Thank you, Mr. Speaker. Your Standing Committee on Economic Development and Infrastructure is pleased to provide its Report on August 2012 Hydraulic Fracturing Study Tour: Towards a Policy Framework for Hydraulic Fracturing in the Northwest Territories and commends it to the House.

Introduction

The emerging shale resource play in the central Mackenzie Valley has the potential to bring unprecedented economic activity and prosperity to the Sahtu region and the Northwest Territories as a whole. These oil and gas resources must be extracted through the use of the horizontal drilling process and multi-stage hydraulic fracturing, used to extract hydrocarbons from deep subsurface shale. Hydraulic fracturing, or fracking, has attracted worldwide attention and continues to be the subject of much publicity and environmental concern. Northern regulators have recently received applications to hydraulically fracture exploratory wells in the Sahtu.

In August 2012, Members of the Standing Committee on Economic Development and Infrastructure, and Sahtu Member of the Legislative Assembly, Norman Yakeleya, traveled to Calgary with the territorial Minister of Industry, Tourism and Investment and departmental representatives on a hydraulic fracturing study tour. Members received presentations from the minerals, oil and gas division of the Department of Industry, Tourism and Investment; the Canadian Association of Petroleum Producers; Husky Energy; and all proponents in the central Mackenzie Valley shale play: TriCan Well Services, the National Energy Board, the Energy Resources Conservation Board of Alberta (ERCB), and the British Columbia Oil and Gas Commission. The committee also visited a gas plant and well site in the Kananaskis area west of Calgary.

Prior to the study tour, the committee sought to establish a basic understanding of the hydraulic fracturing process and the status of drilling activity and regulation in the Northwest Territories and other jurisdictions. The committee met with the departments of Industry, Tourism and Investment and Environment and Natural Resources, as well as the Pembina Institute, to discuss the possible implications of hydraulic fracturing in the Northwest Territories. The goal of this research has been to gain an understanding of the technical, environmental and regulatory aspects of unconventional resource extraction in order to contribute to the development of a responsible policy approach to hydraulic fracturing in the Northwest Territories. The committee would like to take this opportunity to publicly thank all organizations and individuals for their significant time and effort in meeting with Members, engaging in meaningful discussion, and sharing valuable knowledge and expertise. The committee has discussed the findings of its research and prepared this report and recommendations for the Legislative Assembly.

It is well beyond the scope of the committee’s mandate and capacity to comprehensively address all aspects of hydraulic fracturing and its related regulatory processes. Although the committee highlights some areas of specific concern, the main intent of this report is to provide broad recommendations for policy development.

I would now like to turn over the reading of the report to my colleague Mr. Robert Bouchard, MLA for Hay River North.