end of this country to the other. So I am not going to apologize for anything other than that I am available to answer questions. If this committee wishes to have me back at any time, and my time permits, I will make my time available, whether at 5 o'clock in the morning or 10 o'clock at night.

I apologize to the chair for having to leave, because the Prime Minister has said that there is a meeting and I will go to that meeting. If you wish me to come back at any time, I can; and if you wish to take the time in the House of Commons to ask me a question that you consider of great importance to the resource development of this country, on where we spend our money, I can assure you that I will answer that question.

As a final comment, before I get into the details of your question, the people in the Department of Natural Resources spend the money very transparently, with reporting done on a regular basis, to the advantage of the people of Canada in resource development, no matter their walk of life or where they live in Canada. I can assure you that if you have any problems, you can come over to my office at any time, and I will provide the time to take you through every single estimate. The information is available.

I'll deal with your second question on the Alaska Highway pipeline and the Mackenzie Valley pipeline. The Mackenzie Valley pipeline is a priority for this government. In fact, if you notice in the throne speech or in the most recent budget, some $75 million is set out in the budget to be part of the review that is necessary for the Mackenzie Valley pipeline. I've had many discussions with my colleagues in Canada and the United States on the willingness of Canadian industry people to invest billions of dollars, and of the aboriginal communities and everybody else to play a role.

Mr. David Chatters: But just before you leave that one, if there's $75 million in the budget, why isn't there anything in your spending estimates?

Hon. R. John Efford: The $75 million was allowed in the budget to deal with the Mackenzie Valley pipeline.

Mr. David Chatters: But it's not from your department?

Hon. R. John Efford: A small amount is from our department, but I didn't say--

Mr. David Chatters: Where is it in the estimates?

Hon. R. John Efford: Allow me to answer the question. I didn't say the $75 million was from my department. You asked if it was for the Mackenzie Valley pipeline, and I said it was--

Mr. David Chatters: Sir, we're examining the estimates from your department. I'm asking questions about your estimates.

Hon. R. John Efford: If you would allow me to finish, I will finish, and I'll have the necessary information checked out. The Mackenzie Valley pipeline is not just the responsibility of one department. I was giving you the example that the Canadian government is very supportive of, very interested in, and sees as a major priority the development of the Mackenzie Valley pipeline. I would think that as a member of the opposition you would be glad to know this, particularly with the importance it's going to have on western Canada's economic development. In fact, Canada is ahead of the United States in developing the Mackenzie Valley versus the Alaskan pipeline.

When we get down to the details of which department gets the money, the majority is going through the Department of Indian Affairs and Northern Development, but there will be some moneys spent by the Department of Natural Resources. My officials will be glad to find the information for you.

¾ (0855)

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you very much. Your time is up, but maybe you can ask that question of the officials in the next round.

Monsieur Cardin.

[Translation]

Mr. Serge Cardin (Sherbrooke, BQ): Thank you, Madam Chair.

Minister, you told us that you have an important meeting with the Prime Minister. You had one yesterday. The first question that comes to my mind is, when will the elections be held?

Now for more serious matters. When the Minister of Natural Resources used to come to our committee, our chairman, Mr. St-Julien, was always quite supportive of the mining sector. He always used to ask the minister to provide a clear and precise breakdown of his overall budget of more than $1 billion into the amounts provided to the forestry, mining, energy and sustainable development sectors. We have before us the total amounts, but it is not clear how much has been spent on each one of these sectors. Could you give me a breakdown of that $1.092 billion?

[English]

Hon. R. John Efford: I'll start off with a general statement. In answer to the first part of your question, there will be an election sometime in the future, and that's as close as I can go today. I guess I'm as anxious as you and everybody else till I go to the election.

But seriously, I won't have time to get into detail with your question, but my deputy and Mr. Tobin will go into the review. Okay, I can give you an example: 2004-05, earth sciences, $184,766,000; Canadian Forest Service, $161 million; minerals and metals, $45,489,000; energy corporate services, $592 million; corporate services, $55 million; corporate costing model fund, $6 million; direction and coordination, $19 million; climate change action fund, $16,809,000--a sub-total of $1,095,281,000. So it is a very broad-based budget and goes into many different sectors.

Let me talk about the mining industry for a second. The Government of Canada does not get involved and put money into the actual exploration and development of a mine or the further development of a mine. That's the responsibility of industry. My department has done tax incentive bases through the Department of Finance, and we make sure that the necessary supports and services are in place for the development of natural resources on a broad base, whether it's the mining industry, the oil and gas industry, or forestry. We put quite a bit of money into research and development and new technologies and the enhancement of development and economic opportunities.

If there are some other questions that need detail, either my deputy or Mr. Tobin will answer, but, Madam Chair, I apologize, I do have to leave. But as I said to Mr. Chatters, if you want me to come back at some later date or if any individual member of this committee wants to come to my office at any time, I'll provide the necessary information, and the same goes for the House of Commons in question period. I'm more than willing.

Thank you very much.

[Translation]

Mr. Serge Cardin: Minister, my question is brief and the answer can also be brief.

In an article on the 26th, Mr. Arthur Carty was said to be opposed to the privatization of Atomic Energy of Canada Limited. Given that the issue has been raised, has it ever been the department's or the minister's intention to privatize Atomic Energy of Canada Limited?

[English]

Hon. R. John Efford: No, at this time, we've had a review of the AECL board done. The review is in my office. The intention is to ensure that the board operates in an efficient way in the future. There are areas of the board where we feel it can be somewhat commercialized, looking at the opportunities for nuclear industries in the future, but we have not made any decision to privatize the board.

¿ (0900)

[Translation]

Mr. Serge Cardin: Would a gas price control or assessment board be an option?

[English]

Hon. R. John Efford: I wish I didn't have to go. I'd like to get into some of these questions.

Seriously, in my experience on gas pricing—and I say this very seriously, with respect—I believe very strongly in free enterprise. I also believe very strongly, if there's anybody out there in private industry who is gouging or doing something that's not according to law, there's a process in the federal government of Canada and the provinces, by the way, through the consumer affairs agencies of the provincial governments and the federal Competition Bureau in the Government of Canada, to make legitimate complaints and have a full investigation done.

When it comes to gas pricing, at the level the federal government is talking about, in the provincial governments, there were several provinces that had agencies in place. In my own province of Newfoundland and Labrador, it's costing the taxpayers over $250,000. They tell us the day before the price is going up or they tell us the day before the price is going down. I don't know if they have any impact whatsoever, so I'm not in favour of spending taxpayers' money to have unnecessary agencies in place that are not able to do the job.

With the Competition Bureau and the Department of Consumer Affairs, as a citizen of this country, if I knew there were any problems going on, I would report it immediately to the agencies, provincially and/or federally. We would have some teeth to deal with it.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Cardin, you have about 15 seconds. Do you want to ask another question or wait for the next round?

[Translation]

Mr. Serge Cardin: That gives me just enough time to thank you, Madam Chair. I'll come back on the second round.

[English]

The Vice-Chair (Ms. Nancy Karetak-Lindell): Okay. Thank you.

Mr. Bagnell, seven minutes.

Hon. Larry Bagnell (Yukon, Lib.): Thank you.

My question is primarily for Mr. Anderson. I want to basically deal with the Alaska Highway pipeline.

I'm glad Mr. Chatters brought it up. The government has been scrupulously careful to maintain that its role is to make both pipelines go, and not to get involved in route selection but to be ready to regulate whenever the private sector decides to go ahead on one.

I'd like to ask about the government's readiness. We had an answer from the minister on the readiness of the Mackenzie Valley pipeline, relating to the $75 million that's in the Government of Canada. A lot of it is not necessarily with Natural Resources, but the government will be ready to regulate should someone make an application for an Alaska Highway pipeline. Is the government sufficiently ready in this respect, as well?

Mr. George Anderson (Deputy Minister, Department of Natural Resources): There is no likelihood of an immediate application for the Alaska pipeline. As for the likely timing of the two pipelines, our current best estimate is that the Mackenzie pipeline will be completed in 2009, if things go well; and for the Alaskan pipeline, the expectation is that just as the Mackenzie line is being completed, we would start construction of the Alaskan line.

There are a number of issues that have to be resolved for the Alaskan line to go forward, as you know. Probably the most important is the fiscal circumstances. There was a proposal in Congress, which the Government of Canada has objected to, to have a price floor protecting the price of the Alaskan gas. At the moment, that's not a part of the draft energy bill in Congress.

So what's happening now is that attention is being paid in Alaska. They have a thing called the Stranded Gas Development Act, and they're looking at changing the fiscal terms around gas there in order to have a more profit-sensitive royalty regime, and what have you.

The minister has been made the minister responsible for the Northern Pipeline Agency, the agency created pursuant to the treaty between Canada and the United States to oversee the building of the Alaskan pipeline. I am now the commissioner for that. In the last few weeks, we have been engaged in a review of the preparatory work that needs to be done to prepare or update what's there, so that we would be ready if and when things move on the Alaskan pipeline.

That agency is funded by Foothills Pipe Lines, which is the designated pipeline company under the act. We're sitting down with them to talk about the type of work that needs to be done so that we'll be ready.

¿ (0905)

Hon. Larry Bagnell: So the $1.252 million in the estimates here...?

Mr. George Anderson: For the Northern Pipeline Agency?

Hon. Larry Bagnell: Is that paid for by Foothills?

Mr. George Anderson: Correct.

Hon. Larry Bagnell: First of all, I'm interested that it doesn't change from this year to next year, though in theory we're getting closer to a pipeline.

But my second point is that it is my understanding that there is only one employee, and I wonder what the $1.2 million would be spent for.

Mr. George Anderson: That money was not spent last year. A fair bit of it was not spent, but some of it went to consultants, and so on.

We are gearing up. It's very much a dialogue with Foothills, because Foothills has to pay, and they were not pushing for early work. They're now interested in seeing more work being done, and so the first step we're engaged in.... In fact, I have a meeting later this week with a senior executive from TransCanada PipeLines, which owns Foothills, to talk about exactly this.

We did have a period in 2002-03 when we had appointed a man by the name of Bob Skinner as the administrator for the Northern Pipeline Agency. He did a report that gave us a good sense of some of the work that needs to be done. He then resigned as administrator to go to other employment in Europe. We are looking at whether we should be appointing a new administrator or some other staff. That's one of the things that I'll be discussing with the people at Foothills.

Hon. Larry Bagnell: A while back, the government took a position on the Alaska Highway that they would prefer the Foothills route, given the treaty that we have with the United States—the ANGTS treaty—as opposed to a greenfield route, which could be the same thing right beside it.

Does the government still have a preference about those two routes, and if so, why?

Mr. George Anderson: There's been no explicit statement by the new government, but my sense is that they have in no way backed off the letter that Mr. Chrétien wrote.

The reasons are that there are legal uncertainties with both approaches and that, on balance, this may be the most expeditious way. That's one of the things we're doing further work on. There's also the question that significant investments were made by the Foothills interests, on the understanding that they had the right to build the pipeline. The treaty was set up to provide for Canadian benefits, and we have an interest in seeing those Canadian benefits, etc. These are the types of reasons.

Hon. Larry Bagnell: Is my time up, Madam Chair?

The Vice-Chair (Ms. Nancy Karetak-Lindell): You have about 30 seconds.

Hon. Larry Bagnell: I forgot what I was going to ask. I'll pass.

Thank you.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Chatters, the next round is for three minutes, please.

Mr. David Chatters: I didn't get answers to any of my questions, but the whole issue of the Mackenzie Valley pipeline gets more curious all the time. Perhaps I'll pursue that one a little more.

We had a briefing the other day that suggests there are 3,400 permits required on the Mackenzie Valley pipeline from 14 different agencies. We heard that the Deputy Minister of Natural Resources is head of the Northern Pipeline Agency, yet the funding for the Mackenzie Valley pipeline is supposed to be in the Department of Indian and Northern Affairs portfolio. And it's not in the estimates; it's not there that I can see.

The whole thing seems pretty curious to me. The funding isn't through Natural Resources and it's not in the estimates of either department. Could you talk about that a little and explain some of the anomalies?

¿ (0910)

Mr. George Anderson: Thank you, Mr. Chatters.

The first point is that the $75 million will be in the supplementary estimates, so that's why you don't see it there. It'll be scattered across a number of departments. The largest amount will be going to the Department of Indian Affairs and Northern Development, but there'll be money for this department, there'll be money for the Department of Fisheries and Oceans, and there'll be money for the Department of the Environment.

The minister responsible for gas and oil north of 60°, or at least in the Northwest Territories, is the Minister of Indian and Northern Affairs. Our minister is the minister responsible for the National Energy Board. As well, we provide a number of technical services to the National Energy Board or to the Minister of Indian Affairs and Northern Development, particularly through things like the Geological Survey of Canada. There's a lot of scientific work that needs to be done on things like permafrost, heaving, and what have you.

Our money is essentially for two things. The largest part that will be coming to our department is for scientific work. There is money that will be voted to the NEB for their costs. There's also a small amount of money for some additional capacity to track this within our department.

I should say, as Mr. Efford indicated, the Mackenzie Valley pipeline has clearly been a priority for the government—the previous government and this government—in terms of making it move. About three years ago or two and a half years ago, there was a coordination agreement amongst all the regulators. It sets out understandings on how they're going to relate to one another and on timelines. Those are not legal obligations, but they're moral undertakings.

We are working very hard with the various actors to keep that going. Some of the money that was announced will reinforce the capacity of the federal government north of 60° on the ground.

We now also have an informal committee, presided over by the Deputy Prime Minister, that brings together the relevant ministers and senior officials on a regular basis to take stock of where we are, what needs to be done, etc. This has been given very special attention.

Mr. David Chatters: Obviously, you have it all planned out and organized. Why is it in the supplementary estimates rather than the main estimates?

Mr. George Anderson: It's because of the timing of the decision. Not everything that was announced in the budget actually appears in main estimates.

Perhaps Mr. Tobin could speak to the timing of things that went into the budget versus things that went into main estimates. Some of the new announcements in the budget are actually only going to appear in supplementary estimates.

Mr. Richard Tobin (Acting Assistant Deputy Minister, Corporate Services Sector, Department of Natural Resources): The format of the main estimates is such that it really compares main estimates from year to year. It's practically technically impossible to get those mid-budget decisions incorporated into the main estimates, so they come out in the supplementary estimates.

I'd also say that all of the funding for the department is contained in the plans and priorities report and departmental performance report, both of which are more comprehensive, I would say, than the main estimates.

The Vice-Chair (Ms. Nancy Karetak-Lindell): That's all the time we have for this round. We'll put you down for the next round again.

Mr. Telegdi, you have three minutes.

Hon. Andrew Telegdi (Kitchener—Waterloo, Lib.): Yes, thanks.

I'm just curious about something I'm looking at on table 1, “Main Estimates of the Department of Natural Resources”. For the item under “Ministry Summary”--“Contribution to employee benefit plans”--I see an increase of $6,216,000, which represents something like 11.9%. I go over to the Canadian Nuclear Safety Commission listing on table 2. I see an employee benefit plan increase of 16.6%. Then when I look at the National Energy Board listing, I see 7.8%; the one for the Northern Pipeline Agency, 7.8%. Can you tell me how these different numbers come up?

Mr. George Anderson: It could also be that you have to look at what's happened to the number of employees as well as the size of the benefits. This is something we may have to get back to you on. It's a fairly technical question.

¿ (0915)

Hon. Andrew Telegdi: Well, just under that, I'm looking at program expenditures. In the case of the Canadian Nuclear Safety Commission, the program expenditures increased by 7.8% and the employee benefits increased by 16.6%. It just seems to--

Mr. George Anderson: That's a good question. It's just that we may not have the answer ready at hand.

Mr. Richard Tobin: The answer I would give is that, first of all, the employee benefits program actually increased this year. It had been normally 20% for quite a few years. It went up to 21.5%. So that is part of the increase in all of those line items that you mentioned.

The other one is, as Deputy Anderson has indicated, the number of salaried employees will have changed within each of those envelopes, as well. But certainly, if you wanted an exact breakdown of each number, we could do that, too.

Hon. Andrew Telegdi: So you're saying to me that I could assume that when you have an increase of 16% in one case and 8% in another, you will have hired that many more employees on the...?

Mr. Richard Tobin: Yes.

Hon. Andrew Telegdi: Thank you.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Is that it, Mr. Telegdi?

Hon. Andrew Telegdi: Yes.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Since Mr. Cardin's not back yet, I'll call on Mr. Laliberte.

Mr. Rick Laliberte (Churchill River, Lib.): Thank you, Madam Chair.

I'm just reading through the notes the minister highlighted, and the term “sustainable approach” really jumps out at me. Then there's forestry being a part of the department's responsibilities. On the softwood lumber file, I'd like to point out to you that when the United States first raised the flag on the softwood lumber, what they said was that our stumpage fees were too low in comparison with American stumpage fees. I live in the middle of the boreal forest, and I agree, there are no resources left at the stumpage site.

My community is the community of Beauval, which has had a tradition of trapping, fishing, and hunting all through the years These are hunter-gatherer societies of the boreal forest. But all the sawmills, the industrial activities, are on the southern fringe in Saskatchewan. So you cut the forests in the north, leaving no resources and leaving no revenue, and here's our customer telling us that it is a wrong practice. We agree. Leave the stumpage fees in the north as well. Let the local human resources have opportunities for replanting or else let them change from one economy to another, because if I look at the history of my trapline, which I'm supposed to inherit from my father, I see it's all gone.

This is industrial forestry now. They mow 24 hours a day. With these forests, because the land is so gentle, these machines cut 24 hours a day. But there's no employment created; these are positions for highly trained people, where these guys sit in controlled-environment cabs.

Another issue is uranium mining. There's a town called Uranium City on the shores of Lake Athabasca. That mine operation was controlled by a federal crown corporation called Eldorado Nuclear. In this past budget there was an announcement that federal sites would be cleaned up. Now I've been told that this did not qualify under federal sites, but this was operated by a federal crown corporation. Is the federal government trying to wash its hands clean of these sites of Gunnar and Eldorado and up to forty decommissioned mines?

These were entrepreneurs who started up uranium mining before a monopoly and a control of this dangerous substance took place. These are unclean mines, about forty of them, just out in the bush with holes dug in the ground and tailings leaching into the ponds and into the lakes. Is the federal government willing to address the cleanup and the decommissioning of these sites? Is there anything in the estimates for this year for you to start negotiating or to start putting out an initiative between the federal and provincial governments to clean up these sites?

There are other new mine sites in northern Saskatchewan, and I think it's going to reflect on the future of mining in that region. The communities are fed up with not hearing anything. This is from the 1950s.

This is a sustainable economy with a sustainable resource. I'm looking at forestry. Should the stumpage fees be increased so there will be a revenue? They tell us it's, what, $2 billion dollars that's being spent to pay for the tariffs in the United States. Why couldn't $2 billion be injected back into the boreal forest?

That's the way I see it; it's simple accounting. Instead of paying George Bush, you pay the people of the bush $2 billion. Is that something that's in the estimates?

And as to the uranium cleanup, is there anything in your estimates for cleaning up a region that's resource-rich in uranium? Is there something I can find in the estimates towards that?

¿ (0920)

The Vice-Chair (Ms. Nancy Karetak-Lindell): I'll allow a little time for the answer. I think you used up your three minutes asking the question.

Mr. George Anderson: It was a two-minute question delivered in three minutes.

Thank you.

On the first issue of stumpage fees, I'm sure you'll appreciate that it's a provincial issue. The federal government doesn't have any direct say in that.

Mr. Rick Laliberte: But how can the minister say “sustainable practices”?

Mr. George Anderson: Well, let me continue.

We've had discussions with the provinces. There are really two issues, and one is the economic issue: are we subsidizing our forests? That's what the Americans have been claiming about our stumpage fees. There has been this horrendous number of legal cases with the Americans under every kind of trade agreement, the WTO, NAFTA, and all the rest of it, where we've consistently argued that, no, we don't.

For the most part we're doing very well with those legal cases, but there have been some issues raised about some of our practices in terms of whether they constitute subsidies. A number of our provinces are reviewing their practices, in some cases quite radically, like British Columbia. The Americans are arguing that what we need to do is to have a much more open, transparent type of auction regime to set the value of these things. Some of the provinces, to the extent they raise revenues from stumpage fees, do put that money back into the forest sector in whole or in part, usually in part, investing in forest maintenance and what have you. But that is a provincial issue.

For the most part, the location of mills is decided by the private sector, although some provinces have what they call appurtenancy rules, which tie harvesting in some parts of the forest to particular mills.

You will understand that if you're going to have good employment in the forest, you're constantly having to increase productivity so you can pay modern wages. That does mean we're moving towards more mechanized forestry in terms of harvesting practices. You wouldn't be able to pay the high wages people make in the forest if people were still using axes; they have to use modern equipment.

On the cleanup of contaminated sites, you'll remember there was $3.5 billion in the budget for the cleanup of federal contaminated sites. A large number of those are north of 60°, but there are also scattered across the country contaminated sites such as old defence and research establishments. In addition to that, there was $500 million set aside for the cleanup of the Sydney tar ponds and other sites. Now, we don't know quite what will qualify for that remaining $500 million.

We have had a program over the last number of years that has been very successful in the cleanup of old uranium mining sites. Those were almost entirely federal sites because they were federally administered. We worked with the industry, and in most cases it didn't involve any spending by government to get those sites cleaned up.

Now, we do have this particular issue in Saskatchewan, the Gunnar and Laredo sites. Those sites were transferred to the province, and the policy we have is that we take responsibility for federal sites, while provinces have responsibility for provincial sites. We're talking with the province about ways we can be helpful, but the province has taken the view that this is entirely a federal responsibility. I hope we'll find a solution to it, but it is a very particular problem. The fact is that unlike the case with most uranium sites, the province took this responsibility; maybe it's something they regret doing, but it is a provincial site. We're looking for a solution, but it's a very particular issue, and I hope we'll find a solution, perhaps quite soon.

In addition to that, we have contaminated mine sites across the country, and we've had discussions at the federal-provincial mines ministers' meetings about doing an inventory and looking at how we could have an approach to doing those. But the federal position will be that while we may provide some technical support, the actual responsibility is provincial.

I would expect that in many cases the provinces will find that the companies will assume the largest part of the responsibility, and there's already been good success with that. In some cases it may also involve some modifications to laws or procedures.

¿ (0925)

We have cases now where companies are prepared to go in and clean up a site that isn't theirs because there's some interest in getting into the property, but there are liability issues if they do that. Some of those kinds of legal issues have to be straightened around to permit them to clean up those sites.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you very much. I've let this round go a little longer because it was of general interest to all of us. We missed Mr. Cardin in the second round, so I'll go back to him and then go back to Mr. Chatters.

Mr. Cardin.

[Translation]

Mr. Serge Cardin: Thank you, Madam Chair.

There have been discussions concerning the implementation of the Kyoto Protocol. The government doesn't seem to be making much room for wind energy in its spending. I am thinking more specifically of the Wind Power Production Incentive. After having cut taxes by $250 million for the oil industry over the past year, do the department and the government intend to invest more and invest more actively in wind energy, which is a renewable and clean source of energy?

Mr. George Anderson: Don't under estimate what we are currently doing. The government announced a $260 million program over 15 years to support wind power. This program seems to be working quite well to date. We have received 125 project proposals. Our goal is to add 1,000 megawatts to the Canadian grid throughout the country and these project proposals add up to 6,000 megawatts overall.

When we started this program, the industry said that the federal government was providing too little, but we have noted that several groups have moved forward with the incentives that we proposed. We are following the situation closely.

I would also like to point out that the cost of wind power has been improving from year to year. Apparently the costs go down by about 5% per year. Therefore, wind power will soon become a commercial enterprise, within this framework at least, which means that we may have to reassess how much the federal government or any government should be subsidizing a source of energy that is becoming marketable.

Mr. Serge Cardin: You mentioned $260 million over 15 years.

Mr. George Anderson: Two hundred and sixty million dollars.

Mr. Serge Cardin: That's right, $260 million over 15 years. If I compare that to the $250 million in tax benefits that you recently gave the oil industry, I see a rather significant difference. Technically, that is the same as favouring oil and gas at the expense of wind power. You said yourself that the more we invest in wind power, the sooner it will become efficient.

M. George Anderson: There is a difference. In the case of the oil sector, from a fiscal point of view, the federal government benefits from the taxes in that sector, including new areas such as the tar sands. For wind power, there are incentives for that type of energy within the tax system. Furthermore, there is a special program subsidizing those activities.

From a fiscal perspective, more is being done for wind power. The oil sector is an important source of taxes and royalties in Canada.

Mr. Serge Cardin: That is what leads us to think that there is more interest in constantly investing more in the oil sector and also perhaps in meeting the needs of the United States, given the measures that are being taken.

Mr. George Anderson: It is not just an issue of supplying the United States with energy, but also of supplying Canada with energy. This is also an extremely important source of economic activity, not only in regions with gas and oil, but throughout the country. There are suppliers of equipment and services in Ontario and Quebec. We can give you numbers to show you how important this economic sector is for Canada. It also happens that this sector is an important contributor of taxes and royalties in this country. The fact of the matter is that Alberta, for example, pays huge sums of money, through the federal government, in transfers to other provinces. This sector is the source of that money.

¿ (0930)

Mr. Serge Cardin: But oil is also the source of greenhouse gases.

Mr. George Anderson: We are very aware of the enormous challenge that this poses. We're talking about the long-term role of the sector based on oil and coal as well as the problem of climate change. There are two ways of addressing these problems.

First we can look at ways of burying CO₂. We currently have an experimental program looking at this in Saskatchewan. If we also ensure that vehicles and other oil consumers become more and more efficient, then there will be fewer emissions produced by this type of energy.

[English]

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

[Translation]

Mr. Serge Cardin: Is that all the time I have, Madam Chair?

[English]

The Vice-Chair (Ms. Nancy Karetak-Lindell): We're being a little generous with everyone's time, but I think we're trying Mr. Chatter's patience, so I'll let him have his round.

Mr. David Chatters: How could you tell that?

I want to get back to this direction we're going on, how the estimates are divided between Indian Affairs and Northern Development and Natural Resources. You suggested that because the Mackenzie Valley pipeline is north of 60° the funding in support of that program goes through Indian Affairs. Yet you have this $1,130,000 contribution for aboriginal consultations on the long-term management of nuclear waste. That would seem to me clearly to be within the jurisdiction of Indian Affairs, and yet it's here in the natural resources department. What is that for, specifically? Where is that money going?

Mr. George Anderson: We do have a number of programs, as you'll find, across the Government of Canada. There are lots of departments that because of their main responsibility have particular concerns about relations with aboriginal Canadians and have programs around that. Mr. Laliberte will be familiar with what we do with the aboriginal forestry initiative, for example. In this particular case, we have obligations to consult on matters relating to aboriginal interests when we're doing things that touch those.

If you think about the long-term storage of nuclear waste, there's a fair chance that some of the sites will be in areas where a large percentage of the population is aboriginal. So what this does is provide the communities in the areas of the country that are potentially involved with this, as well as some national associations, with some money to examine the issue and be able to participate in those consultations.

Mr. David Chatters: Provisions in the bill that deal with the long-term management of waste specifically delegated the responsibility for consultation to the producers of that waste to come up with a plan that was acceptable to the local communities and to the industry. I still don't understand. Is it possible to get a breakdown of where that money is going, specifically what you're--

¿ (0935)

Mr. George Anderson: Yes, we could do that.

Mr. David Chatters: I'd appreciate that, if you could, because it seems to me that we're going outside of the bill that we supported through the House.

Also, I would like more specific breakdown on the other issues that I raised under the Canadian Nuclear Safety Commission, under grants and contributions. Could we get a specific breakdown of the grants to support non-profit organizations that are furthering development of nuclear safety standards?

Mr. George Anderson: Yes.

Mr. David Chatters: That is impossible to understand. I think we need a better understanding of that particular one.

I have a broader question, but I perhaps need another slot to do that one. But if you could provide the breakdown on those particular items, I'd appreciate it.

Mr. George Anderson: Fine.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Bagnell, three minutes please.

Hon. Larry Bagnell: Thank you.

I'll take a one-question break from the Alaska Highway pipeline. I want to address something that was an issue a couple of months ago, although I'm not sure if it's still an issue. But we have an energy solution centre in the Yukon, co-funded by the federal government and the territorial government, to basically handle all the energy programs and climate change. My understanding is that they were about to close because the new direction on the federal funds was that adaption was no longer eligible, that it could only be for reduction of greenhouse gases.

And of course our biggest objective in the north is not like the rest of Canada's, it's not reducing greenhouse gases. We want to do that, but in a way it's too late. Our immediate concern is the adaption because it has huge effects there. There are buildings shifting all over the place. There's ice melting in the Arctic dramatically. So we have a lot of adaption work to do. The centre was going to have to close because of the more restricted eligibility on the funding.

Do you have any clarification on that problem?

Mr. George Anderson: David Oulton will join me here.

You're right that the focus of the new funding was very much on emissions reduction. We have had a program on adaptation, but it has been very much focused, at this juncture, on studying the issue and understanding the implications. We're doing policy work, which we'll take to the new government after the election, I assume--assuming they have an election--that would consider where we go and do we need to do more on the program side of adaptation?

This is David Oulton, who's the acting assistant deputy minister for the programs and technology sector.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Go ahead.

Mr. David Oulton (Acting Assistant Deputy Minister, Energy Technology and Programs Sector, Department of Natural Resources): Madam Chair, as you may know, we're in the process of negotiating a memorandum of understanding with the Government of the Yukon. Those discussions have been going on over the last few months.

One of the issues they had raised as a subagreement that they would like to negotiate was the ability to continue that centre. We've been funding that centre from the climate change action fund, which has just completed its last year of activity. Indeed, because the work they are doing is work in the area of impacts and adaptation, which we share a mutual interest in, we agreed that we would, indeed, fund a bridging year, which is this fiscal year we're now in, from the last year of the climate change action fund, and then look at what new source of funding might be needed after the completion of this fiscal year that we're in.

So indeed, that funding has been done for the current fiscal year. There's a question of where we want to go after that, and this is something that we're agreed we need to explore with them.

Hon. Larry Bagnell: Great. Thank you very much.

That used my three minutes.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

We're now back to Mr. Cardin.

[Translation]

Mr. Serge Cardin: Thank you, Madam Chair.

Earlier on we were talking about wind power and about the $260 million over 15 years. This is the wind power production incentive. The amount for 2004-2005 is $10.488 million.

Is the $10.488 million for this year part of that program?

Mr. George Anderson: How much did you say?

¿ (0940)

Mr. Serge Cardin: I see $10.488 million for the year.

Mr. George Anderson: That is in fact the amount for this year.

Mr. Serge Cardin: How is that $10 million actually spent? In the form of subsidies?

Mr. George Anderson: Yes. Usually our subsidy is equivalent to a little more than one cent per kilowatt-hour. If a project is approved, the amount of money granted depends on the number of kilowatt-hours produced.

Mr. Serge Cardin: I'm sure you'll understand that I'm mainly interested in the sustainable development side to your department's activities. Natural Resources is the department responsible for this.

We know that the use of oil and gas is an important source of greenhouse gases. The department expects automobile producers to take certain initiatives or make some sort of contribution.

However, if we just wait for them to do this, do you not think we'll be waiting for a long time and that we will never achieve our goals for 2010? Is the department's intention to provide stricter guidelines for the automobile industry?

Mr. George Anderson: You may recall that in its climate change plan, the government stated that its goal was to reduce, by the year 2010, new vehicle emissions by 25%, compared to 1996. We have done a lot of technical work, studying available technologies or technologies that will become available. We feel, for now at least, that this goal is achievable.

To date we have had voluntary agreements on the part of the automobile industry. We would like to continue on a voluntary basis, but we would also like to add an objective that would be respected, if possible. We have already had several discussions over technical issues with companies. I expect that in the fall we will have discussions at other levels in order to address these issues.

Mr. Serge Cardin: You said earlier that there were...

[English]

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Cardin, you've finished your three-minute round already.

Mr. Telegdi, please.

Hon. Andrew Telegdi: Thank you very much.

In the whole area of energy, can you tell us something about the department's initiatives, what you're doing right now, around alternative energy sources? For instance, we actually were leaders in wind power at one point, and my understanding is that we've fallen quite a bit behind in that area.

Mr. George Anderson: One or two of my colleagues might want to join in here.

We are doing a good deal in this area. With the new focus on climate change, the department has received a good deal of money to promote less-emitting forms of energy and to improve energy efficiency. However, the best thing you can do, to the extent you can do it, is to use less energy, because less use has minimum applications. And we think a lot can be done on the energy efficiency side, so we work on technologies and we also have a whole suite of programs on the energy efficiency side.

On new energy forms, we have a program, which I was just describing to Mr. Cardin, for wind energy. That program, with $260 million, is going very well. It has a target of 1,000 megawatts.

There are other things going on in other jurisdictions in Canada. I think we'll see that Canada moves quite well in the direction of bringing on wind energy. The economics of wind are getting much better, and the program we have really is helping us learn a lot about how to use wind in the Canadian context, and to tie it in with grids, etc. There are all kinds of issues in terms of how it operates.

There are other renewable sources of energy, such as heat ground pumps, which are potentially quite interesting, and solar energy, as you know. As well, Canada has traditionally made a lot of use of small hydro. We also have a lot of large hydro left in Canada. We produce 65,000 megawatts of hydro in this country, and we have maybe twice that still available in terms of untapped large hydro across the country. Not all of that is economic at the moment, but if you go across the country, there are a number of large hydro projects being looked at.

¿ (0945)

Hon. Andrew Telegdi: One of the concerns I have is that one of the reasons for the high cost of living particularly in isolated areas is the ability to supply power. To the extent that we can use alternate energy sources that are local, then you would obviously reduce the cost of power for that particular community.

Mr. George Anderson: You're absolutely right. In fact, we're doing some technical work within the department that hasn't yet reached the form of some recommendations. But we're looking at the whole issue of Canadians who are off-grid, and often the most interesting way to use new energy sources is those high-cost areas that are off-grid. So what we're looking at is what we might do in terms of focusing on people in off-grid communities.

We're already doing some things in that area, but it is often an interesting area in which to test new technologies. The economics can be more difficult, and the energy source can be more expensive, but it's still better than the alternative in those communities, whereas if you were trying to use the new energy directly, in competition with the cheapest form of electricity, say, it might require a big subsidy.

Hon. Andrew Telegdi: So what you're saying is that it doesn't make sense to try alternative sources when, say, the Province of Ontario subsidizes electricity used.

Mr. George Anderson: No, that's not what I'm saying. What I'm saying is that for some of our new technologies, the most promising immediate application will be where the economics of alternative sources, such as traditional electricity, are not very good.

Traditionally, when you're introducing new technologies, they find their way in through non-conventional uses, or uses in areas where the conventional source has been expensive. Over time, people get more effective at using the new source, they bring the costs down, and then you can have a head-to-head competition with your traditional types of sources. But it's a combination.

These days, wind is getting to be part of the suite of sources being used by utilities in their main line. We're not at that stage yet with solar in Canada, and I don't know whether we'll get there, but that doesn't mean we won't have applications for solar. We can have applications for solar.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Laliberte, please, three minutes, and then we're back to Mr. Chatters.

Mr. Rick Laliberte: Thank you, Madam Chair.

On the issue of forestry again, would the department entertain a Métis model forestry initiative? Right now the department coins the first nations, but because of constitutional definitions, the Métis and the Inuit aren't active in that area. But through the boreal forest there's a huge number of Métis communities, not only in northern Saskatchewan but in Alberta and Manitoba. Would you entertain that? There is a specific region in my constituency that has been just begging for some kind of attention, because all the attention seems to be, as I said, on the southern fringe.

You responded that this is because the industry is located there, but it's because the infrastructure is located there; that's the reason. Natural gas is down there, the railroad is down there, the paved roads are down there, and the north is forgotten. You think the west is alienated. This mid-Canada region between the 60th parallel and the boreal forest....

So maybe the northern definition of Canada should be under Natural Resources and it should include the boreal forest region. We shouldn't be stuck on this north of 60°, because in large part Forestry Canada is the boreal forest overseer, so to speak, but with no jurisdiction. It's kind of kneecapped because of provincial jurisdiction. I just wanted to raise that.

The other one is seabed mapping. There's this huge land grab internationally of minerals under the water, because technology now has access to go into mining or to access this mineral under the seabed. On this, is there a jurisdictional fight internationally, and is there a jurisdictional fight between Natural Resources and Fisheries and Oceans? I need to know that aspect.

On energy, in my region the Province of Alberta had raised the flag that Fort McMurray needs more energy and they said, let's put a nuclear power plant in northern Saskatchewan, where hardly anybody lives; nobody will really realize that something is happening. If something bad happens, it will have less impact.

But there is also hydro energy in northern Saskatchewan. There's one plant there that was built in 1927 with 1800 technology. If we upgraded that technology at that hydro plant, we would double the output of energy. Is that something that Natural Resources could work on with those communities in that region, to increase the output of the existing hydro plan without creating a new dam with new flooding, just by upgrading technology? Is that some for which Natural Resources can be called upon, to help those communities look at an industry that could increase the output for use in northern Alberta, as an example?

¿ (0950)

The Vice-Chair (Ms. Nancy Karetak-Lindell): You have to give a very short answer because he used up all his minutes again.

Mr. George Anderson: I will.

On the Métis issue, you will have followed closely, I'm sure, the meeting that the Prime Minister had with aboriginal leaders, and it's clear there's an opening towards doing more with Métis Canadians.

At the present time our forestry program is co-funded with Indian Affairs and Northern Development, which has restricted it to first nations, but I think this kind of issue, as to whether we could have a broader definition, will be reviewed as we go forward.

Seabed mapping. There was $70 million in the budget for seabed mapping, which will permit Canada to do the necessary bathymetric and seismic studies of its areas of economic interest beyond the economic limit, and that's a 10-year program. It's being done cooperatively. I'm not aware that we have any jurisdictional disputes between us and Fisheries and Oceans. In fact, we are the agent for Fisheries and Oceans on doing the seismic work.

On energy, on the specific question of this hydro plant in northern Saskatchewan, I'm not aware of the issues. But we don't intervene directly in hydro projects. That's very much the responsibility of utilities, and the provinces if they own the utility or they're the regulator of the utility. Sometimes we provide some technical support if there's a technical issue, but that's not typically a federal responsibility.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Chatters.

Mr. David Chatters: Thank you, Madam Chairman.

Actually, it's not electrical energy that the tar sands need, it's heat energy that could be provided through the nuclear technology. Anyway, that isn't the area I wanted to pursue.

As I said, I've been involved in this committee for a number of years and under a number of ministers. There was a time under Mr. Goodale's time as Minister of Natural Resources when he spoke often, in any number of forums, about Canada's need to develop a national energy strategy. I heard him speak certainly in Canada and internationally on that issue. Certainly with the issues that have been raised here today, Mr. Telegdi's particularly--the development of alternative energy sources, the tight supply of gas, the drive to get the northern gas down to southern Canada and the United States, the new nuclear technology with the new-generation CANDU--it seems to me that was a worthwhile initiative for the department and for the minister. Yet under Minister Dhaliwal, that initiative seemed to fade away. Certainly I've never heard the current minister speak of that.

Is that initiative no longer there, or is that something the department is moving on, or looking at, somewhere down the road? I think that more and more, year after year, when we have these discussions, the department seems to be shooting in every direction and trying to cover everything. Yet there doesn't seem to be a lot of focus on the objectives in energy security and energy development.

I embraced Mr. Goodale's idea of developing this strategic energy program. Certainly it fits with George W. Bush's commitment to develop a U.S. energy strategy.

Perhaps you could comment on that.

¿ (0955)

Mr. George Anderson: Yes, this is very much an active idea. Mr. Efford has made reference to it. I think there's a reference to it in the Speech from the Throne. We've been having discussions with the provinces and with industry and other stakeholders in the sector about the idea.

There is some question about how you manage that kind of exercise. There's some sensitivity on the part of the provinces because they think that if it's too all-embracing it could intrude into their jurisdictions.

Mr. David Chatters: Just don't call it a national energy program.

Mr. George Anderson: That's what Mr. Bush called his.

I think what we're talking about at the moment in this dialogue--and this will be a subject for discussion in Iqaluit when the energy ministers meet in July--is an energy issues agenda. What we're doing is focusing on priority issues. Three of them that have been identified are the regulatory issues that you've heard Mr. Efford speak to; demand-side management and energy efficiency, more generally; and new technologies and new energy forms, which goes a lot to some of the questions we've had.

We'll see how that evolves in terms of how it's approached. It's obviously very tied up with the environmental issues as well. Would you do an energy strategy, or would it have to be a broader energy and environment strategy?

Mr. David Chatters: So there's really no timeline or there's no date at which we can expect to see a draft of the energy strategy. It's simply hanging out there, and there's nothing specific at this point?

Mr. George Anderson: At this stage, we don't have clear instructions in terms of how to manage all of that. As I said, there is a sense among some of our interlocutors, including the provinces, that we should be working on an energy issues agenda. It may add up to some of the same thing, but I think the next thing to watch will be the results of the federal-provincial meeting in Iqaluit in July.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Laliberte. Three minutes.

Mr. Rick Laliberte: Forgive me if I seem a little selfish on this question. The bulk of the uranium activities in Canada take place in northern Saskatchewan, right?

Mr. George Anderson: Correct.

Mr. Rick Laliberte: There is no presence at all of any of the nuclear safety agencies in northern Saskatchewan. Would you consider relocating the Saskatoon operations to the north? Because Saskatoon has its own industry and its own activities.

It's the same thing with forestry. There was a forestry centre built in Prince Albert. Prince Albert is industry based, with pulp mills, saw mills, and everything.

We seem to be following the industries' headquarters. Maybe the forestry centres should be inside the boreal forest, as opposed to the fringe of the prairies. Maybe the nuclear safety agency should be inside the communities within northern Saskatchewan. It's more of a selfish look, but that's the way I see it. Why should people in northern Saskatchewan go to Saskatoon to find all the nuclear agency activities when we're part of Canada?

I'm sure you can operate at any point. You don't need a Tim Hortons and I don't think you need a McDonald's to have a nuclear safety infrastructure. I think you need to have access to communities. I think you need to have a physical presence to create an economy in that area, because the employees will be shopping at the same local communities, in the same local economy, as the local residents are asked to do.

Mr. George Anderson: As your question made clear, what you're talking about is where the employees of the Canadian Nuclear Safety Commission would be located. As deputy minister of the department, it's really beyond my mandate. I'll give notice of your question to Mr. Efford.

I don't know if you've raised it with the head of the Canadian Nuclear Safety Commission. It's something we can get back to you on, or have them get back to you on, but I don't feel I can comment on it.

Mr. Rick Laliberte: On the forestry side, Forestry Canada--maybe that's another side. Your department looks at the activities of forestry. Where are those locations? Perhaps that's something I should ask your department to provide to us. Where are the offices or sub-offices of all these activities?

We don't see it. In the north, where the bush is, as I said, there's no presence, so there's no opportunity for local people to touch somebody, see somebody, or be encouraged by somebody to look into this industry. Perhaps that's another side you should look into.

Mr. George Anderson: With the indulgence of the chair, we can give you a sense of where we are in western Canada, if you wish, but bear in mind that we essentially run scientific facilities. We have some model forests and that type of thing. We are not on-the-ground inspectors or doing that type of work. Those are provincial officials, not federal officials.

À (1000)

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you. That brings us to the end of your round.

Mr. Cardin, please, three minutes.

[Translation]

Mr. Serge Cardin: In the 2003 annual report that was just tabled by the National Energy Board, it says that oil production increased by 8% in Canada, compared to 2002, whereas renewable energy only increased by 2%, that is four times less. The same issue arises. If oil is such an important source of capital for the government, should this money not be used to develop renewable energy? And what is the government doing to slow down the production of oil?

Mr. George Anderson: We have already had a similar discussion. If you look at the increase, in percentage terms, of certain new sources of energy, you will see, I think, that the rate of that growth is higher than that of our conventional sources. That being said, we're starting with a very small base. In absolute numbers, it does not look very significant.

Nothing is being done to slow down the development of oil resources because that is not how we'll find an answer to climate change issues and other environmental challenges. If Canada does not produce oil, then other countries will do it. It is in our interest to use our own resources as much as possible in order to meet our own demand and that of the United States, which is just next to us.

In order to improve the oil situation, we need to find ways of producing it and using it in a cleaner way. I already mentioned the possibility of injecting CO₂ underground, and we are looking at this closely. According to experts I have spoken to, capturing CO₂ emissions and injecting them into the ground is probably one of the most promising long-term technologies. This may have another effect, depending on the location that is chosen. If this is injected into reservoirs where there's already oil, it may be profitable because it would cause production to increase.

Mr. Serge Cardin: Essentially, this shows that the government's interest in this sector is not particularly significant compared to what it should be. Perhaps we should be looking at an energy policy that would make oil, because it is a greenhouse gas producer, of secondary importance in our society. Currently we're making it our main source of energy because it is profitable, but it should become strictly secondary. If all the revenue that you are currently collecting from the oil sector were to be invested in renewable energy, then we could hope to see oil become merely incidental for centuries and centuries. But we're talking about constantly developing the consumption of this source of energy because it is such an important source of revenue.

Mr. George Anderson: I hope that one day fossil fuel will either become incidental or very clean, in other words that we will find ways of minimizing our emissions.

You might want to look at the long-term projections put out by the International Energy Agency. There's not one single source of energy, renewable or otherwise, that can meet our global energy needs, even if energy use becomes much more efficient. Even renewable sources of energy have their own problems in terms of the environment. Therefore our way of doing things is not to choose one single source of energy, but rather to encourage the development of cleaner sources of energy, whether that means developing renewable energy, finding cleaner ways of using conventional sources of energy or using nuclear energy, which is also a source of energy that does not produce emissions.

À (1005)

Mr. Serge Cardin: Speaking of nuclear energy...

[English]

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Bagnell.

Hon. Larry Bagnell: Thank you.

In relation to the Alaska Highway pipeline, a couple of months ago I got a letter from British Petroleum, BP, who are big owners of gas in the north. It basically outlined the same tentative schedule that you have for the two pipelines—although, as you mentioned, both pipelines have serious challenges. They go through a lot of jurisdictions or various governments—first nation and other governments—and there's a lot of environmental coordination to be done, with two different regimes on both lines.

If the Mackenzie Valley pipeline were to get held up, for whatever reason—British Petroleum said that if the Alaska Highway pipeline were to go, the Mackenzie would come a year or two right after that—would you be able to regulate? Are you prepared to regulate and go that way, through the regulatory agencies, if that's the scenario that occurs in the private sector?

Mr. George Anderson: Well, you're into hypotheticals.

I think the government has made it clear that our view is that the underlying economics are such that the Mackenzie pipeline is a more economical one at the moment than a pipeline from Alaska. It may be that the Americans can work out a fiscal regime that doesn't require subsidies, but we would be particularly reluctant to see a subsidized pipeline going ahead of an economic pipeline.

Now, at the moment, we're very confident that the Mackenzie pipeline will come on stream on time, and we're doing everything we can to facilitate all of the regulatory dimensions of that, and the coordination. We have no reason to think that the Mackenzie pipeline won't happen in the time that we're looking at. We'll do everything we can to make sure we stay on schedule there.

Hon. Larry Bagnell: When you have a railway with a pipeline or oil and gas development, as in most cases in the world, it's said that the industry average would maybe cut the cost of a pipeline 20%.

Actually, I highly commend your officials, because they've been very positive in the working groups on looking at joining the Alaska-to-Canada railway project, which could therefore help the pipeline.

Of course, there would be huge cuts in greenhouse gases by having a railway as opposed to trucks. The trucks can only carry one piece of pipe each, so there would be great environmental savings, too, by having a railway. In fact, it would almost be paid for in the amount it would save out of the $20 billion pipeline project—maybe $4 billion.

So I assume that your officials continue to be helpful and positive on the potential of joining the Alaska railway to the Canadian railway system?

Mr. George Anderson: I'm aware that there has been a technical study on this, but I thought actually....

Is there anyone here in the room who is more knowledgeable than I am on this issue?

We'll have to get back to you on this, Mr. Bagnell. My understanding was that the report was done and there wasn't further work being done. Is your sense otherwise?

Hon. Larry Bagnell: Yes, because the report was positive and it looked really good, there is still some work going on, but not in your department. Some of it is being done in the Department of Transport.

Mr. George Anderson: I think the lead is in the Department of Transport. Perhaps you're further up the curve on that than I am.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Chatters.

Mr. David Chatters: I have a couple of short questions.

We had a very interesting and very comprehensive briefing on the seabed mapping issue the other day, but one of the questions that were asked and the officials weren't able to answer because they were fisheries people was whether or not the technology that's doing the seabed mapping can identify the presence of gas hydrates on the seabed. They weren't able to answer that.

À (1010)

Mr. George Anderson: This is Dr. Irwin Itzkovitch, who, as you know, is the head of the earth sciences sector within the department. He knows a lot about gas hydrates and seabed mapping.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Dr. Itzkovitch, please go ahead.

Mr. Irwin Itzkovitch (Assistant Deputy Minister, Earth Sciences Sector, Department of Natural Resources): Thank you, Mr. Anderson.

Can they identify gas hydrates on the seabed floor? Yes, if they are solid chunks of gas hydrates on the floor. If they are subsurface to the floor, then it is seismics that would identify it. But the location of gas hydrates subsurface might be identified by gas vents that appear as craters on the seabed.

Mr. David Chatters: Good. That's interesting. That's a better answer than we got before.

Mr. George Anderson: Just as a comment, the Japanese, as you know, have identified large gas hydrates in their offshore.

Mr. David Chatters: Okay. Well, we have the expert at the table.

Going back to the estimates, I was delighted to see that Geomatics Canada is one of the most profitable parts of your department. In fact, there's a $5-million drawdown on Geomatics Canada.

Has consideration ever been given to privatizing Geomatics Canada? It clearly is self-sustaining and provides a broad service both to the Canadian public and to international customers. It seems that it would be a prime candidate to hive off and privatize and put in the private sector. Why would we not do that?

Mr. Irwin Itzkovitch: Mr. Chatters, what you're referring to is the revolving fund, which only looks at parts of Geomatics Canada, the mapping services branch in terms of the sales and revenue with respect to maps, as well as the satellite receiving stations, one of which is located in Prince Albert, Saskatchewan, in terms of the collection of data and the archiving of those data and the sale of those data through a distributor called RADARSAT International. Geomatics Canada itself has a budget approaching about $60 million or more. I'm not quite sure of the exact number. That is not all under the revolving fund.

As to the second part of your question, as to whether at times the privatization of parts of Geomatics Canada has been considered, it has, but it is not self-sufficient and it's doing what in essence is a very good public good. In those provinces and other jurisdictions where mapping has been privatized, it has now been brought back into Canada because the private sector corporations that were doing the mapping will go where the money is and not necessarily where the needs are in the best interests of the public good.

Mr. David Chatters: Good answer.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Laliberte.

Mr. Rick Laliberte: Again, while our seabed specialist is here, there is a jurisdictional issue, and I know the deputy minister mentioned that there is an economic delineation. Were you speaking of the 200-mile...?

Mr. George Anderson: Yes, the 200-mile limit, and the Law of the Sea provides for extending one's economic interests beyond the 200-mile limit, but you have to do this seabed mapping as a part of all of that.

Mr. Rick Laliberte: The question I have is this. We have a lot of international interests and there's a whole bunch of seabed out there. Are we going beyond our Canadian interests; are we going offshore to the United Kingdom or Spain as well? What are our interests internationally? To me, this is a whole new excitement. I see the media starting to pick it up, but it's been a very quiet jewel, so to speak, because there are so many resources and so much revenue to be created off this in the future that, if Canada doesn't jump in big time, we're going to be losers.

Mr. George Anderson: Some of these resources are potentially of real, immediate interest--for Newfoundland, for example--beyond the 200-mile limit. A lot of them, however, are for the very long term. That being said, it's worth making the investment now to protect the resources.

Dr. Itzkovitch can describe further to you what the Convention on the Law of the Sea does and what we're doing in terms of exploration.

À (1015)

Mr. Irwin Itzkovitch The Law of the Sea requires us to map the outer limit of the continental shelf. Under the Law of the Sea all the resources that exist up to the outer limit of the continental shelf will be considered Canadian resources.

There might be some confusion between terms, so let me just clarify this. Seabed mapping refers specifically to the use of sonar to map the seabed and the sea floor. What is going to be done with regard to reinforcing our position on the outer limit of the continental shelf, both in the north and on the eastern coast, is more seismic mapping of where the continental shelf falls off. At this point we are not, except in support of our internal programs, doing what we have referred to as seabed mapping, which is a complete map of the sea floor...and both the fisheries that exist on the seabed floor as well as the potential for other resources on the sea floor.

The Vice-Chair (Ms. Nancy Karetak-Lindell): That takes care of your first round.

Mr. Cardin.

[Translation]

Mr. Serge Cardin: I would like to ask you one brief question. Earlier you touched on the question of nuclear energy. Can you tell me what is happening with the Nuclear Waste Management Organization?

Mr. George Anderson: This organization was created two or three years ago. Ms. Dowdeswell, who has worked with the United Nations, heads the organization. She is an environmental expert. The organization receives funding from nuclear plants and therefore is acquiring a sizeable budget. They have a work plan which begins, I believe, in 2005. If you would like more details I can provide them. They are going to begin asking questions of the public and they will organize public consultations in order to do that. They're hoping to find, two or three years after their work has begun, one or more sites and the right technology, and they also hope to determine how Canada will dispose of its waste in the long term and how it will manage it.

Mr. Serge Cardin: If I've understood correctly they're following their schedule.

Mr. George Anderson: I don't have all the details but if you like I will find them and send them to you.

Mr. Serge Cardin: One final question. Once the BAPE, in Quebec, has wrapped up its study on natural gas operations in the Gulf of the St. Lawrence, and if there are no potential environmental hazards, will it take the government very long to issue operating licences, given that this is an ideal situation?

Mr. George Anderson: I myself met my counterpart in Quebec on that issue and we are willing to find a way to open up the submarine zone in Quebec and to reach an agreement with Quebec in the same way that we have reached agreements with other provinces.

Some issues remain to be dealt with, but I expect that this file will have the support of both sides. We hope to find a solution within the year.

Mr. Serge Cardin: You say that you will try to find a solution, but if the BAPE finds that there are no environmental problems with this in Quebec and that we can move ahead, then what kind of problems would there be?

Mr. George Anderson: According to the federal government and to our legal advisors, Quebec's offshore area belongs, technically and legally, to the federal government. Therefore, if we reach an agreement with Quebec, it has to be consistent with the constitutional reality. As you know, we have signed agreements with Nova Scotia and Newfoundland. In a sense, we had found a way of jointly managing the offshore area while complying with the legislation. Both provinces have their own constitutional perspective, but we found a way of legally satisfying their claims.

We feel that in order to pursue offshore activities in Quebec, we need to reach an agreement that respects the fact that this is federal territory. We can do this, but we can't just copy provincial procedures. We need to find procedures that take into account federal requirements and that comply with those requirements.

À (1020)

Mr. Serge Cardin: Thank you.

[English]

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you very much.

Mr. Telegdi.

Hon. Andrew Telegdi: Thank you, Madam Chair.

Mr. Anderson, earlier on I mentioned that when one subsidizes electrical power like we do in the province of Ontario, it really doesn't serve the purposes of either conservation or helping us develop alternate energy sources. The reason for it is obvious: alternate sources are more expensive than existing sources. The need for insulation and all that stuff doesn't become as immediate when you're dealing with subsidized energy. So I think it's quite critical that the process whereby they're looking, in order to manage peak demand in the province of Ontario, at pricing electricity in such fashion that if you use it at peak time, you'll pay a higher rate.... This is called management of the hydro resource.

Now, the reason I'm underlining this is that we're dealing with oil and gas, the consumption of which is going up substantially and which is a finite resource. Eventually we're going to have to get onto other sources. Have you done any modelling in the department as to when we can expect to be running out of known reserves?

Mr. George Anderson: Well, that's a very large question. I agree with your point that consumers respond to price signals. We do on a regular basis, through the National Energy Board, what are called supply-demand projections for oil and gas in Canada. There was one that came out about a year and a half ago, and these are updated. Obviously, as technologies change and prices change, you have to adjust your scenarios and so on.

Interestingly, in the last report the NEB did two different scenarios, which was something they hadn't done before. They did what they called a Techno-Vert scenario, which assumed there was more of a push towards cleaner energies, and then they did a more business-as-usual type of scenario.

There are also North American studies. There was a very important study done on gas by the National Petroleum Council in the United States that showed we had a gas supply problem in North America. We could require as much as 15 billion cubic feet of liquefied natural gas coming into North America, even assuming we get Alaskan gas, Mackenzie gas, and what have you. These studies are done on a regular basis.

At the global level you also have people saying, well, it is a finite resource, oil and gas; how long before we find that we're starting to hit the limits? The lower 48 are now on a declining curve and the North Sea is starting to be on a declining curve for oil production. You have some geologists out there who would argue that within 10 years we'll start on a global declining curve for oil. Others say no, no, no, there are new technologies, new this, and new that; it will be twenty, thirty, or forty years before you see a declining curve for oil production.

We follow all of this. We tend to focus as a government particularly on the supply-demand scenarios within Canada. Those are public documents, and we can make them available to you.

À (1025)

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Bagnell.

Hon. Larry Bagnell: Thank you.

In north Yukon, as you know, there is natural gas owned by companies such as Northern Cross. I'm just wondering what your plans are to make sure that Canadian gas is not left stranded by the various pipeline proposals.

Mr. George Anderson: I'm not aware of any particular plans, Mr. Bagnell. As you know, a lot of gas has been discovered that is not yet connected to pipelines. I don't know how big the Northern Cross field is. When the Alaskan pipeline goes forward, that would provide the first opportunity to see whether one could make a connection that would be economical. Certainly, one of the things we will be looking at is the possibility of feeding Canadian gas fields into that new infrastructure.

Hon. Larry Bagnell: My understanding is that according to the treaty, it's mandatory that the producers build a Dempster Lateral up to that gas. But the closer pipeline would be the Mackenzie. I think if it were left to pure economics, the producers might not build it big enough for the gas fields that have been discovered both to the west, which is the Yukon Eagle Plains, and to the east, in Sahtu territory. Local residents in both those areas want to ensure that the Mackenzie Valley pipeline is big enough so it can take these future supplies, even though it may not be the first choice of the producers and the pipeline companies.

Mr. George Anderson: As you know, they're separating the liquids from the gas. The size of the pipeline is such that it would be possible to upgrade it with additional compression to get up to something like 1.8 billion cubic feet a day.

In the nature of things, when you open up an oil and gas province, you get lots more exploration. Exploration is going on in this winter season. We don't have the results of that yet, but we're hopeful that more will be discovered. As we get closer to the point where steel is going into the ground and people can see it happening, you can expect much more activity. Our view is that the prospects for the whole delta area, right across to the Alaskan border, and the shallow Beaufort Sea are tremendous. But it will be like any gas province. As it develops, infrastructure will grow. But the critical thing is getting that first infrastructure in.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Chatters.

Mr. David Chatters: Following up on Larry's question, it raises the need to have a focused long-term plan, a national energy strategy, if you will. We keep getting this focus on green energy and renewable energy, and I think sometimes we lose our perspective. I think we need to refocus on some of these issues. For example, everybody is pushing wind power. Wind power, as you said, is becoming part of the mainstream. It's also becoming more economical, but its capacity is truly limited. I read an article that suggested that if you were to supply Toronto, Canada's largest city, with wind power, it would require a wind farm roughly twice the size of Toronto to put your windmills on. So clearly, while we need to work toward greater integration of green energy and renewable energy, we have to remember that there are limited possibilities for the replacement of fossil fuel energy, nuclear being one of them and maybe hydrogen someday. It seems to me that the department needs to bring the Canadian public back to reality when it comes to these renewables.

Maybe you could comment on that.

Mr. George Anderson: As you know, views will differ on what the potential is of any given source of energy and over what time period. Regular technical reports come out, particularly from the International Energy Agency. We are having discussions amongst ourselves, particularly once we get into a full government period, on how we will contribute to the debate amongst Canadians on some of these issues.

It's hard at this stage to see anything other than a continued significant dependence on fossil fuels over the next 20 or 30 years. At the same time, if we carry on along on the road that we're proceeding on, this will contribute very significantly, particularly with the growing demands in China and India and other developing countries, to the climate change issue. So how do you square the circle? That's where we get into issues of energy efficiency, and CO₂ sequestration. Hydrogen itself could come from fossil fuels, but if you sequester the emissions, it could become a clean energy source.

I don't think I've ever seen a period like the one we've had over the last five or ten years, where there is so much searching for alternative ways of meeting the world's energy demands. I think it's fair to say that we haven't yet come up with a clear-headed view or consensus view as to what either the economic or the technological pathway will be to get us there. That means we're going to have to work on a lot of things at the same time and learn as we go.

À (1030)

Mr. David Chatters: Maybe the department needs to be a little more vocal--or the minister does, not the department, I guess, because the minister is the spokesperson for the department--about the reality of the potential. I mean, the windmill down by Queen's Park on Lakeshore Drive in Toronto is really neat to see, sitting there turning with almost no wind and all the rest of it, but the reality is that it's not producing much power in the big scheme of things.

Certainly in southern and southwestern Alberta there are some large wind farms that are producing significant amounts of power, but in terms of their contribution to the overall grid.... Even in countries like Germany, where they are much further advanced, the suggestion is that to go beyond about 20% of the demand is not practical and never will be.

Perhaps Natural Resources Canada needs to inform Canadians a little more about the limitations of some of these things.

Mr. George Anderson: We are giving serious thought to how we contribute to that debate. The 20% number a few years ago was 10%, and there are people who say one day it will be 30% or 35% in terms of the ultimate potential of something like wind, and wind being integrated into grids. You get into storage issues, what it's married with, and all those kinds of issues.

It is a really significant issue, how you educate people on these issues. It's not obvious to me that it's simply the minister speaking out, because the minister will.... These are technical issues, so as we think our way through it, I think we're looking at bringing other voices to bear and giving some scientific validity to the results of our work.

Mr. David Chatters: Thank you.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Laliberte.

Mr. Rick Laliberte: I'm still troubled by this Uranium City jurisdictional battle. From what I saw in terms of the economic activity in Uranium City, a large part of the workforce came from Edmonton and Fort McMurray, because that's where Eldorado's main.... They didn't pick up workers in Saskatchewan.

When that was decommissioned, a huge activity happened in the tar sands. Northern Saskatchewan communities have been trying to access jobs in the tar sands for many numbers of years. One of the initiatives was to build a road between Garson Lake and Fort McMurray, but that has stalled out. The Alberta portion of this road is not extended.

Now, maybe northern Saskatchewan has oil sands as well. In your perspective, or in the mapping of this kind of mineral, are northern Saskatchewan's oil sands rich as well? Does the border stop oil sands? Did the dinosaurs stop at--

Mr. George Anderson: Dr. Itzkovitch may be able to contribute more, or perhaps Dr. Plourde. Mr. Anderson doesn't know that much about these things.

What we do know is that Saskatchewan is extremely rich in heavy oil. At the moment, the recovery rate in Saskatchewan on heavy oil is about 4%, because it's very viscous and hard to extract. That's one of the reasons the government established the Petroleum Technology Research Centre in Regina, to look at new methods of developing heavy oil, particularly getting it out of the ground. There have been some really interesting developments in that regard.

The oil sands are concentrated, as you know, in the Fort McMurray district.

Irwin, I don't know if you can speak to the precise extent of that kind of deposit and how much of it might go into northern Saskatchewan, or how much heavy oil there might be in northern Saskatchewan.

We can give you a more detailed briefing on this in due course.

À (1035)

Mr. Irwin Itzkovitch: I think I'd rather wait and give you a detailed briefing at a later date.

Much of northern Saskatchewan is Precambrian rock; it's part of the extension of the Precambrian Shield. That's why you find uranium as opposed to oil and gas.

An extension of the government's targeted geoscience initiative in budget 2003 has been targeted to the north, as we define the north in Natural Resources Canada--the northern parts of the provinces plus north of 60°--and it's been targeted to oil and gas. There are partnerships between the provinces, including Saskatchewan, looking at the extent of oil and gas deposits in the northern parts of our provinces and north of 60°.

Mr. Rick Laliberte: I have a question on your definition of the north.

The Vice-Chair (Ms. Nancy Karetak-Lindell): It's the end of your time, though.

Mr. Rick Laliberte: Is it the boreal north? Is it the permafrost north? Is it the Hamelin line north?

Mr. Irwin Itzkovitch: Permafrost north.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Bagnell, Mr. Telegdi, and then back to Mr. Chatters.

Hon. Larry Bagnell: I have one last question on the Alaska Highway pipeline. As you know, it's about four times as long as the Mackenzie, so there are a lot more tariff revenues for Canadians. There are a lot more Canadians who live along the route, so they'd get a lot more in and out, or at least they'd get gas out to reduce their costs. There are more aboriginal people; there's more construction, more steel, a longer distance and everything. So it's important that it does go ahead.

Apparently there has recently been an application put in through the Alaska regime to look at--you were talking about LNG earlier--putting that down on a pipeline beside the oil pipeline to Valdez, and then shipping it out as LNG. Of course, Canada would lose tens of thousands of jobs.

Can you update me on the progress of that initiative?

Mr. George Anderson: My understanding is that's not the preferred approach of anybody. Dr. Plourde may know more about that particular initiative than I do.

Mr. André Plourde (Associate Deputy Minister, Energy Policy Sector, Department of Natural Resources): Thank you, Madam Chair.

Right now there's not much progress happening on that proposal. It's considered to be much too costly to proceed. So right now, the producers themselves, as you know, are looking at building pipelines either by themselves or in partnership to take the gas through the lower 48 as a gas, not as a liquid.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Telegdi.

Hon. Andrew Telegdi: Thank you very much.

Thank you, Madam Chair.

Mr. Chatters, I think we're getting a little debate going on finding new sources. I'm sure it's going to go on during my lifetime and beyond.

The reality is when you look at a city like Toronto.... I think back to when we first got into energy conservation. You could very well make the claim that by doing insulation and using energy much more efficiently...and we still have a way to go on that. What we've done is we've virtually created oil wells by savings. If you look at the efficiency of cars, if you look at the efficiency of refrigerators, there have been tremendous improvements.

I don't see alternatives or efficiency as the only source, but it has to be a big chunk of the answer, because ultimately, we're dealing with a finite resource that becomes more and more expensive to develop. Energy prices of existing sources aren't going to go down, they are only going to go up. Once we get into the deeper waters, it becomes much more expensive.

Canadians as consumers are, in many ways, a big part of the answer to energy efficiency. So there are a whole bunch of strategies that converge in providing energy security, particularly when we have China, India, and Brazil, whose economies are growing by leaps and bounds. It's going to put great pressure on the existing and future supplies.

There's no one answer, but efficiency certainly is a big chunk of the answer, as well as alternative sources.

À (1040)

Mr. George Anderson: Well, to comment on your comment, we very much agree. The 1990s were a decade of relatively low prices for oil and gas. What happened around the world was that the progress on energy efficiency declined in that period. It was also a period when we saw deregulation in electricity. In some cases, the regulators hadn't figured out how to do demand-side management in that context.

We're seeing--and I'm very encouraged by this--a lot more interest now in our provinces in the issue of energy efficiency, particularly as it relates to electricity and gas. Just to give you an example, in the Power Smart program with BC Hydro, they're going to be investing $600 million, I think, over five years. They expect to get one-third of their new supply on the efficiency side as opposed to new-source supply.

Ontario has just announced a whole series of initiatives, including creating a new office of a chief conservation officer in this regard. Other provinces--Quebec, Manitoba, and Alberta--have their own programs. So we're very much looking forward to a much richer dialogue nationally and federally-provincially on how to come at some of these things. My personal view is that we can do a good deal more.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Chatters, then Mr. Jackson.

Mr. David Chatters: Thank you, Madam Chair.

In response to Mr. Laliberte's comments, in my 25 years in the oil industry, Saskatchewan made up probably the majority of the labour force in the oil industry. Saskatchewan certainly has not been left out of the development of Canada's oil resources.

Mr. George Anderson: I think Mr. Efford would want you to mention the Newfoundlanders, as well.

Mr. David Chatters: Yes. That's a more recent phenomenon, certainly in the oil sands.

Going back to my initial comments and my initial concerns about the format of the presentation of the estimates, it's very hard for me to understand from what we have before us where your money's going and what it's going for. I did ask for and you agreed to present a breakdown on a few of the things. But as I continue to look, I would ask for a much more comprehensive breakdown on your transfers and grants.

For example, I don't understand your contribution of $900,000 to the National Community Tree Foundation. These may be very worthwhile projects, but I don't know what they are or what the objective of those dollars was. There are two entries to the ocean drilling program, one much larger than the other one, and there's the Canada-China wood products initiative--all of these things.

I need a breakdown of where that money's going and what our objective is in participating in those programs. If it's possible to get that, I'd appreciate it.

Mr. George Anderson: Absolutely.

You'll understand that if the estimates are to be something anyone can carry, there's a limit to how much departments can put into them. If you want to give us a list of particular programs you'd like, we can give you a sort of one-pager on each of the programs.

Mr. David Chatters: Yes.

Mr. George Anderson: If you or any other members of the committee ever want to come by for a briefing, we'd be more than happy to help you in that regard.

Mr. David Chatters: Truly, the estimates are voluminous, but actually, the natural resources department is on only about six or seven pages. I don't think, when we bring your department before the committee and the minister comes before the committee, it would be impossible to produce a less voluminous document that would provide a breakdown of these things in your department.

Mr. George Anderson: Well, we'll have a discussion amongst ourselves. Some of what we might be doing...we are under Treasury Board guidelines as to what goes into the actual estimates, but maybe we could find ways.

There's a lot of information on our website. Perhaps we could have our website brought into a line. You could get some of this information through our website.

À (1045)

Mr. David Chatters: Sure. We'll look at that and explore that possibility. But as it's before us, it's really hard to understand.

Mr. George Anderson: Yes, I understand.

Mr. David Chatters: Okay, thank you.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Jackson.

Mr. Ovid Jackson (Bruce—Grey—Owen Sound, Lib.): Thank you, Madam Chair.

I'd like to make a comment and ask some questions. Would our guests agree that all energy comes from the sun?

We talk about replanting trees. The tree rots, it turns into peat, peat turns into coal, and the coal gasifies and probably becomes petroleum. Since energy comes from the sun, and we're disrupting a lot of the sources that normally would have gone through the natural process to produce gas and oil, in your travels, are you are finding any systems with a paradigm shift that could take energy directly from the sun and, in an integrated way, perhaps start feeding into smaller systems that would heat homes and feed back into the network? That's one question.

On my other question, since I don't have a lot of time, is Natural Resources responsible for the integrity of the country to make sure all the borders are secure? Do you help in that? Is there a part of the budget to look after that, to make sure we're keeping track and not losing any land to any foreign people who may invade our territory?

Mr. George Anderson: If I may, Madam Chair, I will respond very briefly to the second question and then ask Dr. Cook to pick up on the larger question.

We have a responsibility in relation to the International Boundary Commission for the surveys. In terms of security issues, we work with the new national security department on issues of energy security. Obviously, there has been a greatly enhanced focus on that in the last couple of years, and there's still further work to be done.

Dr. Bryan Cook, who's the head of our energy technology laboratories, could talk to you about possible transformational energies coming from the sun.

Mr. Bryan Cook (Director General, CANMET Energy Technology Centre, Energy Technology and Programs Sector, Department of Natural Resources): Thank you very much.

We are doing work in the whole field of photovoltaics. We actually have a leading company in this country that is developing photovoltaic cells. Downstream, I think nano technology will revolutionize the photovoltaic world.

We're also, in a sense, using the sun by focusing on biofuels, growing crops and converting crops into alternative liquid fuels or, in fact, directly combusting biomass.

We also have programs in the area of direct solar and seasonal storage in the form of geothermal energy. In fact, we're doing some demonstrations on that in Alberta at a place called Okotoks.

We are doing work in the area that you describe and it will continue.

The Vice-Chair (Ms. Nancy Karetak-Lindell): I'm going to take the liberty of taking this one slot for the government side.

We talked about geoscience needs in the country. We know, for natural resources in northern Canada, there has been a real jump in the permits. But one of the drawbacks is that there are large areas of the north that are still not mapped to assist private industry to help us capitalize on the natural resources.

On alternative energy, the majority of the communities are still fuelled by diesel fuel. It's for heating homes and for energy and power. We really need to look at alternative energy in the north. One of the suggestions was tidal energy, but I understand it's very expensive to set up. Could you provide more information on that?

Mr. George Anderson: I'll speak to your second question and then pass this over to Dr. Itzkovitch on your first question.

I mentioned earlier that we are doing some work within the department on the energy problems of off-grid communities. I would hope, in the not-too-distant future, we'll put something out on that in terms of a strategic approach.

The Vice-Chair (Ms. Nancy Karetak-Lindell): You talked about solar energy. We have some communities that have 24-hour sunlight over the summer. You'd think we could find a way to capitalize on that too.

À (1050)

Mr. George Anderson: Right. We did have some tidal energy projects in Canada in the 1980s. It's not an active area of research here. There's some new interest in the U.K. on tidal energy. It doesn't work awfully well in the winter in the north. I don't think it would be our focus.

Generally, we are concerned with the issue of off-grid communities because they have the highest energy costs of any Canadians. We're thinking of how we could help in that regard and also promote new technologies at the same time.

In terms of mapping in the north, it's worth mentioning that we have a tremendous diamond boom going on right across northern Canada, including the northern part of the Prairies. This year, for the first time, exploration for diamonds exceeds in value all the exploration in Canada for base metals. A lot of it is in Nunavut, the Northwest Territories, and right across the Precambrian Shield, but Dr. Itzkovitch can speak more to the issue.

There's enough mapping that people are out there digging holes and breaking off bits of rock, but Dr. Itzkovitch can speak more about some of the areas where we need to do more mapping and what we're doing about that.

Mr. Irwin Itzkovitch: Madam Chair, as I'm sure you're aware—because we've had this discussion on other occasions—we've heard the call for increased mapping by the government with respect to the north. As well, the government has heard the call, in terms of budget 2003, for refunding the polar continental shelf project and funding the targeted geoscience initiative. The budget documents instructed us to put much of that effort—$5 million a year for two years—in the north and to direct it towards oil and gas.

With regards to the north, Natural Resources Canada has reallocated a significant part of its budget, some $23 million from our geoscience budget, to the north from the south. In the last couple of years, we've also started to do not only geoscience mapping but also topographic mapping, because the existence of topographic mapping will allow companies to further develop the north. So we are proceeding to map Nunavut at a 1:50,000 scale. We will move from Nunavut into the Northwest Territories and then into the Yukon. We're moving our way from east to west.

So we've heard the call, and we're investing a substantial amount of our resources—through reallocation, as opposed to new money—to meet the needs of the north.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Laliberte.

Mr. Rick Laliberte: Thank you, Madam Chair.

I have a question on the nuclear waste. There was a discussion of consultation with first nations. My question would be, specifically with what first nations is this consultation taking place, in which province?

Also, in reference to producers, there are two types of producers of nuclear waste, in my mind, and those are energy—in which university-based research is a big part—and weapons. In my view, Canada has an opportunity, because there is a lack of an international law of peace.... Maybe the nuclear waste from weapons can be tied into an international law of peace. Because of our position in the world and our inactivity in creating weapons of mass destruction of nuclear origin, maybe we could be a broker of this kind of peace, as keepers of this waste.

The reason I bring this forward, as well, is that it has been brought to light that provinces, like Ontario, that are huge producers of nuclear energy also pay a nuclear waste fund, and they don't want to see this fund leave their province just because of economics. But maybe some scientists have shared in their disclosures that they'd like to see this waste go back to its source. When people say that...well, my backyard is a producer of the uranium right now. So if scientists have considered that waste should go back to its source, it will be coming back to northern Saskatchewan.

That's why I'm very concerned about this consultation. Is it taking place appropriately? Are we looking at only energy producers? How about weapons? Is there a discussion of American and Russian sources of dismantling these weapons? Where is that waste going?

Mr. George Anderson: I'm going to ask Mr. Pereira to respond to your question.

À (1055)

Mr. Ken Pereira (Vice-President, Operations Branch, Canadian Nuclear Safety Commission): Thank you.

I'll start with consultation in the areas where the mining industry is located. At present it's mainly northern Saskatchewan. There the mining companies have consultation mechanisms that involve not only themselves, but the provincial government and us, the regulator. Environmental quality committees meet at regular intervals in the areas where the mining is undertaken.

In terms of the waste program, what you're probably referring to is the consultation that will be done as part of the Nuclear Waste Management Organization's activities as they investigate options for disposal or long-term management of waste. They have a program to examine options and eventually to recommend to the Minister of Natural Resources an option for the long-term management of waste. As they examine those options, they are undertaking consultations right across Canada, including consultations with the aboriginal communities.

With regard to energy production, consultations take place where the energy is being generated. The nuclear power companies will consult with the communities in their areas, and in some cases native communities are involved. For instance, for the Bruce nuclear power plant, it's the Saugeen First Nation that's consulted regularly and that appears before our commission to testify and to raise its concerns about the generation of energy and the local storage of waste. Those consultations depend on what one is talking about and where the activities are being conducted.

With regard to the weapons programs and the waste from the weapons industry, none of the weapons waste is being brought to Canada at present. Small amounts were brought to Canada for some testing as an option for the disposal of weapons waste. But as you know, Canada does not own weapons and has never produced weapons, so there is no weapons waste in Canada of Canadian origin. The Russian and American programs are being conducted on their own territories at present.

Mr. George Anderson: The CANDU technology, I understand, can have some advantages for reprocessing weapons waste. There is some interest in this internationally, but not in bringing the waste to Canada.

Maybe you'd like to speak to that.

Mr. Ken Pereira: Because of the type of fuel we use and the type of fuelling operations that are undertaken on those reactors, they do lend themselves to incorporating weapons waste into the fuel and burning it such that it's no longer amenable to use in weapons. We had trials at the Chalk River laboratories to explore that as an option. So CANDU reactors in other countries or in Canada could be used to dispose of waste. But those are only trials, just experimental work. There is no commitment to bring weapons waste to Canada in large quantities at present.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

We have run out of time because another meeting is scheduled to take place in this room at 11 o'clock.

I have some announcements to make and information to pass on to you. As you notice, we did not vote on the votes we were going to do this morning. I understand that if we do not vote on estimates, the said estimates are deemed adopted and to be reported to the House of Commons on May 31, 2004.

Because the minister had to leave quite early this morning, we decided that we would ask him to come back at a later time, and he did offer to come back and answer more questions. So that will be worked out between the clerk and his staff.

Mr. David Chatters: But every attempt will be made to have the committee vote on those votes before they're reported back to the House, I would hope.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Yes, we will try. I mentioned that in case we don't get that opportunity.

The next meeting will take place this coming Thursday from 9 a.m. to 11 a.m. in room 269 of the West Block to discuss future business.

I thank the officials for staying and answering questions. We hope to work out another time for the minister to come back.

The meeting is adjourned.