Debates of February 21, 2017 (day 57)
Yes. You know, I hope I don't have to say, "I told you so," in the next year or two, but let's just hope that Inuvik is not put in danger with this decision that was made by the department. You never know how long freezeups can last, especially with climate change right now. The average is two months from the time they pull out the ferry until the heavy traffic can move through the ice road, so that is a lot of time. That is over 60 days that something tragic could happen with the situation that they have in Inuvik with the natural gas and LNG. We will just have to see what happens here. Thanks, Mr. Chair.

Thank you, Mr. Blake. Anything further from the Minister?
Thank you, Mr. Chair. I just want to clarify that it is actually 36 days that cost us $1.8 million. I stand behind, as I have said on a number of initiatives, that we warrant that this initiative being put forward as a costsaving measure is justifiable, and we will stand behind it. Thank you, Mr. Chair.

Thank you, Minister Schumann. Mr. Blake.
Thank you, Mr. Chair. I think the Minister is referring to light traffic. Light traffic can transfer LNG, just for his information. Thank you, Mr. Chair.

Thank you, Mr. Blake. Anything further, Minister? Nothing further from the Minister. Next on my list I have Mr. Nakimayak.
Thank you, Mr. Chair. Mr. Chair, I am just looking at bullet number three, highway operations. I see there is an increase. Can the Minister elaborate on that? Thank you, Mr. Chair.

Thank you, Mr. Nakimayak. Mr. Neudorf.
Thank you, Mr. Chair. The majority of the increase there is actually just an amortization adjustment, so it is not actual cash. $2.3 million of that is amortization adjustment, mainly because we anticipate the Inuvik to Tuktoyaktuk Highway to come into service and so we will start amortizing it.
There is also an increase of about $300,000 related to operating and maintaining the Inuvik to Tuktoyaktuk Highway, so we will begin to do that next fiscal year. Then there is a reduction that we had started last year. We were reorganizing some of the highway operations in the South Slave region, so there is a $250,000 reduction associated with that. Thank you, Mr. Chair.

Thank you, Deputy Minister. Mr. Nakimayak.
Thank you, Mr. Chair. Getting back to the Inuvik to Tuktoyaktuk Highway on this, has the department started looking at tendering for the maintenance of the highway? Thank you, Mr. Chair.

Thank you, Mr. Nakimayak. Minister.
Thank you, Mr. Chair. As we get closer to completion, we are actually still reviewing that. Thank you, Mr. Chair.

Thank you, Minister. Mr. Nakimayak.
No further questions right now. Thanks, Mr. Chair.

Thank you. Next, I have Mr. McNeely.

Thank you, Mr. Chair. I'm just looking at operations on page 239, the program detail. I understand my colleague in the Delta's concerns. As you all know, we had a near miss last year where a tanker actually partially did go through the ice on Bear Lake. If it had in fact gone through, it could have created a catastrophe for downstream communities.
I am glad to see the operations as it is covering some extra allowances for the winter roads, whether it is north of Yellowknife. Hopefully, some of those monies might be increased for additional flooding requirement to minimize the risk and ensuring that the heavy traffic destined for Deline does not interfere into high risk factoring in.
As we speak right now, the community of Deline sees on the average of 60 to 70 truckloads of fuel come in for the Power Corporation, community demands, and the home heating fuel. To date, we have not seen one load of fuel go on that road yet or go across the bay to the community, so with this extra funding, I am hoping that some of that would be directed to providing assurances on flooding the bay going across to the community of Deline. Thank you, Mr. Chair.

Thank you, Mr. McNeely. Minister.
Thank you, Mr. Chair. As the Member is well aware, we have sent our staff in there along with the operator. Last year's incident, they met with the community along with our staff to discuss what happened last year and how we can best move forward. We are doing our due diligence. We have met with the operator last year.
We met with the department, as well, to discuss what happened and what we can learn from that moving forward. As far as the resupply of Deline, itself, we tend to do the other communities first to help the contractor build up the ice thickness to what it needs to be to access the community for the fuel trucks. Thank you, Mr. Chair.

Thank you, Minister. Mr. McNeely, anything further?

Yes, thank you, Mr. Chair. I am glad that it is being addressed and being considered, I would say. Just moving up the ladder to regional projects here, on the same page, is there any money destined for my new office in the Sahtu for regional projects, Mr. Chair? Thank you.

Thank you, Mr. McNeely. Minister.
Thank you, Mr. Chair. Yes, there are two positions. Thank you, Mr. Chair.

Thank you, Minister. Nothing further from Mr. McNeely. Next, I have Mr. Nadli.
Thank you, Mr. Chair. I wanted to get a sense in terms of the Department of Transportation's plans for the Mackenzie Valley Highway. I wanted to ask the Minister: what is the status of the Mackenzie Valley Highway?
I understand with the winding down of the Inuvik to Tuktoyaktuk Highway, and then there are other initiatives at play, too, namely just recently the announcement of the Whati road initiative, as well, but I just wanted to get at least an understanding of where is that road to the Mackenzie Valley? I think the last discussion was that there is maybe some consideration of extending the road from Wrigley to Tulita, or else perhaps from Tulita right to Good Hope to Inuvik. Thank you.

Thank you, Mr. Nadli. Minister.
Thank you, Mr. Chair. First of all, on the Mackenzie Highway, as all Members are aware, we announced the Canyon Creek project. Hopefully, that is getting kicked off here in the next month or so, with that initiative moving forward, employing a number of people and training them in the Sahtu region.
As far as the Mackenzie Valley Highway ask with the federal government, as I have stated in the House, the federal government put that program on pause. We have submitted a business case for that project moving forward, and we are waiting to see what the federal government does, coming in their budget address. Thank you, Mr. Chair.

Thank you, Minister. Mr. Nadli.
Thank you, Mr. Chair. I just wanted to get a sense in terms of the priorities scale. I understand there are other initiatives, including, as I stated, the Whati road that will be in progress here fairly soon. What priority scale would be the extension of the Mackenzie Valley Highway? Mahsi.

Thank you, Mr. Nadli. Minister.
Thank you, Mr. Chair. As all Members know, it's in our mandate, all three parties, and the department is chasing all opportunities for all three sections of the highways, the Slave Geological Province, the Mackenzie Valley Highway, and the Whati one. The Whati highway, the federal government has made their commitment and, as I've stated in the House, it's going through its regulatory environmental process, and we will continue to work on that as it gains more traction and we continue to promote both the Mackenzie Valley Highway and the Slave Geological Province and focus on the ones that seem to get the federal attention. Thank you, Mr. Chair.

Thank you, Minister. Mr. Nadli, anything further?
Thank you, Mr. Chair. My final question on this is: the Minister stated that the federal government has put the pause on the initiative of the Mackenzie Valley Highway; similarly, has his department put this project on pause, too? Thank you.

Thank you, Mr. Nadli. Minister.
Thank you, Mr. Chair. No, we have not put this project on pause. While the federal government is trying to figure out how they're going to allocate their infrastructure money, we continue to look at other opportunities moving forward, be it the department or CanNor's funding or other opportunities moving this initiative forward. Thank you, Mr. Chair.

Thank you, Minister. Mr. Nadli.
Thank you, Mr. Chair. No further questions.

Thank you, Mr. Nadli. Seeing nothing further from committee, I will call this activity. Infrastructure, regional operations, operations expenditure summary, total activity, $126,995,000. Does committee agree? Mr. Vanthuyne.
Committee Motion 58-18(2): Tabled Document 261-18(2): Main Estimates 2017-2018, Infrastructure, Deferral of Regional Operations Activity, Carried
Thank you, Mr. Chairman. Mr. Chairman, I move that this committee defer further consideration of the activity regional operations under the Department of Infrastructure, Main Estimates 2017-2018 on page 239 at this time. Thank you, Mr. Chair.

Thank you, Mr. Vanthuyne. There is a motion on the floor and it is being distributed. The motion is in order and is non-debatable. All those in favour? All those opposed? The motion is carried.
---Carried
Thank you, committee. Committee, we will move on to the series of information items beginning at page 241 and continuing on to page 248. This includes information items on the Technology Service Centre, Public Stores Revolving Fund, Petroleum Products Revolving Fund, lease commitments, and work performed on behalf of others. We can tackle these all at once. If committee has comments or questions on a particular activity, please let us know which page you are speaking to. Comments or questions on any of the information items, pages 241 to 248. I'll give committee a moment. Mr. O'Reilly.
Thanks, Mr. Chair. I'm looking at page 244, which is the Petroleum Products Revolving Fund. I see that there will be a deficit in this revolving fund at the end of 2017-18. Can someone from the department explain how we're going from a surplus of $115,000 in the current year to a deficit of $100,000 in this year or the year to come? Thank you, Mr. Chair.

Thank you, Mr. O'Reilly. Mr. Guy.
Thank you, Mr. Chair. So the Stabilization Fund is really the positive or negative revenue we get through the sales of fuel. So once we determine our pricing and sell the fuel to the residents and consumers that we buy it from, we have to offset that with our operating costs. Our costs are based on the salary, the transportation costs, the cost of purchasing the fuel, and all those things. In any given particular year we could have lower than anticipated costs, so we'll end up with an excess in the Stabilization Fund, so that would be that we collected more money from our customers than we needed to deliver the program. Conversely, if we have a situation where our winter roads are in poor condition so we have to take lighter loads and we have higher transportation costs, we may be selling fuel at a loss until such time we get the price change in effect. The Stabilization Fund… We're permitted by legislation to be plus or minus $1 million. We like to keep that fund at around plus $500,000. As you can see it's been creeping up a little bit, so the proposed deficit is really just to bring it back down into a range that's more comfortable for us, around that $500,000 range. Again, that's a forecast; it's based on how much we think we're going to sell the fuel, how much we think it's going to cost to buy it. It's also forecast based on what our operating costs will be and a number of other factors. So it's a very conceptual number, if you like, when you get that far down. The only actual number in there, I think, is the closing balance of 2015-16. We have not yet finished this fiscal year so we don't even know what the 2016-17 closing balance in the fund will be. Thank you, Mr. Chair.

Thank you, deputy minister. Mr. O'Reilly.
Thanks, Mr. Chair; it's a helpful explanation. So with the GNWT taking on the operations of former NTCL, will that have any impact on the revolving fund? Thank you, Mr. Chair.

Thank you, Mr. O'Reilly. Deputy Minister Guy.
Thank you, Mr. Chair. The thinking right now is no. If we were to set up that service through a revolving fund it would likely be a separate revolving fund. So the marine transportation that was purchased from the private sector is shown in here in this fund, that would then just be a purchase out of the other revolving fund. We're not proposing at this time to combine them into this fund. So the short answer to that question is no, there's no impact on this revolving fund; we would be just be purchasing from another internal service. Thank you, Mr. Chair.

Thank you, Mr. Guy. Mr. O'Reilly.
Thanks, Mr. Chair. Maybe I'm not quite understanding the response there. I understand that we're going to do the shipping or try to contract the shipping of petroleum products to at least four communities. The fact that we're doing it now rather than NTCL, can we expect to see any impact on this revolving fund as a result of us doing the work in terms of the shipping? Thanks, Mr. Chair.