Merci, Monsieur le President.
Significant Discovery Licences in Bill 36
Bill 36 establishes a term of 15 years for significant discovery licences (SDL) where previously exclusive rights to petroleum lands were granted for an indefinite time. Committee received submissions that questioned the 15-year term and were seeking answers on why this number was chosen. Considering term limits in other jurisdictions while taking into account the unique conditions of the Northwest Territories, committee believes that 15 years is a time limit that would allow industry to do work and still insert a time-bound requirement.
Several submissions accepted the 15-year term of SDLs, however expressed a preference for a set time limit on the renewal term for SDLs. Bill 36 provides the Minister with the discretion to make a decision that would have an SDL being considered for an extension. This discretion was seen by several stakeholders to be concerning for two reasons: first, placing the authority with the Minister allows the possibility of political interference in what should be a regulatory function; and secondly, the ability to indefinitely renew an SDL would allow companies to potentially hold territorial lands indefinitely.
Committee shares these concerns and believes that a licence renewal should be time-bound. Consequently, committee proposed in Motion 3 to amend the current wording and require that an extension of the term of a SDL licence is for one or more terms of 15 years.
Committee had intensive discussions on the mechanism of SDLs and whether it is the best approach to ensure that the Northwest Territories will benefit from oil and gas exploration. Making SDLs time-bound by setting a time limit on the term of licence and licence renewal was considered a positive step toward a more transparent and accountable system. However, to maximize benefits to the Northwest Territories, committee is suggesting a more comprehensive review of the SDL system, including consideration of models for oil and gas exploration in other jurisdictions.
Therefore, committee is making the following recommendation.
Recommendation 4
The Standing Committee on Economic Development and Environment recommends that, in phase two of the review of Northwest Territories oil and gas legislation, a comprehensive evaluation of options related to Significant Discovery Licences (SDLs) be conducted, providing alternatives for consideration, and table its findings during the 19th Legislative Assembly. Committee further recommends that this report identify how the findings will inform any future changes to be made by the Government of the Northwest Territories with respect to its oil and gas resources.
Environmental Studies Management Board in Bill 36
Several submissions commented on the new provisions on the Environmental Studies Management Board (ESMB). Committee heard that the ESMB's public legitimacy would be improved by setting terms for the appointment of the members. Currently, members are appointed by the Minister and hold office during pleasure. Committee gave this suggestion consideration, however is not able to propose term requirements. The term of board members is determined under subsection 70(2) of the Petroleum Resources Act, and this subsection is not included for amendment. Therefore, a motion to set terms would be out of scope and not applicable.
Committee heard that, for the appointment of members to the ESMB, a clear definition of number of appointments by interest group should be provided in legislation. Stakeholders asked that public representation should be ensured. The definition of membership representation was seen as an improvement to the public legitimacy of the ESMB.
Committee agreed with the need for clarity on board membership and proposed an amendment that would ensure that at least one member from the public will be serving on the ESMB. To further ensure that the appointment of members from the public would allow for a balanced representation, committee moved Motion 4, which requires the Minister to appoint one member from the public for a board with the size of five or less members, and two members from the public for a board with six or more members.
Definition of Hydraulic Fracturing Fluid in Bill 36 and Bill 37
Committee received several submissions from Indigenous governments and organizations, as well as non-government organizations, asking for an addition to the definition of hydraulic fracturing fluid. Bills 36 and 37 propose a comprehensive definition for hydraulic fracturing, including the requirement that the cubic metre volume of water injected into a well be measured. In their submissions, some stakeholders proposed to include the requirement to collect data on volume of fluids recovered from wells.
Committee agreed that knowledge of the volume of fluids recovered is important to better understand how much fluid may be left underground. Committee therefore moved Motion 5 to Bill 36 and Motion 2 to Bill 37 to amend the definition of hydraulic fracturing fluid information to be collected and to include information on the fluid recovered from wells.
In the context of hydraulic fracturing in the Northwest Territories, committee members discussed initiatives of past Legislative Assemblies. It was noted that, during the 17th Assembly, the Government of the Northwest Territories proposed to improve the regulatory framework by drafting new regulations. In its current mandate, the Government of the Northwest Territories committed to "ensure that residents have meaningful opportunities to participate in the assessment of potential benefits and risks associated with resource development, including hydraulic fracturing."
Committee is making the observation that the Government of the Northwest Territories has chosen to address mandate commitment 1.1.10 through the amendment of its oil and gas legislation and presentation of Bill 36 and Bill 37.
Mr. Speaker, I would like to turn over the next part of the report to the honourable Member for Kam Lake. Mahsi.