Thank you, Mr. Bromley. Mr. Bouchard.
Thank you, Mr. Chairman. I guess I had one question on the mineral, oil and gas section. Is this where the new position would be for, I think we talked about a permafrost specialist in some of the preliminary discussions?
Thank you, Mr. Bouchard. Mr. Ramsay.
Thank you, Mr. Chairman. Yes, the permafrost scientists would be located and working out of the geoscience office located here in Yellowknife.
I guess I continue to have some concerns in that area. I know we have requested that the department look at relocating that to a more northern location, a northern community where I personally feel that permafrost is a larger issue. I think it stems back to some of my comments earlier today about decentralization and positions. I understand that the department wants to look at a group issue, grouping some of these positions together, but as individual MLAs we have to fight some of these battles on a one-on-one position at a time. I just know the department has justifications as to why they think the position should be allocated in Yellowknife and most of them are, in my personal opinion, excuses.
My question is: Has the department… I know the department has given us some information on the costs related to maybe positioning it into the higher north, but have they looked at all the locations where they could position this office, this position? Because I just am fighting with the point that these positions are going to headquarters or going into, I know it’s going through the geoscience office, which is in the North Slave office, which is still part of Yellowknife. The point that I’m trying to make is, the priority is to get the jobs out in the regions, and an area where we’re doing the Tuk to Inuvik highway is a major project and maybe an area where we definitely need that type of specialist in permafrost to look at some of the potential operating costs of that new road we’re looking at building. It makes sense to me that that position would be located closer to that type of project or somewhere up the Mackenzie Valley where we’re looking at developing a highway. I guess I’d just like to hear what the Minister has to say about that.
I appreciate the Member’s questions. We did look at that through the business plan review and it was still our belief that the position was better suited to work with other scientists at the geoscience office. It’s a permafrost geologist position. There would be increased costs if we were to locate that position, say, in Inuvik.
Again, I want to go back to something I mentioned earlier, and I think in the bigger context when we look at decentralization and with devolution coming, I think we need to look at this more as a comprehensive overall look at government and where positions are, instead of one position here, one position there, and maybe better suited here, maybe better suited there. That would be our belief, is it would be best to situate the position at the NTGO in Yellowknife to work with the other geologists. It’s a science centre.
That’s it. Thank you very much.
Thank you, Mr. Bouchard. Mr. Moses.
Thank you, Mr. Chairman. I was going to make a quick general comment about the Mackenzie Valley Pipeline office and with the downturn and, I don’t want to say lack of activity, but how other groups are addressing it and reacting to it and yet we’re still continuing to put money into the office. I just want to make a general comment. I know we did a comment back to Mr. Bromley earlier.
I have a question in terms of the line item of industrial initiatives there. There is a decrease and the mandate of the industrial initiatives outlined in the activity description do a lot of work in terms of the socio-economic agreements and trying to make sure that this government gets the best bang for its dollar, I guess, and with the reporting and making sure that this government is accountable and transparent with the reports and that everything is brought forth so that we know what government is doing on behalf of the Northerners.
In my earlier general comments I talked about how we’d like to get more northern jobs in some of these mining industries. If I can ask the Minister why there is a decrease and how is that going to affect the mandate of this area under industrial initiatives.
Thank you, Mr. Moses. Mr. Ramsay.
Thank you, Mr. Chairman. The mandate hasn’t changed. The reduction that the Member sees there is a result of the sunsetting of the mining MOU that happened. We continue to work with the three mines to move forward and try to identify a new approach. That work is going to continue.
Thank you, Mr. Ramsay. No further questions. Moving on to questions. Mr. Yakeleya.
Thank you, Mr. Chairman. The office of the Mackenzie Gas Project, the Minister indicated that his department and the government have not yet given up or thrown in the towel on this project. The Mackenzie Gas Project has gone through some pretty rough rides. It’s on and it’s off. I’m not too sure, but we know the project is there. We all know that. But when you start to read and hear that oil companies are pulling out of the project, Esso is pulling back its staff on this project, the APG has cut back on staff. There are meetings in Ottawa and I’m not too sure what’s happening. The price of natural gas is down. We know there has to be better times where the project is up again to some form of construction.
The Mackenzie Gas Project is a valuable project for Canada and the North, and we just don’t know when. There are lots of what if’s in the future. Now, the Mackenzie Gas Project staff has done some good work right across the North. They have done some good work in the communities. There’s a lot of work yet. We’ve got to get the union on side for the North and our training. How long it takes to train an apprentice welder or people you’re going to need on the pipeline. Has this office talked to the union and said we want you guys to start training the people down the Mackenzie Valley? There’s going to be a union on that pipeline. The union will have the insurance and the liability to cover any leaky pipeline.
I want to ask this Minister, are we ramping up our people in our communities for the training. You know, there’s money there from the federal government for the communities for socio-economic impacts, $500 million, and if the pipeline is still coming, are we preparing our trainers, our workers to say tomorrow you’re going to work with this union? This union is going to hire you or they’re going to bring up their own people from the South. Too late.
I want to know that kind of work we’re going to be doing with the Mackenzie Gas Project, then I’ll go into the Sahtu and oil and gas play. I want to know what kinds of things that the pipeline office is going to do. Thank you.
Thank you, Mr. Yakeleya. Mr. Ramsay.
Thank you, Mr. Chairman. I thank the Member for his questions. Over the past seven months, related to the MGP, I’ve been speaking directly with industry. I’ve been meeting with the APG, and we continue to support the APG. I believe, as a government, we have to remain optimistic. We have to remain positive. It’s a matter of when that project does go ahead. The key mandate of the office is to work with communities, to explain opportunities to communities, to explain the regulatory process and help build capacity.
When the Member was talking about the $500 million socio-economic funds that the feds had said they would provide to communities impacted by the pipeline, that money, obviously, is not set to flow to communities until such a time as the decision to construct that project goes ahead. When that does happen, that’s when that money would flow. But obviously, with a project of this size and magnitude there’s lot of opportunities that would avail themselves for people up and down the Mackenzie Valley. Thank you.
The Minister’s Mackenzie Valley Pipeline office mandate to work with the communities, I like to see them come into the Sahtu and say, okay, community of Tulita and Norman Wells, we need X amount of welders, pipefitters and et cetera, et cetera, when we know for sure the pipeline is coming down. Are we ready? Have we done the assessment? Because right now, like I said, we don’t know, and maybe that’s our strategy, is to continue saying we support the Mackenzie Gas Project. I don’t know. Someone’s got to tell the emperor he has no clothes. We can’t keep saying that.
For me, the big push right now is in the Sahtu where the oil and gas phase is happening. There’s interest there. Eleven parcels. That’s a record in the Northwest Territories for going up. That’s a record for the amount of money that’s going into… That should say something to this government. Hey, something’s going on here when Husky’s going to spend over $370 million within five years, and Shell and all those other companies. That certainly should have said something to the government. We’ve got some big players coming in, big players.
I’m really looking forward for this department here to put some serious dollars, serious thought to the Norman Wells oil play…(inaudible)…Tulita, however that gets done. You got the smarts there with your staff there. We need the help or we can work it together. The permafrost position, I think, needs to be out of Yellowknife. I hope the Minister looks at these issues.
I want to ask the Minister if we would see something to support the Tulita district in the Sahtu. Thank you.
Certainly, I support what’s happening in the Sahtu. We’re not just sitting back and watching it happen. I’ve been working with the Member. The Member knows I’m a big supporter of the Sahtu and the activity that’s happening there, as is the government. We want to see us maximize those opportunities, and I think we have been doing that. I look forward to getting in front of committee here during this, I’m not sure exactly which day it is, but I know we’re planning on coming and updating committee, and I’ll be updating Cabinet, as well, on the developments in the Sahtu and what’s happening there. I look forward to doing that because, the Member’s right, it’s exciting. There’s a lot of money that’s going to be spent there and a lot of jobs created and business opportunities as well.
We’ve answered the bell, too, when it comes to trying to help Members understand what’s going on there. I’ve offered to help coordinate an industry day in Calgary later this summer where the EDI committee and, I believe, Mr. Yakeleya will be joining them as well. We’ll go down, we’ll have a tour of a hydraulic fracturing operation, we’ll meet with industry, we’ll meet with the NEB and some academia, as well as environmental reps while we’re in Calgary for a few days. I believe it will be held in August. We’re looking forward to doing that. I think educating folks on the possibilities and what’s there is paramount. I mean, that foundation has to be laid about what the opportunities are in the Sahtu.
As we go forward, I mentioned this earlier, I believe, in questions, but there is so much opportunity there. I think, as a government, not just our department but, I believe, it’s going to have a big impact on government’s various departments when you look at projected population spur in communities like Norman Wells and Tulita, if there are the two to three billion barrels of oil that experts predict is in the shale formations across the river from Norman Wells. It’s exciting opportunities for our government. There are going to be pressures put upon us, but I believe the government can answer that call if we work in a coordinated way. There’s going to be more pressure put on health, there’s going to be pressure put on the education system. So it’s not just in our department. I think a lot of people are watching what’s happening there and it’s not out of the realm of possibilities, Mr. Chairman, that 10 years from now Norman Wells could be the second largest community in the Northwest Territories, so we really need to watch what’s happening there and are excited about all the prospects that exist in the Sahtu. Thank you.
Thank you, Minister Ramsay. I just noted that your time has expired so, Mr. Yakeleya, if you have more questions I can put you back on the roster. Would you like to continue, Mr. Yakeleya? Mr. Bromley.
Thank you, Mr. Chair. I didn’t mean to interrupt my colleague’s flow there, but I just have a few quick ones. First of all, the department seems to be focusing on large projects quite a bit. That’s great when they happen. You know, there’s potential for a lot of benefits, but we don’t have a lot of influence on whether or not they happen. That’s primarily an economic analysis. We do have a lot of influence on whether or not and to the degree to which and how we make sure we tie down benefits from those big projects when they happen.
An example was mentioned by the Minister of Finance in his opening address when he talked about our diamond mines. In 2011 we exported $2.1 billion worth of diamonds. I’m not convinced that we are getting the benefits, especially in the way of lasting benefits and legacy benefits that we should be from the extraction from these non-renewable resources. Once they’re gone, they’re gone.
I get the sense that that approach is continuing here. We are interested in big projects at any cost. We do have some socio-economic agreements and I think we have some good ones. But letting the world know that we support the Mackenzie Gas Project, my gosh, I assure you the world knows the NWT supports the Mackenzie Gas Project at any cost. That includes socio-economic costs.
So I don’t think that’s the correct road to go down. I think we want to be taking a critical approach and so that’s why my emphasis is on the opportunities right now until these projects happen, and working with the communities on things that are appropriate for those communities and obviously where the needs are the greatest. So I guess I’d appreciate any perspectives on that from the Minister.
In terms of the Mackenzie Gas Project, again, we are continuing to fund that as if it’s going to happen soon. It’s clearly not. The Minister knows that. I don’t think he debates that. So I’m mystified by this, you know, believing that it will happen eventually, which he does and he’s said I agree with this. It likely will at some point in time. But why keep spending? I will have other questions later, but I’m just a bit mystified there.
Thank you, Mr. Bromley. Minister Ramsay.
Thank you, Mr. Chairman. I appreciate the Member’s perspective. When you look at the department, it’s varied what responsibilities we have. As Minister, it’s my job to try not to pay too much attention to one area and try to balance myself out and support all the efforts that the department has, whether it be in small business, tourism, the traditional economy, manufacturing and services or projects like the Mackenzie Gas Project, offshore developments.
These are going to be important to the Northwest Territories and the residents here in the Northwest Territories. Yes, market conditions will dictate somewhat, but at some point in time when those resources are developed, when we have a Devolution Agreement complete here in the Northwest Territories, we will be getting resource royalties here into our coffers here in the Government of the Northwest Territories.
Within 60 days of that Devolution Agreement, we can go back to the federal government and look at negotiating a deal on offshore royalties much like the provinces of Newfoundland/Labrador and Nova Scotia have. To me, that’s where the future lies when you look at resourcing government objectives, providing programs and services for people in this territory for decades to come. We need to balance all of that and it’s a tough one to do, but my objective, as Minister, is to try to balance all of that. I have to be many things to many people. I’ve sat down with the agricultural folks in Hay River. I’ve been to mining conferences, oil, it runs the full gamut. It’s just taking a balanced approach to everything.
I mentioned earlier a diversified economy is a strong economy and that’s what my focus as Minister is going to be, is that diversification and providing opportunities in all of our communities. That’s why I’m so excited about the advancement of this Economic Development Strategy and what it means to the Northwest Territories as we move our economy forward. I think we have just scratched the surface when it comes to providing jobs to people in the small communities. I think if we put a real effort into this strategy, it will pay huge dividends for us down the road. Thank you.
Thanks to the Minister for those comments, many of which I agree with. I, too, look for the time when we will have access to royalties that will fund some of our other priorities and so on. Being a bit longer in the tooth perhaps, or maybe for some other reason I found that generally one thing is not the answer to everything and I don’t think devolution or MGP is the answer to everything. I agree with balance. I think we are out of balance now in terms of our ongoing commitment, both apparent and real, in terms of participating in international meetings and travel and advertising, as well as actual dollars.
I am a bit mystified, again, with that aspect of it. I agree with my colleague, things are obviously happening in the Sahtu. We need some resources focused in that area. I know the Minister is thinking about that and I’ll be looking forward to hearing about progress in that area, as I said earlier. I’ll leave it at that. Thank you, Mr. Chair.
Thank you, Mr. Bromley. Just a follow-up. Moving on to your questions, Mr. Yakeleya.
Thank you, Mr. Chair. I want to ask this department on the oil and gas information that we’ve been receiving the last couple of days on the resources and how the oil companies are looking at ways to extract the oil out of the Tulita district and the Sahtu through Norman Wells.
They talked about the hydraulic fracking. I know this is old and new information. It’s been used in Canada for awhile. It’s fairly new to us here. They did a little bit up in the Fort Liard area in the gas fields there, but with us in the Sahtu, they are talking about this as a potential method that they want to extract shale oil. It’s quite new for us and I know the National Energy Board and federal government and our departments, government departments, have been putting together some informational sessions and they’ve been going to Good Hope, Norman Wells and Tulita. It’s a method that is new to us. It’s scaring some people, especially with the amount of oil, the water and air. There’s a whole process. It also has potential to create some long-term economic sustainability and jobs and employment, but it’s got to be done in a strict, disciplined manner. We always have to keep on top of this method here and not let it run amuck, so to speak.
So I want to ask the Minister within his department, keeping the Mackenzie Valley Pipeline office staff busier and busier, is that something that they are looking at with us, with the government in saying we’re going to do our best to get this information into the community and get them talking and not at the last moment? So is this something that the ITI department is looking at to continue advancing more education to our people and also into our government? Thank you.
Thank you, Mr. Yakeleya. Minister Ramsay.
Thank you, Mr. Chairman. I thank the Member for that question. In regard to what we have been doing, we’ve been working with AANDC as well as NEB and the Member is aware that they’ve delivered community information sessions in the Sahtu region on the issue of fracking. We, as I mentioned earlier, are planning a trip with the Economic Development and Infrastructure committee and we’re looking forward to that. I think in that we will get a chance to discuss the issue with academia, with environmental groups and also with industry. So I think we’ll get a good balance on that tour and certainly look forward to that.
Also, we will be getting in front of committee sometime here in the next little while and I look forward to that briefing that we have EDI, and perhaps the Member will come to that briefing where we’ll update Members on activity in the Sahtu. We can have a good discussion there as well.
What I wanted to mention was that between the Department of ITI and the Department of ENR and also Health and Social Services, we’re working together to outline the economic opportunities, environmental concerns and human health issues related to the use of nonconventional hydraulic fracturing techniques on the Northwest Territories, and we expect that the work would culminate in a discussion document and we’ll have that document able to review in advance of the drilling season next year. So we’re working on that and it’s important that we continue to work to get all the facts on the table, so we can make that balanced approach.
Just in relation to the Member’s comments about the MVPO and, again, I was before committee and I listened to committee during the business planning process. We are reviewing that and we will be moving forward with decisions on that and a communications strategy related to that in the near future. Thank you.
I look forward to the Minister continuing his work on this initiative. I think I just have to work my schedule and look at when to do a presentation to the EDI so that I can come in then. So I look forward to the Minister’s continued work on this whole issue here. I’d like to see how far, when you clear the dust off and you see how big this thing is and say okay, this is what we’re dealing with and this is real. This is not one year, this is 10 years, 15 years and this could possibly be significant for the North.
So in saying that, I want to just get to an issue here that Mr. Bouchard talked about with resources in our region and moving some of these positions out of the larger centres such as Hay River or Yellowknife. We talked about, somewhat, the permafrost position or specialist in the Yellowknife area. Mr. Minister indicated, through his letter to us, the reasons why it was going to be difficult for fiscal, saying that it’s better to have it in Yellowknife, plus he’s got all his buddies here or all the people here that they can associate together. We as committee want to move this position out where we see it more valuable. Either in Inuvik or the southern portion, but we gave our reasoning. I wanted to ask the Minister is he firm on that position being situated in Yellowknife and having no chance of moving outside. We talked about Inuvik being possible for many reasons and there are many reasons that you can communicate with your colleagues. So why is he so firm on having this position here in Yellowknife other than it’s going to cost us an extra few thousands of dollars? I’m a little bit lost here.
Again, I just wanted to mention something I mentioned earlier, and that is the government has made a commitment to look at decentralization and the possibility of moving some positions. I think before we begin looking at one position here or one position there, it would be in our best interest to look at it collectively and in a comprehensive fashion before we make decisions just to one-off moving a position here or moving a position there.
In our review of the position of the permafrost geologist, it was best situated here at the NTGO, and that’s the geoscience office. It’s a permafrost geologist position, and with the other scientists and geologists that are located at that NTGO office there would be some synergy there and opportunity for them to get together. We have to remember this position, even if it is located in Yellowknife, would be hard to hire a person of that calibre. We’re hoping for the best. We’re hoping we can go out and find somebody to fill this position, but in Yellowknife even we’ll be challenged to find a person to fit that position here in Yellowknife. So we’re going to be challenged at the best of times in recruiting for this position. Thank you.
Thank you, Minister Ramsay. I’m just noting the clock and I believe we’ll be taking just a short recess and returning to page 12-17.
---SHORT RECESS
Welcome back, committee. Welcome back to Mr. Ramsay, Ms. Magrum and Mr. Vician. We are on page 12-17, Industry, Tourism and Investment, activity summary, minerals and petroleum resources, operations expenditure summary, $6.802 million. Mr. Bouchard.
COMMITTEE MOTION 4-17(3):
DEFERRAL OF CONSIDERATION OF
MINERALS AND PETROLEUM RESOURCES ACTIVITY UNDER ITI,
CARRIED
Thank you, Mr. Chairman. I move that the committee defer further consideration for the activity summary of minerals and petroleum resources under the Department of Industry, Tourism and Investment main estimates 2012-2013 on page 12-17 at this time.
Thank you, Mr. Bouchard. We’ll just give a second for the motion to be circulated.
A motion is on the floor.
Question.
Question has been called. Motion is carried.
---Carried
Thank you, committee. Consideration of activity summary under the Department of Industry, Tourism and Investment on page 12-17 has been deferred. Page 12-18, Industry, Tourism and Investment, activity summary, minerals and petroleum resources, grants and contributions, contributions. Mr. Bromley.
Thank you, Mr. Chairman. I’m wondering about the Mackenzie Valley development contributions, $715,000. I wonder what is our contribution to the Aboriginal Pipeline Group given that all the other proponents are closing their offices and shutting down on a temporary basis, at least. What is our contribution to the APG?
Thank you, Mr. Bromley. Mr. Ramsay.
Thank you, Mr. Chairman. That remains at $300,000.
This is a group of very capable people and we want to see them be successful, but obviously, in terms of the MGP, that won’t be for some time now. What analysis did the department do to continue with that support in lieu of what we know is the current situation and the responsibility to our taxpayers to put our money in the most appropriate places where demands are greatest for success?
Perhaps I’ll go to Deputy Minister Vician to explain that.
Thank you, Mr. Ramsay. Mr. Vician.
Thank you, Mr. Chairman. We have made a multi-year statement to the Aboriginal Pipeline Group for continued support at the increased level of $300,000 a year pending an annual appropriation from this Legislature in review of the amount of funding that they need on an annual basis. They have seen some reduction from some of the proponent parties; however, we’ve signaled to them pending approval of this budget that we would advance $300,000 this year.
Thank you, Mr. Vician. Mr. Bromley.
Is it the understanding of this department that the MGP will not be going ahead for several years, likely late 20-teens, 2020?
Thank you, Mr. Bromley. Mr. Ramsay.
Thank you, Mr. Chairman. That would be unknown at this juncture.
Thanks for that interpretation of everybody pulling out. I’m sure that’s getting some chuckles across the territory on a very serious subject. Given that the MGP will not be pulling forward, is this just blind support that we freely give away taxpayers’ money on an impossible venture to which there will be absolutely no progress possible for the next few years? Or are we requiring some response for those dollars such as they become experts in biomass and start doing some biomass projects or something like that? Obviously, they’re based, I believe, in Inuvik and there are serious energy issues there and we’re talking about renewable energy as one option. What are we doing? Is this blind support, no questions asked? Here’s $300,000 of taxpayers’ money despite so many demands?
The Government of the Northwest Territories has supported the Aboriginal Pipeline Group in the past and we’re continuing to support the APG. It’s important that we do that. I don’t believe it’s going blindly. I believe it’s supporting the potential advancement of the Aboriginal Pipeline Group. When the Mackenzie Gas Project does go ahead, they will own one-third of that pipeline and it will be the big piece of the capacity building for Aboriginal groups in the Northwest Territories. Our support of the APG is integral to that advancing. With the MGP, we’re optimistic that it will see the light of day, and it’s a matter of when, not if.
The issue is that we know the when does not include the next number of years. So this I view as close to insanity and certainly irresponsible use of taxpayers’ dollars. I wonder if the Minister would commit to giving us a full accounting for the dollars that we’ve given the Aboriginal Pipeline Group this current year or last year and if we can expect that to occur for this fiscal year for this $300,000.
We’d be pleased to provide that to the Member. Last year we gave APG $300,000 and we can certainly get an accounting of that $300,000 for the Member.
Just on the Resource Predevelopment Program and the Aboriginal capacity building and community consultations, could I get a breakdown of what those are for as well?
