This is page numbers 5945 - 5992 of the Hansard for the 18th Assembly, 3rd Session. The original version can be accessed on the Legislative Assembly's website or by contacting the Legislative Assembly Library. The word of the day was public.

Topics

Wally Schumann

Wally Schumann Hay River South

Thank you, Mr. Chair. One of the things with these SDLs that are already in place, as I said, there would be significant litigation possibilities with it.

Now, if we want to try to get these companies to create some type of economic opportunity from existing SDLs, I would say exactly that is what we are doing through our petroleum strategy. We are trying to attract investment in the Northwest Territories. We are trying to get the federal government to invest in infrastructure to help lay the way to make it more possible for industry to be attracted to this area, to bring their costs down.

These are the opportunities that we will need to continue to work on in the 19th Legislative Assembly to attract investment back to the Northwest Territories around oil and gas. Thank you, Mr. Chair.

The Chair

The Chair R.J. Simpson

Thank you. Mr. Testart.

Kieron Testart

Kieron Testart Kam Lake

Thank you, Mr. Chair. To be frank, the federal government can't build a pipeline to save its life, so I find it highly doubtful that they will be able to bring forward significant infrastructure to address the concerns that SDLs were created to address.

What can this government do directly, through working with industry, because I will address the liability that the Minister has clearly laid out, to avoid any potential liability of changing the existing SDLs? What can this government do to incentivize or encourage work in the areas that are covered by these SDL licences? Thank you.

The Chair

The Chair R.J. Simpson

Thank you. Minister.

Wally Schumann

Wally Schumann Hay River South

As I have said, Mr. Chair, these SDL-holders that hold a significant amount of opportunity in the Northwest Territories are put into a spot right for you, as the Member from the Sahtu earlier said in his comments today, to attract investment into the Northwest Territories versus some of these other opportunities that lie globally. We are at a significant disadvantage, the way things are playing out globally. There are a lot of challenges around that industry.

Canada, as a whole, is having a problem attracting the oil and gas industry back to Canada as an investment opportunity, and we will continue to work with all of our partners across the country to be able to try to bring opportunities back to our region, and that is what we will do in the rest of the life of this Assembly. Thank you, Mr. Chair.

The Chair

The Chair R.J. Simpson

Thank you. Mr. Testart.

Kieron Testart

Kieron Testart Kam Lake

Thank you, Mr. Chair. I appreciate the Minister's earnest attempts to drive investment in this region, but I don't think that these instruments are working. We have heard directly from stakeholders that they are not working as intended. Going forward, they will work better, but there are still a lot of issues with even the revised forms. At least there is an expiry to the terms, but I am afraid that I am still unconvinced that the current state of affairs surrounding SDLs is the best approach to managing opportunities in our economy.

I wouldn't be encouraging any effort that would drive liabilities up for government or expropriate private property or privately-obtained rights, but we have to do something, and if we can collaborate with these proponents who already have these licences and, again, who can hold them until the end of time, then that would be the best way forward. Even if that is a specific feature of the petroleum strategy or whatever efforts are going forward, we have to do something. People are relying on these opportunities, and to say that we will wait until commodity markets make it feasible or wait until a pipeline is built, we might be waiting a very long time. The economic opportunity is needed now and badly needed in some of our regions. If there is a way to make use of these licences now and to respect that they were granted, to respect that they are federal art facts, but to still make sure of the relationships that they have created, I think that that is the best way forward.

That is more of a comment, but this was a significant concern for me as I reviewed this bill, and it was a significant concern of committee as well. It is not to penalize industry or to drive away investment. Rather, it is the opposite; it is to make sure that we have responsible resource development and that the tools that we create are driving economic opportunity or, at the very least, are driving revenues or benefits for the public Government of the Northwest Territories to benefit the people of the Northwest Territories. We still haven't hit that balance with the existing regime, and that has to change. Thank you.

The Chair

The Chair R.J. Simpson

Thank you. Next, I believe Mr. O'Reilly was on the list. Mr. O'Reilly.

Kevin O'Reilly

Kevin O'Reilly Frame Lake

Thanks, Mr. Chair. I have a few brief comments, and I do have a couple of lines of questioning that I would like to pursue.

First off, I was quite surprised that committee received absolutely no submissions from industry. Not one. Nothing. There is no record of any submissions made to the department as part of their development of the bill, because all of the submissions are still available on their website. To me, that means that there doesn't seem to be a lot of interest on the part of industry in commenting on our regulatory regime that they are actually governed by. They don't seem to be all that interested in doing any work here. I just want to get that on the record.

Now, the scope of the changes that were made was very limited, and I do want to congratulate late the department and the Minister for reversing the onus on secrecy. Right now everything is secret. Now everything is going to be public, unless there is some reason to keep it secret. That is a good thing, so I want to thank the Minister and the department for doing that.

The scope of some of the changes in here, I don't think, are really where they can and should have been, and I will give a couple of examples. The Environment Studies Management Board can and should have been made a co-management approach. I had raised that while the bill was being developed on the floor of this House. That was not done in this bill. We have some tinkering in here to include some public representation on the Environmental Studies Management Board, but industry representatives still sit on this, and I think that that is an inherent conflict of interest.

The scope of the changes does not include royalties, one of the most fundamental things that we have inherited. Even on the Significant Discovery Licences, my colleague mentioned that this does not fix the problem of Significant Discovery Licences. Under this bill, the Minister will still retain incredible discretion over whether Significant Discovery Licences are issued and, more particularly, renewed, and I don't think that that creates certainty.

This bill does not deal with the issue of whether to frack or not. That was a commitment made by this government as part of the mandate, to ensure that our residents have an opportunity to make informed decisions about this matter. This bill does not address this in any significant way.

I want to move on to a couple of issues that I mentioned, Mr. Chair. I raised federal concurrence in my remarks on the report by committee. I would like to ask the Minister why he went out and sought federal concurrence on this legislation while it was before committee. Thanks, Mr. Chair.

The Chair

The Chair R.J. Simpson

Thank you. Minister.

Wally Schumann

Wally Schumann Hay River South

Can you repeat the question?

The Chair

The Chair R.J. Simpson

Mr. O'Reilly.

Kevin O'Reilly

Kevin O'Reilly Frame Lake

Thanks, Mr. Chair. Why did the Minister and his department seek federal concurrence on these bills while they were before committee? Thank you.

The Chair

The Chair R.J. Simpson

Thank you. Minister.

Wally Schumann

Wally Schumann Hay River South

I am going to give a fulsome answer here, so just bear with me. Okay? The threshold for dissent requirement is low federal consent is required for any amendment that would affect the regulatory functions of the NEB and the ISR onshore. Given that low threshold for federal consent requirement, ITI staff began engaging with the federal government in 2018, in July. ITI staff worked with the federal government and the NEB to ensure that it would be able to obtain federal consent for any amendments it proposed. The federal government, through an order in council dated May 21, 2019, provided its consent to specific amendments in Bills 36 and 37. Securing federal consent does not interfere with any processes of our legislator, and, should the legislator want to make changes to a bill that would trigger federal consent, it would be the GNWT's responsibility to secure such consent. We are not required to, and this work did not interfere with any process within the Legislature, so there was no need to. Thank you, Mr. Chair.

The Chair

The Chair R.J. Simpson

Thank you. Mr. O'Reilly.

Kevin O'Reilly

Kevin O'Reilly Frame Lake

Thanks, Mr. Chair. Well, I am not sure I agree with the Minister's assessment. I believe that this is really certainly not in keeping with consensus government principles, to go off and seek federal concurrence while a bill is before the Legislative Assembly. I would like to get confirmation from the Minister and his staff: the changes that have now been made to this bill, they, as I understand it, they will require federal concurrence again. Is that correct?

The Chair

The Chair R.J. Simpson

Thank you. Minister.

Wally Schumann

Wally Schumann Hay River South

Thank you, Mr. Chair. No, we will not. It is consented as a bill already. Thank you, Mr. Chair.

The Chair

The Chair R.J. Simpson

Thank you. Mr. O'Reilly.

Kevin O'Reilly

Kevin O'Reilly Frame Lake

Thanks, Mr. Chair. It was my understanding and I believe it was stated in committee that, with the amendments that were made that the Minister has already concurred with, that some of them do impact and affect the authority and jurisdiction of the National Energy Board as it relates to the ISR. Do any of those amendments require federal concurrence? Thanks, Mr. Chair.

The Chair

The Chair R.J. Simpson

Thank you. Minister.

Wally Schumann

Wally Schumann Hay River South

Thank you, Mr. Chair. No, nothing in the bill needs federal consent. Thank you, Mr. Chair.

The Chair

The Chair R.J. Simpson

Thank you. Mr. O'Reilly.

Kevin O'Reilly

Kevin O'Reilly Frame Lake

Okay. Thanks, Mr. Chair. That is not what I heard in committee, but I will take the Minister and his staff at face value. This could have still created a lot of duplication. It took 10 months for the department and the Minister to get federal concurrence, so this is a time-consuming process on their part. It's not what I heard at committee, but I will take it at face value. I don't think this was a good thing, to be messing around with a bill while it's before committee. I would like to ask the Minister: what are the next steps in terms of reviewing oil and gas legislation? This was step one. What is the next step, and when is it going to happen? Thanks, Mr. Chair.