Mr. Chair, I'd like to raise a point of order regarding the scheduling for this committee. I will say at the outset that I'm very disappointed by what we're seeing. This is an important issue, and I hope we can proceed in a collaborative way.
The committee held a meeting on July 15 and agreed to summer hearings. The committee wished to hear from ministers before July 22. That didn't happen. The committee met once on August 4. It has now been over a month since the committee last met.
In the context of this meeting, we received a notice for a three-hour meeting to hear from witnesses, according to a schedule. Members made plans, prepared questions and provided your office with rounds of questions to be asked, and you, by all indication, unilaterally changed that agenda and shortened the meeting with less than an hour to go prior to the beginning of the meeting. If you proceed with this plan, it will significantly limit our ability to engage with important experts in accordance with the notice that was provided to the committee.
We also requested that there be some time for committee business, so that we could discuss the committee's agenda. You have shortened the committee's agenda, but you have provided no additional opportunity for committee business to talk about the forthcoming agenda and to try to reach some kind of consensus. Of course, in cases on which consensus had been reached in the past, such as having summer hearings, that consensus wasn't honoured by your office.
It's very frustrating and disappointing to see a chair operating in the manner that you have with respect to the schedule, Mr. Chair. I am disappointed and frustrated. This is not what the committee saw in the past from Mr. Spengemann or Mr. Levitt, other chairs who were able to set aside their partisan affiliation and deal respectfully with all members regarding the agenda.
Can you provide an explanation for your conduct, Mr. Chair? Why have you not allowed the committee to meet for over a month? Why did you suddenly shorten this meeting with less than an hour's notice to members? Why are you behaving in such a fashion? Do you think this is an appropriate or respectful way for a chair to operate?
If you would consider appeals from the committee to go back to the agenda that was originally proposed, which was a three-hour meeting, we could hear for three hours from witnesses. Perhaps we could also set aside some time for committee business in the near future, so that we can agree on an agenda and move forward.
Mr. Genuis, thank you for your comments.
First of all, you have raised a number of different issues. I can assure you that in consultation with the clerk and other members, we have tried our utmost to ensure that these committee hearings proceed.
The reason it was delayed initially was that, as you will recall, members indicated that they wanted to hear from nine witnesses over the course of three hours. Unfortunately, despite the efforts of the clerk and other members, only three people made themselves available several weeks ago, so it was decided that it was best not to proceed at that time and to redouble our efforts to have the opportunity to hear from as many witnesses as possible. That was one reason.
Another reason is that Parliament had a network maintenance week—as you're fully aware, Mr. Genuis—which meant that no committee had access to virtual meetings. Despite that, as soon as it was over, we again endeavoured to invite as many witnesses as the committee members wanted to hear from, but again, as you know full well, unfortunately, quite a few of those witnesses indicated that they were not available.
Several hours ago, on advice of the clerk, who had spoken to various members, it was agreed, given that there were only four witnesses appearing before us today, that we have two panels. That is generally in the regular course of business, but if you'd like, after this meeting is over, I'd be more than happy to contact you and provide you with any information that may be of interest to you.
Thank you, Mr. Chair. I will try to be brief.
While I consider Mr. Genius's concerns to be entirely legitimate, it would be inappropriate to assume bad faith on anyone's part in this matter from the outset.
Let me explain. The last meeting was indeed cancelled because, given the very short notice, unfortunately only three witnesses had been confirmed. Since we wanted to have three hours of debate with nine witnesses, more notice should have been given. Despite the advance notice, clearly it wasn't possible for us to welcome more than four witnesses today. It seemed to me that it would be altogether inappropriate to spend three hours asking questions to four witnesses when we had planned to spend three hours on nine witnesses. The chair respected the wishes of committee members to hear from the Ukrainian Canadian Congress again, spending one hour on that alone, then to hear from a second group of three witnesses.
Now, that leaves us with the matter of the third hour. Would it have been appropriate to use the hour to discuss the committee's future business, as the committee members have said? That's a legitimate question. However, perhaps it would also be worthwhile to let the dust settle once we've heard from the witnesses, so that we can make more timely interventions as to how we will proceed.
Therefore, if we must have a meeting about the committee's future business, I'd like to see it happen as soon as possible. I'm not sure we have enough time to do it in the third hour today, since we will still need to digest the information the witnesses have provided. However, while Mr. Genuis's questions are entirely legitimate, I feel that, under the circumstances, the clerk and the chair acted in the best possible manner and with the best intentions. I therefore support the chair's decision to cut today's proceedings short in order to consolidate our panels and make the discussion even more illuminating. By the way, this was not a unilateral decision. Other members, including myself, were consulted.
That's what I wanted to add, Mr. Chair.
Mr. Genuis, you're engaging in debate. I would ask that you extend some courtesy to the witnesses who are making themselves available today. We can discuss this later, and I can assure you that everything has been in order. The clerk has—
Mr. Garnett Genuis: No, it hasn't.
The Chair: Mr. Genuis, this is debate at this point.
Mr. Garnett Genuis: I'm happy to proceed, Mr. Chair. This is not helpful to you, but I look forward to hearing from the witnesses.
The Chair: Thank you.
If we may now resume the meeting, I'd like to welcome all the members to meeting number 25 of the Standing Committee on Foreign Affairs and International Development.
Pursuant to the motion adopted on July 15, 2022, the committee is meeting on its study of the export of Russian Gazprom turbines.
As always, interpretation is available by clicking on the globe icon at the bottom of your screen.
I would like to take this opportunity to remind all participants that taking screenshots or photos of your screen is not permitted.
I would ask that before speaking you wait until I recognize you by name. When speaking, please speak slowly and clearly. When you are not speaking, your mike should be on mute. I remind everyone that all comments by members and witnesses should be addressed through the chair.
Before I welcome our witnesses, I'd also like to welcome a new clerk who has been assigned to our committee. We are very fortunate to have with us today a new clerk who has indicated that she will be here as soon as Parliament resumes. She has made quite a few efforts to make today's committee hearing possible.
Thank you for that.
I'd like to welcome our first panel for the day.
We will be hearing from two witnesses who are from the Ukrainian Canadian Congress. We are truly privileged to have with us today Mr. Ihor Michalchyshyn, executive director and chief executive officer of the Ukrainian Canadian Congress. Also, we have Mr. Orest Zakydalsky, senior policy adviser with the Ukrainian Canadian Congress.
I would like to remind the witnesses that you each have five minutes for your opening remarks, after which the members will have the opportunity for the remainder of the hour to ask you questions.
I will be providing opening remarks and then we'll be happy to move to questions. On behalf of the Ukrainian Canadian Congress, it's a pleasure to be here and to have had the invitation to appear before you today. Alexandra Chyczij, our president, spoke with you several weeks ago. We're here to continue to share the views of the Congress.
I hope that members of the committee had a good summer. We've been in touch with many of you and appreciate the work you've been doing over the summer.
Since it's September 7, I want to wish you a happy Ukrainian Canadian Heritage Day. Ukrainian Canadians have been here in Canada for 130 years. It's a day that's recognized in several provinces, and we're working to recognize it nationally. I wanted to note that for the record.
On today's topic, on June 15, the UCC wrote to , expressing our concern that the Canadian government was considering waiving the sanctions. On July 6, we wrote to . We said about this turbine matter that it would be “a test of the resolve of the Government of Canada to maintain sanctions and to continue to isolate Russia.” Our feeling was that any waiver of Canadian sanctions would be viewed as “a capitulation to Russian blackmail [demands] and energy terrorism,” serving to “embolden the Russian terrorist state, with far-reaching and negative consequences not only for Ukraine or the European Union, but for Canadian security as well.”
Unfortunately, the Canadian government neither heard nor heeded our concerns, which were shared by the Ukrainian government, and the waiver was granted.
We see that the Russian government has predictably been very emboldened in demanding further concessions. Despite Canada’s and Germany’s capitulation to the Russian demands, Russia has, in fact, shut off the Nord Stream 1 pipeline entirely. No gas is currently flowing. There's a continuing escalation of stories about the reasons the Russian gas supply isn't working this particular week, or that particular week.
Kremlin spokesperson Peskov said on September 5 that Russian gas supplies will not resume until western sanctions are lifted, using the false pretext that sanctions are preventing the servicing of Russian pipelines. This, of course, is not factual, but that is not the point. The Kremlin lies brazenly and as a matter of regular policy. What matters, as we've said many times, is that the turbine issue here has never been about the turbines. It was about the sanctions.
Now, Canada and Germany continue to have a choice: whether to continue to play this game with Russian blackmail demands or simply to cancel the sanctions exemption and show Russia that we will not be intimidated in the face of its threats.
We understand that the Russian regime responds to strength. The UCC believes it's past time for Canada and their allies to show this strength in the face of increasing Russian aggression and pressure.
We call on the committee to do the following. First, urge the Government of Canada to revoke the permits issued on July 9, 2022, by the , which allow for the repair and transport of six Siemens Nord Stream 1 turbines over a period of two years to the Russian state gas monopoly, Gazprom.
Second, support the designation of the Russian Federation as a state sponsor of terrorism.
Third, support the expulsion from Canada of the ambassador of the Russian Federation and the Russian diplomatic mission.
Fourth, support the suspension of the issuing of travel visas by Canada to all citizens of the Russian Federation.
Finally, and most importantly, we believe the tide of Russia’s genocidal war against Ukraine is being turned on the battlefield by the Ukrainian people's heroic defence of their country. We know that the Government of Canada can continue to play a leadership role in ensuring that the Ukrainian people have the equipment, weapons and means with which to finish the fight and ensure the victory of freedom over tyranny.
There was $500 million allocated in budget 2022 for military and security support to Ukraine. Those funds have been spent and exhausted, so we urge this committee to support us in reviewing the ways that Canada can substantially increase its military assistance to Ukraine going forward.
We look forward to your questions and to discussing Canada’s support for Ukraine. I would also note that the committee may wish to consider in the future a working visit to Ukraine, as we've seen legislatures from many countries visit Kyiv and Ukraine to talk to their Ukrainian counterparts and get a sense of the matters on the ground.
With that, I will close my remarks. We're open to questions.
Thank you, Mr. Chair.
That is a decision that we hope the President will review and take another look at.
In the U.S. Congress there is wide support for this designation. A Senate resolution passed unanimously. We all know our friends down south; the U.S. Senate doesn't pass anything unanimously, but this passed unanimously. This was a resolution introduced by Senator Graham and Senator Blumenthal, calling on the administration to in fact designate Russia as a state sponsor of terrorism.
We also know that the Speaker of the House of Representatives, Ms. Pelosi, is a strong supporter of this position. She is, of course, from the President's party. We hope that both the Senate and the House will encourage the President to revisit that decision. We certainly look to you to encourage American legislators in your interactions with the U.S. administration, and to encourage us together to list Russia. In the U.S. it's called a “state sponsor”; here it's called a “state supporter” of terrorism, but the designation means the same thing.
Certainly this designation is long overdue. The shooting down of flight MH17 was in July of 2014, and certainly a country that shoots down civilian airliners is engaging in terrorism.
Gentlemen, thank you for being with us today. Your testimony is certainly most relevant to this committee's work.
Great care has also been taken to ensure that the waiver can be revoked. At the meeting where we heard from ministers and , I asked what the grounds would be for revoking the waiver. Unfortunately, due to time constraints, Minister Joly was unable to answer the question.
Therefore, I'd like to look further into this issue with you. In an August 21 interview with Radio-Canada, Minister Wilkinson said that he believes Russia's scheme has been exposed, but he's still hopeful that the turbine will be returned to Gazprom and that it can be put into service.
On August 24, the told CBC News that she did not plan to reverse her decision even though Gazprom is refusing to accept the first turbine.
Now that Russia's blackmail has been exposed, why bother maintaining the waiver?
Even before the Canadian government made the decision, there was some doubt as to the point of lifting the sanction on turbines, particularly because some people believe that Russia has a stockpile of turbines. Moreover, even Siemens believes that the pipeline can function regardless of the turbines.
The ministers made those statements on August 21 and 24, before Dmitry Peskov announced on September 5 that supply would only resume if sanctions were lifted. This was quite clearly blatant blackmail by Russia, and it shows that the waiver needs to be cancelled, even more so because the German ambassador mentioned the cancellation scenario when she appeared before this committee. Neither minister has issued any new statements since Mr. Peskov's on September 5, but I can't understand why we're maintaining the waiver when Russia's blackmail has been so obviously exposed.
The last time the Ukrainian Canadian Congress appeared, alternative solutions were on the table, including the pipeline Gazprom is operating in Ukrainian territory. Based on what you said, that pipeline could have completely taken up Nord Stream 1's capacity. That pipeline is currently operating at under 40% of its capacity.
Now that we know that Nord Stream 1 is no longer working, my question is this: Has supply to the pipeline running through Ukraine been interrupted, or is gas still being supplied in Ukraine through that pipeline?
Like all of my colleagues, I would like to thank the members from the UCC for being here today.
I'd also like to take a moment and acknowledge the generosity that they have shown with regard to their time throughout this entire period. I know that many of us request information from them and are informed by them on a very regular basis. Orest and Ihor, thank you very much for that.
I would be remiss as well if I didn't acknowledge the UCC-Alberta Provincial Council and what an amazing job it is doing in my province.
I want to start today with the waiver question; that's ultimately why we are here. Similar to my colleague, Mr. Bergeron, I just don't understand why at this point the government has not been willing to revoke that waiver.
When this first came up and we were first hearing that this was something the government was considering, similar to many of the people in this room, I wondered why on earth we would trust that Putin would do what he said; he's never done what he has said. He's clearly weaponizing energy and food; he's weaponizing all kinds of those things, so why would we put trust in this? He has made it very clear, and his government has made it clear, that they will not be shipping gas to Germany. I cannot get my head around why the government fails to revoke that waiver.
When Ambassador Kovaliv was in front of our committee, she talked about this being a “dangerous precedent”. I'd love to hear from both of you why you think this is a dangerous precedent and what examples you've seen of how this has proven to be a dangerous precedent.
Ihor, I think you mentioned that the Russians have asked for “further concessions”. Any more clarity you can give on that would be very welcome.
Thank you for your warm remarks.
I'll pass along our best to the UCC-Alberta Provincial Council. It is working incredibly hard to support the Ukrainian refugees who have arrived in the province.
As you said, we believe it's a precedent we've seen, particularly on some sectors. For example, in terms of the tariffs on fertilizer there has been a lot of impact on the pricing of fertilizer due to the Canadian tariffs; obviously with an impact on the agricultural producers in Canada. We've seen public pressure on the government to move on these tariffs, to reduce them and to exempt them. That's the most public example we can give you of where we've been urging the government to remain strong and consistent on this issue.
We don't think it's helpful. We actually think it's the goal of the Russian Federation to poke holes in both Canadian sanctions policy and, generally, western sanctions policy. They understand that consistency and coordination are critical.
I don't think they particularly care what they poke holes into. The more they can poke holes in the sanctions regimes, find differences between jurisdictions and build inconsistencies between our governments that are largely on the same page on this issue.... We believe that is their overall goal. It is part of their goal of disinformation to say that the west is inconsistent and incoherent in applying this kind of pressure.
Orest, do you have anything to add to that point?
I would like to extend a welcome to Mr. Michalchyshyn and Mr. Zakydalsky. Thank you for coming here today.
Allow me to reiterate our support for the people of Ukraine in their valiant fight against an aggressive and hostile invading army.
Canada should be doing all it can to assist the democratic and free Ukrainian people in upholding their sovereignty and their right to live as free people in their own country. In my opinion, this includes maintaining sanctions on all trade with Russia.
As recently as August 22, Canada's stated that Canada “will be there to support Ukraine and Ukrainian people with what they need for as long as it takes.” These are words in the air, without substance, after the government's decision in July to grant a two-year exemption to federal sanctions and allow a Canadian company to return repaired turbines from a Russian-German natural gas pipeline. This was a decision that Ukraine's president, Volodymyr Zelenskyy, called “a manifestation of weakness”, and I agree. No sooner had the Canadian government capitulated than Russia constrained the supply of natural gas to Europe.
The narrative quickly changed to saying that we called Russia's bluff because we didn't want to be blamed for the shutdown of Russian energy delivery to Europe.
Mr. Michalchyshyn, is it your opinion that there was any bluff to call, or is this just another pivoting narrative from a government with diminishing relevance in international affairs?
When the government decided to allow this waiver, the Bloc Québécois felt that it was certainly a difficult decision, and that the Canadian government had been caught between a rock and a hard place and forced to choose between cholera and malaria, so to speak. So it was an extremely difficult decision. We felt that the government must have had very good reasons for making that decision at the time.
On the other hand, we immediately said that this would surely lead to a new round of sanctions and Canada providing more military support to Ukraine. However, we've seen few additional sanctions since then. Where military support is concerned, we note that, other than announcing the extension of Operation UNIFIER, the “Canadian military support to Ukraine” page on the government website has made no announcements regarding the provision of military equipment to Ukraine, which it urgently needs, as the Ukrainian ambassador reminded us when she appeared more than two months ago. The ambassador insisted that it was imperative that these supplies reach Ukraine this summer.
On the one hand, how would you assess the reasons ministers and gave us for making this difficult decision?
On the other, how would you assess Canada's contribution to Ukraine since then? In your opinion, is it meeting the needs expressed by the Ukrainians?
This whole conversation is around the sanctions regime. I have found it incredibly difficult to get information about the sanctions. It's the details of what's been seized and the details of the sanctions. It's not who has been sanctioned, but how much and what.
I would like to take a moment, if I could. Please bear with me to read into the record a motion that I brought forward on May 31, 2022:
That, pursuant to Standing Order 108(2), the Committee conduct a follow-up study to the 2017 FAAE Committee study on Canada's sanctions regime titled “A Coherent and Effective Approach to Canada's Sanctions Regimes: Sergei Magnitsky and Beyond”; that the Committee review the Government's implementation of the recommendations in the 2017 report; that the Committee review the need for new recommendations, if any, resulting from Canada's response to the situation in Ukraine and other situations since 2017; that the Committee hold no fewer than (4) four meetings; that the Committee report its findings to the House; and that pursuant to Standing Order 109, the Government table a comprehensive response to the report.
I would like the subcommittee to have an opportunity to discuss this. I think we've heard from our witnesses from the UCC that our sanctions regime needs to be re-examined very carefully. We've heard that the waiver has fundamentally damaged our sanctions regime and fundamentally damaged the credibility of Canada. It is imperative that this committee undertake a study as soon as possible.
I will end at that point because I know I'm very close to my two minutes.
Orest and Ihor, I would like to thank you both very much for being here. Thank you for sharing your wisdom with us again.
I will proceed. That's excellent.
Thank you, Mr. Chair.
Could one or both of you comment on the impact that this turbine decision has had on Canada-Ukraine relations?
President Zelenskyy chose to speak personally to this issue. I know from friends and contacts I have spoken to in Ukraine that there's a lot of disappointment. There's a sense of betrayal. There's a long history of close relations between Canada and Ukraine, but in this very dark time for Ukraine, what was the significance of this decision for Ukraine?
Also, maybe related to that, the government talks about standing with our allies. Germany and the U.S., our allies, have said this was okay. Ukraine is also supposed to be an ally, yet the government speaks of standing with our allies with no acknowledgement of the response to this decision from Ukraine.
Thank you, Mr. Chair.
Personally, I think the study that Ms. McPherson spoke about, a study on the effectiveness of our sanctions regime, would be very important and worthwhile in order to build on the work that we're doing in the context of this discussion.
As a follow-up to Mr. Bergeron's point, some of us took the position right at the beginning that this was a terrible decision. That was where we as the Conservative Party were at. I think there were others who were maybe a little bit more sympathetic to the government's decision initially, and then since more facts have become clear, since Gazprom hasn't taken the first turbine and Russia is seeking further concessions, more and more people are coming over to the point of view that surely even if the decision was justifiable in the first instance, there's no reason to continue the waiver now.
Have you had ongoing engagement with the government, even in the last couple of days, since the most recent announcements from the Kremlin? What is the government saying now? Are they saying the same things? Are they saying different things compared to what they were saying at the beginning?
Before I ask my questions, I'd like to briefly come back to what my colleague Mr. Bergeron touched on, which is the statement or rather the blackmail by Mr. Peskov with respect to the Nord Stream 1 pipeline. As I understand it, this pipeline that runs through Ukraine and enters the European Union through Slovakia is indeed in service, and volumes are stable. Again, as I understand it, this pipeline and the TurkStream pipeline are the only two remaining land routes for importing Russian gas into Europe.
Of course, I have questions for both witnesses.
In the discussion we are having with you today, you mentioned in your opening statement that you encouraged our committee to travel to Ukraine. As you know, we had travel plans that were vetoed in the House of Commons by the Conservative Party.
Are you aware, gentlemen, of why that travel was vetoed?
Thank you very much for this opportunity to contribute to the committee's deliberations.
My comments are aimed at shedding light on what I see as the central question in the debate about the gas turbines today: Should Canada revoke the permit allowing the maintenance of the now-infamous gas turbines? The answer to this question is a resounding yes.
Doing otherwise—continuing with the sanctions exemption—does not advance Canada’s interests, does not help our European allies with their energy problems, and continues to provide the Russian dictator Vladimir Putin with opportunities for blackmail and leverage against the west.
Let me briefly elaborate in the five minutes that I have.
It is clear to all that the technical issues have nothing to do with Russia’s decision to first reduce and then completely shut down gas flows to Europe via Nord Stream 1. Russia’s actions over the years, and particularly in the last few months, made this very clear. There is no need to again go over the familiar terrain that has been covered in the deliberations of this committee. It's a political decision aimed at blackmailing and forcing Europe to ease or break the sanctions imposed on Russia as a result of its brutal and unprovoked invasion of Ukraine.
Kremlin spokesperson Peskov said as much with great clarity on Monday, and Putin repeated the same thing today in his remarks. This fact is clearly recognized by the German and European public, as polling consistently indicates. It would be giving too little credit to the European public’s political sophistication to argue that they will buy into Russian excuses and blame Canada for the difficulties.
Therefore, it is clear that Canada’s decision to continue to provide an exemption for the gas turbines will have no role in determining whether Russia will resume gas flows to Europe or not, nor will revoking the permit lead to a backlash against Canada from the Europeans.
What it does, however, is provide an ongoing point of leverage for the Kremlin to create friction and discord between allies and enable the Kremlin to develop a narrative of western weakness and disunity by pointing out the carve-outs within the sanctions regime.
In other words, the Kremlin turns to other countries and says, “Look: Canada, Germany and other western powers immediately violate their own sanctions regime and carve out exemptions when their domestic interests are threatened. Why would you go along with this and pay the price when they are not interested in doing the same?” Putin is basically repeating the same line today in his talk.
Continuing with the exemption also does not help our European allies with their energy needs. What would help is to get Canadian LNG to them, as they have been asking for publicly and very clearly. Not only has Chancellor Scholz voiced his desire for more Canadian LNG, but other allies, such as Poland and Latvia, have been calling for more Canadian gas to Europe for a while. Clearing the obstacles in front of this real and tangible support for Canada’s allies is urgently needed. That is what a good ally would do.
Lastly, it is important to keep in mind the broader geopolitical context in which this issue needs to be considered. The strategic goal for Canada must be Ukrainian victory in this war. Supporting Ukraine is not charity but enlightened self-interest. What is at stake for Canada is not only the security and prosperity of our European allies but also the future of the rules-based international order that has benefited Canada and Canadians immensely. The country—Russia—that launched this brutal attack on that international order is not far to the east of us; it is an immediate neighbour to the north in the Arctic. Policies that provide leverage and opportunity for Russia are not in the interests of Canada.
To recapitulate, whatever the initial merits of the decision to provide an exemption, there are no strategic, political or economic reasons now to continue to provide Russia with potential leverage for the next two years. It neither advances Canada's interests nor alleviates our allies' suffering. The permit should be revoked and Canada should look for ways to get its LNG to European markets as fast as it can.
Thank you very much for this opportunity to talk to you today.
I am simply Mr. Marcus Kolga, not Dr. Marcus Kolga.
Thanks to you and the members of the committee for this opportunity to appear before you today.
Over the past months, Russia has threatened to starve vulnerable nations around the world by blockading millions of tonnes of Ukrainian grain while shelling and bombing critical Ukrainian agricultural infrastructure to induce a global grain shortage. At the same time, Russia has falsely blamed western and Canadian sanctions for causing this food crisis, despite the fact that our sanctions do not affect any Ukrainian agricultural infrastructure or the transport of grain and food to those nations that rely on it.
Russia's weaponization of hunger is matched in cruelty by its use of energy to freeze Russia's neighbours. Many Europeans experienced this first-hand when Russia cut all gas supplies transiting Ukraine in January of 2009. Canadians only recently became aware of Putin's energy warfare after Global Affairs granted Gazprom a sanctions exemption to permit the repair in Canada of turbines that compress gas exported from Russia through the Nord Stream pipeline to Europe.
However, the Kremlin's use of energy as a point of geopolitical leverage did not emerge out of a vacuum. The former vice-president of Gazprombank, Igor Volobuev, told a Polish newspaper in May how he was instructed by Gazprom executives to develop anti-Ukrainian narratives in 2005 when Ukraine's political trajectory shifted toward Europe. He also created anti-Georgian narratives in 2008 when Russia invaded South Ossetia and Abkhazia. According to Volobuev, all decisions within Gazprom are made inside the Russian presidential administration.
If Canada's decision to grant Gazprom a sanctions waiver was intended to call Putin's bluff, that mission has been accomplished. It is now clear that our sanctions did not impair Gazprom's ability to pump gas through the Nord Stream pipeline. As we've heard from previous witnesses today, they never did.
Underscoring the false nature of Russia's accusations, a recent report published by the BBC exposed massive gas flares at Gazprom's Portovaya compression station near the Russian starting point of the Nord Stream pipeline. Flaring is a process by which gas producers burn off large quantities of gas for sustained periods of time. According to that report, $10 million worth of gas is being burned off by Gazprom each day. That is gas that would otherwise be pumped through Nord Stream to Germany and Europe or through existing pipelines that transit Ukraine and Poland.
Indeed, as other witnesses have pointed out, the Kremlin has now explicitly stated that gas will only start flowing through Nord Stream once Canadian and western sanctions have been lifted. This is blackmail.
Vladimir Putin's intent is to weaponize gas in order to erode western support for Ukraine and undermine Canadian and allied democracies by blaming us for rising inflation and energy costs through disinformation. This is happening right now. This morning, in fact, in Vladivostok, Vladimir Putin doubled down on his accusations about western sanctions and even claimed, “we did not start anything in terms of military actions; we are trying to end it.” At the same time, Putin made it very clear that the polarization of the democratic world that his regime is actively contributing to will greatly benefit Russia.
We're currently witnessing Russian state media and proauthoritarian groups promoting these exact narratives. Protests that were organized by Kremlin-aligned Communists and populist neo-fascists in Europe this past weekend will be exploited by Russian propagandists to build on them and destabilize western democracies. We cannot rule out that these false narratives will not inspire similar protests among Canadian far-right and far-left extremist groups.
In Putin's own words, the sole beneficiary of this polarization is his regime. Now that Putin's bluff has been called, the sanctions waiver issued by Global Affairs should be revoked and the integrity of Canada's sanctions regime should be restored. Sanctions work when they are applied, sustained and enforced.
Finally, Canada should prioritize the development of infrastructure to export Canadian gas to Europe, as many of our allies have asked us to do. Canadian small nuclear reactor technology can also help our allies take control of their own supply of electricity. In fact, Estonia recently signed an agreement to do just that. Canada can provide a mutually beneficial contribution to European energy security that will lead to greater overall European stability if we only commit to it.
Thank you, Mr. Chair. I look forward to your questions.
Hello and bonjour
, Chair Ehsassi, Vice-Chair Bergeron and distinguished members of the Canadian Parliament. Thank you and merci
for the opportunity to speak today about supporting Europe’s energy security.
My name is Benjamin L. Schmitt. I'm an astrophysics researcher at Harvard.
I'm a former European energy security adviser from the U.S. Department of State. Currently, I’m a research associate at the Harvard-Smithsonian Center for Astrophysics and Harvard Ukrainian Research Institute, a senior fellow at the Center for European Policy Analysis, and a Rethinking Diplomacy fellow at Duke University.
We meet today nearly seven months after Moscow unleashed its horrific campaign of chaos in Ukraine, but let’s be clear: Just as Putin’s military aggression against Ukraine didn’t start with its February large-scale invasion, the Kremlin’s wider hybrid aggression against global democracies, including weaponized energy, is nothing new either.
With this in mind, we can look back on three critical lessons.
First, energy and critical infrastructure proposals advanced by Putin’s authoritarian regime are not just commercial deals.
Nord Stream is more than just a commercial deal.
Second, sanctions have been an effective tool to slow and stop Kremlin malign energy activities over the years.
Third, technology export controls remain vital to throttle the Kremlin’s ability to acquire systems and components needed to both wage and fund its horrific war.
Given the total state control of authoritarian nations like Russia, nearly every sector of society can be weaponized to advance geopolitical aims, from cyberspace to supply chains to space assets and, of course, energy for political blackmail. Knowing this, undermining sanctions unity on the Nord Stream 1 turbines simply to “call Putin’s bluff” is only justifiable in a world where Russia hasn’t been weaponizing energy for years—but it has. For context, we can look at Putin’s Nord Stream 2 pipeline.
Nord Stream 2 was a long-running geostrategic anchor that Germany openly clung to as Russia created a gas crisis last year. In 2021 the Kremlin intentionally limited natural gas volumes destined for European storages, most of which were owned by Gazprom. Despite this reality, Berlin convinced the United States government to waive its own mandatory bipartisan sanctions aimed at stopping Nord Stream 2, with Berlin agreeing to seek EU sanctions in the case that Russia took further steps to weaponize its energy resources. Even though Putin did just that, Berlin failed to seek those sanctions, emboldening Putin’s confidence that energy pressure could limit the latitude of foreign policy responses to Russia's horrific war against Ukraine.
Thankfully, Washington finally sanctioned Nord Stream 2 AG and its corporate officers just hours before Putin's large-scale invasion began, ending the project for good, hopefully. But distressingly, even with this fresh lesson in mind, history seems to be repeating itself here in Canada.
For months, Gazprom has cut flows to at least a dozen EU member states, including via its Nord Stream 1 pipeline, and since mid-June has cut by 60%, 80% and now 100%. Multiple technical assessments from German ministries and officials stated that Russia’s explanation for these cuts—supposed technical issues that could only be solved by receiving stranded Siemens turbines near Montreal—were nothing more than pretext for another political energy cut.
That’s why it’s so baffling that Berlin simultaneously pressured Ottawa to undermine its own technology sanctions against Russia. Even if Gazprom’s dubious technical justifications had merit—and they do not have merit—the Kremlin could easily restore gas deliveries to Europe right now via other routes where it's limiting flows. That it refuses to do so speaks volumes about Putin's malign intent.
Berlin pressuring Ottawa to undermine sanctions unity through the turbine waiver sets a worrying precedent from which the Kremlin will learn a troubling lesson—that weaponizing energy dependence can be effective at breaking western consensus on the very technology export controls that are curbing Russia’s military potential and economic engine.
Russia’s refusal this summer to take custody of the first of the turbines transferred to Germany raises questions about Ottawa’s subsequent decision to stand by its waiver after the visit of German Chancellor Scholz in late August, when news reports say that it authorized the transfer of five additional Siemens turbines.
To cap off the saga, this week Kremlin spokesperson Peskov stated out loud what the world knew for months, that the turbine story was a cover for energy weaponization, declaring that the cuts will continue until sanctions are dropped, and that “Other reasons that would cause problems with the pumping [simply] don’t exist.”
In closing, I will leave you with three very brief recommendations.
One, Canada should reverse the turbine sanctions waiver as soon as possible, backed by political endorsements from Germany and the United States.
Two, Canada should expand sanctions on the Putin regime and increase LNG export capacity, incentivizing exports to European partners and allies.
Three, Canada should pass legislation to curb Kremlin strategic corruption in western democracies, just like what I proposed to U.S. Congress, called the “stop helping America’s malign enemies, SHAME, act”.
In our dire struggle against Russia's criminal onslaught against Ukraine, Putin and his authoritarian cronies need to see a wall of strength from democracies unwilling to waiver in their resolve to hold the Kremlin to account. Then there will be only one nation forced to change its foreign policy in order to avoid “Ukraine fatigue”, and that would be Putin's Russia.
Thank you for your attention.
I look forward to your questions today.
I'd like to direct my question to Dr. Schmitt.
According to the Finnish Centre for Research on Energy and Clean Air, Russia has raked in €158 billion since the war began in Ukraine from the sale of oil and gas exports, more than half of which have been to the European Union. In fact, this Finnish research centre has indicated in its report that €43 billion has been added to the Russian budget from the sale of these exports to the European Union.
Canada could displace Russian gas in western Europe. We are the fifth-largest natural gas producer in the world and we have the longest coastline in the world. According to my back-of-the-napkin calculation, a simple 15% increase in Canadian natural gas production could displace more than a third of all Russian gas in western Europe.
Recently, Chancellor Scholz was here in Canada, and he said:
As Germany is moving away from Russian energy at warp speed, Canada is our partner of choice.
He further added comments:
For now this means increasing our LNG imports. We hope that Canadian LNG will play a major role in this.
The Canadian rejected the German request to work with Germany to export more Canadian LNG to Europe.
I'd like your comments on that.
Like a lot of the G7 members that are producers, including the United States and others, Canada needs to make sure that global democracies are making our energy resources available to Europe as quickly as possible.
I do want to point out on the German side that they're doing a number of things. Two floating storage and regasification units in Brunsbuettel and Wilhelmshaven, Germany are being built, but there also is a need to build out floating storage and regasification units, or floating LNG import terminals, at locations that are strategic and have existing infrastructure. There's been some talk in the media about potential companies that are thinking about this at Lubmin, Germany, but Lubmin is the point of contact where Nord Stream 2 comes onshore. In June the economic ministry in Berlin came out and said that they were considering a plan to expropriate the Nord Stream 2 pipelines in German waters, physically cut and sever them away from the Nord Stream 2 pipeline, which is currently unused due to U.S. sanctions, and attach them to floating storage and regasification units to bring non-Russian LNG through those systems and through the Lubmin gas hub and the EUGAL pipeline onshore.
This would basically be a war-time level of effort and speed to leverage existing infrastructure. That still hasn't happened yet. We need more signals from Berlin that that's going to happen. That's got to happen infrastructure-wise on both sides of the Atlantic, and we need to do it awfully quickly.
There certainly is demand in the Baltic states, and there has been, for quite some time, for the export of Canadian energy. As I mentioned in my opening remarks, Canada and Estonia have just recently signed an agreement to develop a program to build small-scale nuclear reactors in Estonia to wean that country off Russian electrical supplies. Lithuania, about three or four years ago, built an offshore LNG terminal, and officials in all three Baltic states have clearly stated that they would welcome Canadian gas in those countries.
There are opportunities for Canada to begin exporting gas quickly. There was previously a question about the timelines to build some of this infrastructure. In the United States, there is technology available right now to build offshore export LNG terminals off the coast of Canada. These could be built within 12 months, and we could start exporting LNG to the Baltic states and other European countries quite quickly.
There are other trade opportunities, of course, in the IT sector. Estonia is a leader in developing e-government technologies and such. They've recently set up shop here in Canada, and I think that Canada could greatly benefit from working with Estonia to develop our own technologies here.
So there are plenty of opportunities, and the fact that Canada has established and has announced that it will establish full embassies in all three Baltic states is certainly a positive sign.
I'd like to thank the witnesses for being with us and enlightening us with their words.
Mr. Schmitt, I found it refreshing, to say the least, to hear a few words in French from a friend who is from south of the border. It was ironic at the very least. Thank you very much for that short interlude in French.
My question is for Mr. Kolga. If the two other witnesses would like to comment, of course, they are welcome to do so.
Two former U.S. generals, David Petraeus and Wesley Clark, praised the Canadian government's decision to return the turbines to Germany so as not to threaten NATO cohesion and unity. Canada's former chief of defence staff Rick Hillier has argued that the decision would be seen as a signal that sanctions on Russia will weaken.
Didn't we get the worst of both worlds, having perhaps undermined cohesion between the allies, while also opening the door to weakening sanctions on Russia?
I completely agree that we have the worst of both worlds. We've arrived at a lose-lose situation.
The fact that we have compromised on these sanctions opens the door to other allies doing the same. They can justify that action by pointing to our decision to provide that exemption to Gazprom. That is problematic.
Publicly, our NATO allies are going to be supportive of any decision that we take. We worked with the Germans on this issue. Privately—certainly among our eastern European NATO allies and in the Baltic states, Poland and beyond—our decision raised eyebrows. This decision also raised eyebrows among Russian opposition leaders. They all understand that what Putin is very much hoping for is a return to business as usual. The erosion of sanctions, as he clearly mentioned today in Vladivostok, is one of his primary goals at the moment.
I think that Canada still has an opportunity to correct that decision by cancelling that permit to Gazprom and rebuilding confidence in our sanctions regime. That's vital today to maintain that cohesion among our allies, but also to maintain trust in our own defence policy, foreign policy and sanctions policy.
I would like to thank our witnesses today. It's been very enlightening. Before I start I just want to take a moment. One of the biggest issues for me has been the efficacy, the transparency and the ability of Canadians to understand how our sanctions regime is working. I think that probably some of you saw that I brought forward a motion in the previous session, but I think it's important to note.
Mr. Kolga, you were one of the key witnesses for the 2017 study, but we also had another witness who testified for this committee. Vladimir Kara-Murza was one of the witnesses. He was arrested in Russia in April and he's facing 10 years. Today is his birthday. I just want to take a moment to acknowledge that he has testified for this committee and that he is in a very difficult place looking at 10 years in prison for criticizing the war in Ukraine. I am sorry, Mr. Kolga, and those who know Mr. Kara-Murza.
I would like to start with you, Mr. Kolga. You were a key witness in 2017. You have talked about how this particular waiver has harmed our sanctions regime. There were recommendations that came out of the study of the sanctions regime in 2017 that have not been acted upon. Can you talk a little bit about how we could strengthen our sanctions regime and how we should be making it more transparent, more accountable and easier to understand for Canadians?
I think there's a lot that Canada could be doing to make our own sanctions regime more effective.
First and foremost is working with our allies to harmonize our policies and legislation with the United States, the EU and the U.K. We should be stepping up the enforcement of our sanctions policy. To date, since the start of the war, the RCMP has seized $122.3 million worth of Russian assets. We know for a fact that Russian oligarchs have billions of dollars of assets hidden well in plain sight in this country. We need to be doing a heck of a lot more. If we intend to use our sanctions policy as a consequence and a cost for these foreign regimes, we need to make sure we're using that legislation properly.
During the past six months, the Canadian government enacted new legislation and an amendment to the Special Economic Measures Act that would also allow our government to repurpose some of those assets that have been frozen. We need to start using that legislation. We need to start repurposing some of those billions of dollars that are hidden in this country. We could use some of those funds to help support Ukraine in its struggle to push Russia back past the February 24 border, to reclaim Crimea and to rebuild the country.
We could also be introducing a measure of transparency to the entire process of how those sanctions are imposed, who they're being imposed on and what sorts of assets these targeted individuals have. There should be some accountability through regular reporting.
I would also suggest that this committee be given the power to nominate candidates for our sanctions list. You are experts in Parliament. You've heard from experts and you know who these human rights abusers are, those who threaten the stability of western democracies even in their own countries. You know who these people are. Giving this committee more power to designate individuals and entities for our sanctions list is also important.
One of the most important things that you could do is have that review of our sanctions legislation as you've proposed. I and, I think, a lot of other human rights activists in Canada and elsewhere would very much support this as, I'm sure, Vladimir Kara-Murza would.
This is really high quality testimony we're receiving from all three of you. Given your thoughtful and biting critique, I now find it no surprise that the Liberal chair made a last-minute change to the agenda that limits the time we have with you, though it is unfortunate.
Mr. Kolga, you mentioned the ability of committees to be able to nominate people for sanctions.
I want to note, for your information and for the record, that Bill , tabled by my colleague, Philip Lawrence, the international human rights act, contains some of those provisions. We will be debating that bill in Parliament this fall. Hopefully it will be coming to us here at this committee soon.
It's been reported recently, as well, by CBC that the value of frozen sanctions in Canada has dropped in recent months to suggest the possibility that some people have been allowed to sell off assets.
Do you have any reflections or information about how it is that the value of frozen assets under sanction would somehow be dropping?
Thanks so much. That's an excellent question.
The bottom line is that Russia has been weaponizing energy for many years. This has a wide definition. First of all, there are the overt gas cuts that we can see have happened dozens of times over the years. I can supply the committee with a list of every one that I am aware of, but I know it's long, with at least 20 or 30 of these sorts of instances.
This doesn't necessarily mirror military conflicts that the Russian Federation has been in, because the Russian Federation under Vladimir Putin has been in a hybrid war at the same time during many of the conflicts you mentioned, at least since the mid-2000s through now, with the west, and has been using energy in one way or another to either create market uncertainty and energy insecurity by actual energy cuts or by doing what I'm really concerned about as well, which is using energy as a means of strategic corruption, to enact energy deals and things like this and then allow for elite capture around this.
We saw this in 2005-06 when former German chancellor Gerhard Schroeder stepped out of office. At the end of his tenure in office, he was supporting Nord Stream 1 and was basically pushing that project forward. He stepped down and was chairman of Nord Stream AG. We saw this go on with Nord Stream 2 and things around Nord Stream 2. Former Austrian economy minister Hans Jörg Schelling became Nord Stream AG's senior adviser after stepping out of office. Former Austrian foreign minister Karin Kneissl stepped out of office. Of course, she was famously covered in the press for having Putin at her wedding and dancing with Putin at her wedding. She stepped out of office after supporting Nord Stream 2 and other pro-Russian policies while in office, and was appointed a board member of Russian state-owned oil company Rosneft. Former French prime minister François Fillon was nominated to not one but two Russian state-owned oil and gas trading companies.
So this really is a concern, and this is what I'm constantly calling for in the United States, which is to start this norm-setting process. The United States should pass an act called the “stop helping America's maligned enemies, SHAME, act”. When small-case shame doesn't work, you need large-case shame. It doesn't have to be called that here in Canada, but Canada can join in this effort. There should be a Magnitsky-level anti-elite capture and anti-strategic corruption effort legislatively throughout global democracies to make sure that former officials cannot leave the public trust and then work for authoritarian state-owned enterprises.
It shouldn't be controversial. This is something that this Parliament can do today, if it would like to, or at least put out a statement saying that it's the sense of Parliament that this sort of practice can no longer happen, because it's still legal in too many jurisdictions.
Thank you, Mr. Chair; thank you, Mr. McLean, and thank you to the witnesses again.
Just to avoid further shenanigans and delays, I think it's important to move the following motion. My motion is as follows:
That the committee meet in public within seven days of the adoption of this motion for a discussion of committee business related to the study of the export of Russian Gazprom turbines.
That motion has been moved; the clerk has it in both official languages and can distribute it to members.
In light of the fact that it's been a month since the committee met, in light of the last-minute changes we've seen to the agenda, and in light of some of the issues we've had, I think it is important that the committee provide clear direction to the chair, in the form of a discussion on committee business, that programs our path forward. That is why I am moving this motion. It's very reasonable that we would, within seven days, meet, do committee business, and be able to define an agenda so that we don't have some of the things that have happened from the chair's office happening again, and so that we can establish some clarity going forward.
That's the motion. It's been distributed. Thank you very much.
Mr. Chair, you have a very valid point there. I believe that ministers and relevant ambassadors have appeared before our committee and have made it clear that while it was a difficult decision, it was one that was necessary to take. As our minister stated, they discussed the matter with all parties, including Ukraine, in advance of the decision being taken. The decision was supported not just by the Germans but also by our allies in the European Union and our allies to the south, the United States, and it in no way reduces our support for Ukraine and, of course, its people.
I also find it very difficult to believe that had another party been in government and been faced with the clear and urgent request from a close ally such as Germany, it would have decided any other way. Given the circumstances, it was a necessary decision, and I cannot support a motion that would suggest otherwise.
Thank you, Mr. Chair.
First, I am very surprised to see Mr. Sidhu repeat the government's lines as if we haven't had any hearings and we haven't heard from witnesses, and as if the committee has already made a decision on these hearings. I find that not only astonishing, but concerning at the very least.
In addition, the motion before us from Mr. Genuis seems quite reasonable to me, and it's consistent with the discussions we have had with the chair about having a meeting on future business at the end of this meeting. When we've had that discussion, we will decide together if we are to continue this study. As members of this committee, let's give ourselves the opportunity to discuss what we have heard. Have we heard enough to propose anything to the government? The purpose is not simply to repeat what the ministers told us, as Mr. Sidhu has just done, but to report on what we've heard as part of this study, or, if appropriate, go further in terms of the hearings.
I therefore find what Mr. Genuis is proposing to be entirely reasonable, and I see no reason why we shouldn't have the opportunity to meet to discuss this committee's future business, as we had discussed with the two vice-chairs and the chair.
So I am announcing that I will be voting in favour of this motion.
We have all heard the motion. We have it. Thank you, Garnett, for that.
With respect to next week, I'd like to flag for everybody's attention that we, as the Liberal Party, have our national caucus retreat taking place. I don't know what the schedules are of other parties, but that's our schedule. It would make it hard for us to all participate in a fulsome way.
That being said, before we vote, we should all consider the schedules of colleagues around the table, no matter what party they're from. I think that we'll all do that in order to move ahead on important business.
Thank you very much, Mr. Chair.
I thank the witnesses very much. I'm sorry to have kept them waiting.
I'm particularly interested in comments that you made in your testimony, Mr. Schmitt. You talked about the importance of our unity, as allies, in our response to Russia.
To me, that is fundamental, and I'd like to hear what you have to say about it. In light of recent developments on the political scene, can you talk about how important it is to you that unity be maintained? I'm thinking in particular of what happened in Italy, but also of the discussions that took place earlier this summer in Germany. Mr. Putin is clearly trying to divide us at all costs. He's trying to divide NATO, the European Union and the G7. Can you tell us how important unity among the allies is to you?
Feel free to answer in English, Mr. Schmitt.
Thank you, Ms. Bendayan.
I think your question is absolutely spot-on, and it's incredibly important that we maintain unity.
Obviously, as I said earlier, the success that Ukraine will need to have in order to win the war and restore full territorial integrity and sovereignty over its territory.... It's paramount that all democracies stand united against Russian aggression, both in Ukraine and in hybrid warfare, whether that aggression is in cyber-attacks, disinformation, propaganda, energy weaponization or using space assets in ways that are concerning to global security.
What we have to do is make sure that sanctions stay united. When we have these sorts of situations where, over the years, Russia has basically built energy infrastructure and used it to split allies, we have to look at where the unity was on projects like Nord Stream 2. Over the years, all of NATO's eastern flank at one point or another opposed and called for this project to be stopped. The United States—both Democrats and Republicans, both administrations and on Capital Hill—called for this project to be stopped. When I was in my role as European energy security adviser at State, I visited Ottawa in 2018. Global Affairs Canada had also come out as opposed to Nord Stream 2. The United Kingdom and France, at times, have opposed Nord Stream 2, as have a number of countries throughout the Nordic region. Basically, the only countries that supported Nord Stream 2 were Germany, Austria and, of course, Russia.
When you have examples where the European Parliament, on a nearly unanimous basis, or at least with extreme majorities, on at least three occasions called for this project to be stopped over the years.... For that to continue to go forward and for Germany to pressure the United States to suspend its sanctions and then pressure Canada to suspend its sanctions.... That's a slightly different situation, but in this case, on the Nord Stream 1 turbines, those are the sorts of actions that we need to avoid as global democracies.
We need to continue to mount as much pressure as possible on the Putin regime, so that democratic norms and sovereignty will be restored in Ukraine. It will become more resilient, going forward, in standing up to authoritarian aggression, whether it comes from Russia, China or elsewhere.