Standing Committee On Natural Resources (Canada) 02-01-2011

House of Commons
CANADA
Standing Committee on Natural Resources
RNNR ● NUMBER 040 ● 3rd SESSION ● 40th PARLIAMENT
EVIDENCE
Tuesday, February 1, 2011
Chair
Mr. Leon Benoit
1
Standing Committee on Natural Resources
Tuesday, February 1, 2011
● (1535) Concern that North America's energy resources are not being
[English] developed as quickly and extensively as they could be in order to
allow the citizens of Canada, the United States, and Mexico to reap
The Chair (Mr. Leon Benoit (Vegreville—Wainwright, CPC)):
the maximum employment income and social benefits led us to
Good afternoon, everyone. It's good to see everybody back.
initiate a continental energy strategy project two years ago.
We are of course doing a study on energy security in Canada. The
committee began the study a few months ago. We're looking at what As explained in a 2008 Fraser Institute paper by former premiers
the federal role is in unconventional oil and gas development, such Klein and Tobin, the envisaged strategy would require North
as deepwater offshore drilling, shale gas exploration, and oil sands American energy policies at the national, provincial, and state levels
development. We're also looking at the regional economic impacts of to be aligned in support of efficient and as rapid development of the
the oil and gas development on conventional oil and gas, and at the continent's energy resources as possible in light of free market
National Energy Board's role in the development and export of conditions, science-based environmental concerns, competition from
unconventional resources. Today we are looking at the shale gas oil and gas imports, and petroleum investment opportunities abroad.
component. Clearly, increased development and production of the continent's
We have with us today, on our one panel, three individuals. We energy resources would bolster the security of oil and gas supplies as
have Dr. Gerry Angevine, a senior economist from the Fraser well as provide economic and social benefits. Because market forces
Institute, and Dr. Anthony Ingraffea, Dwight C. Baum Professor of will determine the most efficient allocation of North America's
Engineering from Cornell University. energy resources, development of a continental energy strategy does
not encompass identifying energy investment, production, and trade
Professor Ingraffea's flight was cancelled this morning, so he will targets. Rather, the focus is on ensuring that government policies and
be with us by video conference. If he isn't on...we'll have until the regulations pertaining to energy resource investment, development,
others have presented, so we'll have him last in the group. and trade are stable, fair, and appropriate.
As well, we have the Honourable Bruce Northrup, Minister of Governments must avoid intervening in energy investment
Natural Resources with the Government of New Brunswick. He's decisions, as these are best left to those who are motivated by
appearing by video conference from Fredericton. market forces, have an in-depth knowledge of the technologies
Welcome, everyone. We'll get right to the panel. We have just one involved, and are prepared to take risks based on their understanding
panel for the full two hours. of how energy requirements are likely to change.
We'll start with Dr. Angevine, please, for up to ten minutes. In the continental energy strategy program, at the institute we
recently released two papers, which are available on the institute's
Dr. Gerry Angevine (Senior Economist, Global Resource site, free of charge. One is Towards North American Energy
Centre, Fraser Institute): Thank you very much, Mr. Chairman. Security: Removing Barriers to Oil Industry Development, and the
Good afternoon, ladies and gentlemen. Thank you for the second is North American Natural Gas: Reducing Investment
opportunity to speak about the Fraser Institute's research pertaining Barriers.
to energy security and how it relates to the committee's study.
These studies review the oil and gas supply potential and
I understand that the study includes reviewing the roles of the requirements in Canada, the U.S., and Mexico and prospects for
federal government and the National Energy Board with respect to national and continental supply-demand balances for both oil and
the development and export of unconventional oil and gas resources, gas.
and this will be part of my focus.
One of the conclusions from this research is that, with continued
I assume that, in the context of the study, energy security refers to technological improvements, there is potential to significantly
an assured supply of energy for Canadians under normal market increase the volume of oil liquids that is produced in North America
conditions. From this perspective, the greater the Canadian oil and relative to domestic demand. Along with continued development of
gas production is and the more opportunities there are to freely the oil sands, increased offshore production, commercialization of
export and import these resources, the less Canadians should be gas to liquids, and coal gasification technologies will contribute to
concerned about oil and gas supply difficulties. improvement in the continental oil liquids balance.
2 RNNR-40 February 1, 2011
Eventually, when we get there, the technology that allows us to pipeline construction. Necessary changes to environmental regula-
commercialize oil that's found in shale—the oil in the U.S. that's tions need to be defined and implemented as quickly as possible. If
been indicated to exist in large quantities locked in the kerogen in oil potential investors don't know what changes will be made and can't
shale—will also contribute. estimate the cost of compliance with accuracy, major projects will be
lost to other regions.
With regard to natural gas, technological improvements have
made the production of gas from shale formations viable. That has
transformed the long-term outlook for continental gas supply and
demand from one of increasing dependency on LNG imports to near Fourth is the issue of moratoria on offshore exploration, which are
self-sufficiency. standing in the way of development of petroleum resources—
offshore British Columbia, for example. Moratoria on exploration
An indication of this is the plan to export gas to overseas and production in offshore areas should be lifted once the authorities
destinations from Kitimat instead of importing gas at that location, as are satisfied, having examined the cause of the disastrous oil leak in
originally planned. Because of what's been termed the shale gas the U.S. Gulf of Mexico last year, that the environmental risk can be
revolution, the security of gas supply should not be a matter of mitigated. This will open new areas for development and in turn
concern for Canada in the foreseeable future. contribute to Canada's energy security.
With regard to the impact that shale gas is having on the outlook
for U.S. gas supply, the upward revisions contained in the U.S.
Energy Information Administration's 2011 long-term forecast are Fifth, regulatory process and procedures that threaten to delay the
telling. approval of oil and gas pipeline construction that will be required to
transport new supplies of bitumen, shale gas, and other petroleum
● (1540)
resources to market hubs need to be made more efficient. The
This is gas production from shale formations reaching almost 8 National Energy Board has self-imposed standards regarding time
trillion cubic feet in 2020, compared with 4.5 trillion cubic feet in the schedules with regard to the release of decisions following the
administration's previous forecast just 13 months ago. That compares completion of public hearings. But these are arbitrary and serve only
with actual 2009 production of 3.3 trillion cubic feet. More as guidelines, not hard and fast rules that must be achieved.
remarkably, the projected volume of U.S. shale gas production in Moreover, there are no such standards with respect to the time
2035, when total gas production is forecast to reach 26 trillion cubic required from when an application is received until a public hearing
feet, has been doubled from 6 trillion cubic feet to 12 trillion cubic commences or with the maximum time to be allowed for public
feet. As a consequence, U.S. gas production from other sources—not hearings. To ensure a more rapid response to pipeline construction
all other sources, but some, including coalbed methane—and applications, more may be required than simply tightening the NEB's
imports of gas from Canada and abroad are projected to shrink. self-imposed service standards. In fact, the National Energy Board
Act may need to be revamped to limit the board's involvement in the
The Fraser Institute studies that I referred to and the U.S. Energy construction permitting process to non-commercial aspects such as
Information Administration's most recent long-term outlook under- safety, environmental impacts, and other matters of public
score the fact that the continent has a strong oil and gas resource importance.
position; however, non-market barriers stand in the way of achieving
the goals and objectives of a continental oil and natural gas strategy.
Because these obstacles prevent oil and gas production from
increasing as rapidly as they could, they also impinge upon oil Finally, there is the land claims issue. Means for settling
and gas security. There are a number of barriers that Canada is in a aboriginal and other claims expeditiously and in a fair and
position to address because of its jurisdiction over oil and gas appropriate manner need to be found to prevent unnecessary delays
exploration in the north and in the Atlantic and west coast offshore in the construction of pipelines required to transport oil and gas to
regions, and also on account of responsibilities that Canada has with markets. A matter that should be of concern to the federal
regard to environmental protection. government is that investors regard the Northwest Territories as
relatively unattractive for investment in oil and gas exploration and
First, the government needs to ensure that royalties or production development.
taxes on conventional oil and gas in the areas for which it has
jurisdiction are competitive, not only with those in the provinces but
with those in competing jurisdictions around the globe. ● (1545)
Second, it needs to ensure that royalties in relation to higher costs
of production because of deep offshore or remote far north locations
or other factors, as with some of the unconventional sources, reflect According to the Fraser Institute's global petroleum survey, in
those higher costs. If royalties don't do this, investment will be 2010 the NWT ranked 74th of 133 jurisdictions worldwide. This was
allocated to regions promising more attractive returns. worse than any of the other Canadian jurisdictions that were ranked,
other than Quebec. In fact, the NWT appears to be less attractive for
Third, the government needs to remove the cloud of uncertainty investment than almost all of the U.S. states and offshore regions, all
overhanging the oil and gas industry in relation to the timing and of the Australian states and territories, New Zealand, Chile, the
specifics of environmental policy changes that could significantly United Kingdom, Norway, the Netherlands, and many other
impact the capital costs of oil and natural gas projects and energy jurisdictions around the globe.
February 1, 2011 RNNR-40 3
Now, according to survey respondents, the Northwest Territories' The first is, don't make the same mistake that's been made in the
poor performance in the global ratings is due to a number of factors, U.S. by framing and naming the issue of unconventional natural gas
but most important is the land claims dispute issue. On this factor, production from shale fracking. It is not just fracking; it is the entire
the NWT was deemed to be the least attractive for petroleum process, the whole system of producing unconventional gas from
investment of all 133 jurisdictions around the globe that we were shale formations that you should be investigating. So don't develop
able to rank. The Northwest Territories also scored poorly in relation too narrow a focus.
to the availability of infrastructure, regulatory duplication, and
uncertainties in relation to protected areas. If the federal and NWT The second point is that the most important aspect of developing
governments wish to attract petroleum investment to the north and unconventional gas from a resource like shale is the scale of an
thereby advance energy security, these matters need to be addressed. operation. By that I mean two things. It takes between 50 and 100
times more fluids to develop a shale gas well than to develop a
As I've mentioned, Canadians are fortunate in not having to worry conventional gas well. That implies that a concomitant amount of
much about the security of oil and gas supplies given our fortunate waste products is produced in the stream. I emphasize 50 to 100
position as a net exporter of both commodities. However, those parts times the amount of fluid necessary over a conventional gas well.
of the country that are mainly dependent on imported crude oil and That's one aspect of what I refer to as scale. The second aspect is
refined petroleum products would be disadvantaged by any lengthy this. The nature of the geology of shale is such that to produce the
interruption in the usual marine supply channels. The government vast quantities of gas that are being forecast by the industry will
may therefore wish to investigate the extent of the risk exposure of require a very high well density compared to conventional gas
that sort and how it might be lessened. development. By that I mean on the order of three wells per square
kilometre. Those two issues of scale need to be absorbed and
The Canadian government has a role to play in ensuring that the
digested: the large amounts of fluid necessary, which implies much
laws and regulations that define the conditions within which the
transportation and much waste disposal; and many more wells per
petroleum industry operates are conducive to free market competi-
square kilometre than previously experienced.
tion, and also in working to lower non-market barriers to petroleum
investment such as those that I've identified, so that development of The third point is that the technology to do this kind of
Canada's oil and gas resources, including oil sands, bitumen, and unconventional development is, surprisingly, relatively new. There
shale gas, can proceed quickly where production is viable in light of are four elements of that new technology, and they did not come
the rigours of competition, free trade, and the costs of compliance together in the United States until about eight years ago. So this is
with necessary environmental protection policies. not the hydraulic fracturing of the 1950s, 1960s, and 1970s. It's not
Thank you, Mr. Chairman. conventional gas development of that era. It's a relatively new
combined technology.
The Chair: Thank you, Dr. Angevine.
Fourth, because it's relatively new—in the U.S. certainly, and in
We have next Dr. Anthony Ingraffea. His flight was held up due to the western provinces where it's going hot and heavy in Canada—
a snowstorm, and I want to thank our clerk for doing some stellar regulations and the enforcement of the regulations have not kept
work to arrange the video conferencing. It just got completed in pace with the technology in the U.S. I'll repeat that. The regulations
time. So thank you for that. and the enforcement of those regulations have not kept pace with this
Go ahead, please, Dr. Ingraffea. new technology. It is unlikely, based on the experience that we're
seeing in the eastern part of the United States—Pennsylvania, Ohio,
Dr. Anthony R. Ingraffea (Dwight C. Baum Professor of and West Virginia, where shale gas development is under way—that
Engineering, Cornell University, As an Individual): Good your eastern provinces are ready for similar development. I
afternoon, and thank you very much for giving me this opportunity emphasize that it is unlikely because we have similar geologies,
to present testimony to your committee. I do apologize for not being similar surface uses, and similar population densities, and, as I said
there, and I also compliment your staff for setting up this video previously, the regulations and the enforcement of those regulations
conference on short notice. in that kind of environment. Your eastern provinces, I claim, are not
I want to make it clear that all of my testimony this afternoon is on yet ready.
point, that is, unconventional natural gas development from shale
Finally, the fifth point I want to make is to follow the waste
formations. I'm going to limit my time to just a few comments right
streams. If there's one lesson we have learned already in the eastern
now, because I understand we have a whole two hours and I would
part of the United States where shale gas development is undergoing
rather spend my time with you answering your questions. But I am
tremendously rapid expansion, it is that the ability to note how much
going to spend a few moments and suggest some lines of questions
waste is being produced in each well is important—and by waste I
based on my reading of all the testimony on the issue of
mean solids, liquids, and gases. It's important to know what's being
unconventional natural gas from shale formations that your
produced, in what volume and when, and where every waste stream
committee has received to date from various speakers over the last
winds up in the environment.
few months.
● (1550)
As I've read that testimony, I've noted some inaccuracies and some
misleading statements, so I hope today to help to clarify those for Those are the five points I would like to make in my opening
you. There are five main comments that I'd like to suggest right now comments. I hope we have ample time during Q and A that you
that perhaps we could follow up on during Q and A. might want to ask me to expand on all of them.
Thank you very much for your attention. of Arkansas. As Governor Beebe told us, the shale gas industry has
The Chair: Thank you, Dr. Ingraffea. transformed Arkansas from a have-not state to a have state.
Thousands of new jobs have been created directly by the shale gas
We go now to our final witness, the Honourable Bruce Northrup, industry, or indirectly as companies have moved to Arkansas to take
Minister of Natural Resources from the Government of New advantage of the secure and relatively inexpensive energy source.
Brunswick. Welcome, sir. Go ahead with your presentation for up
to 10 minutes. Thank you for being with us. We believe a significant natural gas industry would have the same
Hon. Bruce Northrup (Minister, Department of Natural positive economic impact in New Brunswick. What our government
Resources, Government of New Brunswick): Thank you very is determined to do is to realize the benefits of this resource without
much, Chairman Benoit. suffering any negative consequences—and I just want to repeat that:
without suffering any negative consequences.
Good afternoon, everyone.
We know there have been environmental problems in some parts
I want to thank you for the opportunity to appear before the of the United States. While the impact sometimes can be
committee today, and I appreciate that you have made it possible to exaggerated, we do not take these concerns lightly. That's why our
do it via video conferencing. government support is based on the responsible expansion of the
The Government of New Brunswick is very pleased to present its natural gas sector. The development of this resource must be done
views on the energy security in Canada and how our province can right. It is imperative that the social and environmental fabric of our
contribute to our country's energy needs. rural communities continues to be substantial in the future. We won't
sacrifice the safety and security of homeowners and their ground-
I understand I have 10 minutes for my opening remarks, so I'll use water supply to make this happen.
this time to share where we are now and where we want to go.
Today we are confident that our present legislative framework is
Today we are in the very early stages of what could be a very
more than adequate to deal with the current level of activity. This
substantial natural gas industry in our province. This is a very
activity is primarily at the exploration stage with very few wells
exciting prospect, and we are very optimistic that this could be a
drilled. In addition to our existing legislation, we have introduced a
major part of the New Brunswick economy if managed in a
phased environmental impact assessment, an EIA process, as a tool
responsible manner. In just the Sussex area where I live, there is an
to enable the proper planning for what lies ahead. The phased EIA is
estimated 60 trillion cubic feet of natural gas trapped in shale
unique in Canada, and we feel it will address many of the issues
formations deep underground. For comparison purposes, just one
raised by concerned citizen groups and other groups.
trillion cubic feet of gas could power 10,000 homes for 1,000 years.
So you see there is enormous potential from an economic We also realize that if this industry moves forward as hoped, we
development and energy security perspective. must adapt our legislation and human resources accordingly. We feel
Today, 11 companies have rights to explore for oil and natural gas this can be done right and that we have the necessary time to ensure
on almost 1.5 million hectares of land in New Brunswick. Two of this happens.
these are large American companies with extensive experience in ● (1555)
shale development in the United States and Canada. Exploration
companies have invested $350 million in our province over the past We are in the fortunate position of being able to learn from other
decade, looking for natural gas and oil, and they plan to spend at jurisdictions like Arkansas that are a decade or so ahead of us in
least another $200 million over the next two years. So the developing shale gas reserves. In some states, development outpaced
exploration phase alone is creating employment and pumping the regulatory regimes, and the environment was the big loser. In
significant dollars into the New Brunswick economy through the New Brunswick we believe we have a strong regulatory framework,
purchase of goods and services. and we're willing to make it even stronger if that's what it takes. Our
But it's the next stage that has the potential to substantially change objective is to be a leader in this area, and we feel we are in an ideal
our province's future. If shale gas is discovered in commercial situation to achieve this goal. Consequently, our government is now
quantities, then we're looking at a game changer for our great re-examining legislation and regulations governing the exploration
province. A large-scale natural gas industry would generate millions and extraction of minerals, oil, and natural gas. We see this as part of
of dollars in royalties, create many new direct and indirect jobs, and a continuous improvement process. We also believe in the close
expand our tax base to help fund services we all count on, such as collaboration with people, communities, and interest groups to
health, education, and senior care. ensure they are engaged in the process.
Just last week I returned from a fact-finding mission to the State of It is the position of our government that we engage the public and
Arkansas with my colleagues, the Minister of Energy and the conduct our business in a completely transparent manner. Just this
Minister of Environment. We were joined on this trip by Stephanie weekend I hosted an open house in my hometown of Sussex, so that
Merrill from the Conservation Council of New Brunswick, who also anyone with questions on shale gas development could get the
appeared before this committee. During our visit we met with answers directly from government officials or industry representa-
landowners, environmentalists, regulators, and politicians, including tives. This was the first of what I anticipate will be a series of
the Governor of Arkansas. It was a very eye-opening experience. information sessions in different parts of the province as exploration
What we saw is how the shale gas industry has ignited the economy and development activity picks up in other areas.
We are planning at least one additional fact-finding mission. This that were foremost at that time are not something, perhaps, the
time we plan to go to northern British Columbia to see first-hand National Energy Board needs to be concerned about. For example, if
shale gas development there and to meet with residents and we're looking into whether a proposed pipeline project is necessary
regulators. I also believe the hearings this committee is holding from a commercial and economic point of view, certainly the
will help focus public attention on shale gas development and what it proponents wouldn't be applying to construct a pipeline if it wasn't
could mean for Canada's energy security. viable, and they're the risk takers, so that's something the National
Energy Board likely doesn't need to spend much, if any, time on.
It is well understood that the natural resources of New Brunswick
belong to the people of our province and the responsibility to
On the other hand, there are new developments and concerns as
manage those rests with us. I believe we are up for the task. But New
we get more into unconventional oil and gas recovery. The institute
Brunswick is a team player, and I recognize there may be areas
certainly is in support of necessary and continually updated
where cooperation with the federal government and our sister
regulation.
provinces and territories may prove mutually beneficial. Areas of
cooperation that come to mind include the environment, economic ● (1605)
development opportunities, research and development, investigation
of value-added opportunities, and human resource development. Hon. Denis Coderre: Mr. Ingraffea, thanks for your five points.
These are all the areas where cooperation may lead to enhancing
opportunities this industry brings to New Brunswick and the rest of I come from the province of Quebec. We are living right now with
Canada. This ultimately may lead to a very secure energy future for a situation with shale gas. Of course, I'm a federal politician, so I
us all. know that everything is a matter of jurisdiction there. It's a Quebec
Again, I appreciate the opportunity to appear here today, and I provincial issue, but I'm sensitive anyway to the situation in the field,
look forward to answering questions from committee members. and I believe the NEB has a role to play at a certain level,
specifically on environmental assessment.
Thank you very much.
● (1600) Because of the uncertainty, which you've been talking about in
your five points, would you suggest to the Government of Quebec
The Chair: Thank you, Minister Northrup.
that they implement a moratorium first before going ahead on the
We'll go now directly to questions and comments, starting with situation of the shale gas?
Monsieur Coderre from the official opposition.
Dr. Anthony R. Ingraffea: My direct answer is yes, emphatically.
Go ahead, sir.
[Translation] Let me support that by saying a few things about a moratorium
that exists in my home state of New York. At the same time that
Hon. Denis Coderre (Bourassa, Lib.): Thank you, Mr. Chair.
Pennsylvania, a sister state, and Ohio, a sister state, and West
Good afternoon, gentlemen. I will start with you, Mr. Angevine.
Virginia, a near sister state, began full-scale development of their
The issues of energy security and economic impacts are certainly shale gas resources four or five years ago, New York State had the
hot topics. Your comments gave me the impression that there need to wisdom to stop and say, wait a minute, this is substantially different
be fewer barriers. But I did not sense that you felt the need for some technology than has been used in the past, it's relatively new
kind of monitoring. Talking about energy security implies making technology, and we do not have in place adequate environmental
sure that we are working with people because of the environmental regulations, we do not have in place adequate numbers of regulators,
situation and climate change. and we do not have in place an adequate number of inspectors;
therefore we need to study the problem some more, and not just in an
With respect to balance, the Fraser Institute is talking about academic sense, but we need to learn from the mistakes that are
monitoring and regulation. What role does a government play when being made today in our sister states, and we would really like to
it comes to regulations to ensure that there are, in fact, fewer barriers wait until the federal government completes its study under the
to better economic functioning? Since there may be downsides, what Environmental Protection Agency to determine, hopefully once and
can we do to protect the public as well? for all, what really are the risks.
[English]
Dr. Gerry Angevine: The position of the Fraser Institute would No one is saying this is risk-free. No one is saying it's accident-
be that regulation that is needed is important and protection of the free. No one is saying that one cannot develop an acceptable level of
environment is important. That's the bottom line. Regulation, risk in the technologies. What New York State is saying with its
however, needs to be as efficient as possible and needs to be moratorium is that we do not have adequate scientific information on
changed in accordance with technologies and kept up to date. But in which to base adequate regulation and enforcement.
some cases there is a tendency for regulators to add functions to their
Hon. Denis Coderre: Thank you.
roles that increase the cost of their organizations.
As I've mentioned, regulations sometimes need to be updated. If Minister Northrop, the reason I asked the first two questions of the
you look at the National Energy Board Act and why and when it was other witnesses is because of course you're the politician and you're
put into place, the world is different today, and some of the concerns stuck with the decision-making process.
There is, I believe, the necessity in Canada to have a national we want to extract shale gas in densely populated agricultural
energy strategy, because it seems that you have some problems at the regions. This has a great impact on people's quality of life. It seems
regulation level on what the role of the NEB should be. For the sake to me that an agricultural region is not the same as the northern
of the people of New Brunswick, do you believe it is more reaches of a province where there are fewer inhabitants.
appropriate, before taking a stand, to say to the enterprise, well, take
a break, we'll go through all the processes first because of the Certainly we are talking about energy security. That being said, in
technology issues and all that? Are you putting in place a kind of Quebec, where hydroelectricity is abundant, do we really need shale
moratorium? gas? That's why Quebeckers are now agreeing to issue a moratorium
while we are taking a closer look at the environmental consequences.
There is an issue with people, of course—the fear of the unknown,
with all the information coming from everywhere. How do you Do you think that you can draw from Quebec's experience and
manage your own decision-making process? mistakes in this situation? Do you think that things in the United
States, Quebec and elsewhere in Canada can be equally compared?
● (1610)
[English]
Hon. Bruce Northrup: We have been very clear since we took
government in October that the moratorium was not in place for the The Chair: Go ahead.
Province of New Brunswick. We felt, and we know and we have had Hon. Bruce Northrup: What we are doing here in the province of
time to explore and come up with.... We have good regulations in New Brunswick is putting the best practices and standards in place.
place now. Since taking over as government, we have phased in the
EIA process, the environmental impact assessment process. There You mentioned consulting with the public. We've done that since
were a couple of wells that had been drilled by Apache in the Elgin day one. I mentioned in my brief 10-minute spiel that we had an
area in New Brunswick. They've drilled the wells. They're finished, open house in my backyard in Sussex last weekend. We had over
and they've taken all their criteria back to Calgary. They won't be 400 people who came in and talked to three different industries. We
drilling any wells for quite a while. Our other major one here, had the Department of Environment there. We had the Department of
Southwestern Energy from Arkansas, is just in the preliminary Natural Resources there, with all the people who were experts in
stages. different fields, just to explain to them how the process works from
A to Z.
That's why we went to Arkansas, to get the positives and negatives
from that state. That's why we're going to Alberta and B.C., We were quite happy with the outcome. At the very first part, we
especially Horn River. They've been in operation there for quite a had the mayors and council people in, along with LSDs. In the next
few years, so we want to go talk to the regulators there, the hour, we had concerned citizens groups come in for an hour to
environmental people. Actually, when we went to Arkansas, we took express their views. What we heard loud and clear was that while we
a lady with us who was part of the Conservation Council of New accomplished what we did that last Saturday, they want a public
Brunswick. She went to every meeting we went to with landowners, forum so that they and the general public can come and make their
with regulators, and with environmental groups. views known to us. That's exactly what we'll do within the next
month or so. We'll have industry there, we'll have government there,
We feel we're in the early stages here right now, and as a minister and people will be coming in, probably with a facilitator to make
and with my staff, we don't feel, working with the Department of sure everything runs well.
Environment, that we have time to enforce our regulations more. In
New Brunswick, that's the position we are in as of today. We've been very up front with the people of New Brunswick.
We've been very up front with the industry here. Just last week, the
Hon. Denis Coderre: Thank you. environmental impact assessment that we phased in was explained to
The Chair: Merci, monsieur Coderre. industry. We met for over three hours. The environment people
explained the EIA process. That's how we're being up front with
Madam Brunelle, you have up to seven minutes. Go ahead, please. industry, so that if this does go through, they know 100% where the
[Translation] Province of New Brunswick stands.
Ms. Paule Brunelle (Trois-Rivières, BQ): Thank you, We feel that we have ample time to do that with industry and
Mr. Northrup. I'll continue with you. ample time to do that with the concerned citizens groups and the
I am from Quebec. I find it interesting that you spoke about citizens. That's basically why we did not put a moratorium on here.
consulting the public. It is clear that natural resource development is ● (1615)
the responsibility of the Government of Quebec, and Mr. Coderre [Translation]
was perfectly correct in saying so. The Government of Quebec made
a huge blunder by forgetting to inform the public and establishing Ms. Paule Brunelle: Thank you.
with the public what could be called a social contract before starting I want to move on to Professor Ingraffea.
any type of extraction or exploration. We are now in a situation
where water use is a major issue. [English]
Dr. Anthony R. Ingraffea: Yes.
When you said that you are going to consult people elsewhere in
Canada and the United States, I wondered whether things would [Translation]
really compare. The scenarios are completely different. In Quebec, Ms. Paule Brunelle: Good afternoon.
You talked to us about the importance of water use. The use of What is so fundamentally different about what the industry is up
water on shale gas production sites has become a major environ- to with this non-conventional source of natural gas compared with its
mental issue. other drilling operations in the oil and gas sector?
The city of Trois-Rivières, which is my constituency, had to treat ● (1620)
water from shale gas generation at its water treatment plant. Now, the
ministère de l'Environnement is giving a conflicting opinion, saying Dr. Anthony R. Ingraffea: That's an excellent question.
that it can no longer do this.
I'll amplify on the comment I made earlier. It's all about the scale
Has enough research been done to determine all the appropriate of an operation. It takes upwards of 30,000 cubic metres of water to
environmental measures that should be adopted? Are we not playing hydraulically fracture a shale gas well. That's 50 to 100 times more
sorcerer's apprentice a little by trying to produce shale gas without water than has traditionally been used in conventional wells. That
really knowing all the ins and outs of producing it? also implies that the waste stream coming back from that well is
[English] going to be equally large.
The Chair: Go ahead, Dr. Ingraffea.
When the industry says that they've had vast experience, 60 years
Dr. Anthony R. Ingraffea: My answer is yes. I wouldn't exactly of experience, with hydraulic fracturing, what they fail to say is that
call it magic. I'd call it black magic, not in the sense that more they've had fewer than 10 years of experience on a large scale using
scientific investigation needs to be done, but that more technology these unconventional methods to develop gas from shale.
needs to be developed.
It comes down to two things—one, the larger volume of fluids
Let me be very specific. In regard to the liquid waste stream, the
being used and fluid waste being produced, and two, the absolute
fluids, the flowback fluids and so-called brines and produced waters,
necessity, because of the geological differences between gas
which the industry uses interchangeably to describe the liquid
distribution and shale and gas trapping in traditional wells, that it
waste—flowback water, brine, produced water—it is different from
take a large number of wells per square kilometre, three wells per
what is produced from an oil well or from a conventional well. It
square kilometre. That means thousands and thousands, or tens of
cannot be taken to a public waste water treatment plant and then
thousands, of wells for a particular place.
dumped into a river. It contains something more than salt. It contains
heavy metals. It contains some amount of naturally occurring Mr. Nathan Cullen: So the—
radioactive materials, which are signatures of shale gas. Public waste
water treatment plants are not equipped to remove those materials Dr. Anthony R. Ingraffea: Multiply the tens of thousands of
from the waste stream. There are no facilities in the State of New wells by the high volume per well and you get astronomically large
York currently licensed to remove such materials from the waste numbers, which the industry hasn't shown it's able to dispose of yet.
stream from an unconventional shale gas well. That is one of the
reasons why we have a moratorium in New York. Mr. Nathan Cullen: So a two-part question with respect to the...
because we've asked for what's in this fluid that they're putting down
New York will not issue a permit for the development using high- the well site to force the gas back out, and it ranges.
volume slick-water hydraulic fracturing of gas from shale in New
York until the permit holder can show where the waste stream will be First, can you mention a few of the chemicals that are used in this
disposed of properly. So until the technologies are developed—and compound that's sent down the well? And what percentage is typical
they are developing—where high volumes of this waste stream can for industry to recover back? If they put 30,000 cubic metres down a
be treated correctly for what's in it, we stand by our moratorium. well, what is typical?
[Translation]
The Chair: Thank you, Ms. Brunelle. Second, we've heard from Minister Northrup that in New
Brunswick at least—-I'm not sure if you've necessarily studied
[English] New Brunswick in particular, but you get his points, I think, from his
Mr. Cullen, go ahead, please, for up to seven minutes. testimony—they're trying to incorporate different regulations that
allow for more stringent observation of the industry so that the fears
Mr. Nathan Cullen (Skeena—Bulkley Valley, NDP): Thank of landowners and people concerned about contaminated water will
you, Chair. be assuaged by the way in which New Brunswick is setting up their
industry. Does that not give you comfort?
Thank you to our panellists today.
Mr. Ingraffea, I'll stay with you. First, then, can you talk about the fluids that are going down and
what's in them, and what kind of recovery we likely will see in terms
We've heard from industry people involved with this technology, of the percentage? Lastly, is what New Brunswick is setting up, from
and they tell us essentially to relax; they've been at it for years, and what you've heard today at least, not moving the ball forward or
there should be no concerns over the fracking or the waste waters. progressive in terms of protecting the public and the environment?
I'm wondering why that assuages some within the industry. You say
in New York it wasn't...but in Pennsylvania, West Virginia, and the Dr. Anthony R. Ingraffea: I'll try to answer those three questions
western part of Canada, that seems to have worked. very quickly.
In a typical high-volume slick-water hydraulic fracturing opera- particular alternative oil and gas industry, various institutes in
tion in a shale gas formation, there are roughly five types of Washington have been calling on the President to remove subsidies
chemicals that are necessary. I won't give you their chemical names from the oil and gas industry—heritage and other groups that are
—one can look those up—but one needs to add a lubricant to the hardly tree huggers. I'm curious as to whether the Fraser Institute
water so that pumping the high volume used under very high holds a similar view, in terms of the distortion of the market, of the
pressure over a very long distance can be done with a reasonable current subsidies that go towards the oil and gas industry to enhance
amount of horsepower at the surface. That lubricant is typically a production and give them a leg up, if you will.
hydrocarbon derivative. There is a biocide necessary to kill the
bacteria that otherwise would grow in the well and clog the well. Secondly, why is there urgency to develop extremely large
There is an anticorrosive to prevent rusting of the all-important steel amounts of natural gas reserves at a time when prices are at near
casing—that's the first line of defence for the entire life of a well historical low levels? I don't understand. In your testimony, you
that's expected to last 20 to 50 years. There's an antifouling agent to talked about the need for speed. It seems to me that if prices are
stop scaling—that is, deposits of hard minerals on the inside of the where they're at, if government doesn't offer up any subsidy to the
casing in the well that would otherwise clog it. And there is an acid industry, the market will simply decide that at $3, this isn't worth
that is used to clean out perforations right before the hydraulic doing.
fracturing process and immediately after the start of it. The Chair: Could you make your response brief, Dr. Angevine?
Those are the general categories of chemicals. Some of them are Dr. Gerry Angevine: Yes.
relatively benign, even though you would not want to be drinking
them or having them in your trout streams. Others are known to be On the question of subsidies, certainly the Fraser Institute position
toxic, carcinogenic, and don't belong in the human environment. But would be that subsidies on all forms of energy should be removed so
I should also emphasize that once the fluid comes back—and I'm that there's a level playing field and resources, including renewable
trying to answer your second question now—it contains not only the resources, get developed on their economic merit. Is that sufficient at
chemicals that were put in on the way down but the material that was this point? To expand on that would really simply underscore the fact
picked up from the shale. As I mentioned before, notably, in black that there's no role that the institute sees, in general, for subsidizing
shales, shales containing gas, the most dangerous of those are the oil and gas or any other form of energy resource development.
heavy metals—strontium, barium, uranium, and radium—some of On the matter of urgency, the Continental Energy strategy research
which are also naturally occurring radioactive materials. is being carried out on the premise that if market conditions,
The industry is fond of saying that most of what they pump down competitive forces, could lead to more rapid development of
stays down. What they fail to talk about is the timeframe in which Canadian oil and gas resources, then anything that's non-market
they're counting. Typically, the returned fluid, after the fracturing standing in the way of that development that cannot be justified and
process, is counted as returned fracturing fluid only during about the isn't necessary should be removed or reduced. That's why I spoke to
first week or two of flowback operations. However, all shale gas the non-market barriers. Certainly we see the market today
wells continue to produce fracturing fluid and brine containing developing natural gas with some very low price levels, and we
heavy metals for the entire life of the well. One has to be very find that people who have looked and compared the shale in different
careful. One cannot say that on average, 50% of the fluid comes parts of the U.S. have noted that some shale development is more
back. One has to say under what timeframe one is making that economic than others. They're speaking to prices, and in some cases
measurement. Typically almost all of the fracturing fluid comes back our cost for a thousand cubic feet is below $4, so this gas
during the life of the well. development may proceed, but other more costly sources will not.
The Chair: Thank you.
In answer to the third question, whether I take comfort from my
friends in New Brunswick saying they're trying to keep up with Thank you, Mr. Cullen.
regulations, I don't know. I don't know what their starting point was
for their regulations. I don't know what the current, perhaps We go now to the government side. Mr. Allen, for up to seven
modified, set of regulations looks like. I would only suggest that they minutes. Go ahead, please.
go to perhaps the closest match to New Brunswick, which I would Mr. Mike Allen (Tobique—Mactaquac, CPC): Thank you,
say is Pennsylvania, and take a look at the substantially revised Chair, and thank you to our witnesses for being here. I especially
regulations that have been put in place just in the last year as a result want to note my friends from New Brunswick. It's always good to
of only three years of substantial development. have New Brunswick folks here at the natural resources committee.
● (1625)
I want to start, Mr. Northrup, with one of your comments with
Mr. Nathan Cullen: Thank you for that. respect to New Brunswick regulation at least keeping up with where
In my remaining time, I'm sorry, I'm not going to get to you, Mr. we are at this point in time. You said you will continue to develop
Northrup, but I am curious about some questions, so hopefully I will that regulation and that Apache has done some test drills in the Elgin
get to you in round two. area of New Brunswick. How far out, realistically, is your
department seeing the actual development of these wells before, if
Quickly to you, Mr. Angevine, with respect to the Fraser Institute, everything goes well, we would see everything go into a production
and I'm sorry you're here more on economic issues today than you state to sync up with your comments about the regulation making
are on necessarily the specifics we're talking about, which is this sure it stays ahead of that?
● (1630) the neighbours around there. A lot of these compressors were not
Hon. Bruce Northrup: Thank you, Mike. It's always a pleasure really out in remote areas; they were around different housing places.
to hear your lovely voice and see your half-body on TV. That was probably the number one concern, and we really
appreciated the people talking to us and giving us their experiences,
It's a pleasure to be here. which we brought back to Canada. The sound was one of the main
things.
We've done very well as far as the EIA process, phasing it in, in
the Apache, in the Elgin area, as far as the process goes from As far as technology goes, it was interesting that Calfrac, from
beginning to end. They have drilled two wells there. They've Calgary, Alberta, were there doing most of the fracking and drilling.
completed two wells there, and they've been very up front with the So it was interesting to talk to them on a one-on-one basis.
people around the area as far as communication goes. They put flyers
out to the people around that area as to what they're doing that day,
They were happy employees. It was nice to see. They work seven
what they're doing the next week, and what they're doing in the next
days on, seven days off. We had some good conversations with
two weeks. They've also gone into the community as far as hiring the
Calgary-based Calfrac. What we want to do when we put this EIA
local fire department to do security for them. This is all about
process in—and we talked about chemicals before. We're going to
community involvement, and Apache has done a great job there.
make sure, Mike, that full disclosure of these chemicals is brought
As far as a timeframe for Apache goes, we're probably looking at in. I know the doctor mentioned three or four of them, and that's
around 18 months, approximately a year and a half, and with exactly what Apache did. They disclosed. They had a really nice
Southwest Energy, which is at the very, very early stage, we're pamphlet made up and they disclosed exactly what they put into the
probably looking at about three years there. ground. The recovered water is stored in storage tanks right around
the area and then it's transported to an approved industrial water
Mr. Mike Allen: I just have a couple of questions on your trip to
plant within a couple of hours of these wells.
Arkansas.
● (1635)
The first one is this. What did you learn about the regulatory
environment down there? The Environmental Defense Fund and Mr. Mike Allen: Have there been any incidences about water and
Southwest, of course, had a little bit of a meeting—I think it was at spills? One of the folks from the Environmental Defense Fund talked
the University of New Brunswick—a couple of weeks ago, and it about that. One of the biggest challenges they have is not necessarily
was actually quite productive. They were talking about the use of the fracking and the contamination of the aquifer, but spills and some
water. What did you see about Arkansas...? Was there any specific contamination. Have they experienced anything like that in
mention there of some states having a better regulatory environment Arkansas, and if not, what principles have they used to prevent that?
than others?
Hon. Bruce Northrup: We didn't experience any spills or
The second question is this. What did you learn about the
anything in Arkansas. You can imagine in your mind where you
advances in technology with respect to chemicals and water usage
have six or seven 18-wheelers in one spot with a drill rig, and it's all
and the recovery of those? computerized, and they actually had tar ponds out on the ground so
Hon. Bruce Northrup: As soon as we landed in Arkansas, in that if anything did happen they would recover it very quickly. That
Little Rock, as soon as we got to the motel, we had three or four was very impressive.
groups waiting for us there to have a meeting. These folks have been
involved with the industry for probably 9 to 10 years, and we talked Another thing we brought back for New Brunswick...we want to
to them for a good two and a half hours. By the end of the make sure that if anything does happen, if water does come up and
conversation, we understood they weren't really against the industry leak outside this well, that it is contained for sure. I just want to
itself, as far as industry goes; they were just a little upset with some emphasize that water is our number one priority here, along with the
of the things that had gone on in the past, and one of the things, environment and the people around the area. And the “keep it
Mike, was the sound of everything that was going on. We sat down simple” attitude is that if we can do this, we're going do it and we're
in a lady's kitchen and they had six compressors about a half a mile going to do it right. If we can't do it and it's going to be done wrong,
from her house. And we all know how jets take off. It just sounded we won't do it.
like a jet taking off, and that's 7 days a week, 24 hours a day, 365
days of the year. The Chair: Thank you, Mr. Allen.
We wanted to see the opposite of these compressors, so we went We go now to the second round, to five minutes of questions and
to a place where six compressors were housed inside a building, with comments, starting with Mr. Tonks, and Mr. Andrews, if there is
four inches of insulation, and we stood outside that building and some time left.
could hardly hear the compressors on the inside.
Mr. Alan Tonks (York South—Weston, Lib.): Thank you very
Southwestern promised the lady that they were in the process of
much, Mr. Chairman.
putting a building over these compressors.
That's one of the things that we brought back to New Brunswick. Again, thank you to our witnesses.
Even before these compressors are turned on, they'll be inside a
building and they'll be well insulated so that the noise is not heard by My first question is to Professor Ingraffea.
You've given us a really comprehensive characterization of both Dr. Anthony R. Ingraffea: No, I was not just talking about the
the flowback and the chemicals that remain in the ground, which are water. I dropped the hint that there are solids and gases downstream,
part of the hydraulic fracking process. I can only infer that the level with potential impacts on the environment and human health. On a
of uncertainty about matching that issue—not to mention the small scale, around a development near a compressor station, near a
propane, methane, and other chemicals and gases that are created— pad, in addition to sound there are gaseous emissions. Some of them
has given the State of New York cause to take a step back and have a are purposeful and some of them are accidental. You know now that
look at it. most shale gas wells leak small amounts or large amounts of
methane. That's the nature of the beast. It has always been that way
Can you give us any insights on the level of technology and the and will always be that way. So there are leakages of gases on a
research that exists, in terms of now getting an opportunity from this small scale.
moratorium to match the degree of uncertainty and risk with
technology that can counterbalance that? Are you aware of what is On a large scale, remember that natural gas is a non-renewable
happening, and can you share that with the committee? fossil fuel. When it is burned it produces carbon dioxide in the
Dr. Anthony R. Ingraffea: I'll try to. atmosphere. When you produce it, store it, and transport it through
gathering lines, transmission lines, and distribution lines, in the
Accidental spills and discharges happen daily in Arkansas and United States—I'm not aware of the figure in Canada—somewhere
Pennsylvania—not the blowouts experienced in the Gulf of Mexico, between 3% and 5% of all the natural gas produced leaks into the
but truck accidents, valve failures, tank leaks, and pipeline failures. atmosphere. Natural gas is a much more potent greenhouse gas than
These are daily occurrences in shale development activities. Perhaps carbon dioxide, so even a relatively small percentage leak on a very
the most important area of technological development that could large volume of gas results in a very significant impact on
diminish those risks is recycling as much of the return fluids as greenhouse gas emissions, and therefore potentially on climate
possible so the total volume of waste fluids that need to be change. So there are other effects one should consider on human
transported from a drilling pad to the ultimate site of disposal can be health, the environment, and climate—not just from water, but also
reduced. It's all a matter of risk. If you reduce the truck traffic, you from solids and gases.
reduce the total volume and the risk of accidents.
The Chair: Thank you, Mr. Tonks and Mr. Andrews.
Recycling in the U.S. is in its infancy. There are two types of
recycling. One can hopefully reuse some of the return fluids in
subsequent wells. Very few of the companies operating in New York, We'll go now to Mr. Anderson, for up to five minutes.
Pennsylvania, Arkansas, and Texas are doing that right now because
Mr. David Anderson (Cypress Hills—Grasslands, CPC):
it's an enormous additional expense.
Hello, witnesses. Glad to have you here.
Recycling also takes the form of transporting the waste fluids
away from the well pad to specially designed new technologies that Minister Northrup, I'd like to actually invite you to come to
can remove most of the waste from the fluid. What you're left with is southwestern Saskatchewan, instead of Pennsylvania, and you can
a smaller volume of more highly concentrated waste that can then be actually see the benefits of oil and gas development.
transported for safe disposal to underground injection wells, for
example—which by the way probably will not work in your eastern I'm just wondering in your travels if you've focused on the
provinces, just like they won't work in Pennsylvania and New York. significant benefits that come to local communities in terms of the
But they do work in Arkansas and Texas. local employment, the local service providers that are given
opportunities, and those kinds of things. Have you spent some time
One has to be very careful what you compare your future to. looking at that? Are you inviting those folks, or folks who benefited
Arkansas is not New Brunswick. Come to Pennsylvania. from that, to come to your public meetings to explain the benefits to
● (1640) communities?
Mr. Alan Tonks: Thank you, Mr. Chairman.
Hon. Bruce Northrup: I guess that's why we had the open house
Do I have a little more time? last Saturday morning, because the first people who came in at 9
o'clock in the morning were the mayors, councillors, LSDs, and
The Chair: You have a minute and a half, Mr. Tonks. representatives from the area. We let them talk to industry. We had
Mr. Alan Tonks: Perhaps Mr. Andrews can ask his question. three industry representatives there: Southwestern, Apache, and
The Chair: Go ahead, Mr. Andrews. Corridor. We had the government there, including Environment and
the Department of Natural Resources.
Mr. Scott Andrews (Avalon, Lib.): Thank you.
My question is for Professor Ingraffea as well. This is something that we try to get out into the general public.
When we were down in Arkansas, we saw the benefits of the areas
In your opening statement you talked about downstream down there. They were just opening up a brand new office down
environmental concerns. Outside of the water concerns, are there there. It was a “go green” office. We were there on Sunday and they
any other downstream environmental concerns? Do you want to were opening it up Monday morning. There were over 500
elaborate on that, or when you made that statement were you just employees there with different areas of expertise. These are good
talking about the water? paying jobs too.
Around the area you could see a lot of new houses going up and We go now to the Bloc Québécois, Monsieur Pomerleau, for five
enerventures out in the rural part. Outside of Conway and outside of minutes.
Little Rock you could see what had happened around that area
because of that shale gas industry. They have 3,000 wells there, in [Translation]
the Arkansas area.
Mr. Roger Pomerleau (Drummond, BQ): Thank you very
Obviously, there are other things that are attributed to the gas much, Mr. Chair.
wells, as far as the shale gas goes, and the benefits are just
overwhelming. Thank you to our three witnesses for your presentations and
comments about the issue we're discussing.
But at the end of the day, we just have to make sure that it's done
right and done in the right way. Just one example: when we met with Mr. Angevine, my first question is for you. One of the arguments
the governor on Sunday night, he was saying that in the educational we hear most often—and you made it like many others before you—
system, where a lot of the money was put in, where they get the to promote exploration and, eventually, extraction of shale gas is to
royalties from shale gas, they went from 40th to 6th in the 10-year tell us that we could get rid of a large part of our reliance on
program. imported petroleum or natural gas. That's absolutely true in some
cases.
So we are trying to bring all the positive aspects back to the area
in southern New Brunswick. Our biggest job is communication and However, don't you think that, in Quebec, given that we produce
educating the people on the benefits. electricity, we could get exactly the same economic effect by relying
● (1645) less on petroleum and more on electricity by, for example, deciding
to replace our current automobiles with electric cars over 20 or
Mr. David Anderson: Well, I'm glad you're seeing them. I think 25 years?
the further you go out into the rural areas where there is this activity,
the more the impact is on it. Because you've got smaller companies ● (1650)
of two or three or four people who are doing the welding, or the [English]
service industry, or checking the wells and those kinds of things, this
actually keeps them in the rural communities, which we are all Dr. Gerry Angevine: To examine the benefits of increased
working hard to do. hydroelectric development in Quebec and compare that to the
benefits of shale gas development, the two options, two possibilities,
I just wanted to ask you another question about the phased EIAs. for reducing the dependence on imported crude oil into eastern
Can you explain a little bit more about how that would work? How Canada, is not something we've done at the Fraser Institute. There
do you perceive that working? You also talked about re-examining would be economic benefits, of course, from both, but I'm sorry, I
your approval process. I'm just wondering, do you have any timeline can't tell you an answer. I haven't compared the employment income
on that—a timeline on your examination, not on the approvals, and GDP impacts of both possibilities.
actually?
[Translation]
Hon. Bruce Northrup: Even before they start drilling, they have
to disclose everything, basically what they're doing from A to Z. Mr. Roger Pomerleau: That would be worth studying.
That's even before they do anything. They're going to have to give
full disclosure of all the chemicals they're going to use and what [English]
they're going to do day in and day out. That's what the EIA process
is all about. It's well structured, as far as what they're going to use Dr. Gerry Angevine: It would be an interesting study to do, yes.
through the process. That's where communication has to come in, [Translation]
where government has to monitor that through the EIA process.
Mr. Roger Pomerleau: You talked about land claims and
That's kind of where everything's going to go day in and day out. aboriginal land rights. You know that, in Quebec, to build the large
It takes approximately 30 days to do this review—about a month— hydroelectric networks in the far north, it was absolutely necessary
and the objective is to approve a significant number of wells and to come to an agreement with First Nations, specifically, the Cree,
sites beforehand, before they even get started. That's why when Inuit and Attikamek. We were able to come to an agreement with
Apache was drilling two wells in the Elgin area, even before they these people, and the James Bay Agreement was created.
started, we piloted and phased in the EIA process with Apache.
There's an MLA down in that area and I contact him two or three At that time, Mr. Bourrassa was premier of Quebec. He
times a week. He said that everything was going well down there and understood perfectly well that we could not build something
they didn't have any problems. belonging to us on a neighbour's land. So he had to establish very
strict land ownership rules. He had to buy property rights.
So it's a strategic EIA process that both government and industry
have to work through. At the end of the day, if they're not doing it
When you say that Canada must come to an agreement with
right, it's plain and simple, we'll shut them down.
aboriginal nations for land claims, are you referring to something
The Chair: Thank you, Mr. Anderson. like that?
[English] and as something that we maybe shouldn't even be looking at up

Dr. Gerry Angevine: I think in my remarks looking at non- here because of all these potential hazards.
market barriers, I was simply observing that if we have, and where
we have, land claims issues, we need to resolve those. I think a On the other hand, I'm hearing from Mr. Northrup, from New
greater effort needs to be made to ensure that they are resolved in a Brunswick, that prior to any development of shale gas extraction or
reasonable amount of time; otherwise the cost benefits that could be exploration in his area, the regulatory people will set some standards
had from the development may not occur, or may not occur for a and some criteria that must be.... After their study on how to do this
long time. There's no easy solution. safely and efficiently, the rules would be put in place so that this
indeed would not be a fast and loose, reckless endeavour, but rather a
We've seen, for example, in the Northwest Territories the great very carefully monitored, efficient, safe, and environmentally
difficulty to get agreement with respect to the possibility of a friendly way of extracting shale gas.
pipeline coming from the Mackenzie Delta through the territories
because of difficulties with various local groups. We certainly So we have these two pictures. I wish we had more time to get an
wouldn't say that those rights that people have need to be explanation from each one of you.
disregarded, but there need to be solutions found to overcome these
problems. It may be, for example, that one looks at the amount of My question is this. Given the potential economic benefit to this
land that's impacted and the amount of tax, so to speak, that would type of gas development, I would assume that unless you have a
normally be levied by a municipality on that amount of land. If a fairly delinquent regulatory environmental body overseeing it, in fact
generic formula of some sort could be found at least to start there have to be prudent ways of extracting this, where all due
negotiations, that would help. diligence has been done, environmental safety has all been put in
[Translation] place, and we're good to go, providing all of this is adhered to. I
think we do a pretty darn good job of that in Canada—maybe not in
Mr. Roger Pomerleau: But do you agree that we do not have the other jurisdictions outside our borders, but in Canada I think we have
right to build something on a neighbour's land? We are trying to get some of the toughest environmental regulations.
pipelines through land that doesn't fully belong to us. Do we have to
at least acknowledge that the land doesn't fully belong to us, and do I'm wondering, Mr. Northrup, would you like to comment on my
we need to come to an agreement with the people who have claims little dissertation there?
on it?
● (1655) Hon. Bruce Northrup: My first comment is that you're exactly
right. I couldn't agree with you more. We here in New Brunswick
[English]
cannot ignore the potential of what it could mean for this province,
Dr. Gerry Angevine: I think if we have a group of individuals but at the end of the day, we have to make sure it's done right. I do
who oppose development, then it's up to the local government to take this personally. A lot of this activity is being done in my
determine the best way to go ahead and to try to get the parties backyard. I represent the people around that area as their MLA. I
together to resolve a solution. take this very seriously, and I've said to many people that if we can't
We've seen different approaches in recent years. For example, do this right, then we won't do it. But we just can't ignore the
with the Mackenzie pipeline, we see the Aboriginal Pipeline potential for this province to help pay down our $9 billion debt, to
company being put in place and the aboriginal groups being given help pay for education and health costs, which are a burden in all the
an equity position in the pipeline through that process. We see that provinces.
Enbridge, I think, is looking at a similar approach with regard to
their Northern Gateway pipeline proposal. We want to make sure we do it right. We actually have a
committee, with industry, first nations, and government, that meets
So there have been different versions of that approach, but again, all the time. We just want to make sure at the end of the day that we
it has to be something that the parties agree to. do this right. We feel we have time to do this right. That's why we're
[Translation] going to B.C., and we've also talked about going to Pennsylvania at
the end of February or the first week in March, talking to the
The Chair: Thank you, Mr. Pomerleau. regulatory people down there, getting the regulations, seeing why
[English] they have a moratorium down there. They can always make a
positive out of a negative. Maybe it's not a nice thing to say, but you
We go now to Mr. Harris, please, for up to five minutes. learn from people's mistakes. That's what we want to do here in the
Mr. Richard Harris (Cariboo—Prince George, CPC): Thank province.
you, Mr. Chair.
● (1700)
Thank you, gentlemen.
Mr. Richard Harris: Okay.
In listening to the testimony today, I'm getting two distinct
pictures of shale gas extraction. One is being given by Mr. Ingraffea, Mr. Ingraffea, given what Mr. Northrup has said and the map they
who describes it, as I understand him, as somewhat of a reckless intend to follow, notwithstanding what you saw south of the border,
endeavour that is fraught with the danger of spills, truck accidents, what issue can you take with the approach Mr. Northrup is
bursting valves, and every other kind of mishap you can imagine, suggesting?
Dr. Anthony R. Ingraffea: What I've heard so far in your Dr. Gerry Angevine: I don't think there's a role for government
characterizing of the seemingly disparate viewpoints voiced by the incentives. If, economically speaking, it should be developed, let the
three of us today is, to put it mildly, a somewhat pie-in-the-sky naive risk takers determine that.
view of how everything is going to work out just fine, thank you.
Hon. Denis Coderre: So it's the free market and that's it?
Mr. Richard Harris: Sorry, is Mr. Northrup being naive?
Dr. Anthony R. Ingraffea: I don't think adequate background Dr. Gerry Angevine: Yes. It's the government's role to set the
research has been done. There's a boom and bust cycle associated framework, to ensure that if you want shale gas to go ahead, the
with resource developments, as you know. royalties are competitive.
I haven't heard anybody today say anything about the detrimental There will be, and there are, environmental concerns. If the
side in the social, economic, and infrastructure levels to what will be government wants to have shale gas developed, then it's up to the
an overwhelming industrialization of your region. government to determine that the people, the environment—
In order to get this gas out effectively—I'm repeating myself again Hon. Denis Coderre: I have a problem understanding, for two
—using unconventional methods, a large number of wells per square reasons. First, of course, when we're talking about energy
kilometre is required. One or two test wells in New Brunswick sufficiency, that's also about a kind of ownership, right? The bottom
should tell you absolutely nothing at this point. Talk to me in ten line of monitoring is that we need to, of course, enhance the quality
years when you have 50,000 wells in New Brunswick and your of life; we need to protect the quality of life. We don't want to be at
roads and bridges need to be reconstructed, the local cost of living the mercy...so that other countries can suck it up.
has gone through the roof, you can't find a hotel room—
The Chair: Mr. Harris, I'm sorry, your time is up. It's also a transformation. How can we have a more balanced way
of protecting people's wealth while at the same time being for free
Professor, thank you. enterprise? There is a balance there, but I have a feeling what I'm
hearing from you is that it's a free market, enjoy yourself, and that's
We do have to go to the next questioner, who is Monsieur
it.
Coderre, and Mr. Tonks, if there's time.
Hon. Denis Coderre: Gentlemen, you realize that was from the In the 1950s, Duplessis was good at that, with iron, but I'm not
Conservative side. We don't talk like that, necessarily. We believe in sure that's the way in the 21st century. We can have the same result
expertise. without necessarily saying no government at all.
Mr. Ingraffea, one of the issues, of course, is.... You're saying the Dr. Gerry Angevine: Certainly, I wouldn't argue for no
technology is not accurate right now to address all those issues, and government at all. You need government. Governments have a role
that we should take a break instead of going too fast. Is that what to play. But in terms of resource development, you have to listen to
you're saying? the people, to what's best for the people of Quebec and Canada, and
Dr. Anthony R. Ingraffea: Yes. have the regulations in place that are required.
Hon. Denis Coderre: Mr. Angevine, what do you think of that? Hon. Denis Coderre: Okay.
Another expert.
Dr. Gerry Angevine: I'm not an engineer or a technologist, but if You have a question?
a jurisdiction decides that it needs to go more slowly than some of
the neighbouring jurisdictions that have shale gas potential, the gas Mr. Alan Tonks: Yes. How much time is left?
will stay in the ground, and someday it may be worth more money. The Chair: You have a minute. We may have another round,
Hon. Denis Coderre: Someday—like the oil sands. though.
Dr. Gerry Angevine: Yes. Mr. Alan Tonks: Minister Northrup, you've heard the concerns
Hon. Denis Coderre: I want to come back to royalties and maybe that have been raised by Professor Ingraffea. You undoubtedly will
talk a little bit about the fiscal incentives regarding energy. Do you hear these concerns as you proceed in a more evidence-based way
believe right now as an economist that we should invest more in R through what you've described as your EIA process.
and D, instead of having those fiscal incentives? What would be the
best, economically? Can you describe just a little more how that process differs from
Dr. Gerry Angevine: You're referring to shale gas in particular? the environmental assessment process that conventionally we've
been used to applying to these kinds of activities?
Hon. Denis Coderre: Well, it can be shale, it can be oil sands, it
can be unconventional. Hon. Bruce Northrup: As far as our EIA process goes, it
Dr. Gerry Angevine: When you say “we invest”, do you mean involves social issues and different other issues. I guess as the
government incentives? industry grows, the EIA process will also grow. Obviously, this is a
very difficult decision we have to make here, and we have to take it
● (1705) seriously, but I just can't emphasize enough that our number one
Hon. Denis Coderre: I mean the government. concern is the water and the environment.
I can't emphasize enough too that as the industry grows and more When witnesses testify before us in good faith and give us their
wells are being put through—and I don't know about 10,000 wells in point of view, I find it absolutely unacceptable that some committee
10 years; Arkansas has had 3,000 wells in 10 years. I can't members crucify them publicly because they do not agree with them.
emphasize enough that we are taking this slowly. We're not jumping I find it unacceptable, and I ask that you prevent such things from
into this overnight. We want to take logical and technological advice happening again.
to go down this path. It's not easy. It's day in and day out of getting
[English]
things right. As I said before, we're not going to do this unless we're
going to do it right. So we do take it seriously. The Chair: Mr. Coderre, of course that is not a point of order.
When you talk about royalties, we're talking about a three-phase It is up to each member of the committee to determine how they
royalty system whereby a royalty will go to the landowner, a royalty conduct their questioning, and Mr. Anderson is completely in order.
will go to the province, and a royalty will go to infrastructure around
the area. We've been in informal talks with industry as far as royalty Go ahead, please, Mr. Anderson.
rates to the province, to the landowner, and to infrastructure go. Mr. David Anderson: Actually, this goes back to something
The Chair: Thank you, Mr. Tonks. maybe a little bit earlier. Mr. Coderre is a bit defensive on this
because he was the one who asked a U.S. witness—a federal
Mr. Anderson, go ahead for up to five minutes. politician asking a U.S. witness—to tell the Quebec provincial
Mr. David Anderson: Thank you, Mr. Chair. I appreciate it. government what they should do on shale gas. I don't think Mr.
Coderre can give us any lectures. I think he should be minding
I might share my time with Mr. Hoback if I run out here. provincial jurisdiction and paying a little bit of attention there—
Professor Ingraffea, I think it would be safe to say that you're not Hon. Denis Coderre: A point of order.
an unbiased participant in this discussion. If we go online, we see The Chair: Mr. Coderre, is that on another—
that you've been working on this issue politically for quite some
time. Is that fair to say? From what I read of most of the Hon. Denis Coderre: It's another point of order. My line of
presentations, when you've been giving them, they've been at questioning was to ask an expert about his point of view on an issue
that's important for every Canadian here. So I'm not going to let
political events, and then there has typically been an urge for the
him—
people who have attended them to write to their politicians to get
them to ban unconventional drilling. Is that accurate? The Chair: Order, please. You've made the point before.
● (1710)
Mr. Anderson, carry on, please.
Dr. Anthony R. Ingraffea: No, that's not accurate.
Mr. David Anderson: Thank you.
Mr. David Anderson: This is more politics than science, I think.
Is that accurate? I guess I understand now why Mr. Coderre is so defensive about
this, but that's all right.
Dr. Anthony R. Ingraffea: No, not at all. I'm not a politician. I
don't have any conflict of interest here. I'm not running for office; I I'll go to Mr. Angevine. You talked about some of this—
don't hold office. I'm a professor at Cornell University and a licensed
professional engineer. I have tremendous experience in oil and gas Hon. Denis Coderre: [Inaudible—Editor]
well development, hydraulic fracturing, pipeline safety.
Mr. David Anderson: Pardon? You have something else to say
So when I make presentations in public—some of which you have that's important? Everything you say is important, isn't it?
probably seen on the Internet—they're in public fora, they're not in
political fora, and I never say to anybody that they should write The Chair: Order, please.
anybody to say to stop something.
Mr. David Anderson: Mr. Angevine, you talked earlier about
What I usually say—in fact what I always say in conclusion—is some of the specific regulatory hurdles that you identified that stand
think, act, do what you think is right. in the way, and you mentioned the NEB and some of the things
around them. I'm just wondering if you have some other things that
Mr. David Anderson: Typically, the people who have been you could identify that would be regulatory hurdles that this
organizing the functions you've appeared at seem to be pretty committee could address in our report later.
seriously—
Dr. Gerry Angevine: Those six that I identified were the main
Hon. Denis Coderre: A point of order. areas. Did you want me to drill down into the NEB situation a little
The Chair: A point of order, Mr. Coderre. more?
[Translation] Mr. David Anderson: Sure. You've talked about the NEB. I'm
just wondering if there are other areas that you have concerns about.
Hon. Denis Coderre: Mr. Chair, the witnesses have shared with
You could talk about that, if you have some specifics you'd like to
us their points of view and expertise. Just because someone doesn't
mention.
agree with you, that doesn't mean you can intimidate them and try to
make them see things your way. Dr. Gerry Angevine: Is it with respect to the NEB itself? Yes.
I think just as a casual observer, I see the NEB doing things like against the benefits. You talk to people about what they think and
quarterly reviews of the energy outlook in Canada, for example, that you move forward.
are useful. Things like that are things really left to the marketplace,
to consultants. I don't think the NEB needs to have a core of people
It was interesting to go to that fracking site to see the safety and
providing reports on the energy outlook on a regular basis.
security and the process. I get a little confused here today because I
The NEB's role as a regulator under the NEB Act is to look at hear testimony about broken valves and stuff, as Mr. Harris talked
what is specified in the act. I alluded to the fact that the act itself calls about, and yet I never saw anything like that. In fact, what I saw was
on the NEB to determine if a project is feasible and to look at the something that was very tightly controlled, very highly regulated; it
economic impacts and things of that sort. I'm not sure that's is something where not just anybody is going to walk onto that site
something the NEB needs to worry about. I think its role should be and not be accounted for. In fact, I looked at their safety systems and
to look at matters of public safety and environmental issues and the monitoring, and it was very impressive.
things that are in that sort of area, not to be concerned with the
viability of a project. That should be left to the risk-takers. That was my first site, so I'm not an expert on the topic. There
● (1715) might be more to it, I don't know, but I'd encourage the committee to
Mr. David Anderson: Natural resources, as most of us know, are at least look at these things before you start making judgments on
under provincial jurisdiction. I'm just wondering if you see any what you're going to do in your own province.
complications in terms of jurisdictional issues faced in the
development of this industry. Mr. Northrop, you're doing the right thing. You're actually going
I guess exploration permits are the responsibility of the out and talking to the people in the field. You're going to the areas
provinces.... and getting the information first-hand and learning from other
people's mistakes. That is a wise thing to do. I just hope you won't be
Dr. Gerry Angevine: Certainly, when you look at the moratoria
scared away by extremists. When I look at what's happening in the
on offshore drilling in British Columbia, there are two governments
communities and what they told us there, it is a very positive thing.
involved. In a way, there are more than two: there are the first
nations, the Haida, who have a strong interest because of where they
reside. In the north, the overlapping regulations between the different In Saskatchewan we had an NDP government for quite a few
— years, and they had this theory that we would let the gas stay in the
Mr. David Anderson: Do you have any solutions for that? ground. That was a good theory. We let the oil stay in the ground
while the kids all got educated and moved off to Calgary, which
The Chair: Mr. Anderson, your time is up. became the biggest city of Saskatchewan people who weren't in
A short answer, please. Saskatchewan. You have to look at what's best for your communities
and what's best for your province before you start making decisions.
Dr. Gerry Angevine: The governments have to work together
from a single window that prospective investors can deal with, rather
than from a maze of windows with many officials from several levels That is going to lead into where David stopped. When we look at
of government. provincial jurisdictions and what barriers are in place, Mr. Angevine,
The Chair: Thank you, Mr. Anderson. what are those barriers? Where are we overlapping? On the
agriculture side, we see overlap all the time, and it's more than
Thank you, Mr. Angevine. frustrating. There must be a tremendous amount of overlap that
could be removed. Could you identify some of those overlaps?
Mr. Hoback, welcome to our committee. It's great to see you here.
Go ahead.
Dr. Gerry Angevine: You mean between provinces?
Mr. Randy Hoback (Prince Albert, CPC): Thank you, Chair. I
look forward to working with this committee. It looks like a great
group of people here. Mr. Randy Hoback: I was thinking between the federal and the
provincial.... You have the federal government coming in and doing
First of all, I want to welcome the witnesses to the committee. I a regulatory process, and then you see the province doing a
appreciate your testimony and your interest in the topic we are regulatory process of their own. A lot of times, there are two
discussing today. different people doing the exact same thing.
This past year, I had the luxury of going to a fracking in process at
the EnCana site just outside Dawson Creek. I talked to people in the Dr. Gerry Angevine: It's worse than two different people. In
community. We went to an opening of their local arena. EnCana had some cases, you have different facets of the same government. You
provided a substantial amount of money to build that arena in could have the Department of Fisheries and Oceans. You could have
Dawson Creek. Without EnCana they wouldn't have been able to do Environment Canada. You could have Natural Resources Canada.
it. We talked to some of the local people about the impacts and their You could have Alberta Environment. You could have Alberta
concerns. There were concerns. There's no question about that. Energy. You can have five or six government departments involved
in a particular project. In some provinces, at least, there has been an
There are concerns with everything we do. There are concerns effort to reduce that by bringing the provincial parties together in a
when a farmer puts a seed in the ground, but you have to weigh that single window.
Today, we see more of an effort, because of the importance of The last thing Mr. Angevine said was with respect to—
environmental issues, to form joint panels, joint hearings, as we see The Chair: A point of order, Mr. Anderson.
now with regard to the Gateway project in British Columbia, with
the province and the NEB coming together. You see joint panels with Mr. David Anderson: Chair, if Nathan wants to apologize, he can
NEB and parties from the Canadian Environmental Assessment apologize for himself. He doesn't need to apologize for me.
Agency, but we need to see more of that across the country to I just wanted to point out that Mr. Ingraffea has been involved
streamline the regulatory process and shorten the time it takes to get politically on this issue for quite some time. He can check that on the
approval of a project if it's worthy of being approved. Internet. I think we just needed to know that.
● (1720) ● (1725)
Mr. Randy Hoback: You said that within the province you'll even The Chair: Okay, Mr. Anderson. That isn't a point of order.
see different departments come to a site. Of course, they must have
different issues. There must be a reason why they're doing that. Go ahead, please, Mr. Cullen.
Mr. Nathan Cullen: Well, Mr. Ingraffea, I had some questions for
Do you know why?
you with respect to industry, so-called, being onside, according to
Dr. Gerry Angevine: They have different issues, but if they can Mr. Angevine, but let me change tack, just to follow-up on Mr.
come together through a single window kind of approach, it does Anderson's comment.
make it easier, and sometimes I would think it would reduce the time
and the cost of processing applications. Mr. Angevine, can you confirm whether the Fraser Institute
receives any money from U.S. foundations?
Mr. Randy Hoback: So if you're giving advice to the Minister of
Natural Resources from New Brunswick, who happens to be here Dr. Gerry Angevine: The Fraser Institute, as you know, is a non-
today, how would you have him arrange his bureaucracy in such a profit organization. It's not a consulting organization. It receives no
way that you could see the systems or the technology move forward money for consulting work. It's not a consultant and receives no
in an efficient manner, in a competitive manner? Any advice to give money from government. It operates strictly from donations from
to him? individuals, companies, and foundations.
Dr. Gerry Angevine: I think he's doing the right thing, certainly, Mr. Nathan Cullen: So just specifically to my question, do you
going out and seeing what is taking place in Arkansas, B.C., and receive money from U.S. foundations?
other jurisdictions, and learning from the mistakes that have been Dr. Gerry Angevine: I believe it may...I think it does, but I'm not
made and hoping to take a best practices approach. There certainly is absolutely certain.
a benefit in being able to see what has gone before. The difficulty for Mr. Nathan Cullen: Let me apply some certainty. Are you
New Brunswick will be to find a market for that gas. How will that familiar with the Koch Foundation?
gas compete economically? But that's a bit off your question. That's
another issue. Dr. Gerry Angevine: I'm not familiar with them. I've heard of
them.
I think that most likely the regulatory apparatus in New Mr. Nathan Cullen: They are the primary funders of the Tea
Brunswick will need to be expanded to have the expertise to look Party in the U.S. They also help fund you folks.
at these new issues of shale gas. They'll have to have excellent, on-
the-mark regulation, but they'll have to have regulators who are The question I put to you is that nine of your directors who
capable. They'll have to have inspectors and so on. currently sit on the Fraser Institute board are involved in the oil and
gas industry. They are also heavy contributors to your foundation.
There'll be a number of changes, but I think industry welcomes The government has raised its concerns about witnesses in the past to
good sensible regulation, and enforcement as well, because if people the effect that if they receive money from industry or if they receive
are allowed to violate regulations and get off the hook easily without money from across the border, that may taint any of their testimony
much penalty, it damages the reputation of the industry and hurts the or research in front of this committee. The government has seen that
whole process. as a problem for anybody who ever raises a concern about the oil and
So the industry is onside, I would think, ensuring that the gas industry, but it seems to have no problem with anyone who
regulations from square one are appropriate from a technical point of comes here to defend the oil and gas industry.
view, to protect people, to protect the environment, but also ensuring I find the lack of questioning by my Conservative colleagues with
that enforcement is strong and realistic, in the sense that no one can respect to any potential bias on the part of those who support the oil
get away with floating, so to speak. and gas industry somewhat troubling and a little weak on logic.
The Chair: Thank you, Mr. Hoback.
Mr. Ingraffea, the general fear raised by the public is with respect
We go now, finally for today, to Mr. Cullen, for up to five minutes. to water contamination and then the liability that follows any
Mr. Nathan Cullen: Thank you, Chair. contamination that happens. We saw recently that Talisman—and
this is for Mr. Hoback, who hasn't seen any incidence of spills—
First, Mr. Ingraffea, I apologize on my colleague's behalf for the recently shut down continent-wide drilling for more than a week.
earlier line of questioning. I'm sure you're quite used to that with Canbriam Energy is leaking in Quebec right now, and, according to
American-style politics. In Canada we're just growing accustomed to the Quebec minister, “the industry is not in control of the situation”,
it, with a new direction from the current government. and I am quoting.
Am I typifying the concerns of the general public correctly, that is develop in the state, and that's one quarter of the cost to the state of
that it's both water contamination and supply, and then who's plugging an abandoned well, of which there are 100,000 in
responsible, who's on the hook, if any contamination does occur, Pennsylvania.
once it begins?
So the point I made before, to look before you leap, to go slowly,
Dr. Anthony R. Ingraffea: Yes, you are on both counts.
and to study what's already been done wrong in other places.... The
I hinted in my opening comments that I wanted to have the gentleman from New Brunswick is right on target. He just needs to
opportunity to correct some of the earlier testimony that your expand a little farther and ask more questions in more places. Don't
committee has received. In particular, I noted that during a previous count on hearing from just the industry people in one location as to
meeting, the senior vice-president of Talisman was quoted as saying how to proceed. Ask people like him, the director of environmental
“We have been fined in Pennsylvania three times in the last three preservation in Pennsylvania. He'd be glad to come up and talk to
years a total of $21,000. None of it was for contaminating surface you. By the way, he was charged with both promoting—which he
water.” With respect to your second point, about whether regulations did—and regulating shale gas development in Pennsylvania, and he
are in place that are adequate, I should point out that he failed to did both jobs very well. But he is very realistic about the current
point out that his company has been cited for violations of state.
regulations in Pennsylvania 285 times in the last three years. The ● (1730)
fine was only $21,000 because the fines hadn't been assessed yet for
the 285 regulation violations. The Chair: Thank you very much.
I should also quote someone that you would do well to invite to a Thank you, Mr. Cullen.
future meeting, and this is the outgoing director of the department of
environmental preservation in the State of Pennsylvania, John Thank you all for your questions and comments today, members
Hanger. Right now the department really has very questionable of the committee.
authority when telling a company that it operates so badly that the
To all the witnesses, thank you very much for coming today and
department is not going to give it permission to get any more
for giving information that's very helpful to the committee. Thank
permits. He's also quoted as saying “the maximum fines that
you very much for your input.
environmental regulators can issue to violators of the state's oil and
gas law are...'scandalously low'”. He goes on to say that currently a We are finished with the meeting for today.
gas company like Talisman operating in Pennsylvania pays a
$25,000 bond to cover as many wells as that company would ever The meeting is adjourned.
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House of Commons

Standing Committee on Natural Resources

RNNR ● NUMBER 040 ● 3rd SESSION ● 40th PARLIAMENT

Tuesday, February 1, 2011

Standing Committee on Natural Resources

Tuesday, February 1, 2011

[English] and as something that we maybe shouldn't even be looking at up

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