Canada's Original Think Tank

Study on the Development of a Strategy to Facilitate the Transport of Crude Oil to Eastern Canadian refineries and to Ports on the East and West Coasts of Canada

Study on the Development of a Strategy to Facilitate the Transport of Crude Oil to Eastern Canadian refineries and to Ports on the East and West Coasts of Canada

Study on the Development of a Strategy to Facilitate the Transport of Crude Oil to Eastern Canadian refineries and to Ports on the East and West Coasts of Canada

Study on the Development of a Strategy to Facilitate the Transport of Crude Oil to Eastern Canadian refineries and to Ports on the East and West Coasts of Canada

Published on 15 June 2017
Hansard and Statements by Senator Terry Mercer

Hon. Terry M. Mercer:

I rise today to speak on the Senate Transport and Communications Committee Report, entitled Pipelines for Oil: Protecting our Economy, Respecting our Environment. Most of my remarks you may have heard when we released the report, but for those of you who did not, I will review them with you.

It was noted in the report that Canada has the world’s third-largest oil reserves, but because of a lack of proper infrastructure, we are still somewhat dependent on foreign oil and are still limited to selling domestic product at a discount to our neighbours to the south.

The committee heard that pipeline operations added $11.5 billion to Canada’s Gross Domestic Product in 2015 alone, in addition to generating 34,000 full-time jobs and $2.9 billion in income.

Let me repeat that, honourable senators; $11.5 billion to the GDP; 34,000 full-time jobs and $2.9 billion in income. This is an important issue.

The report makes seven recommendations to the Government of Canada that the committee hopes will provide some guidance while the government is examining the future of our energy resources and the environmental implications of energy projects like pipelines.

While I will not go into detail on the environmental risk associated with such energy projects, I will say that I do believe that we can responsibly get our oil reserves to tidewater while at the same time respecting the environment and protecting it against harm to the ecologically sensitive areas that such pipelines may threaten.

Before I review the recommendations, it should be noted that the Government of Canada received a report from the National Energy Board Modernization Expert Panel in May that made 26 recommendations, notably, a restructured National Energy Board; better consultation with the stakeholders, including indigenous peoples; and a better mechanism to deal with their complaints.

I look forward to the next steps in that review, but I also hope the government will take note of our recommendations in its deliberations on the future of the National Energy Board and the future of the pipeline projects in this country.

Let’s review some of the key recommendation from our committee’s report:

The Committee recommends Natural Resources Canada modernize the National Energy Board by methods that include:

  • Broadening the Board’s mandate to ensure effective communication and consultation with stakeholders, and
  • Removing the Governor in Council’s automatic final approval . . . .

Board decisions would instead be subject to appeal to the Governor-in-Council, not automatically reviewed.

To improve relations with Indigenous peoples and enhance their involvement in the process, the Committee also recommends integrating information gathered during the Crown’s duty to consult Indigenous peoples into the Board’s process, and that the Governor in Council use its authority to appoint permanently an Indigenous peoples’ representative to the Board. . . .

In light of the potential economic, environmental and logistical attributes, the Committee also recommends that the National Energy Board, as part of its hearings on the proposed Energy East project, examine the Strait of Canso area in Nova Scotia as an alternative end point.

I will expand on this later in my remarks.

The Committee recommends that Fisheries and Oceans Canada ensure that the Oceans Protection Plan includes enhancements to the Canadian Coast Guard, including an expansion of resources and bases of operations for the purpose of tanker spill mitigation and prevention.

If you read the report of the National Energy Board Modernization Panel, you will indeed find similarities between our report and theirs.

Honourable senators, I believe the committee did its due diligence in fully understanding what is going on and what we can do to streamline processes, enhance the public trust and get pipelines built in an economically and environmentally responsible way.

The recommendation I am most interested in concerns the proposed Energy East pipeline project. I know my esteemed colleague from New Brunswick, Senator Mockler, has an inquiry on this, calling the attention of the Senate to the issue of pipeline safety in Canada and the nation-building project that is the Energy East proposal and its resulting impact on the Canadian economy. So I know Senator Mockler will be especially interested in what I have to say about Energy East.

I would note, honourable senators, that the Energy East pipeline project is currently under review by a new three-member review panel of the National Energy Board, with no new hearings scheduled yet. It has, however, been receiving comments on new criteria for assessment on the project.

Our recommendation on Energy East is particularly appealing to me and should be to my fellow Nova Scotians. This, of course, involves the ice-free port on the Strait of Canso between Cape Breton Island and mainland Nova Scotia, a port that has great potential to help Nova Scotia share in the benefits of Western Canadian oil.

At the Strait of Canso, there are already tanks that are housing thousands and thousands of gallons of crude oil coming into the country, and there’s no reason they can’t have thousands and thousands of gallons of oil going out of the country. It is already there in place, in an ice-free harbour in the Strait of Canso.

The proposed Energy East 4,500-kilometre pipeline would transport approximately 1.1 million barrels of crude per day to a new marine terminal in Saint John, New Brunswick.

More than 3,000 kilometres of existing natural gas pipeline would be converted to carry crude oil, and approximately 1,500 kilometres of new pipeline would be built.

What if we expanded upon that initial plan and extended the pipeline through Nova Scotia to the Strait of Canso? I believe that would be a great opportunity to share the wealth from the West for both New Brunswick and Nova Scotia.

The equally important point is that it would also add more safety to the project, and here is why. More oil in Saint John means more tanker traffic in the Bay of Fundy, which increases the risk to our fishing and tourism industries in that area. The Strait of Canso is also closer to the European markets and would stabilize tanker traffic in the Bay of Fundy. If the evidence supports extending the pipeline to the Strait of Canso, then the possibility of doing it should be explored.

So, honourable senators, I believe we all would benefit from the recommendations we have provided in this report.

In closing, I would like to echo the comments of the committee from the Senate website:

A stronger, more inclusive, less political regulatory process is an essential first step toward expanding Canada’s energy infrastructure in a way that maximizes economic benefit and minimizes environmental risk while achieving broader public consensus.

I think you can all agree with that.

I would like to thank all honourable senators who participated in the committee study as well as the staff who helped put this together.

Finally, the report also quoted Albert Einstein, and I believe it is worth repeating:

The world as we have created it is a process of our thinking. It cannot be changed without changing our thinking.

I believe our report is reflective of the ever-changing landscape in Canada for energy projects. Only by changing how we think about the industry, and by exploring the broad implications of energy projects efficiently, will we get shovels in the ground and oil to our shores to export to the world, which is thirsty for Canadian petroleum.


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