Truly, we have some special guests today. We're joined today by two groups, four individuals whom I want to thank for being here. Everybody should have in front of them two decks of material, one on behalf of CSA and one on behalf of CAPP. If you don't, we can get you copies.
I want to take a quick moment to introduce the individuals and thank them for coming. Mr. Ferguson is the vice-president, policy and performance, from the Canadian Association of Petroleum Producers, which we know as CAPP. I'm sure Mr. Ferguson will go into more detail, but CAPP is a large industry organization that represents the upstream Canadian oil and natural gas industry. Their members produce 90% of Canada's natural gas and crude oil, with revenues of about $100 billion a year, if I have that correct.
After Mr. Ferguson, we will be pleased to hear from Kevin MacDougall, who is the director of energy and utilities; Mr. Michael Leering, who is the program manager, environment and climate change; and Jeffrey Walker, the program manager of natural resources, from the Canadian Standards Association. Gentlemen, thank you for coming.
The CSA group is traditionally known.... Certainly I associate you with things like hockey helmets and stoves, but we're going to learn today—most people should already know this—that the organization is much bigger and far reaching than that. Thank you very much for coming out today.
It's up to you who wants to go first, but I'm looking to my left, so maybe Mr. Ferguson would prefer to start.
First of all, thank you very much for the opportunity to be here today. I have gone through a lot of the previous materials and presentations that you've had here, so I'm hoping not to rehash some of the good information that I saw in some of the materials that you've seen already, but hopefully to add a little bit of value to that and maybe additional insights from the upstream producer's perspective.
I do want to highlight that although we focus on the upstream as the sector that we represent, it's not just large producers, it's also very small producers, down to some of our member companies that would be in the order of drilling two or three wells in a year. It's quite a diverse perspective on what the industry is, where it wants to go, and where it thinks it can go. It does provide a good integrated view.
I thought I would start with some really new information. I sent some information in some slides previously. I don't know if they translated that perfectly, but I thought I would start with a few opening remarks about some of the late-breaking news this week that would add some perspective on the current situation and highlight some of the direction that we think our sector could be and should be going into the future.
This first highlight of note that I wish to bring up is the recent media release late last week on the capital investment plans for our sector for the coming year 2016. We do this on a regular basis. It's not a forecast. It is a compilation of all our members, their capital programs and budgets, and how collectively that impacts activities.
In that context, over the last seven or eight years, every dollar of income that our member companies have made has been directly put back into the ground in activities in Canada. On top of that, we have had over the last several years, a pretty significant inflow of capital from foreign sources into Canada to support the activity levels up to date.
It is a pretty significant number. It's hard to put into context for average Canadians, but it is a sector that permeates a lot of our other industries, a lot of our alliances, associations, and supplier networks. It's a pretty far-reaching integrated network based on the capital investment that our sector brings into Canada and puts into Canada. Unfortunately, we had to announce this week that we've seen a 62% drop in capital investment in our sector from 2014 levels. To tell you what that number looks like, it is approximately $50 billion of investment that has been lost out of the Canadian economy since 2014, projected to 2016. That is a pretty significant drop.
Another way to translate that is in terms of actual well-drilling activity, which is a good indicator outside of the oil sands of the kinds of activities that drive local employment, local opportunities, and government revenues. We're projecting right now for 2016, a total number of 3,500 wells drilled primarily in western Canada. To give you a perspective, in 2014, that number was a little over 10,000. There has been a pretty significant impact, not just on sources of government revenues, sources of community employment, but also on the service sector that's related and relies on the investments that we bring in.
Although we've seen this week a slight recovery in the price of oil, it's important to note that we haven't seen the lasting effects of some of the decline that we have seen in terms of impacts on the service sector. Our industry relies heavily on that service sector. By service sector, I mean broadly. It's not just the companies that contract drilling for us but it's individual companies, one-truck type of operations hauling water for a facility.
It could be completion crews, but also if you go more broadly into the supply network, there are—for example in Prince Edward Island—three companies that supply goods and services to the oil sands, and they are impacted today by that decline and that impact. Once we lose the service sector and we start seeing drilling crews go south to the U.S., it becomes very difficult to bring them back. We are at the point now where I think our anxiety level for the sector has translated into a concern for the integrity of that value chain in the service sector and what we can do today to support that the best we can, so when there is a recovery we are able to get Canadians back to work.
The other thing I would point out is that this week we have our annual joint CAPP and Scotiabank investment symposium for our sector. It's held in Toronto every year. It's very well attended. Among the highlights you will see from that is, if I can quote the headline from one of the more notable things coming out of that symposium, that “The era of megaprojects in Canada’s oil sands is probably over ”. What that means—and we've seen this for a while—is that the value opportunity for us for our sector, and for our resources in Canada, is going to shift and we're going to be looking at more of the unconventional resource-play type of opportunities. The investors are looking for more confidence and shorter return periods. They don't want to wait 15 years to see what kind of return they're going to get from their investment. We've seen this phenomenon in the U.S. as well, in terms of the shift to investment into resource plays where you can shut and turn off a well program a lot quicker than a $2-billion oil sands project.
Now the converse of that is also true. We haven't seen a decline in oil production at the same time as the decline in oil price simply because it's also hard to turn off those megaprojects. You know the capital has been invested, and it's two-thirds or three-quarters of its way through, so that project will continue. We are still going to see growth in oil production in Canada for some time; however, new megaprojects are probably going to be a lot more challenged going forward than they have been in the past.
Another point I would highlight is that tomorrow the Alberta government announces its budget. I'm aware we're going into the lock-up in Edmonton tomorrow. We are expecting to see some manifestation of the recent climate policy statements and commitments made in Alberta. Certainly it's not the only province that has made significant commitments to the climate agenda, but we think Alberta should be particularly proud about the leadership position it has stated. We're hoping to see some evidence around the carbon levy piece that it has announced, the oil sands emissions limit, and the performance standards, as well as the methane reduction commitments that we have made as a province, and provinces, as well as federally.
Certainly in my last points before I turn it over to my colleagues, I think one thing I do want to mention, certainly, is the recent activity around the federal government leadership on market access and pipelines for our sector. We have seen some growing and certainly this week some more activity in that area, more intent stated in that area, which I would say from our sector's perspective we welcome dearly. It is really the underpinning piece for our aspirations on the climate policy; for indigenous peoples and their role in going forward, which is a key trigger in the market access issues from our perspective; for the regulatory confidence that we're hoping to see continue to emerge and grow in this country; and of course for the political commitment to get Canada's natural resources to the right markets, at the right time, all the time.
I'll stop there, and there are plenty of answers that I hopefully can provide to questions that come up from any of the detailed materials we've provided, as well as previous presentations.
Thank you, Mr. Chair and committee members, for inviting CSA here. As indicated, I'm a director with CSA and I have two of my colleagues here with me today.
We sent 70 slides in with the submission so we're not going to do that to you this afternoon. This is about discussion, and I'm not trying to put you to sleep with a PowerPoint presentation, but there are some key slides, and I'll go through them relatively quickly. Then I want to turn it over to Jeff and to Mike. They have some key messages they want to deliver as well.
The key points I want to focus on here in the information that was sent is what CSA is and how CSA standards support society and industry for the better good. Of course, if there are questions afterwards, we can respond.
We heard the hockey helmet and the refrigerator reference. We do much more than that when it comes to supporting industry and other initiatives. As I said, the information was sent through, and I'll focus on what CSA is and the standards development.
Here are some key facts about CSA. CSA was established in 1919, so we're coming up on our 100th birthday here. We're going to have a big cake and a celebration. The other key thing is that we have a presence in 14 countries. Saturday I returned from Taiwan. We had met with the Taiwanese government and industry officials, and they are adopting our standards for pipeline operations, so it's huge with regard to the recognition that we're seeing around the world and the adoption of the standards that have been developed by CSA.
Moving on to CSA standards, basically, we're a not-for-profit organization. We serve business, industry, government, and the consumer society. Our whole goal here and our vision is to make the world a better, safer, more sustainable place to be. We build our standards to that end to enhance public safety and health, quality of life, and to facilitate trade.
If I was to pick out one part of that to add on to Mr. Ferguson's information that he shared, it's that recently, and because we are not-for-profit, we have seen a vast decline in many areas of our operations in CSA. We produce training manuals and training classes on the standards. That has declined. The purchase of the publications have declined. Participation in our technical steering committees that come from industry, which I'll speak to in a minute, has declined, as has funding, which historically comes from industry and government sectors.
We're seeing a risk here to what CSA does. If the government wants to do right by Canada and it wants to fund the development of standards and programs to support industry, that's a key place that they could focus on. One of the organizations that is funded by the federal government is the NEB, the National Energy Board, which is key to many of the standards that CSA produces for the oil and gas industry.
Moving on, the slides show the breadth of where we operate and where we produce standards across the various programs: the electrical, the energy, the environment, and technical safety. It's not just focused strictly on the energy industry.
As for the standards development process, basically, CSA is a facilitator of an accredited process. We bring the experts to the table to develop the standards to put controls in place and run the industry safely and sufficiently. Those committees are composed of volunteers. They all volunteer their time and efforts and, of course, are funded by the companies they work for or by the programs that are funded by the government.
Slide nine shows a brief overview of the workload for standards development. The key thing to notice here is that there are three points in the process where standards in development are put out for public review. We have an opportunity for the public or for interested parties to actually submit a request for information or to provide any additions they want for the standards.
I want to touch on the part of the process that affects the energy industry in oil and gas. We also have a nuclear program, but I won't get into that today. I'll talk about the oil and gas program. It has been in existence for about 45 years. There are actually 20 committees that support the standards development process in the oil and gas industry, and about 400 members in 11 different areas are covered in the work that those committees do. That's found on slide 12, and those are all the green balloons, if you see them there.
On our goal in CSA moving forward, we opened an office in Calgary in 2014, and our goal there is to advance the development of standards in additional areas of the oil and gas industry. Currently, we deal with LPG—liquid petroleum gas—storage and handling and pipelines. We also want to get into the upstream industry on the refining side, into the gas processing side, and into the oil and well drilling and servicing piece as well. That's an area where we want to work with industry and the regulators to move forward and have more standards in place to support that side of the industry, sustain it going forward, and make it successful in Canada.
We see the technical committee and the formation of that now, so I'm not going to spend a lot of time on that. But on slide 14 you'll see that the two main standards in the oil and gas industry are supported by about 11 other standards. As we develop a standard, we start to develop more standards to support those various aspects of the industry to make sure the industry is safe and that we have regulatory and public confidence as we go forward.
We have a couple of slides there on security management and emergency management. Those are global. They aren't adopted just by the oil and gas industry. Many of our municipalities and cities have adopted these same standards for their emergency management processes and security processes.
Next, there are examples of some standards that are in development. The one on “fugitive emissions and venting” is a work in progress right now, as is the one on “well design”.
Moving into the piece away from standards development, CSA supports our standards with web applications and access. We have over 100 learning products that support the standards and about 10,000 customers who access our information annually.
On stakeholder engagement, we have about 9,000 members currently, and well over 40,000 people have actually come to our website in what we call our “community of interest”, which provides information to the public about what's going on within CSA, the various programs, and the status of those.
At that point, I'm going to stop. There is a ton of information that was sent to you. If you have any questions on it, of course we're prepared to answer.
I want to turn to Jeff first and let him give you a quick briefing on what he has going on.
In the near future I think we'll get to slides that are related to the natural resources program. In my group we're looking more on the unconventional oil and gas side. We also look at mining, which also relates to the oil sands, forestry, carbon capture and storage, and water resources.
I want to take a moment to talk about one of the standards we're working on. It's related to international standards. It's about innovation and how standards support innovation. It's on autonomous mining.
Autonomous mining is a new and emerging field. It's exciting. It's related to the application of information technology, advanced robotics, vehicles and equipment in the mining process. In relation to oil and gas we're talking about the oil sands mining side. It's a brand new initiative. In theory it's expected to have a significant impact on the oil sands because all this rapidly developing automation technology can improve the performance, the economics, and the safety of the operations.
With the standards, we're trying to help commercialize the field by providing for interoperability, common reference points, common interfaces, and fewer non-value-added differences that crop up whenever a new field is developing. All these different producers will develop their own things and they don't work together, so it can introduce inefficiencies and confusion.
We're trying to show that standards aren't just about mature areas. They're also about commercializing and mainstreaming new innovations. Often standards provide some of the building blocks that you need to commercialize and mainstream the new innovations.
When you see the slides in future you'll see a few more examples in carbon capture and storage, and offshore oil and gas, and northern, which is really the Arctic and offshore Newfoundland types of applications for oil and gas. Innovations are being made there, particularly where Canada is a leader, not only in international standards but also in these applications. It's a way of helping to give them a wider, more global market.
That's all I had to say. I'll hand it off to Mike now.
Thank you. I just have about one more minute of context to add as the program manager for the environment and climate change group with CSA.
The information I want to bring forward today is that aside from standards development, we also have a large portfolio of programs and services that we offer that are supplemental to certification and testing.
I'd like to focus on climate change implementation and emissions within the province, present day and into the future. I think by and large the biggest program we do offer and manage is that, since 2007, we have operated the entire offset system within the province of Alberta. Under the specified gas emitters regulation, there are means by which the large emitters in Alberta can track and reduce their emissions under that regulation. CSA has been operating the entire offset registry system since 2007.
Obviously the federal government is now very actively engaged in the climate portfolio. As we move into the era of new regulations within Quebec, British Columbia, and Manitoba, I just want to bring to the table that CSA has a lot of experience and services that we've been working with the provinces on for about 10 years now.
You will be receiving further slides from the CSA group, I believe on Friday. In those slides, I have provided for you a pictorial representation of the Alberta offset system and what it looks like.
My key takeaway that I would like you to have is that public transparency, from a climate change reporting perspective, is of utmost importance. People in the public need to trust that offsets and the use of carbon market mechanisms are robust and secure.
Our registry and work with the Province of Alberta really speaks to that, in that all project documentation on any greenhouse gas initiatives are publicly available. If you're looking for the emissions savings or emission reductions and offset usage of any specific company, you can use our registry, and the public portals that are live and active today, to gain insights as to who's creating offsets, how they are creating them, who's verifying them, and what the verification reports say.
Public transparency is of utmost importance for us. I just wanted to bring that context to you today, aside from the standard development work that we do. We have a lot of robust programs that are very mature with all the provinces, and we're obviously very interested in supporting linkages, new regulations in Ontario, Quebec, B.C., Manitoba, and others.
I just wanted to provide that. There will be some supplemental information on Friday that you will be receiving from us. I appreciate the opportunity to provide that context for you today.
Thank you very much for the question.
The value-added piece for our product is pretty important for us. We don't represent the refineries and the upgraders necessarily. They are not really an upstream activity. However, we fully support any value-added employment opportunity in Canada.
It's a fact, for example, that all bitumen produced in Canada is upgraded somewhere, so the question for us collectively is where we would want that to occur. We would be happy, as the upstream producers, to see that happen here in Canada for the benefit of Canadians. I think of some of the activities we saw recently in Alberta, for example, where the government a little while ago announced a subsidy-type program or incentive program to promote more upgrading of that bitumen product in Alberta.
Also, when we've had conversations...for me personally, recently in Ontario, for example, around an oil product, an oil pipeline moving through a jurisdiction. If you look at it from a long-term perspective, that does create and should create opportunities for the petrochemical sector. Certainly, if you just take the refineries in eastern Canada, I think there's a pretty significant volume of oil that's brought in from outside of Canada from jurisdictions that, I'll be honest, have pretty significantly lower environmental and social standards than we have in Canada and that guide our activities here. We think there's an opportunity to replace this with a Canadian product.
That's just on the refineries in eastern Canada, but a longer-term vision might be to look at more oil flowing in and through a jurisdiction for the long term, with some stable supply pricing, which should trigger some thinking around what that might do to growth for a petrochemical sector. Sarnia row occurred for a specific reason. The oil was there. It didn't come after the petrochemical sector was there.
I think there's a lot of opportunity to do longer-range thinking on that and figure out if there's an optimal pathway to create the investment environment that would promote more value-added production on some of our core natural resources, oil and natural gas.
Thank you very much for a great comment and a great question.
For a long time—forever—our economy has been reliant on our natural resources. That is the strength we have in this country. You are right—it's not just oil or natural gas, but lumber, mining, etc. It's a foundation, and it always will be. If we honestly believe that, then I think the role of the federal government might be to focus on.... We have done a lot of work on the Canada energy strategy. I have been to several of those meetings, which are great, but what is our natural gas market access strategy? We have advocated for a very specific, focused effort on how to maximize the value of our natural resources. Having a focused strategy, having a federal government that will work with our provinces and, certainly, with our sectors, is an important part of that.
There are things we see that we can do, as an industry, as part of that. We can certainly facilitate and collaborate on the services with the value chain that we have. For example, I was just told today that building a couple of LNG plants in Canada would, just from that activity, require approximately half the production of the steel plant in Sault Ste. Marie. That's a pretty significant opportunity for the Canadian steel industry as a result of looking at market access for a natural gas product.
I think those kinds of alliances, as we build those out and come forward to our governments to explain the integrated nature of the value opportunity, are something we can do. I do believe we have a strong role to play in supporting governments, federal and provincial, and addressing the indigenous peoples' opportunities that we have in this country. We have a long history of doing that in our sector. I know other sectors have as well. We believe that's a fundamental aspect of the issues that are stopping us from getting on with the market access opportunities that we have for our natural resources, and we are committed to be quite supportive of governments as we seek to address those.
Those are two that I think we can fundamentally help change the dial on moving forward, and there are probably many others.
Thank you very much, Mr. Chair.
I want to thank all of you for coming. You are giving us some phenomenal information, and I appreciate your taking the time to be here.
Alex, good to see you here as well. You talked about your report that came out last week regarding the decrease in investment in Alberta's oil sands. We are talking $60 billion over the last two years, a 62% decrease from 2014. Just to put that in perspective, that would be like losing half of our automotive industry. I don't think people understand that. If this were happening in southern Ontario, we might have a much different reaction Canada-wide.
We have seen oil go up past $40 here in the last couple of weeks, but that hasn't stemmed the loss of investment. Our job here in this study is to.... What can we do as parliamentarians to try to stem that tide? What would be your advice, as CAPP, for us? What can you see us do, and ask the minister to do, to start to rebuild that confidence and have these producers start investing in Alberta again?
I think the first thing we talk about at our boardroom table with all the companies is that there is no one simple answer to this. There are probably hundreds and hundreds of things we collectively need to do, and I can give you some examples.
We're pleased to see some of the instruments in the federal budget that came out, and we're quite supportive of many of the elements in there. One of the things, a granular example I can give you, is that we've looked at this industry. I come from the forest sector, so I know the forestry world quite well. This industry has a fiscal treatment of the capital it expends that is different from many other sectors, certainly different than forestry.
You saw the shift I just suggested that some of our members are seeing around the shift from big projects to these resource-play unconventional opportunities they are supporting in terms of the standards, development, and processes. Yet our understanding...our tax rules, for example, on the way we treat capital expenses in this industry were developed long before the existing technologies led to the growth and the opportunities in the unconventional resource sector.
We have suggested to the that we're not supposing we have the magic answer, but we believe—given the fundamental, dramatic changes in the technology that have unlocked this resource opportunity—that we should probably modernize and give a view to our tax treatment rules around that as a result of those changes. That's a granular thing, but if thought through carefully would have amazing impacts on the amount of investment that goes into the ground to employ people in Canada.
That's one and that's a very small, very granular, but a very profound way of looking at the changing world we're in, and there are many others.
COSIA is a globally unique and globally significant example of collaboration on the technology innovation space. You have to pause for a minute and realize that nowhere on this planet do we have that kind of breadth and depth of collaboration around managing and reducing our footprint on the planet, from this sector or any sector.
But I do want to point out that outside of the oil sands there is a lot of work that has been going on. There's collaboration with universities. Of course, it's not brought together the same way COSIA is. It's unique because it's an oil sands-focused area. I think there's a lot of work that our non-oil sands members are doing with SDTC federally around building some road maps for technology and innovation on oil sands, specifically around methane emissions, as we heard here as well.
I think that technology innovation story is quite broad. You're right, I don't think we have messaged it as well as we could in our marketplace, and there is a distinction between market access and market acceptance.
I think it's more important to build confidence in Canada because, as we see around the world, people will buy oil from just about anybody, regardless of the standards. But as the world changes and advances, one of the things that we have promoted with the provinces that we work with, for example, is the notion that if we are doing such an excellent job decoupling our economic growth from this sector or any sector and the impact, whether it's GHG emissions or other, the parallel growth that you usually get, why wouldn't we be the global jurisdiction of choice for investment for carbon?
People should want to come and invest in carbon development here because we regulate it, manage it, and do it better than any other jurisdiction in the world. It's quite a visionary thing and a little pie in the sky, but it certainly is an opportunity. I don't know if COSIA, when they were here, talked to you about the Xprize. If you're not aware of it, the Xprize—it has been named different things over its time—Lindbergh's flight across the ocean was one of the original Xprizes.
Funding that groundbreaking moon shot, if you're talking in the U.S. context.... Our members through COSIA have developed the largest ever Xprize and the uptake is phenomenal from innovation teams from around the planet. I think several hundred applications have come in, and the prize question is carbon-related. If we're producing carbon, can we not create some value out of this carbon that we're producing? What's the value piece? If we extract carbon from our flows of energy production, what can we get for that? It's a $20-million prize that will create some innovation spark that will lead to the aha moment for our sector.
We're looking forward to that.
Thank you all for being here. I appreciate very much your affirming the world-class and socially and environmentally responsible history of oil and gas development in Canada. Of course this is timely, given the downturn in the industry.
You can imagine, I represent a riding that stretches from Bruderheim to Lloydminster. It includes places like Bonnyville, Elk Point, St. Paul, and Vermilion, and I have a little background in the Alberta government, working on oil sands and heavy-oil related issues. I am thankful for your being here and explaining all the reasons and all the ways in which we should be very proud of our history and ongoing development of our natural resources, which set us apart globally.
I might have a bit of a wonky question, but I am interested in your getting into specifics if you can on any measures or actions the federal government could take to assist in the recovery of the industry and then in its long-term viability and prosperity. To emphasize the context of the downturn, I just saw numbers that said two years ago the active rig count in Canada was 212, I think, and now it's 41. I'm mindful too of the way in which the federal accelerated capital cost allowances for oil sands projects in combination with the 1997 generic oil sands royalty regime in Alberta unlocked the development of in situ projects in oil sands, which will be the future of development there.
You're speaking a little about tax changes, and I wonder, Alex, if you could get into some more specifics on what could be done to help support this industry that does so much for all of Canada.
Sure. We did provide a pre-budget submission to Finance that had some more ideas and we looked at innovations in that space. I can make it available.
Broadly speaking, I mentioned the one around the capital cost treatment for the sector, which we believe will free up some capital, and given that we spend it back into the ground pretty quickly, that will create some opportunities immediately.
What government can do I think in the short term is to provide some support to the service sector. I would encourage you to talk to some of the representatives from the service sector specifically. One of the things we have talked about with them recently and have talked to the Alberta government about is finding a way to help the service sector look at treatment in the orphan well program that you're probably familiar with. These are not assets that are owned by our current producing members. We're not asking for anything other than if government wants to discharge some of those problems they have in what's called the orphan program, that would immediately keep a pretty significant number of people employed in the service sector.
Clearly as an employment opportunity, we've been very careful to suggest that we don't need any of that support for our current assets that we have under care and custody and are responsible for. But the orphan program looks like a pretty good opportunity. It would be easy for governments to work with the service sector and get some people back to work immediately. That would be another specific example.
Broadly speaking in some of our dialogue and language, we look at how we find underutilized pools of capital and get them to work. One of the things you'll see in our submission was around a request to maybe relook, review, and perhaps change—although that's not ours to change—some of the large corporation tax rules in CRA. It's not a today issue because given the environment today, not a lot of corporations are paying a lot of tax because of that, but it is a mechanism that seems, when we get into recovery mode, to have been tying up a lot of capital or underutilizing some capital instead of getting it to work, so we've asked for some review of that as well. Those are a couple of more specifics.
I'm thinking off the top of my head if I can think of a few others.
Thank you to both organizations for making your presentations today. The CAPP presentation I'm somewhat familiar with. I've met with representatives over the years.
To the CSA group, thank you for coming. Some of this is new to me.
I'm from the Northwest Territories and I've been watching as the economy has not been doing very well in the last while, and it's amazing what effect the price of oil and gas has on other sectors. The mining industry has seen the prices drop on their products there, and we're seeing other areas that have challenges.
I watch with interest as the rest of Canada talks about, if they had a pipeline, or if they had this piece of infrastructure, it would help them get the economy going. In the Northwest Territories we have a different challenge, and as I talk to the diamond mines they tell me that because there are lower prices, they need to produce more but they also need a better quality of diamond. The tourism industry is saying that, if they had a road, it would lower their costs and they would attract more tourists. That's what the mining industry is saying also.
We've just gone through a permitting process for a pipeline in the Northwest Territories, which took several years and a lot of money, only to see it sitting for I'm not sure how long, but that pipeline will probably never be built unless we see a road.
I'm really curious if you could talk, Mr. Ferguson, on how this government could invest in transportation infrastructure and how it could help all the sectors, but more specifically the oil and gas, because even if we do have a big find in the north, we can't get it out.
For a while at CAPP I looked after our members who were focused on the north, in the territories in particular, and what an amazing opportunity that is for Canada. Bluntly, it's something that's waiting to enrich all Canadians.
But it's a frontier jurisdiction in terms of the exploration and the infrastructure that's required to really ramp up some of the unconventional resource play model that you have up there. Yes, you're right, in that it's about roads, but it's not just about the hard infrastructure. You're going to need a lot more workers there, so you need schools because they have kids. It's a growth opportunity. There's a need for infrastructure and not just for a road or a pipeline.
We need that, absolutely, but unfortunately, just when things were getting a little more interesting in some of the exploration from some of the companies up there on the oil and gas side—the tight oil stuff was a great opportunity—the oil price dropped. It was bad timing. I think there's a low because that exploration piece is no different. Whether it's mining, oil, or gas, it's really the high-risk frontier piece. Once you can prove up or de-risk the resource, then you'll start seeing more investment and you'll see that kind of leapfrog effect on investment.
How government can participate in that is to continue to look at, as you have in the Northwest Territories, some of the regulatory processes and the transition between the federal and the province and how that's going. We are paying attention to a lot of those legislative instruments that are going on there. I think the industry would be reacting positively. There's simply something that's not in the government's control and not in our control right now, which is the commodity price.
I think we'd both agree to it.
Of interest is that both of your presentations included consultation with aboriginal people.
I find it very interesting, especially with the CSA group. I wasn't aware that it was something you did as part of your responsibilities.
In the Northwest Territories, you mentioned, Mr. Ferguson, the regulatory process and how it's a co-management style, where we have aboriginal people who are part of the process. I think that is the solution. That is the answer for the long term as we go forward, that we involve people, that we involve the aboriginal people, and that we don't just talk to them. We don't come in and tell them what we're going to do, but we ask how they're going to be involved.
I've been shaking my head for the longest time about why we don't have aboriginal people sitting on the National Energy Board or those types of agencies that make decisions. How many people involved in setting the CSA standards are aboriginal and know about aboriginal people?
Maybe you could explain a bit about what both your organizations do in the area of working with aboriginal people and in doing more than just coming to a committee and saying, “This is what we're going to do.”
We had lots of discussion around this topic when we were here a month or so ago, and all of our CSA senior staff spent a day or two on the Hill and had meetings with various members of the government specifically about what CSA could do to support these initiatives.
To your point, I sat in on discussions about water management, purifying water, waste water, waste management, and engaging these people. It was not just throwing a solution on the table and then driving back to Toronto, but staying with them and actually teaching them and showing them how to manage these aspects of life. One topic that came up was with regard to home inspections, and how home inspectors would go in and do a home inspection and come back and provide a report to somebody. You haven't done any good because you haven't sat down with the people and explained why things need to be the way they are, and why the electrical systems and the sewage systems and the water systems need to be maintained. It's a process of education and inclusion.
For us to be able to bring in indigenous people and people from the Northwest Territories and include them in the committees and make them part of the solution is hard because we're a nonprofit and we need funds. If we want to all try to get these people to participate, we're going to actually have to bring them down here. You're going to have to pay their expenses, and allow them to come down and participate in these meetings. The meetings do not happen in the far north; most of them happen in central or regional areas. Unfortunately, that's just the way it is. I think if we work on inclusion, make it workable so they can come and participate.... I asked the same question in Alberta. I'm from Calgary and worked in the energy industry for many years, and I said the same thing. Why don't we have more first nations, indigenous people on committees, either with industry or with CAPP, or with CSA? They just don't have the money. They don't make a lot of money and they can't afford to travel.
The other piece of it is providing information in their native tongue. You can't produce something that they don't understand or can't read. You have to work with them and provide that information so that they're capable of actually absorbing the information and providing a response and feeling like they're listened to.
Well, I'm very concerned as well, because I think one of the common themes I've heard here today is that it's not just our prosperity as a country. I've heard $1,600 per Canadian, per capita, is what we've lost in the last year because of oil price drops.
I don't like the figure per se for a number of different reasons, but I think it accurately points out that, as a country, we know we are in a much different state. One of the concerns I have is that oftentimes the prosperity that these projects, these investments, lead to is, on the flip side, what allows the funding for the Canadian Standards Association.
I've spoken about your organization a few times in the House of Commons in regard to the incorporation by reference. The work you do is internationally respected, and we don't talk about what you do enough, particularly on innovation, because innovation not only makes the industry more safe for workers and for communities but also causes the efficiency gains and productivity gains that are so important to creating real wealth on an ongoing basis.
When I hear that the Canadian Standards Association is seeing a drop in participation, that concerns me. When you're seeing a drop in funding, that very much concerns me. What solutions do you have? Obviously you must reach out to stakeholders. How do you deal with these kinds of drops, because again, if we don't have the investment that funds the kind of research that we see, in terms of commercialization and standardization.... How do you deal with that?