Thank you, Mr. Speaker. Further to my statement today, I have some questions for the Minister of ITI. In 2013 the government released the Economic Opportunity Strategy. It recommended the development of an oil and gas strategy. That was three years ago. Where are we with this? When can we expect this strategy? Thank you, Mr. Speaker.
Masi. Minister of Industry, Tourism and Investment.
Much work has been done on the oil and gas strategy in the latter stage of the 17th Legislative Assembly, including the release of the public engagement report “Pathways to Petroleum Development.” The strategy was recently identified as a mandate priority for the 18th Legislative Assembly. The resource sector is the single-largest contributor to the Northwest Territories’ economy. Our territory has world-class oil and natural gas reserves and has had an active petroleum industry for a century. The draft strategy is being reviewed and edited by a Government of Northwest Territories interdepartmental working group. Following this, the draft strategy will be released for input from Aboriginal governments, regulators, industry, and online for public comment. Changes will be made based on comments received to finalize the strategy which is planned to be publicly released in 2017.
2017, we’re still a year away. A lot of analysts believe oil is rebounding at a much quicker rate than expected. I know some good policy people with a lot of experience in Hay River who might be able to help the department get this done a little bit quicker. Earlier I also mentioned some of the challenges we’re facing attracting investment. What does the Minister see as our biggest challenge and what’s the department doing about it?
In my opinion the lack of infrastructure is the biggest constraint on attracting investment in the Northwest Territories as well as the low commodity prices and the very high cost of operating in the Northwest Territories. Construction of the Mackenzie Valley Highway would reduce exploration and developments costs along the corridor by as much as 40 per cent. The 2015 Review Report of the Canada Transportation Act estimated a leverage factor of 80 for the Mackenzie Valley Highway, which means that for every $1 of federal and Northwest Territories’ investment in the Mackenzie Valley Highway the economic benefits related to increased resource development will be $80. Transportation and infrastructure is not only needed for equipment, people, supplies, food and energy but also for data to facilitate communication research. The Mackenzie Valley fibre optic line is also being constructed up to Inuvik and will enable expansion of the Inuvik satellite station facility as well as provide high-speed Internet and telecommunication services to the Beaufort Delta. We have opportunity to responsibly develop, produce and export our petroleum resources to global markets to create high-paying jobs, lucrative contracts for our businesses and tax and royalty revenues for the Northwest Territories, Aboriginal, and federal governments. I too am encouraged by the fact that the price of oil is increasing.
Thank you for that answer. I also understand that the regulations pursuant to the Oil and Gas Operations Act and the Petroleum Resources Act are being reviewed. How is this process being undertaken? Who is being consulted in this?
We cannot deny that we sit in the down cycle of the commodity markets right now. This is something we have seen before. Commodity markets rise, they fall, they recover. It’s a natural flow of the markets. As we sit in this downturn, our government is hard at work ensuring our jurisdiction will be ready to capitalize on the next peak in commodities. ITI has started work reviewing the Oil and Gas Operations Act and the Petroleum Resources Act, regulations pursuant to those acts, and associated policies. Policy intent discussion papers are being developed which will introduce potential changes. These papers will be shared with Aboriginal governments, regulators, industry and the public to provide an opportunity for input on the potential changes the Government of the Northwest Territories is considering, as well as petroleum-related policy issues that stakeholders and Aboriginal governments might wish to raise. Legislative and regulatory drafting will be done by the Department of Justice and follow the legislative and gazetting process.
Masi. Oral questions. Member for Hay River North.
Thank you, Mr. Speaker. We discussed infrastructure, regulation. Research is another big component of this. We need the research so we know the areas to focus on and help industry out. Is the government doing anything on the research front? Thank you, Mr. Speaker.
Mr. Speaker, research is a key component of a strong future for any resource economy. ITI’s new NWT geological survey division helps to fill this need and provides publicly available geoscience information that is used to stimulate mineral and petroleum exploration and investment, understand environmental change, assess mineral and petroleum resource potential, and assist in infrastructure projects and use decisions. Current projects focus on topics such as diamond exploration in the Slave Geological Province, mineral potential of the Mackenzie Mountains, permafrost melting and associated landscape and water quality change. They also administer the Mining Incentive Program. The NWT geological survey division also recently participated in unconventional petroleum resource assessment for the Canol and Bluefish Shale Oil Play and the Liard Sedimentary Basin. In the Canol/Bluefish Shell Play they identified the potential of 200 billion barrels of oil, and in the Liard Sedimentary Basin 137 trillion cubic feet of which 44 trillion would be in the Northwest Territories. These are both world-class oil and gas plays. These assessments are preliminary but indicate significant petroleum potential in both locations.
Masi. Oral questions. Member for Mackenzie Delta.
